Best Practice Business Planning

I still have the business plan that I developed for my first business back in 1990. It is a great example of a poor business plan, full of over confident assumptions, lack of detail and no strategy, I thought it was great at the time.

Looking back I know where I went wrong, I’m surprised my businesses lasted the first 2 weeks, never mind the first 2 years. In over 25 years in business I am yet to see the perfect plan, and doubt I ever will, but I do have a starting template of 10+1 points which I willing share with business start-ups will help them to develop a plan and give them a strong and robust starting place. I always consider my ‘Super 8’, the 8 key areas that should be used when developing a plan or strategy, these being Finance, Sales, Product, Operation, People, Marketing, Insights and the Customer.

  1. A Long Plan Is Not Always A Good Plan

    No-one will thank you for giving them a plan the size of an encyclopedia, there is too much to digest and take on board, they will lose interest. Use a 9 page rule for the plan, plus the front cover and any necessary appendices. Ensure it is well written and presented.

  2. Give The Plan Structure

    Create a vision. Explain, where you are now, where you want to be and how you want to get there. Ensure the plan is market focused; size, growth, demand (units and value) etc. Use appendices wisely.

  3. Identify Your Potential Customers And Competitors

    Give compelling reasoning as to why your prospects will need you, accurately identify who your customer is and who your competitors are, don’t be vague.

  4. Identify The Distribution Channels

    Outline how you will generate sales, who, where, when, what, why and a top line summary as to how. Demonstrate how you will use marketing tools in these channels to establish your product or service within the market.

  5. Include Details Of Your Management Team

    You must show a strong, well balanced team, and explain their roles, without this you may risk missing gaps in knowledge which can lead to failure. Having knowledge gaps is acceptable, you need to show how you intend to bridge them.

  6. Show Where You Will Get A Breakeven Point

    Avoid flash graphs and pie in the sky profit margins or growth. Make sure that everything is as accurate as possible, show cash flow and sensitivity analysis. Demonstrate where you will break even.

    There is always risk involved with business. Make sure you realistically identify all of the risks and show how you would plan to mitigate these. Also identify any potential barriers to market entry, even the obvious ones.

  7. Spend Time Collecting Data

    Carry out lots of research to find data that will underpin your projections and assumptions. Identify sources of market data which support your business idea and use this as a reality check.

  8. Identify Your Products or Services

    Great products and services provide great opportunities, Identify what your product or service really is, why it is better than the competition, what you can do to increase your sales by offering other products alongside. Highlight your main point of difference.

  9. DRESS… To Impress

    You plan must be Defensible, Robust, Executable, Strong and Sustainable. If it is not, then start again, eliminate the flaws and reposition your plans.

  10. Share, Test, Validate, Review and Share again

    You plan must excite and engage the reader. Share it with someone un-connected from the business like a mentor, coach or advisor, never ask a friend or family. Ask them for open, honest and constructive feedback. Test your plan over a period of time, validate your activity, review the plan and make adjustments, re-share and start the cycle again.

  11. Build A Really Strong Strategy Plan

    A business plan explains What You Plan To Do, a strategy plan show How You Are Going To Do It. A Business Plan is not a Strategy Plan, a strategy plan will underpin your business growth demonstrating how you will grow, why, when and where in granular detail.

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