Business Planning: Plan to Succeed!

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Writing a business plan may sound like a long and tedious process that will lead to very few benefits for your business, but in reality the benefits that can be achieved from business planning are huge.

  • Attracting investors – Business plans give investors a look at what a business expects to achieve in the future by using statistics, facts, figures and detailed plans. This gives businesses a better chance of attracting investors to provide capital.
  • Growth – A business plan can be used as a tool to help plan growth and associated costs and capital requirements.
  • Stick to the strategy – During the day to day running of a business it is easy to lose sight of what the main goal is. A business plan can be used to define what the business is or what it intends to be in the future. Clarifying the purpose and direction of your enterprise allows you to understand what needs to be done to meet your objectives.
  • Managing cash flow – Careful management of cash flow is necessary for all businesses. Using a cash flow plan is a brilliant way to link together educated guesses on sales, costs, expenses, assets you need to buy and debts you have to pay.
  • Milestones – A business plan can be used to set milestones that you can work towards. These are key goals that you want to achieve. Having all dates and deadlines visible in one place can make achieving these milestones so much easier.
  • Management – A business plan should include an organisational structure of your business, including titles of directors or officers and their individual duties. It is an ideal place to clarify who is responsible for what. Every important task should have someone in charge of its execution.

A business plan can help to identify potential threats and opportunities your business could face, avoid penalties or other legal problems, helping you to adapt quickly and efficiently to changes.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

 

7 Essential Tips for Start-ups

start up tips

Starting a business doesn’t come as easy as some people think; there are many things which can try and test you, but if you stick it out and follow these simple tips, you can be sure you are heading in the right direction.

When starting up you need to ask yourself the following questions:

1. Do I have a plan?

Firstly, have a business plan and of course test it out. It’s no good having a business plan, if it doesn’t work! Testing your plan can help you come across any boulders in the road early on to ensure that when going into business, these teething problems have already been sorted. (Check out our top tips for writing a business plan.)

2. What should my business structure be?

There are numerous ways of forming and structuring your business. What best suits your needs? This would be a good time to consult us at Green & Co, and speak to one of our partners to discuss maybe starting a partnership, a sole trade, an LLP or a Limited Company. This is something we specialise in – helping clients choose what is best for them.

3. What shall I call my business?

Choosing a name and coming up with a logo for your company can be a challenging task, but a very important one. The name you choose is not only a name, but a brand, and once you become well established, it is something you want to be happy with and not resenting.  Changing the name down the line can be very costly.

4. How much will this cost me?

Saving money is extremely important when starting a business. You need to make sure that you cut costs as effectively as possible and that you do your research on getting the best deals. Starting a business is a very expensive time and the last thing you want to do is to spend all your money straight away when you may need it further down the line.

5. Can I get any financial help?

There are numerous grants widely available and with enough research, you will be able to see if you are eligible for any of them. There are many conditions with grants, including location, what type of business you have and how many people you employ, but there are more organisations out there willing to help you than you might think.

6. What space am I going to use?

Getting a premises can also be extremely difficult, as you need to ensure that you have the right amount of business space and that it’s in the right location. You don’t want to be opening a bakery next door to a bakery that has been open and established for years. Research is the key.

Do you even need a premises to start with? Can you work from home and save on costs until further down the line when the business is more established? Maybe look into a Virtual Address, so as to appear as though you are based at another location.

7. Are there any rules or regulations I should be aware of?

There are a number of things that some people don’t realise which come with the joy of staring up a business, such as abiding by laws and restrictions and making sure you have the right insurances/licenses/council permissions. These are essential to start-up businesses, as the last thing you want is an unexpected fine for, say, not abiding by fire regulations!

And lastly of course, make sure you choose a good accountant :)!

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Top tips for writing a business plan

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If you’re thinking about setting up your own company or considering applying for funding for your business, getting your business plan right is crucial.

A business plan should provide an outline of your business, the market in which it will operate and how it aims to make money. We’ve identified some top tips to help you on your way:

  • Be concise: It’s really important that potential investors can understand what your business is all about from a quick glance at your plan. Remove any filler language and get to the point quickly.
  • Be specific: Being specific is just as important as being concise. The details will help you drill down into how you will actually deliver your plan.
  • Be realistic: You should be honest with yourself in your business plan, if you’ve got a strong idea, let it stand on its merit.
  • Know your market: A big part of knowing whether your business will be successful is understanding your market. This not only includes your customers, but your suppliers and competitors too!
  • Know your finances: Be very clear on how your business will make a profit If it isn’t going to make any money, it won’t be successful.
  • Use visuals: Whenever possible, and without overdoing it, use visuals in your business plan. Graphs, charts, and images can help bring your concept to life. Plus, it breaks up the text and helps a plan flow better.
  • Be creative: Include a creative element in your business plan so you stand out and grab someone’s attention. You can use templates, but don’t look identical to a template. Do something unique to make the plan yours.

For a free business plan template, visit The Prince’s Trust website, and for help on how to write your business plan, the Start Up Donut provide detailed information to guide you through the process.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

 

 

 

Want To Achieve Your Business Goals? Communicate!

Communication

Investing time in people and involving everyone in both the preparation and delivery of business goals is critical in achieving a successful business plan.

Most businesses have two or more people involved in the business, this could be a husband and wife partnership, mother and father or son and daughter together, employer and employee, or two business who invest together in a joint venture. The people involved in any business are the real assets and can either be of massive value, or, if undervalued, the weak link in the achievement of any business plan.

The first challenge for the business leader is to ensure his team are on board with the business plan, know what their role is, and what they have to achieve, i.e. to share and discuss the plan with all involved. It is important to listen to everyone, especially those who may have a better grasp of the day-to-day work than the business owner.

When thinking about people to involve, don’t forget about the third parties, such as the customers, suppliers, the accountant and the bank. There is no point in having a business plan if they are not aware of it or not involved in it. However, the third party should only be a factor, and not the main focus.

Regular communication with all involved needs to be structured. This could include daily communication to deal with current issues, weekly communication to plan the week ahead, and monthly/quarterly communication in the form of strategic meetings assessing business progress and feedback.

Every team requires a mixture of skills and aptitudes to deliver a great business – you need those with vision, those who look at the detail, and those who focus on the day-to-day work and delivery.

Best results are produced when the business leader ensures communication is present throughout the organisation. People at all levels need to understand why they are doing what they do, see the results and understand that their work makes a difference. Investing in and listening to business operators is a necessity for business success.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of digitalart at FreeDigitalPhotos.net

Business Finance – Considering Franchising your business?

Franchising your small business is a good way to achieve fast growth. It may set you on the path to becoming the next McDonald’s or Subway. Whether or not taking such a plunge will work for you is a decision best determined by your own intimate knowledge of your business. You must be able to determine if your business is franchise worthy. Any magnitude of growth as a franchise will require substantial funding, and detailed planning (from acquiring and using a pin to an anchor). Here are a few best practices you ought to follow.

Develop a Business Plan

Develop a business plan outlining the financial details as well as the long-term objectives for the growth and future development of your franchise. Your plan must indicate what you want to achieve, and the measures you will employ to meet that goal.

Key Point: Ensure that the information in your business plan, operations manual, and the market analysis are clear and easily understood. This is what your prospective investors will use to weigh your company. Emulate this clarity in all your business materials.

Develop Your Own Operations Manual

Your franchise operators will need clear guidance on how you want your brand to function. Without this instruction, each chain will more than likely form their own mode of operation which would inevitably take away from your unique brand. Develop a guide bearing detailed instructions for your franchisee to follow. The best way to provide this instruction is to create an operations manual in accordance with your business model. This manual can be made accessible to your franchisee via a private Internet site that is password-protected.

Your operations manual should not be static. It will reflect the knowledge and experience that was gained by you and staff during the years of your operations. New experiences are gleaned each day, and your manual should reflect this through regular updating.

Outline Your Finances

This outline should include cost related to the:

1. Design and development of your operations manual.

2. Research.

3. Recruitment.

4. Support structure.

5. Legal fees.

6. Pilot operation/s.

Test Your Franchise Dream

Before you enter the franchise arena at full force, ensure that you do a pilot test. Set up a pilot site or outlet, and allow it to run for some time before making your final decision. Consider giving it six to twelve months if it is a seasonal business.

Keep a Pilot Going

The marketplace can be volatile at times, and should be monitored on a constant basis. Keep an in-house pilot program going that will allow you to test the marketplace and see how changes affect your business. This pilot will allow you to measure how changes impact your business, and you can also use it to test new ideas and assess the results.

Your Business/Franchisee Legal Contract

Use a specialist franchise lawyer to prepare a legal contract that covers the rights retained by you as the main franchise holder, and that which is given to the franchisee. The contract should cover all other legal terms of agreement between both parties.

These few pointers are key elements that must be observed by those who will be franchising their business. Other important elements include your search for, as well as the selection and training of the ideal franchisee. You will also need to pay particular attention to using the right personnel for legal and financial advise and service.

What Are Angel Investors and How Can They Help Your Business

When entrepreneurs want to start a new business, but don’t have the financial resources to do so, many of them seek out angel investors in order to raise funds.  Angel investors are affluent people who typically have a great deal of business experience and plenty of cash that they can put into a new business.  Angels differ from venture capitalists in that angel investors are using their own money and contributing it independently, not as part of a group like venture capitalists.   
 
On average, in the UK, angels donate about £42,000 per investment in which they participate.  Since it’s difficult for small business owners to get smaller amounts of money from venture capitalists, who usually prefer to invest amounts greater than a million pounds, angel investors make excellent partners for small businesses. Additionally, they come to the table with a great deal of knowledge about finance, business and law and they enjoy giving advice and seeing entrepreneurs succeed. 
 
Before an angel investor will even think of contributing to your start up, you’ll need to know how to approach them tactfully and in ways that show you are serious about your business plan.  They need to have full confidence in you before they’ll risk handing over piles of cash.  
 
Once you know of some angel investors whom you’d like to approach, you need to establish a connection with them, preferably through someone that you both know so that there is a stronger connection right from the start.
Try asking your friend to set up a meeting so that you can get to know the angel investor through your friend and then you can be on your own to set up future meetings. 
 
Never ask for funding within your first few interactions with the investor.  Wait until you have gained their trust and feel that they have a high level of confidence in you before you ask them for money. By this point they should already know about you as a person, your business plans and have met some of your team members, if any.  Make sure that you have a detailed business plan so that, when asked for it, you can provide it to the investor.  However, a good tip to follow is that whenever you are meeting with them in person, only have a summary of your plan so that you have a reason to make further contact with them.  
 
You’ll also need to have a good grasp on the amount of funding you’ll need, how long it will last and when you expect to start making a profit.  Without a good plan and budget, you can easily go through the investor’s money without making any real progress in your business. Having a solid plan will increase their confidence in you as a entrepreneur. 
 
Once you do approach the investor about helping your business, you’ll want to get an initial, non-binding agreement, written or verbal, from them.  This simply helps to formalize the partnership while they are initially excited about your business plans and, again, gives you further reason to contact the investor.  Try to get them to say that they’ll commit to a somewhat specific number like £20,000 to £50,000.  After the meeting, draw up a formal agreement to send over to them or present to them at your next meeting.  Getting an initial agreement will help you in approaching other angel investors since you’ll be able to say that you’ve already secured a certain amount of money from other investors.   
 
As with anything in business, a healthy dose of common sense will go a long way in creating and maintaining good relationships with potential angel investors.  Once you have found a group of angel investors that you’d like to approach, follow these steps and you’ll make an excellent impression on them.