Business Planning For Entrepreneurs

An Instant Guide

Guy Rigby

• Publisher: Harriman House
• Year: 2011
• eBook ISBN: 9780857191786
• Topic: Business
• Subtopic: Entrepreneurship
• Index: Business

This eBook is about business planning for entrepreneurs.The author of this instant guide from Harriman House, Guy Rigby, has also written From Vision to Exit, which is a complete entrepreneurs' guide to setting up, running and passing on or selling a business.

Business Planning for Entrepreneurs

“Business, more than any occupation, is a continual dealing with the future; it is a continual calculation, an instinctive exercise in foresight.”

— Henry R. Luce

Foresight, not oversight

There’s nothing quite like a plan, and every business has one. Whether it’s in the mind of the entrepreneur, a hastily written to-do list or a more traditional document, it’s the plan that dictates what happens in a business everyday.

For a start-up entrepreneur, with no need for funding, one might be tempted to think that writing a formal plan is a waste of time, an unwelcome diversion of energy that could better be directed at, well, just doing it! You might be right. In certain cases, the idea is so crystal clear, the business model so simple, the demand so high, the profits so huge, that ‘just doing it’ may be the order of the day.

Indeed, some entrepreneurs dismiss the need for a formal business plan, with some outstanding business leaders allegedly shunning them entirely.

“I spent many years at Virgin,” says Bill Morrow, founder of Angels Den, “and there’s no way that [Sir] Richard would write a plan. He couldn’t have sat still; he just wanted to get on with it.”

In Sir Richard’s case, it is perhaps not beyond the realm of possibility that others helped him develop the more detailed plans around his insightful entrepreneurial vision. In his book Screw It, Let’s Do It, he talks about always carrying a notepad to write down his thoughts and new ideas, using mentors and coaches to help him with his work, and surrounding himself with good people. His passion, he says, is for leading teams and sharing the rewards. It sounds like a great combination.

So, why would you bother with a formal business plan?

There are a number of reasons.

Lighting the way

“Passion and drive make an entrepreneur. The very last thing you want to do is to write a business plan,” says Bill Morrow, “but it’s an important process.”

And it is. Over the years I have witnessed many examples of potentially great ideas falling by the wayside through the lack of a coherent plan or roadmap. I have seen businesses start up and spend significant sums, only to find that insufficient research had been carried out and their business model was fundamentally flawed.

So barring the odd ‘no brainer’, the general rule is that if you fail to plan, you plan to fail. Apart from anything else, this is because a properly executed business-planning process will make you consider a host of issues that might otherwise slip under the radar.

Contrary to some entrepreneurial thinking, planning need not dampen drive or hamper creativity or passion. Indeed, planning can be an illuminating and inspiring part of the business-building process, as research leads to new ideas and, occasionally, that elusive eureka moment!

Jane Khedair, author of Successful Business Plans and founder and MD of Business Plan Services, believes that business plans are a fundamental part of the management process: “It brings a management team round a table and gets them talking. It helps them understand where they’ve come from, assess where they’re going and how they’re going to get there. It enables them to identify opportunities and strengths, which can then be built upon.”

Business planning is not only good for the management team. Once complete, the key elements of the plan can be communicated and shared with all of the staff in the business. This will help instil a sense of purpose and engender loyalty to the cause, perhaps even passion!

Another powerful reason for having a business plan is that it creates a stake in the ground and a roadmap which gives guidance and can be followed. If you choose to take an alternative route, which from time to time will be both inevitable and desirable, the business plan will be there to remind you that you are changing your approach. It will prompt you to evaluate and justify your actions. Without a plan, many businesses simply drift from one unfocused activity to another, not really understanding what they are doing and why.

Fortunately, a carefully researched roadmap can provide focus, prevent business drift and reduce risk. It will help entrepreneurs and their teams to prioritise, set and achieve their goals.

But what about flexibility? What if you need to change your plan?

Business plans should not be written and put in the bottom drawer. They are living documents that need reviewing and updating on a regular basis, enabling you to focus on the right priorities at the right time and moving each area and function of your business towards your chosen goals.

Clarity of purpose

Business plans come in many shapes and sizes. They can also be written for a number of different audiences or purposes. It’s important to consider what you are trying to achieve.

A strategic plan may focus on high-level options and key priorities. A financing plan may focus on sales, profit and loss and cash flow. An operational plan may look at responsibilities, targets and milestones. In addition, plans may be for internal or external consumption. Whatever the need, it should be identified clearly at the outset, with the readers’ requirements being adequately anticipated.

Irrespective of external requirements, sustaining competitive advantage and focusing on continuous improvement are the key drivers of long-term business success. Sp...

Table of contents

• Cover
• Publishing details
• Praise for From Vision to Exit
• About the Author
• Preface
• Business Planning for Entrepreneurs
• From Vision to Exit
• Other Business eBooks From Harriman House