Ready to launch? Have a business plan!

I recently ran a three day workshop on ‘Start-up & Succeed’ in downtown Chicago.  We had 14 small business owners, with 15 more who were getting ready to launch their own firms.  We kicked off our first session by introducing our team, and then we asked the participants a bit about themselves.  We asked them to share:

  • Their name and role
  • Their company name/line of business
  • What makes their product/service offering unique
  • We put a 90 second limit on their responses.

Sound familiar? Of course – it’s standard practice for this type of thing. Although the ‘ice-breaker’ may feel a bit too familiar, it is a great intro to the ‘elevator pitch’ – a useful tool that trains you to sell yourself and company succinctly at any networking opportunity… often key to entrepreneurial success…

With our group – not surprisingly – a number of participants struggled with this exercise.  It is always difficult to sell yourself to start with, but it is even more difficult if you do not have a sound road map (or business plan) to guide you – more of that later!

We also shared some interesting statistics from the US Department of Commerce with our groups. Here are some examples:

  • 99.7% of all employer firms are small businesses (< 500 employees)
  • They pay 44 percent of the total U.S. private payroll
  • Small businesses create more than half of the nonfarm private GDP
  • 52% of small businesses are home-based
  • Small businesses have generated 64% of net new jobs over the past 15 years
  • Small businesses produce 13 times more patents per employee than large patenting firms.
  • In 2008 there were 29.6 million businesses in the U.S.

Next, we asked our participants what they would define as the success of  their small business. We received a wide range of responses: ‘100% growth over the first two years’; ‘Be in business until I retire’; ‘Joining the millionaire’s club’ and ‘Loving what I do every day’ are a few examples.

We also looked at the flip side: why do small businesses fail. Although our participants were there to learn how to succeed in their ventures, it is also important to know that, according to government statistics, 30% of small businesses do not last 2 years, and after five years there are only about 45% left.

There are a number of reasons why so many small businesses don’t make it – but one major pitfall is lack of planning, and not writing a strategic business plan.

This business blue print will force you to systematically develop the goals and objectives of your business.  It will get you thinking in detail about what it is that you have to offer, and what makes this offer unique.  You need to gauge how best to market yourself, who your target audience is, and what your competition looks like. Following this plan will also require you to make financial projections and to have an exit strategy in place.

If you decide that you will need additional capital to launch your business, then having a business plan is also a ‘must have’ when you approach banks, angel investors, VC firms or the U.S. Small Business Administration.

A business plan is your road map for how you expect to succeed and how you’ll measure success.

All of our workshop participants worked both in sessions as well as in one-on-one coaching sessions with a workshop coach to develop a first draft of their business plan. We are now working with several of them to fine-tune their road map to success.

If you’ve got (or are planning) a small business and would like to maximize your chances of success then contact us at [email protected] and receive our free sample business plan to get you off to the right start…