We’ve given you a lot of advice on what to do and what not to do when writing your business plan. However, we really haven’t touched on what you should do before you write your business plan.
According to Rob Place at Business Plan Local, you need to ask yourself three things before you ever set pen to paper on your business plan: “You need to know if you can do this, why you want to do it and how you’re going to pull it off.” To do that, you need to do a feasibility study of your business and yourself.
“Self-assessment, feasibility is sometimes painful,” Place says. “It’s always a good exercice to do, to sort of check yourself, to check your motive, to check your skillset and to see if your heart’s really in this.”
Place recommends taking a deep and honest look at the following areas.
Resources: Resources can be broken down into money and skills for the purpose of your feasibility study.
Money: Do you have enough money to start your business? If you don’t, do you know where you can get it? If you can’t fill the gap between the money that you have access to and your startup and operating costs, you might have to change your business idea and/or start it later, advises Place.
Skills: Do you have the skills that you need to run this business? As Place puts it: “If you want to start a bakery and you’re going to be working in the bakery in the kitchen every day, (make sure) that you have that baking skill. Otherwise, it’s going to be hard to deliver a product.” If you don’t have the skills that you need, do you know how to get them, either through education or with skilled employees or partners?
Passion: Do you really want to start up a business? If so, do you really want to start up this business? As Place puts it, “If the thought of going into your storefront or your retail store or your restaurant for the next 20 years really makes you tired, you might want to pick a different idea. Passion is what drives local business. It’s what drives great customer service. It gets people to come back because they can see you’re excited about the product, you’re excited about servicing them. You know, the people that I’ve worked with over the last five years, the ones with the greatest passion, the ones that believe in their product, are the ones that are making the most money.”
Execution: How are you going to run your business? How are you going to fulfill your own goals with this business? What’s the basic business model? Place advises you to do some rough profit and loss calculations first. After you’re done with your calculations, you should then ask yourself if your business will let you work the hours and take home the salary that you want.
This video is geared toward people starting local businesses, rather than regional or national ones. Still, it’s worth every entrepreneur’s time.
Sierra Investment Group Inc. Carson City Nevada is a small business plan writing service and small business funding resource. They can be reached toll-free at (800) 323-6298 from 8 a.m. to 4 p.m., Monday through Friday, or at firstname.lastname@example.org