Your Business Mentor | Ray

Small Business | Home Business | Start-up and Growing Advice

Is a Business Plan Template Right for You?

Is a ‘Business Plan Template’ right for you? Should you use a Business Plan Template?

  • Do I really need to do this Business Plan thing?
  • Where do I start?    What to do?
  • How to write a business plan ?
  • Can I just do a cut and paste with a little personalization?
  • Who reads these business plans anyway?

I hear you … it is confusing and seems to be a giant task to write a business plan. When Your Business Mentor Ray looks at this question the answer is always quite simply … ‘it depends’. Or maybe more accurately … ‘the type of business plan depends on your business situation and your plans for future start up or business expansion’.

Let me give you three examples:

1. Small Sole Proprietor – Work from Home Entrepreneur

  • You are running a business from your home where you buy items to resell via the Internet on Amazon.com or on Ebay.com. You plan to be a sole proprietor and to never have any employees.

In this case a business plan that is short and simple is all that is required.
A business plan template from Microsoft Office or any of the other free business plan templates will help you to organize your thoughts.

You need to think of the product niche you are in, it’s trends and seasonality. Potential new product sources and ways to improve your business profit margin and cash flow. And finally, any new niches or categories of products you may want to expand into.

This type of business plan is simple and really only for you to organize your business plans for the near future. It is not intended for outside parties to see as you will not be needing investment capital or any small business loans to meet your business goals.

2. Existing single retail location:

  • You have a small retail store that is at least break even. You now      want to add a second location in a nearby town. To do this you will need to raise some business capital through business loans or outside investors. The new location will bring your business employee count to 10+ right from the opening of the new retail location.

The business plan needed here is not going to be very well developed by using a business plan template. Your needs are very specific and will need to be shared with several outside parties.

You need to think of the business plan document as your business resume and it needs to accurately reflect your business structure, financial condition, current market position and future growth plans, as well as, the supporting cash flows projections to make it happen.

3. Start-up business (Franchise) – 3 employees – small shop

  • You will be starting up your business from scratch or buying a franchise. You plan or using your own savings and some borrowed money to help you with starting the business. You have already decided on the business niche and products.

This is a case where a business plan template is the worst way to go about writing your business plan. First, you need a detailed, researched business plan just to make sure you are doing the right thing with your own money. Do not go ahead until you have confidence your business plan is fully developed and answers all the right questions.

This is good place for me to take a moment to emphasize this point by sharing a business plan definition with you. This is from the US Small Business Administration (SBA.gov) … What is a Business plan?

“A business plan precisely defines your business, identifies your goals and serves as your firm’s resume. Its basic components include a current and pro forma balance sheet, an income statement and a cash flow analysis. It helps you allocate resources properly, handle unforeseen complications, and make the right decisions. Because it provides specific and organized information about your company and how you will repay borrowed money, a good business plan is a crucial part of any loan package. Additionally, it can tell your sales personnel, suppliers and others about your operations and goals.”

Secondly, when you look for bank financing or other sources of outside working capital for your new business, these lenders and investors are going to want this type of business plan before they will be comfortable working with you.

I know this is a lot of work and may even seem to be outside your ability to do it. It is worth spending some time and money to get this done right before you risk your saving and possibly your personal home equity on the business concept you have.

There are many business plan writers and business plan consultants who will help you for a fee – some for just a few hundred dollars and others for thousands of dollars. Match the scale of business plan to the scale of investment required to start or expand your new or existing business.

In a bit of shameless promotion … Your Business Mentor Ray offers a custom researched, business plan writing service for small businesses. A 25 to 30 page detailed business plan and a 2 page business plan executive summary for $495. It is researched, custom, and comes with 6 months of free revisions. My writers have done thousands of these plans over the years. Click Here for more details

To wrap up this discussion of when to use a business plan template … ‘it depends’. Now you know the kinds of business situations it depends on.

Your business should always have a current business plan that you and your team take the time to keep updated. It is very difficult as a small business owner to ‘step back’ and look at the big picture of your market position, your financial ratios and cash flow trends. But it is essential to your businesses ling term survival.

As always your questions and comments are welcomes on; Is a Business Plan Template Right for You?

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