by Alan Seaton, SBDC Consultant
In the years I’ve been helping fledgling entrepreneurs get their businesses off the ground I’ve found most don’t have a business plan worked out. Sometimes they say “I’ve got it right up here” and tap on their head (the world’s worst file cabinet, by the way). Mostly they are afraid to admit they don’t know how to do a business plan, or what goes into a business plan. Nobody’s ever showed them. Once we sit down and I give them to tools to put their super-duper can’t miss idea on paper. It always becomes clearer, always makes more sense and in some cases doesn’t look as great once their thoughts see the light of day. The modern business plan is not simple but at the same time not hard. However it is absolutely vital if you are starting a commercial enterprise. There is so much to think about, be it retail, be it a service company or even an internet company.
A well thought out business plan gives you the big picture, a snapshot of your idea from overhead. This way you are not doing things ordinal on the ground, one after the other and not seeing the big picture, and maybe missing something important. For a small business to succeed you have to be right-on about everything. The failure rate of small entrepreneurs today is shocking. But if you put your mind to it, have a good sellable idea, it is still possible to build a business from scratch. Owning a small business can make a very substantial life and give you a great sense of accomplishment from creating it yourself.
Lending institutions, when approached about financing a brand new small business will usually say “no” even before you can get the words out “I have this idea”. Start ups complain that banks won’t look at lending them money until they’ve been in business at least three years, and two of them had better be profitable. Rarely if ever will a bank finance a small business start-up without adequate capital infusion, good credit and you guessed, a great business plan. Believe it our not when banks lend you money, they really want you to pay them back. Really!
I’ve been involved in Turlock for several years now in the Partnership Incentive Program. This City of Turlock program offers $1000.00 to anyone who opens a business in an unoccupied non residential building, or expands their business by increasing the footprint or square footage of your business. There are some other details involved in qualifying for the program but perhaps the most important one is that you are required to have a business plan when you start. Think of it as a current, workable, concise blueprint of what your business is all about. What you plan to do? How do you plan to make money? How do you plan to support yourself until you do make money? Is your idea scalable? Does it have legs to last for 5 years, or at least 3? Your business plan should also show that you can project out your sales income for at least three years and a workable profit and loss statement. This program has put dozens of small entrepreneurs on the road to success with a little incentive for starting their business of $1000. Yes, it’s only a $1000, but then again, Hey! it’s $1000.00!
The success rate of the Turlock businesses that have qualified for the Incentive is well over the national and state average, and I’d like to think it’s because they sat down and wrote a business plan. The Alliance SBDC has an office in the Turlock Chamber of Commerce and is available to show you how to start and finish your business plan as well as many other tools for the small business entrepreneur. To sign up for services simply go the Sign Up page, follow the prompts to become an SBDC client and then we can help you to start putting your business plan on paper and your plan into action. Another source of good information is the Alliancesbdc Tools For Success, a repository of all things small business and how to go about getting where you need to be. Think SBDC, because Some Body Does Care!