Imagine a house without a solid foundation; it would not stand for long before cracks began to appear. The same concept applies to businesses. Without solid planning, it is difficult, if not impossible, for a business to be successful. Long gone are the days of handshakes and “promises” to keep a company running. Now, it is necessary to create a sound plan and adopt strategic approaches in order to maximize a business’s potential. When considering a plan, use a B.A.L.L.A.D. approach: set benchmarks, attract investors, obtain loans, plan long-term strategies, accentuate accomplishments, and determine future performance.
Setting Benchmarks: What are the goals of your business? Setting benchmarks is a critical part of any business plan. The types of benchmarks set depend on what a company plans to accomplish. A sales-driven business may need a certain amount in orders by a set date – a year, for example. An Internet startup could want different aspects of its software program finished in certain time frames. The best benchmarks have clearly defined targets and detailed methods for reaching those targets.
Attract Investors: A solid business plan attracts serious investors. They can provide an influx of cash a company needs to maintain or expand. In return, they will expect to earn money through their investment. Savvy business investors know the format of quality business plans: a summary of the business, marketing plans, operations, financial data, and profiles of the company’s leaders. They are less willing to invest in businesses that lack detailed information in any of the areas listed.
Obtain Loans: It is essential to develop a solid business plan before seeking a loan from financial institutions. Like investors, financial institutions look for certain qualities in determining whether to approve a loan. They will focus heavily on the financial details of a business as well as its potential for its success based on the product or service description and the marketing plans. Financial institutions may also consider the credit worthiness of the business and its owners.
Long-term Strategies: When considering long-term strategies, businesses need to consider how they will address failures and successes. Evaluating strategies may include reviewing sales and marketing plans and researching the best ways to promote the business. Strategies also include approaches to hiring new employees and acquiring additional property. Even if every area is not addressed, adding long-term strategies in a business plan will help businesses assess feasibility and prepare for the unexpected.
Accentuate Accomplishments: Each week, local newspapers and periodicals geared towards businesses list acquisitions, company awards, new employees and business profiles. Recognition matters. If your company earns any achievements or participates in community involvement activities, include them in your business plan.
Determine Future Performance: How will your business perform over time? What factors can help or hurts its growth? Many corporations have three to five year forecasts of their potential earnings based on various factors. Even small businesses can benefit from planning for the future. Companies can identify risk and opportunities by including a thorough analysis with their business plans.
The best business plans are never “complete.” Think of them as working documents. There are a variety of factors, from the economy to your location, which may necessitate a modification of a company’s benchmarks, its financial needs, its strategies, and its future. New businesses and established companies can benefit from developing business plans. And of course compliance with statutes and regulations, risk mitigation, and your contracts are a critical part of any business plan. Planning now can help businesses be successful well into the future.
The Law Offices of Terry L. Gilbeau provides personalized counsel to clients in a variety of business and personal matters, including creditors’ rights, debt collection, products liability and international transaction issues. His office is located in Rocklin, CA, just outside of Sacramento, CA, near Roseville, Lincoln, Auburn, in Placer County and can be reached at (916-626-5539) or email Terry at firstname.lastname@example.org. Click here for the firm website http://www.gilbeaulaw.com/