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Business Plan Software – How Do you Know Where to Even Start Creating Your Business Plan

Every business in its conception has the same chance at success. The determining factor however depends highly on the business owner and their ability to plan strategically from day one how they’re going to transform their business from an idea, into a highly successful business within its industry.

Many people have the idea that starting a business is a simple matter of having a product, putting up a sign, and away they go…as if the business is going to run by magic just from their grand idea. That’s wishful thinking and it’s really too bad that it’s not like that, but the truth is that if you want a business that’s successful and not another failure like the majority of them, then you’re going to have to do some detailed planning before you even dare to venture out.

Most businesses that fail do so because of the lack of a good, detailed business plan. Your business plan is essentially your blueprint to get your from point A to point B, as well as to take care of all the turns and obstacles in between. In essence it’s like the difference in the individual who has well defined written plans for life as opposed to those who languidly float along through life. Which individual do you think is going to have the most success? Well, studies have actually shown that the person with the written plans has a much, much higher chance of success. Same goes for a business!

Now the part that actually gets most people is not that they’re all lazy and just don’t want to take the effort to design a plan, but the fact that they simply don’t even know where to begin with the creation of their business plan. They have no idea what needs to be included and what doesn’t, or even how to format it so that it’s not just a mess of papers in a binder that they’ll never look at again.

In fact, the best business plan should be one with all of the essential elements as well as one that’s fluid and not static, because if there’s one thing that’s for sure in life it’s change, and that change usually comes from twists and turns and obstacles in the road of life itself, and your plan has to have a way to take in account for those changes.

There are a number of things that you can do to actually learn how to create an effective business plan that’s going to get results. You could go to the library and do tons of research, or you could even spend the same countless frustrating hours at home online, and be shuffled from website to website trying to figure out which information is right. However one of the smartest things that a person can do is to take the quick and easy way out and invest in business plan software that is known to get results.

Of these, probably the best, most used, and most trusted business plan software available is Business Plan Pro from a company out of Palo Alto California called – appropriately enough – Palo Alto Software.

Business Plan Pro is a software designed to help you in as easily and smooth a process as possible to create an effective and efficient business plan that gets results, either with making your business a tremendous success (who doesn’t want that?) as well as setting you up with the best possibility of getting funding for your business if needed. No lender, capital venture firm, or even Angel Investor is going to even consider giving your business funds if you don’t have a well thought-out business plan. It’s that simple.

The software basically gives you exactly everything that you need in a simple step-by-step format to create your business plan, whereas it takes you by the hand, asks you simple questions about your business, and as you answer them it guides you to the next step in the process. It doesn’t get much easier than this.

You’ll have access to over 500 different business plan templates so that you can duplicate the most effective ones for your industry.

As well, and this is a huge part of planning a business since your customers are the life force of your business, you’ll be able to access market data for your business as well as cross check for nine thousand other industries. This is powerful stuff alone.

You’ll be able to print out your completed business plan so that you can refer to it over and over, as well as have it on your desktop to quickly make changes when necessary as previously mentioned.

Having business plan software is easily one of the most important steps that a business owner could possibly take for the probability of success of his or her business, and with Business Plan Pro you’re getting the best of the best. In fact, frequently lists it on their top ten bestsellers list…and it’s the same software that 50% of top Fortune 500 companies use for their businesses. If it’s ideal for these businesses, why wouldn’t it be for yours?

Eleven Ways to Generate Leverage from Your Business

Too many businesses – even fairly large ones — are more like mom and pop entities that take too much time to run, barely make a profit after factoring in the owners’ time, and aren’t worth much on sale. Business owners need to develop sources of leverage so that their business runs without them. That way, work becomes more enjoyable and the business becomes more valuable.

Following are eleven ways that business owners can generate leverage in their business:

First and foremost, the business owner needs the right mindset. He or she must put ego aside and be willing to give control to people and processes to take over the business. Many business owners fear that no one can serve customers like they can. This may be true, but to have a truly successful business, the CEO needs to be willing to cede control. With the right mindset in place and the additional ways to generate leverage (to be discussed below), he or she has a blueprint to succeed.

Second, the business owner needs to spend most of his or her time setting direction for the company, improving performance, and developing processes and systems. Time spent “in” the business instead of “on” it, as Michael Gerber makes clear in E-myth, is time poorly spent. Business owners need a sense of where they spend their time, and how they can focus more on building their business to run without them.

Third, business leaders should be setting high standards for each and every core process, and then measuring results. That way, they can hold people accountable for doing what matters in the business. Metrics are an essential tool for generating leverage. The business owner can watch the metrics and provide tools for others to generate results. Meanwhile, employees do the work of meeting standards and continuing to improve.

Fourth, talent is essential. In the restaurant business, there is an adage that every restaurant chain is guaranteed to fail once it opens one restaurant more than its management team can handle. One of the most important limiting factors in any business is talent. Business owners need a stable pool of full-time talent to grow the business, and in many cases, a pool of part-time talent to flex up capacity when needed. Therefore, one of the most important jobs of every business owner is to find, develop, engage, and retain top talent.

Fifth, the more alliances and strong relationships that the business owner can create, the more powerful their network (or power base), and the more the business owner can get done. Alliances with employees, suppliers, distributors, marketing channels, government, and local leaders assure that in both good and challenging times the business owner has a network of relationships to make things happen. Ideally, these alliances are loyal to the business first, and the business owner second.

Sixth. every business should have operational systems so that the business thrives even when the owner or manager is not present. These systems include detailed product manuals, consistent processes, clear performance standards, and a set of processes to train and motivate people to provide consistent, excellent service to customers. That way, customers associate the business brand with a positive experience every time.

Seventh, you need marketing systems in place. We are blessed to live in a time where much of our marketing can happen while we are doing other things. Thanks to virtual teams, outsourced firms, and the Internet, we can get visible in effective ways 24 hours a day, 7 days a week. Also, executives should constantly test and refine their marketing tactics in order to have a honed lead generation and conversion machine.

Eighth, while the promise of technological solutions sometimes falls short of expectations, technology can still bring enormous leverage to every business. Software, mobile communications tools, and web-based technology can all contribute to a more efficient and profitable business.

Ninth: a unique edge separates your business from others and helps you dominate your market. The me-too business that is almost identical to its competitors will not generate as much value as a business that has a measurable, significant, meaningful (to its customers) advantage over the competition. Types of “edge” include: proprietary technology or intellectual capital, scale, operational excellence, customer intimacy, unique marketing strategies, proprietary alliances, relationships with suppliers/sources of product, and product leadership. Every business should strive to have a three to one advantage over its competitors in some meaningful area, or at least to be the dominant leader in a niche market.

Tenth, develop business credit and sources of financing in order to have a ready source of cash to expand when needed. Sometimes the only thing that separates one business from another is the cash to withstand down business cycles – or expand when others can’t.

Eleventh, by having a clear vision of how to exit the business, the business owner can focus on developing a business that will be attractive to a buyer. Buyers want a business that they can take over and run – without depending on the owner for a long transition period. An exit strategy requires a commitment to a set of processes, a respected brand, and a business that runs without heavy involvement by the owner.

The Importance of Risk Management for Business Owners

The most successful business owners have an innate understanding of risk and how to manage it. This article evaluates four different businesses in the context of risk to draw lessons about effective risk management.

Risk concerns the overall impact and probability of a specific outcome. For instance, a 20% probability of a $100,000 loss has an expected value of ($20,000) while a 10% probability of a $1,000,000 gain has an expected value of $100,000. The smart business owner constantly assesses risk in his or her business dealings in order to minimize potential downside and maximize potential upside.

Put another way: It is wise to invest in businesses and business deals that have a high probability of upside and minimal downside. While this seems obvious when stated explicitly, many businesses operate on quite the opposite principle. That is why so many entrepreneurs invest their life savings into a business only to see their dreams dashed.

Following are four different businesses and their risk profiles:

One: Online publisher. This business develops online distance education programs for fitness professionals. To manage risk and avoid large investments in product development, it begins with a simple ebook written by an investment. It tests the ebook with a low-cost website. If the ebook sells well, the company invests in an expanded program with a hard-copy book, DVDs, and seminars. It also tests different marketing strategies on a small scale, and rolls out the strategies that perform well. In short, this business is able to generate excellent profits through a strategy of low-cost testing and roll out. At the same time, it focuses its products in a niche market (fitness) in order to offer new products to its loyal customers, at a much lower marketing cost.

Two: Mortgage brokerage. While almost everyone and their brother were starting mortgage companies in the first decade of the new millennium, only a few were really generating profits. In the case of this business, the owner had over twenty years of experience originating loans for one of the top financing companies in the world. He had outstanding contacts with lending firms, relationships with the top salespeople in the industry, a proven approach to closing business, and a keen understanding of his customer. He recruited four of the top salespeople he knew – on a commission-only basis — and set up show with nominal costs in the basement of his house. Within a month he was generating over $100,000 per month in fees with almost no overhead. Here you see a business that generates excellent returns with nominal risk.

Three: Event promoter. The promoter put on professional fighting events in a rapidly growing market. It cost over $85,000 to put on an event, and most of this money needed to be paid up front – before any receipts. It was virtually impossible to project ticket sales on a given night because most people purchased tickets two weeks before the event. A competing event, bad weather, or cancellation by an event participant could be costly and stressful. The returns on an event ranged from revenue of $150,000 to only $60,000. In short, this business provided very unpredictable returns with a high upfront investment (e.g. risk). The promoter depended on the glamour factor of the business, and hoped to brand his business and sell it down the road to someone interested in an exciting lifestyle business in a rapidly growing industry. However, does it make sense to rely on this exit strategy without a predictable cash flow?

Four: Fitness facility. A fitness facility usually requires a large up front investment, in order to purchase equipment. This business owner began with a moderate space and equipment, and financed it at an excellent rate. He then marketed heavily to customers in order to generate ongoing monthly fees to cover his finance expense and rental costs. After six months, and thanks to effective and aggressive marketing, he was able to break even on his outgoing cash flow. After a year, he was profitable and preparing to open a second location. He had groomed a manager to run his first location, so that he could repeat the cycle on a second one. In this case, the owner generated excellent returns despite the requirements of a large investment up front.

From the above examples, one can conclude the following rules of successful risk management:

* Test products and marketing strategies before investing huge sums. Expand only when the strategy has been proven. If a business requires a huge upfront investment on an unproven investment, don’t invest.

* Seek out and hire top talent who understands the business and can generate exceptional results – while providing leverage to the business owner.

* As Warren Buffet advises, only get into businesses that you understand and know. If you don’t know the business and still want to get into it, spend plenty of time on research.

* Look for businesses where cash comes in before it goes out – not the other away around. Where possible, minimize cash out with leverage.

* Seek out businesses with annuity streams of cash from repeat charges, membership fees, and high customer loyalty.

* Don’t invest in businesses that require high risk and offer only moderate returns (like the promotion business). Rather, seek businesses with low risk and high returns – or manage them with this principle in mind.

* It should be easy to flex up and down with business cycles; keep fixed costs low.

* Avoid business based on glamor instead of on steady streams of cash.

* Develop systems that enable business growth and expansion.

* Buy at a profit, don’t sell at a profit. That way, a market downturn will have only minimal effects on an investment.