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Bringing Your Business Blueprint to the Table

 

By Hallie Leverich

Marketing & Advertising Manager

Professional Business Brokers, Inc.

888-287-7763 Ext. 206

 

Déjà vu, doesn’t it seem like only yesterday we, as business professionals, were planning for 2007? This past year has flown by and the majority of us feel as though we have been thrust into another year, ready or not.  

 

You, as a business owner, have new goals, ideas and money to be sought out and spent.  But where does one start?  The first step is to organize all ideas and goals into a succinct business plan, one which will serve as a navigational tool, sustaining your company throughout the next few years.

 

Business plans can help perform a number of tasks for those who write and read them.  They’re used by investment-seeking entrepreneurs to convey their vision to potential investors; they are also used by firms that are trying to attract key employees, prospect for new business, gain lender approval, deal with suppliers or simply understand how to better manage their companies.  The primary job of a business owner is to manage and run a business.  The term ‘manage’ implies the task of planning and execution.  Entrepreneurship is often the ability to build a business by taking calculated risks. 

 

You may ask yourself the question, “Why do I need a business plan?  This is my company; I know what’s going on.”  You may very well know every single aspect of your business; however, do you really know how much money you need to make in order to be operational, profitable and cover debt services for the next five years?  Do you have any clue what steps to take in order to get there?  You would be surprised to find out how many business owners actually don’t.

 

New business owners often have the same concerns as new parents.  Will I be successful?  Who has done this before and can they advise me?  Where will I get my financing? Where do I start?  What do they want from me?  Suddenly, a sense of overwhelming paralysis sets in.

 

Traditionally, banks look at the five C’s: Character, Credit, Cash-flow/Capital, Capacity and Collateral.  Nine times out of 10, a bank will require some sort of business plan that outlines your Company’s goals and forecasted financials to confirm that the Company has a plan, can be profitable and most importantly, has the ability to repay debt.  This is especially true with start ups and companies in need of additional capital to fund an expansion or the acquisition of new equipment.  Similarly, venture capitalists don’t invest in small companies to lend a helping hand, but rather to make money.  If a 10-15% ROI was considered acceptable, then investment would be made in less-risky opportunities such as major public companies.  Instead, venture capital firms seek investments in small high-risk businesses where they can demand a huge ROI.  Because venture capitalists are approached daily with a multitude of opportunities, it requires a special effort to gain their attention.

 

Now that we have established the vitality of having a business plan, there are a few ways to go about obtaining one. Purchase a PC program and create one, visit a website which formulates a plan, write one yourself using a ‘how to’ book/prewritten outline or you can hire a professional who specializes in the business planning process.

 

When seeking a professional to create your plan, make sure to do some homework.  Try to determine whether they sound reputable or not, find out what associations they are affiliated with and what accreditations they carry, call and speak to the professional you will be dealing with.  Not only is this person handling your investment, but they will be helping you organize and forecast your company’s future profitability.

 

If you have decided to write your own plan, here are some of the key points:

Let it be known that just by having a business plan, it by no means solidifies success.  It is merely a document of goals, predictions and assumptions that surely decreases the odds of failure.  Analyzing success factors is an exercise that consists of simply working back from a definite goal to see just how you’re going to accomplish it.  The day-to-day success of an enterprise and its ability to attract capital depends to a large degree on the completeness, clarity and precision of the business planning process.  The aim is to challenge every aspect of the business.  It’s a painstaking process.  But keep in mind; it’s a selling tool which requires the careful consideration of multiple facets.  A good business plan is a cornerstone of management.  If you want investors’ money, you’ve got to give them good reason to bite. 

 

If your Lender does not ask to see a business plan, it is still a good idea for you to have one.  You don’t want to find out a year or two into your investment that your Company has steered severely off track.  Follow your plan and make adjustments along the way.  This will lessen the risk of loosing large amounts of time and more importantly personal and borrowed capital.

Hallie Leverich, Marketing & Advertising ManagerHallie Leverich, Marketing & Advertising Manager, has been with PBBI for almost three years.  During that time she has overseen the marketing of the PBBI corporate image, as well as the affiliate offices’ images and each agent’s individual business listings. She also is responsible for organizing the company's bi-yearly business & finance seminars. Ms. Leverich is a graduate of the University of North Florida and has obtained a B.S. Degree in Communications with an emphasis in Advertising.  You can contact Hallie Leverich at hleverich@pbbi.com or at (888) 287-7763.