Business Plans
We have written and/or supervised about 75 business plans in both the for-profit and not-for-profit sectors, and in fact taught strategic planning at UC Santa Cruz for 12 years. These have been used to raise anywhere from $10,000 to $75 million in venture capital. We’d be happy to take a look at your project for you, and perhaps give you a very reasonable fixed price quote.
Sample Business Plans
Do You Really Need a Business Plan?
Rex Walters, Ph.D.
The question is often asked of me, “do I really need a business plan? I’m already working 50 hours a week, and I just can’t seem to find the time to get one done.”
Having written and supervised about 100 business plans, large and small, my short answer to that is…no, not really. An asteroid isn’t gonna drop out of the sky and land on your head if you are guilty of not having one. But the longer, more truthful response to that question would be, it depends on where you want to go, and how fast you want to get there.
As a business broker, I interact with literally dozens of small business owners every year, from the lone wolf painting contractor to some of our area’s larger service and retail ventures, and I can tell you that many of them have never done up a formal business plan, and fewer still have a current, up-to-date version. Tsk! Tsk! And do they care? Usually not. But should they? Well, read the following and make up your own mind. After all, it isn’t against the law to not have a business plan.
Who Should Have a Business Plan?
In truth, if it is just you, plus maybe your husband or wife, or best friend, and you are perfectly well-funded, love your work, your collections are always 100% and on time, and have no desire to ever grow, expand, or retire (and I know some of you out there feel this way), then, no, you don’t really need a formal business plan. Your goals, strategies, and tactics are in your head. You probably have great communication with any partner if you have one, and you are content. Some of our smaller mom-and-pop retail stores are like this, as are the smaller tradespersons and contractors, surfboard shapers, one-person carpet cleaners, massage therapists, etc.
However, if you are like many entrepreneurs, and just never seem to be satisfied with things as they are; are constantly thinking of ways to make something better, smoother, prettier, faster, larger, funner (I know, I know…more fun!), and always MORE PROFITABLE, then yes my entrepreneurial friend, you do need a formal, written, up-to-date business plan.
Advantages of Having a Written Business Plan
Most experts I speak with generally agree that the following are the top five advantages to having a formal, written, up-to-date business plan:
• Defines and refines your major goals for yourself AND your team.
• Provides a means by which to evaluate and correct your business performance.
• Ensures all stakeholders are aiming at the same goals and objectives.
• The process of doing one sharpens and improves YOU, the entrepreneur.
• To raise start-up or expansion capital.
I personally speak to, argue with, and attempt win-win situations on a frequent basis with venture capitalists, hedge fund managers, SBA lenders, commercial bankers, and private, “regular guy” lenders who just happen to have an extra 250K laying around, and I can absolutely assure you, if you are searching for start-up or expansion capital, the first question out of their mouths will be “can I see your business plan please?”
As a final advantage, business plans are exceedingly useful when valuing an enterprise for a sale, inheritance, partnership buyout, and so forth.
What’s in a Good Business Plan?
A business plan should flesh out your vision, mission, major goals, marketing strategy, top management personnel bio’s, and financial achievements (or pro formas if you are new) in enough detail to give your reader a full color picture of who you are, what you do, and how you will do it. AND, that your business will generate enough revenue to cover your expenses, and in the for-profit sector, make a profit. (The non-profit sector is primarily mission-driven, and therefore focuses on delivering necessary services to its target population. But even non-profits need to show in detail how they will fundraise and finance their good works.) Many VC’s, angel investors, and the like measure a plan by the tried and true SMART (or SMART-F) test, which is, is it:
• Specific
• Measurable
• Attainable
• Realistic
• Timely, and,
• Financially sound
But What About Special Areas like Santa Cruz and Monterey, CA?
I find that Santa Cruz and the Monterey Bay region in general (or any highly desirable oceanfront locale. You could easily insert Hawaii here,) have unique business challenges to go along with our world-class weather and lifestyle. Some of them are:
• It takes twice as long to get a new business up and running compared with, for example, San Jose, CA, which is only 30 miles away, but light years away in terms of economics.
• Profitability is more tenuous and seasonal than say Santa Clara County.
• Our general level of business acumen and style is more laissez-faire, or “hang loose.”
Because of these and other local and seasonal forces, it is my belief that for Santa Cruz and Monterey Bay area small businesses, if they have any desire to excel, expand, or become more profitable, they definitely need to have formal, written, up-to-date business plans to compete in our new, topsy-turvy economy.
But on the other hand, as I say, if you are happy and content with where your business is at, then don’t do it. The 200 to 400 person-hours that most good plans require to create just wouldn’t be worth your time or expense, and after all, you’re perfectly happy with the way your business is right now. Right? Right???