Do you have a plan? A business plan? Something that communicates the vision you have for your business.

Maybe with some broad numbers?

Something a little more useful than something an Apprentice candidate might get shredded by Claude Litner for, but not as dense as the annual report for Amazon. And that’s the problem, how do you draw up a business plan that is of any use whatsoever?

Well I am hoping to offer something a little more practical, real-world guidance from someone who’s “lived it and got the t-shirt”. Providing you with some pragmatic and usable ideas and actions and more useful than an academically accurate but useless doorstop of paperwork.

What’s your mission?

Not in your business, but with your life? People start businesses for many reasons, but businesses started by founders with a clearly defined goal are likely to fare better than those who simply want “money”.

A mission, or goal is a torch illuminating your path ahead; guiding you when the going gets tough.

Ben Hunt-Davies, gold medallist rower, talks about the 2000 Olympics UK Men’s Eights team guiding principle: “Will It Make The Boat Go Faster?” If an activity didn’t help the goal of winning gold, then don’t do it, Friday night with the lads? Nope, not going to make anything faster. Standing for hours at the Olympic opening ceremony? No. The team watched it on TV, saving their energy for their heats the following day.

A goal in business gives you a measure of how you are doing too. Are you getting closer to it? If not, can you change actions to improve outcomes?

• Define your mission
• Create the goal
• Build a plan
• Implement the plan

Do something every day that moves you forward, step by step, until you reach your desired outcome.

Russ “Hardest Geezer” Cook set out in 2023 to run the length of Africa and recently completed that mission. He created a plan and then put one foot in front of the other for long enough to reach his goal. On April 7th, 2024, mission accomplished – a staggering achievement “HATS OFF SIR!” but it’s a testament to a definitive goal, a well-constructed plan, and a dogged pursuit of necessary actions required EVERY day until the mission is done.

What’s your business mission?

Is it clear? Is it a definite goal? Can you create an action plan to start moving toward it every day?

For a lot of small business owners, their business activities seem disconnected from their life. If there’s no life plan, how does the business fit into your life? Is starting a business getting you closer to your own life goals? Will the business be a legacy for your children, or is there a plan to exit and sell?

Knowing the purpose of the business within the context of your life can tell you a lot about how to structure it, and how to make the future easier for those who acquire the business. Or, if the plan is to just have a lifestyle business and use it to simply earn a wage, then how do you plan for retirement?

There’s a lot to consider when setting up a business, but the one mistake I see new business owners making consistently is not considering the business exit strategy.
If there’s one thing The Apprentice has shown us, it’s that the lack of the candidates’ ability to plan and explain a solid business proposal is almost guaranteed. I can’t believe none of them watched the previous series to prepare for a grilling by Claude!
Whilst this blog cannot drill you on your numbers, here’s a guide to help you marshal your thoughts and set up the right mindset when approaching a business plan.

What’s your mission? In a paragraph or less describe:

A) What do you want from the business?

Fame, money, plaudits, legacy—be honest. Jot down everything you want the business to provide. Not just the money, income and stability, but what about that skill you always wanted to acquire? Can the business fund a life that allows you to develop that? What opportunities will the mission success provide you and your family with? Are these by-products or must-have outcomes? Stick it in, it’s fuel to push you on through the hardest of times. Whip out this document and read the answer to this question. Focus on what drives you in business and that will keep you going.

B) What will customers value MOST about the business?

You only have three choices here; you can only pick two:

• Speed – convenient, fast, efficient
• Quality – effective, durable, unrivalled
• Price – cost, value, savings

Understanding how these three things interact in a marketplace will guide you on so much in your business. Scarcity, branding, psychology of crowds, and game theory can also help. But for now, how you want your products or services to be perceived can be summarised by picking two of the above three options.

• Low cost, quick = lower quality products and services
• Fast, high quality = the market will stand a higher price
• Low costs and high quality = slow delivery and low priority

You can also reverse engineer these three items within your business. If you need something fast and don’t mind a less than perfect outcome, then don’t spend the earth finding the solution; get it done, quick, fast, dirty but low cost. Need it quick and high quality? Set aside a decent budget. Don’t mind something taking whatever time it will take but needs to get done right? Then there’s likely to be little to no major progress in the short term.

C) Who’s the industry leader, locally, regionally, nationally, globally?

Write them down, follow them on social media, learn what you can from them. If they are thriving, then they are giving the market what it wants. Don’t be so arrogant that you overlook what the competition has achieved. You just have to see what needs to be improved, and ensure the customer appreciates that improvement.

D) How will the business make money?

Be as brief as you can, but ensure you know what activities will generate revenue. There’s already lots of info written about how to play “fantasy business figures”, spend some time on this exercise, it will help you understand the market, but the question that will preoccupy every waking minute in business is, what’s the cash flow like? Do you have enough cash today to service your debt tomorrow? How do you make that revenue?

How will you communicate with your customers? How do they communicate with you? How long does it take to make a sale and what is the likely margin? (Hint, expect your margin to be way lower than your heart would love it to be. No, lower. Down. Way down. It’s likely to be around 10% when all is said and done, if you’re lucky and have a good year.

How do I know?

Just look at the S&P 500. This financial index follows 500 leading publicly traded companies in the U.S. These are 500 of the most advanced and well-resourced businesses on the planet and the index is updated periodically as business fortunes change, so does the index. These titans of business are the 800lb gorillas in any room they choose to go sit in. However, for all their might and wealth, as this article on Investopedia highlights,

“the index has returned a historic annualized average return of around 10.26% since its 1957 inception through the end of 2023.“

REF: https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp

It’s good to be positive, upbeat and enthusiastic about your business outcomes, but if the biggest and boldest Avg 10% set that as your benchmark and use it to motivate you. Whatever your enterprise, I hope it really goes well, and makes enough income to cover your expenses plus some to enjoy and invest.

We all want different things out of our business, but being realistic about the numbers is one of the biggest lessons I learned early on. Your cash flow cannot outrun overspending. Sure, early days you can stay ahead of the creditors, but one bad debt, one slow customer payment or unexpected bill, emergency, or event, and your business will be gone.

Be prudent, pragmatic, and prepared.

E) What will stop you from reaching your goal?

Internal – make a list of all the things you can control and arrange them from most to least control. Anything significant on that list you can assert more control over? It’s not about forcing others to bend to your will. But if there’s a skill shortage, how do you improve? Or do you hire? How will you adapt your plans given the aspects of control and influence you have?

External – make a list of all the things you cannot control and rank each item from 1-10, 1 would be the least impact, 10 would be a business extinction event. In your list, how many 10s do you have? If your list has more than 30% scores of 8 or above, think long and hard about what you do to mitigate these specific risks.

This gives you a very basic SWOT analysis, you will quickly see where Strengths and Weaknesses lie, you’ll also identify areas to review for Opportunities and understand your Threats a little better too.

F) Name your biggest fears, and how you plan to overcome that fear.

You hate speaking in public, many people do, but if your business activities mean speaking to large audiences. How will you overcome that obstacle? Let’s say it is mission critical that you give talks to educate audiences? What are you going to do? Can’t outsource it, can’t avoid it, can’t cancel it…

The answer to overcoming ANY fear is to find a purpose bigger than the fear itself. Go back to your mission, re-read it, and if you hate public speaking, is the mission objective clear, simple and big enough to make you overcome the fear? If not, then rethink this entire plan. You need to solve big problems (fears) before moving on.
If public speaking makes you want to retch, then make sure your mission is so important to you that you just accept retching as part of the pre-speech routine or find a solution to the pre-speech nerves.

G) When you are not in the room, what do you want people to remember about you?

This will be your brand; how you make people feel is a key aspect of branding, so ensure you have the right energy.

“How you do one thing, is how you do everything”

Performance has proven to me that you truly never know who is watching, and gigs get gigs. Anyone can be in the audience; you don’t know if there’s someone in the room who would amplify your message but because you only want to talk to potential customers you overlook a longer-term benefit.

Also, your behaviour says a lot about your business, and people will be watching and sizing you up to see if they want to do business with you. So, ensure that whenever you are interacting with the public you present the best version of you that you can. Even if it is going shopping, be kind, courteous, and friendly, you never know who is watching and may be judging your actions and your business. Don’t be paranoid though!

Conclusion

There’s a lot written about business plans, and the above list can’t tell you if you will succeed, no plan can. But if you have clear goals and outcome expectations then you can judge whether you are making progress towards your goal, or if you need to course correct or even stop altogether.

Whilst I might not have the business empire of Elon Musk or Jeff Bezos, I’ve learned a thing or two about running a small business over my past 30+ years of success and failures. But the one thing I would say, no matter what the outcomes, success is merely trying again. Getting up when knocked down, and finding a new way forward, another plan, a different idea, or iteration.

The ONLY plan to guarantee success is the “happy ending plan”. There are only happy endings, and if I am not happy, it’s not ended.

If you want to discuss your business and just want some honest, pragmatic, and straightforward conversation then pick up the phone, or email. Let’s see if we are a good fit, and if working together would add value to both our businesses. Set up a meeting and let’s talk.