Before you start writing your business plan, ask yourself these questions to get into the entrepreneurial groove.
You wouldn’t start training for a marathon with a 26-mile trek. Likewise, you can’t create an ideal business plan without some warm-up exercises. Think of these five questions as boot-camp drills for your self-taught business fitness class:
1. Why am I starting this business?
Positive reasons will serve you better than negative ones. When you can spin a negative situation into a positive solution, you’re showing innovation that will draw like-minded people to your mission.
Exhibit A: You can flip “leave a harshly competitive, bottom-line focused design firm” to “build a boutique design practice that will reward collaboration and innovation with raises, sabbaticals and support for advanced education.”
2. What’s my risk management acumen?
Whether you love, tolerate or loathe uncertainty, you’ll need to manage it. This calls for understanding your risk threshold and developing a complementary management style.
CEO Joel Trammell, writing in Entrepreneur, describes this approach: “The best entrepreneurs never bet more than they can afford to lose. They always consider Plan B (as well as Plan C, D and E).”1
If you’re risk-averse, provide for such backup strategies and procedures as needed. For example, if you hand off the risk of a future project to a vendor, that may call for allocating resources up front.
3. Where can I find mentors and advisors?
As you write your plan, you’ll want the advice and counsel of one or more mentors–both in and outside of your business category. SCORE, an SBA-sponsored mentoring organization, assists entrepreneurs by holding one-on-one mentoring sessions, events and webinars. Also consult online resources such as Meetup.com, Facebook and LinkedIn for information on networking, social and educational events .
Be sure to “find a match between your deficiencies, limitations or uncertainties and [the adviser’s] experiences, expertise, or knowledge base,” suggests the Harvard Business Review. “Avoid picking advisers primarily for their confidence, likability, friendship or reinforcing points of view–those are not proxies for quality.”2
4. Can I envision my year one lifestyle?
How will you manage your daily activities and your mindset as an entrepreneur? Despite many accounts of mad geniuses staying up for days on end to change the world, that’s not the norm–though you will more than likely need to devote much more time to your venture in the first year or so. You can find a happy medium by delegating tasks, maintaining consistent work hours and pulling the reins in on email and other communications channels.
Put regular time away on your calendar, even if you can’t imagine taking it. Business writer and IT entrepreneur Susan Ward suggests delegating tasks, finding a non-competing replacement and closing up shop entirely so you can go recharge.3 As you plot your time, account for daily sleep, exercise and diet routines. (No one likes a sick entrepreneur.)
5. What is my business’s value proposition?
Your business plan’s initial success hinges on what makes your firm special to your customers. (More than 40% of small businesses fail because they fail to add value by answering a true market need, according to CB Insights4).
So even if you’re kicking off your version of a retail establishment or a professional service, it must still carve a profitable niche among its peers. Are you opening the first trilingual acting school for kids in the county? If so, are you ready to demonstrate demand for this admirable educational mission? The Internet offers a ton of research resources, including patent filings, domain-name searches, and local, state and national business listings.
Before you start writing your business plan, consider sharing your vision with a trusted friend, colleague or mentor. Their feedback could be a great way to build confidence for the long haul.
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1 5 Ways Entrepreneurs Learn to Manage Risk – https://www.entrepreneur.com/article/242977
2 The Art of Giving and Receiving Advice – https://hbr.org/2015/01/the-art-of-giving-and-receiving-advice
3 How to Step Away From Your Small Business & Have a Worry Free Vacation – https://www.thebalancesmb.com/how-to-have-a-worry-free-vacation-2948302
4 The Top 20 Reasons Startups Fail – https://www.cbinsights.com/research/startup-failure-reasons-top/
This article is for informational purposes only. It is not designed or intended to provide financial, tax, legal, investment, accounting, or other professional advice since such advice always requires consideration of individual circumstances. Please consult with the professionals of your choice to discuss your situation.