Creating a Successful Business Plan by Bob O’Connor Over the years, we’ve had the oppor- tunity to work with thousands of shop owners, providing advice and tools to help them grow a profitable business. We’ve discovered that one common key element missing from most of those businesses was a formal business plan. Most shop owners don’t realize that a good business plan reveals a complete story about their business to them and to anyone else who needs to have a com- prehensive understanding of it. A well-developed and comprehensive business plan (updated at least every six months) serves three key purposes: First, it forces you to take an objec- tive, critical and unemotional look at your business the way someone outside of your business would. It assists you in setting goals and determining how workable and profitable your business is or can be. Second, it’s virtually a must when applying for a loan. To a lender, your business plan reveals your business’ fea- sibility and future viability, and reflects your management abilities. It gives the lender assurances that you’ll have the ability to repay the loan. Third, it’s a starting point for creating a more detailed operational plan, and becomes an important management tool for monitoring the growth and perform- ance of the business, and for charting future direction. Business plans are not all alike, but vary depending on the type and size of the business. The importance of a busi- ness plan is not just the written docu- ment itself, but rather the process and thinking involved in creating it. Many shop owners will argue that the marketplace changes too fast for a busi- ness plan to be useful, or that they’re too busy running their operation to prepare one. While many owners are reluctant to invest the necessary effort to put the details in writing, the time is well spent when the business grows and prospers as a result. Why Develop a Business Plan? The importance of a comprehensive business plan for your shop cannot be overemphasized. It’s essential for starting a new business, purchasing an existing business, buying a franchise, expanding an existing business, or even simply remaining competitive. A well-prepared business plan can serve several additional purposes. Essentially, it’s your entire business concept put on paper. For instance, it contains detailed information of where you’re headed and how you’ll get there, your production processes and capabili- ties, the size of your business and its growth potential, your products and services, your competitors’ strengths and weaknesses (including pricing com- parisons), how you’ll advertise and pro- mote your products and services, how much money you’ll need and how it will be spent and, finally, your staff’s ability to execute your plan. When starting a new repair business, a business plan helps the owner(s) deter- mine the feasibility and desirability of pursuing the necessary startup steps. It’s the only way to determine if the new ven- ture is really a solid business opportunity. As previously mentioned, a business plan is typically required to obtain financing from outside investors or lending institutions. In a nutshell, it pro- vides the answers to all the pertinent questions investors seek, including who, what, why, where and how. A business plan is also useful in obtaining initial or extended credit from suppliers. And since details about mar- keting and competition are a significant element of a plan, it can help you better promote your products and services. Finally, when you sell your business, a business plan provides an effective means for the purchaser to evaluate and perhaps validate the investment required. It will also provide the pur- chaser with a set of “instructions” by which to operate the business. For all these reasons, your business plan can and should be your road map to success! Who Should Develop the Plan? Many repair shop owners ask this question. There are several options available, including: ¢ Doing it alone, following the out- line presented here. ¢ Seeking assistance from your local Service Corps of Retired Ten Tips for Developing a Business Plan 1. Take all the time you need to build your plan. Be prepared to spend several weeks at it. 2. Keep your plan in sight so you can work on it consistently a few hours each day. 3. If a particular section of the plan is too difficult or requires more time than you have immediately avail- able, move on to another part, then go back to it when time allows. 4.Once you complete a section, don’t update it unless it directly ties in with another section you’re working on. 5. Employ the KISS principle (Keep It Simple, Stupid) and avoid over- complicating the plan. 6. Ensure accuracy by doing your research thoroughly. 7. Rather than wait for the whole plan to be finished, have completed sections proofed for spelling and grammar. 8. Use color wherever you can to add visual impact to the plan’s overall appearance. 9. Give serious consideration