Shauna Madsen, Madsen Avenue, Edmonton, AB, CYBF Mentor
Creating a formal business plan is a daunting task. In large corporations, a team of individuals develop plans annually and typically across various departments – based on budgets, departmental goals and marketing plans.
Small businesses do not always have the luxury of a team to take on the task of writing a formal plan. However, the process itself will define your company, help you to establish definite goals and give you direction and focus.
Over the past 23 years, I have written a number of plans for others and when it comes to value, there can be no substitute for writing your OWN plan. You will make discoveries, confirm assumptions and realize first-hand whether your concept is a winner or you need to make revisions to your original idea. Regardless of the end result, you will save yourself considerable time, money and heartache by planning it on paper first. I have seen a number of businesses fail when the owners are “married’ to their idea and forge ahead without doing their research.
A formal plan is necessary especially if you are approaching a bank for a loan. And many angel investors will want to see a formal plan to assess the viability of your venture.
Existing businesses need to revisit their plans on a regular basis. It is suggested that this be done every three months. In doing so, you will stay fresh in your ideas, expand or eliminate goals and revise your objectives according to events and situations that occur on a monthly basis. Perhaps your financial plan needs tweaking or your actual revenue may be higher or lower than your original projections.
Utilizing your plan, as a working document in your business will ensure you are always prepared should a turn of events create new opportunities or reveal unexpected risks. For example, should the need for financing arise, you will be proactive and impressive when you are able to submit a current plan on a timely basis to whomever is asking to see one.