Roadmap to Business Success
By: Rob Dickey
I’m a big believer in road maps. When you’re going on a trip picking a destination and deciding to what to do when you get there are only small parts of the process. The journey to get there is the part that takes the most time and requires the most planning. Having a good map in hand ensures your best chance for success. Having a good map shows you all the possible routes to your destination and allows you to pick alternate routes should you run into a detour or change your destination.
Starting a business is a journey of sorts. When you decide to start your own business you pick a destination and what you want to do when you get there (i.e. what kind of business, getting rich, and retiring on a beach somewhere once you make your millions). Like any other trip this requires a plan. First and foremost, you need to have a formal business plan. A good strong business plan can tell you the true viability of your venture and when you can expect to be profitable and when you can expect to hit that beach.
A good strong business plan forces you to explore the ins and outs of your business and uncover the road blocks that may force you in a different direction. Just like having a road map on a trip your business play will afford you the opportunity to find alternate routes to your destination. A good business plan will give you options. When creating your business plan, your road map, be sure to address the following areas:
A Detailed Description of The Business – what is your destination, how are you going to get there, what kind of car are you going to drive, where are you going to stop for gas. Okay enough of the analogy, but seriously, what kind of business are you starting, why, when, and how?
Marketing Plan – first you have to know your target market. You have to investigate whom it is you are selling your products and/or services too. Why are they going to buy from you, how much do they have to spend, how & when do they spend? Knowing this will help you with two things; first, you’ll know if you have enough of a potential customer base to actually sell to and if you can charge enough to make a profit. Second, it will tell you how to market your product to them and get them interested in buying.
Standard Operating Procedures (SOP’s) – don’t overlook creating step by step instructions on how you will do specific tasks. Not only will this give you a reference but it will help any potential employees know how you expect things done. If it is written down it is “law”.
Finance – if you are not strong in the area of financial matters and accounting hire someone who is or pay for outsourced services. Develop a plan to make every dollar count and get the most out of your cash flow.
Legal – if you’re not a lawyer, hire one. You absolutely have to be compliant with the law otherwise you run the risk of losing everything if found non-compliant. This goes for licenses, documents, company structure, payroll & HR law, etc.
Capital Equipment – buy what you need to run your business. Don’t be extravagant and buy the top of the line Italian leather executive’s chair for your office or more computer than you need but don’t overlook any essentials either. Also, remember to have back ups (i.e. extra printer cartridges, paper, alternate ways to transmit information, etc). Be sure to price these things out accurately item by item before putting an amount in your business plan.
Inventory Management – if you have inventory how will you track it? Regardless if you’re selling widgets or thing-a-ma-jigs your inventory has monetary value and is one of your biggest assets. You need to treat inventory like a bank teller treats money in her drawer. You need to know who, what, when, where, why, and how many were moved in or out and have a record of each transaction. Even if you use a simple spreadsheet, don’t overlook having a tracking mechanism in place.
Location, Location, Location – just as with real estate, location can make or break a business. This is especially important for those in retail. However, even if you’re not selling goods to the general public you still need to be in a location that provides the space and accommodations necessary to conduct your business. You also need to be in a location that provides you access to your customers and they you should the need arise. Whether this is an office in your home, a storefront in a shopping mall, or a back alley garage your location should suit your needs and you should account for it in your planning.
These are just the basics of what you should map out when planning your business. Depending on your chosen business you could have much more to consider and much more detail to account for but this is the bare minimum. And just as with life or that trip, you may encounter roadblocks and detours. Be prepared to make adjustments along the way and never be afraid to rely upon your experience and intuition to make the tough decisions. Just make sure it falls in line with getting you to your destination.
Article by: Robert Dickey, President/CEO P3 Solutions, LLC
© P3 Solutions, LLC 2008 all rights reserved. (This article may be reprinted in part or in full provided the byline and website links stay in tact)
About the Author: Robert Dickey offers small business and financial management consulting. You can read more of Rob’s work at http://www.prosperityshift.com and http://p3bizsolutions.com