A business plan can help you manage your business and deal with change as you remain focused on short- and long-term goals.
First, settle on strategy. Match your product line with your strengths and weaknesses, opportunities and threats, and what your target market wants most.
Write down key points so you can refer back to them in the future. Don’t try to do everything at once, but rather focus on what’s most important as the days unfold.
Then create the action plan. Think of the action plan as a solid strategy with measurable specifics that make the strategy happen. Don’t worry about your writing style or formatting; just get the specifics down.
1. Create a review schedule. Schedule something periodically — every third Thursday of the month, for example — for a short review of the plan, actual results and the fine-tuning required to keep the plan alive and relevant.
2. List your assumptions. Go over your initial assumptions to identify potential significant changes. When you find that your initial assumptions were incorrect or circumstances have changed, evaluate whether you will adhere to the plan or revise it.
3. Identify milestones. These are specific dates, deadlines and responsibilities. Make a list of who is supposed to do what, when it should be done, and how much it costs. Estimate the amount of revenue each activity is supposed to generate.
4. Estimate the basic numbers. You must make basic estimates of expenses and profits to follow your plan. For most companies, that means projected sales, cost of sales, expenses, profits and cash flow. Use a basic projected balance sheet of your assets and liabilities. Think of other relevant measurements to track, like units produced or presentations made. Keep a log, or, if possible, enter this information on a computer so you can refer back to it to see what has changed. You also may need to show the information to others, like investors.
Now that you have a plan in practical form, make sure to stick to the review schedule and look at the difference between the plan and the actual details of your unfolding enterprise. This will help keep the plan alive.
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Adapted from material published by the U.S. Small Business Administration.