One of the first steps starting your own business is to write a business plan. Without it, your home business will be rudderless.
Typically, corporate business plans are lengthy documents that take days or weeks to complete. Inevitably, they find their way into a bottom drawer, to be revisited only when next year’s plan needs to be produced.
On the other hand, writing a business plan for a home business is quite different. There are 2 reasons for this:
- You are not writing it for a boss or as a team plan to guide your employees. It is a personal reference to enable you to check that your home based business is on track.
- Getting the business up and running is normally a priority with some urgency. You won’t want to spend days writing a beautiful home business plan. So, you will need it to be short and focussed without any fluff.
If you are ready to get started with your home business plan, then this guide will help you get it done quickly and effectively.
How To Start A Work At Home Business
A few years ago I was the chief executive of a small company, which had an external private equity shareholder. The relationship with this shareholder had become difficult and we decided that the only solution was to sell the company to a larger institution.
I had an opportunity to meet with the president of a large financial institution to put forward an investment proposal to him. But, I was told beforehand that he had a very short attention span and I should keep the proposal length to one page, maximum.
It was one of the most difficult documents I ever had to write. But, it was one of the most effective. He took the action we wanted him to take, and the rest is history!
I learned from this experience that, when it comes to business documents, shorter is almost always better. And the ultimate is a one page document or spreadsheet.
For this reason, we have designed our home business plan to fit on a single page – no more. It has 5 sections:
- Vision, Mission and Objectives – where we want to get to.
- Competition – their strengths and weaknesses.
- Marketing plan – the “who” and “what” of our business growth plan.
- Financial plan – revenue, costs and cashflow.
- Action plan – how to implement the business plan.
As you can see, it is practical and to the point. And, to ensure that the plan becomes a daily reference, I use it as a place to keep my “to do” list. That way, I refer to it every day.
Using Our Free Business Plan Format
At first glance, the elements of a business plan seem theoretical and technical. But, when you cut through the jargon, the planning process is really quite simple and practical.
You start by visualising the business you dream of creating (the vision). Then you figure out what you will need to do to get there (the mission). Next, you translate this into concrete terms (your objectives). And, finally, you work out all the practical steps that will be necessary to achieve your objectives (the competitive plan, marketing plan, financial plan and action plan).
Here is a summary of what to fill in (our free business plan template comes with instructions on how to complete your plan):
- Vision: Have a picture in your mind of what you want to achieve with the business and write it down.
- Mission: Describe what it is you are going to be doing from a customer’s perspective, not yours.
- Objectives: Set targets for the first 3 months and update them after that.
- Competition: This description of your competitors’ strengths and weaknesses will help to shape your opportunities and competitive threats. This is the essence of your business strategy.
- Marketing Plan:
a. Prime Prospect: Your Prime Prospect is the sub-market that has the highest probability of buying your product or service. Describe who they are, what they think and what they do in as much detail as you can. Describe what it is that the prime prospect is seeking from people like you.
b. Positioning: Describe the scope of what you will offer, what is different about it and the benefit to your prime prospects.
c. Price: Are you going to under-cut your competitors, price at parity or at a premium? Be mindful of your planned margins as well as your value positioning when deciding this.
d. Place: How will you get your product or service to the customer?
e. Promotion: Plan, budget and write down the mix of advertising and promotion you plan for the business.
f. Public Relations (PR): The public relations plan will probably require a list of activities on its own. Here we suggest you write down the publications or media you plan to approach for publicity, so that your PR intentions are kept on the radar.
g. Promotional Gifts and Printed Material: Giveaways, business cards, brochures and price lists should be listed and planned with dates.
- Revenue plan: Estimate the income and costs that would apply if you achieved your 3-month goals. Then, project your net income for the rest of the year.
- Cashflow: Estimate the collections and disbursements that would flow from your revenue and costs.
- Action plan: We have found that a weekly action plan works best because it is detailed enough to provide a daily checklist without being too much work to keep updated.
We made a video which shows you, step-by-step, an example of a one-page business plan for a garden maintenance business. You can find it at What Is A Small Business Plan?
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