What you will need to include
- What is the full (registered) name of your business?
- What is your business about?
- What kinds of products and/or services do you provide?
- What area of the (niche) market do you intend to direct your products and/or services to?
- When did the business commence operations or when will it start?
- Who are you?
- What are your reasons for wanting to start a small business?
- What experience, skills and qualifications do you have?
- Which major skills will you use for your business?
- What six entrepreneurial qualities do you have for running your own business?
- What is your vision?
- What do you hope to achieve or strive for within your business (also known as goals and objectives)?
- How will you achieve your goals (also called strategies)?
- What are your personal strengths and weaknesses? Do a personal SWOT Analysis for this one!
- Why have you decided to write this business plan? Is it to assess possible risks associated with the business? Is it to test the viability of the business idea? Or perhaps you merely want evidence to convince your bank manager to give you a loan so you can run your business?
Ownership, Management and Legal Structures
- This is optional for the Introduction section of your business plan. Some people may create a new section specifically devoted to legal aspects. It is totally up to you. But you must indicate somewhere in your business plan who owns the business and the legal structures to be employed in your business.
Extra information to consider
Developing your goals
A goal is something to strive for and will reach (or be achievable) at some future date. For a goal to be achievable, it must be specific, measurable, achievable and realistic.
To create a goal, you need a vision and some guidance from your Mission Statement. In other words, your goals are an extension of the vision statement and Mission Statement. The goals are there to help you elaborate more specifically the accomplishments you wish to achieve to get to that vision.
Remember, for your vision to be achieved, you will need a number of goals or steps to strive for and make a reality in a certain timeframe. So begin setting goals by applying the following seven essential actions:
- Clearly identify your goal.
What is it that I need to do with my life?
- List the obstacles to overcome.
What is stopping me from achieving my goals?
- List the specific knowledge, skills and tasks required to overcome the obstacles.
What do I need to learn to help me reach my goals?
- List the people necessary to work with to help you achieve your goal.
How can other people help me achieve my goals? Who will be affected by my work?
- Define your plan of action.
What will I do?
- Set a specific completion date and know when you have reached your goals.
When will I know I have reached my goal? How will I know?
- List the benefits you will gain when you achieve your goals.
What reward will I give myself? What will others gain after achieving my goals?
Once you have written a list of goals on paper, select those goals that directly affect the business and your customers in some way. Now divide those goals into two parts: short-term goals and long-term goals. These are called your business goals.
Interestingly, some planning experts have defined those really achievable and realistic goals containing specific information and having a time frame as objectives. Anything else that is not specific enough is termed a goal.
For example, a statement like "To have my own publishing business" is too broad. Although it specifies the kind of business you want to get into, there are still different types of publishing businesses you could go into (e.g. electronic or traditional) and you have not specified a time frame (e.g. within 1 year, 5 years etc).
On the other hand, a statement like "To make $50,000 net profit in my first year of business" is described more as an objective because it fulfils the definition of being specific in what you want (i.e. the amount of profit you want to earn) and when you want it (i.e. in the first year).
Whether or not you should go to this level of defining goals as "objectives" instead of "realistic goals" is totally up to you. The point is, you want your goals to be as realistic and specific as possible so that you can convince a highly practical and rational person within, say, the banking industry who may be lending you money, just how believable and achievable the goals are in the eyes of this person.
Developing your vision
There is a difference between vision and goals. A vision is said to be something you are constantly striving to reach. There is nothing stopping you from getting as close as you like to this vision, only that you cannot quite attain the vision or if you do, you cannot hold onto the vision long enough unless you make the effort once again to get to that vision. But a goal is something you can definitely reach for. Once you have reached for your goal, you do not have to achieve that goal again.
To create a vision, summarise all your goals in one simple statement. The statement should tell others what you hope to achieve after running your business in 5, 10 and 20 years from now.
NOTE: This is the old chicken-and-the-egg situation. Should you start with goals to create a vision, or should you create a vision first before formulating your goals. The aim is to start from one end (say your goals for the more practical-minded individual, or your vision for the more creative-minded individual) and keep working at it until the other end starts to become apparent, or vice versa.
Now that you have a vision and a set of goals for achieving your vision, the next step is to turn your vision and goals into reality. This means you must have an action plan showing the strategies (a set of activities) of how to achieve the goals.
In general, these activities constituting a strategy will include various aspects of your business plan such as financial, marketing, manufacturing, sales, technical and operational areas.
When specifying the activities, do not give a highly detailed explanation. Just two, three or a handful of words to describe each activity to be performed in a strategy to help you achieve your goals is enough.
Your best way of summarising all this information about goals and strategies is via a table. For instance, make the column on the left side of the table your list of realistic goals or objectives. The column on the right should therefore contain the list of activities forming the strategy for achieving a goal. Then each row looks at each goal with the top rows focussing on short-term goals (roughly 3 or 4) and the bottom rows focussing on long-term goals. This should make it easy for someone else to see what you're on about.
What does it mean to have entrepreneurial qualities? Good question. Well, let us put it this way.
When goals and a purpose has been developed, many successful businesspersons usually have to expend lots of energy and time to achieve what they set out to do. Because such people cannot afford to sit around on a chair all the time or not apply their mind to the task, or even expect opportunities to come knocking on their door or pretend potential threats and risks do not exist, it is not surprising to hear small business owners say they spend over 50 hours every week on running a small business.
To cope with the hard-work and the potentially long hours required to run a small business, every ambitious entrepreneur must have certain inherent or acquired personal qualities and skills (i.e. the source of a businesspersons' entrepreneurial drive) of which the following are common and necessary:
- Enjoy working in solitude;
- Enjoy working with others;
- Problem-solving skills;
- Creativity skills;
- Able to manage time effectively;
- Able to manage stress effectively;
- Organisational and time-management skills;
- Communication skills.
NOTE: Skills mean to a level needed to achieve your business.
- Sensitive, yet decisive and unwavering;
- Self- discipline;
- Patient and yet quick;
- Emotional Stability;
Kosmas Smyrnious, a psychologist and joint foundation director of the Monash University unit that conducts the annual Business Review Weekly survey on the top 100 Australian businesses, said:
"The entrepreneurs are tenacious and visionaries. The take personal responsibility for finding solutions to problems, set moderate achievement goals, take calculated risks and seek concrete feedback regarding performance. The keep abreast of new developments and are excellent short-term and long-term [usually up to 1 or 2 years] planners." (1)
Or for an alternative definition for a business entrepreneur, try our quote which is as follows:
"Someone who is resourceful, a rational thinker, willing to take realistic risks, be creative enough to see new opportunities, and think laterally. In essence, he/she should be as balanced as possible (i.e. a combination of L- and R-brain or rational and imaginative skills). He/she should also have feelings in a sense that his/her choice of services and products for his/her business should be sensitive to the environment and to the needs of people."
If you feel like you don't have many of these personal qualities, don't worry. We all have these qualities lying dormant in our minds. We just need to be aware of this fact and to awaken them and nurture them through our daily activities.
Actually, some of the greatest and most successful business people in the world can take years to start up a business idea simply because they have to spend time developing certain personal qualities and skills to help make their small business a truly successful one. So try not to rush into starting your business if you can. If necessary, try doing something else to help you get those qualities and skills under your belt before diving into your awesome new business.
What does it mean to be successful?
From a Western society point of view, success in a business is defined on two criterias. Generally, Western society believes success in a business is based on the amount of money you earn in the business and how famous you are.
In truth, success is actually a personal thing. For most individuals, just believing in themselves and what they want to do and then achieving what they set out to do is enough to be called successful. And it does not necessarily mean making money or being famous.
A really successful person is someone who is not preoccupied by money or fame, but rather how many people he/she has helped or the quality of the help given to a few people.
This is what genuine people eventually learn success to be. If you are able to achieve your goal(s) and help people in the end, you are successful and no one can take that away from you.