For many it is a dream to start your own small business, become your own boss with your schedule. There are many things to consider before making that dream become a reality. Before quitting your job, you need to consider if you are ready to make this dream into a full-time commitment.

For any business to succeed it must have a business plan and if it is not presented don’t go with them. The primary value of any business plan would be to create a written outline that evaluates all aspects of the economics viability of the venture. It also includes a description and analysis of the business prospects.

If you choose to operate your own small business, this plan would be useful in a number of ways. Here are some of the reasons not to skip this valuable tool for your success. This will show you why it is important to plan.

Be conservative in predicting capital requirements, timelines, sales and profits because few business plans correctly anticipate how much money and time will be required. It’s best not to ignore spelling out your strategies in the event of business adversities. Use simple language in explaining these issues.

Often new entrepreneurs depend entirely on the uniqueness of their business or their patented invention. It is best to remember that success comes to those who start businesses with great economics and not just great inventions. As you put all of these factors together, your starting model will be easier to understand.

As a buyer, you obtain and examine the seller’s financial statement and records for the past 24-36 months. This will give you a basis for the offer because you have now collected all the information for what your net income will be. It’s also wise to ask for their personal and business tax returns.

Here is an example of items that make a great business plan. You should write out your basis business concept and gather all the data and specifics you can on your business concept. Refine your concept based on that data then, outline your data using, a “what, where, why, how” approach for your agenda.

Put your plan into a compelling form so that it will give you insights and a valuable tool in dealing with business relationships that will be very important to you. As your business continues to grow leave room to add: capable management, able financial control and consistent business focus. All of these factors will be necessary to show a healthy, stable and growing business.

Posted by: Paul Stanford

Building a sustainable small business

A few small businesses grow strongly and continue to develop and grow whilst sadly so many others either get stuck in a rut and stagnate or worse still just implode and die. So why is this? What makes one business able to grow and prosper whilst another withers and dies? Is it the product, the people or the service?

Well one thing I know having seen so many small businesses is that one common theme amongst those that survive and prosper well is that they have a clear vision and plan. So many businesses are run with the task of getting the day job done and not really developing the business as a business. All the effort is focussed on doing the tasks required to get the product or service sold and delivered. Very few small businesses have a clear vision, strategy and plan to get them where they want to be but those that do are the ones most likely to get there.

So how do you go about this? Well firstly you have to decide where do you want the business to get to? Try to create a picture in your mind of how you would like to see your business in the future. What does it look like? What clients does it have? When would you like it to look like this – is it 2 years, 5years or 10 years? How many staff are there?

The biggest single barrier I get form clients when asked about business planning is “well how can I possibly forecast what it will be?” Clearly none of us can for certain but we have to make estimates. Yes we will undoubtedly be wrong some of the time. But at least we will have set a benchmark and have set a goal to aim towards.

And if nothing else please remember that “any plan is better than no plan”

Paul Stanford is a Director of 4Momentum http://www.4momentum.co.uk. 4Momentum provides business advisory services to small businesses, charities and social enterprises primarily in Sussex. Services include advice on starting a business, growing and transforming a business and selling a business. Clients typically contract 4Momentum for short periods of an hour to long term consultancy over many months for advice on subjects such as mentoring, business planning, sales and marketing advice, bidding for contracts, raising finance and general business advice. Paul is approved by the UK Government to deliver business advice on their behalf through Business Link and is a member of the Institute of Business Consultants. Visit his blog at http://www.paulstanford.co.uk/blog

Copyright 2008 Paul Stanford