There are several different formats for a business plan. Most advice you will find about business plans are in situations where you are seeking a loan or investors. The business plans for these purposes are often 20 to 30 pages plus attachments. Given this challenge it is not surprising that most small business owners do not have a written business plan.
If you are a sole proprietor here are the items you need to construct a simple business plan.
Now carefully hand items 1,2 and 4 to number 7. Then pick up item 5 and place yourself with number 7 on item 6.
While it is true you would need a 'real' business plan if you are seeking financing, there is not reason you should not try to create a simple plan. If you need to create a 'real' business plan in the future, this simple plan will have you headed in the right direction. There are even software programs you can purchase to help you in that situation.
In a few sentences put down why you are in business and what you are trying to accomplish.
List the four or five values that are most important to you, e.g. Honesty, Hard Work. Next to each item write a brief definition of what that word means to you.
Write down a paragraph about each of these questions.
What are your STRENGTHS. What are the strengths of your business. What are the strengths of your business partners and employees.
What are your WEAKNESSES. What are the skills you lack. What is hindering your business. What skill sets do your employees lack.
What are your OPPORTUNITIES. What factors are making this a good business to be in. What positive trends do you see in the future. What economic and demographic factors will help your business grow and profit.
What are your THREATS. What outside factors are hindering your business. Is competition tough. Are customer expectations high. Are changes in technology changing how things are done.
If you got this far your well ahead of most proprietors. Take a break. Let some of this activity sink in till next week.
If your bookkeeping is computerized this should be pretty quick. Print out a current Balance Sheet and a current Income Statement. If you are not computerized then your Balance Sheet would be a list of all your Assets and a list of all your liabilities. Your income statement would be a total of your receipts and a categorized list of your expenses.
You could also try to create pro forma statements. But we're trying to keep it simple.
Review your financials. Are things as you expected. Do you see any expenses that are out of line. Is your revenue what you thought it would be.
Who are your customers. What are their needs. What is their demographic profile. How can you best reach them.
Who are your competitors. What are their strengths and weaknesses.
What makes your product or service better than your competitor's.
What makes you better able to meet the needs of your customers.
You have gotten pretty far. It might be time to have some of these notes typed up and reviewed.
Create a force field analysis. Make two columns. On one column write the negative factors or restraining forces that are limiting your growth or minimizing your profitability. On the other column list the positive factors or driving forces that are helping you to achieve your goals.
List some stategies to eliminate or reduce restraining forces. List some strategies to magnify or accelerate some of the driving forces.
Write down a list of five long term goals for your business.
Write down a list of short term goals that will help you reach your long term goals.
Create a list of action steps. These are the things you must actually do to reach your goals.
Remember to make your goals S.M.A.R.T. - Specific, Measurable, Achievable, Realistic, and Time Specific.
There is a lot more you could do. But now you have a very good working document. Get it typed up. Review it from time to time. Change it slightly perhaps twice per year.
Having a business plan, even a simple one, will assist you in making decisions. It will also clarify why you are in business in the first place.