I wrote my own for my firm Lemongrass Consulting.  I read books and figured out the sales forecast; and financial expenses and revenue projections.  When my firm became Small Business Administration (SBA) 8a certified, I wrote our SBA Form 1010c Business Plan.

I am a strategic planner and AICP certified city planner.  In the 1990s, I actually worked as a city planner managing transportation improvement programs, capital improvement programs, and comprehensive development plans.  These are mega project oriented plans.  I coordinated the City of Atlanta’s 1997 Comprehensive Development Plan (CDP) and its accompanying Capital Improvement Program (CIP) representing 400 projects valued at $3.6 Billion.  I also managed the Georgia Department of Transportation (GDOT) Transportation [Environmental] Enhancement Activities (TEA) program was 90 proposed projects valued at $62 Million.

What I learned as a city planner is that plans can be extremely pie in the sky.  They can be pretty elaborate wish lists to appease political constituents.  These types of plans rarely get implemented because there will never be enough money to fund the proposed projects.

As a business owner, I learned that plans need to be much more realistic and broken down into doable action items that result in real return on investment (ROI) and generate real revenue so that real paychecks can be drawn.

Here are some tips:

(1)     Your sales forecast is just that – a forecast.  It is not carved in stone and will likely not match actual sales.  Start with reasonable assumptions and adjust as reality sets in.  Your actual sales may be less.  This is usually the case.  However, you may have great fortune and your actual sales may surpass your forecasted sales.

(2)     If after regular, periodic, scheduled reviews, your actual sales are significantly lower than your forecast, desired sales, then you may want to re-engineer your business model, get sales coaching help, or take some other course of action to increase sales.

(3)     Start ups should start with short term business plans which depicts your sales goals and anticipated expenses in short quarterly increments of 3 months, 6 months, 9 months, and 12 months.

(4)     For the purpose of having a long term vision, create a 3 or 5 year vision with annual sales goals and anticipated expenses.

(5)     The business plan goals should be used to influence your operational decisions as you conduct business from day to day.

Here is how No. 5 would work.  You would simply put a summary of your business plan sales forecast and anticipated budgeted expenses on your desk as a daily constant reminder of where to drive your ship.  Take this summary financial operating plan and gage your actual performance against it.  For example, if you need to decide whether or not to spend money to hire a staff person or consultant; or to order certain equipment or supplies, then look over at your business plan first.  Ask yourself whether the proposed expense is in alignment with your plan.  Ask yourself whether taking on this particular new consulting project or product sales order will catapult you any closer to your sales and profit goals.

Some may argue that business plans should not be the focus of your operations.  I beg to differ.  I think the plan needs to be right in front of you.  In my opinion, it is akin to a simple daily “things to do” list.  For example, on any given day you may list out that you need to go to the post office, to the office supply store, to a few meetings, send some emails, do some data entries, etc.  This is your road map.  If you were able to get it all done, you would have a sense of accomplishment.

A business plan is no different.  You look over at your business plan and you let it guide and drive your business decisions so that you can achieve real results.

Another thing I learned as a city planner is that it is important to get buy-in.  In order to decide whether or not to include a project in a CDP and its accompanying CIP, city planning professionals hold public meetings to get feedback. Business owners should also get input from individuals they may need buy-in from.  Internally, they should make sure the business leadership team has an opportunity to comment on budget and sales projections.  This may be a great way to get a dose of reality from differing perspectives.  Externally, business owners can turn to nonprofit organizations or other consultants that help small businesses and have dealt with bankers that loan to small businesses.

Cash is Queen!  If you are starting a business, you may want to save first.  I heard and read two different schools of thoughts when I first started years ago.  Some advocate that you do not need money to get started and to make money.  That may prove true for some.  But, I can tell you there are very real expenses if you want to go about being in business the right, professional way: phone, fax, website hosting, graphics design, office supplies, domain name registration, taxes.  The taxes can crush you.

This leads us to the second school of thought which is save first.  I have heard that it is best to save 3 months, 6 months or 1 year of your business operating expenses before you launch.  The idea is to not be dependent on sales at all.  But rather, have savings to invest in your business venture.

If I could do it over, I would have saved extensively while building my network of relationships and client base.  Of course, hindsight is 20:20.

I was in the City of Atlanta’s Watershed Department Small Business Development Program.  The accounting trainer advised us to bank our customer payments and cut ourselves pay checks.  But, she advised that we should put our pay checks away in a drawer and forget about them.  This will build up cash in your business bank account and help you to earn creditability so that you can later get lines of credit and loans.  Well, what if you were a single mom? What if you actually need to cash that pay check?  I am a single mom and this tactic would have never worked for me.

If you make it without planning ahead and implementing your plans, you are probably making it on pure luck.  We have all heard people state that business success is 90% luck.  Well, it really does not have to be.  We can choose to draft and work a plan, or we choose to leave our futures in the hand of Lady Luck.

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