Yes, you do!
How will you know if you are achieving your business goals if you have not articulated those goals?
A good business plan guides you through each stage of starting and managing your business. You’ll use your plan like a GPS for how to structure, run, and grow your new business. It’s a way to think through and detail all the key elements of how your business will run.
How much will a business plan cost?
It doesn’t have to cost you anything! Typically a business plan can be put together by yourself and as you continue to read through this article, we will walk you through the steps of what to include. However, if you have no business training, you might want to get help from someone who has previous experience. It will help you understand your business better and allow you to plan and prepare with better data and more accuracy.
Tips for Creating Your Business Plan
The following is not a complete list for every business, but it will help you be better prepared for what can, and cannot, be predicted. When we provide financing to start-up businesses, we ask the owners to tell us about themselves and their business in point form:
What is your experience in your industry?
Your practical experience in the same, or a similar industry, not only gives you perspective but also promotes confidence from your investors and lenders.
What is your experience running a business?
- Provide any details as to a business that you have owned and operated.
- If you have never owned a business, The “next best” is managing someone else’s business to gain experience. Provide details as to what experience you may have in managing a business.
- Provide details as to how long you owned or managed these businesses.
How much of your own money are you investing in the business?
- Investors want to see that you are invested in your business.
- It gives confidence that you are serious about seeing the business through rough patches.
- It demonstrates that you have the discipline to save and stick with a plan.
How much debt and equity are you planning to raise from other people?
- Be realistic about amounts and the cost of capital.
- What type of return would you expect?
What products and/or services are you selling?
What differentiates your business?
Are you doing something different, such as offering a new product or delivering it in a new and unique way?
What is the market for your product/service?
Who are you selling to?
Who is your competition and what makes you different?
- The size of the entire market for what you sell as well as what your competition is doing will determine how much of the market you can realistically capture.
- This is another key input for your projections. Prospective investors will test the assumptions you use for the inputs to your projections. If your assumptions are off, most investors will dismiss your request “on the spot”.
Where will you get your customers/clients?
A business owner must understand how their business will acquire customers/clients and what it will cost to acquire them.
A high-level Income Statement and Cash Flow Projection
- You need to know how much cash you will generate and how much cash you will use.
- Knowing this you can then plan for other options to enforce cash liquidity, such as an equipment financing program or seeking a working capital loan.
When you are ready, share your plan with trusted people and allow them critique and provide input. Make changes as you learn more about the industry and your business.
While putting together a plan can be done on your own – explore hiring professionals if necessary. A lawyer, accountant, or expert in your market. They are the most likely to spot conditions, requirements, or other obstacles you may have missed. They can also guide you on setting up your company structure and books and introduce you to others who can help you with specific details.
We are here to help!
Healthcare financing is our passion, and we are just as passionate about helping you to grow your business. Contact us to share your plans, or to learn more about how an equipment financing program can help you to preserve your working capital, overcome multiple sales hurdles, and extend (or expand) your customer relationships.