Small Business Development Center
At Chemeketa Center for Business & Industry
chemeketa students

Monthly Archives: March 2014

A road map to creating the all-important business plan

By Chemeketa SBDC

The most frequent questions we get at the Small Business Development Center are, “What is a business plan?” and “Do I need a business plan?”

The business plan can be used in many ways over the life of your business. It can provide you with the information you need to make critical decisions such as a “go” or “no-go” decision. It can function as a management tool to describe the way you intend to commit your resources and measure the success of your business. It can be the “selling tool” you use to convince your banker or investors of the worthiness of your ideas and of your business.

The business plan is the “road map” you’ve designed to make informed, strategic choices throughout the life of your business. It also should allow you to be flexible and respond to the changing needs of your market.

Developing a business plan is an intensive process and requires dedication, research and a commitment of time from you. So, let us look at a way to “begin the business plan.” For purposes of clarity and simplicity, concentrate on the following four major areas and the five questions assigned to each area:

I. The Business

• What specific product/service will I offer?

• What experience do I have in this field?

• What skills will I need that I do not have? Where/how will I get these skills?

• Specifically, who will perform what duties?

• Where will I locate my business? Why?

II. The Customers

• Who is my customer? (age, gender, income, occupation, location, etc.)

• Why will my customer buy my product/service?

• How often and in what quantity will my customer buy my product/service?

• How many potential customers are in my market area?

• How far is my customer willing to travel?

III. The Competition

• Who are my major competitors?

• What are their strengths? Weaknesses?

• Are the numbers of competitors growing?

• Have any gone out of business in the past two years? Why?

• Is demand expanding/shrinking? Why?

IV. The Financial Plan

• How will I fund my business? (Personal, loan, other.)

• What are my start up expenses?

• What are my projected sales for the first twelve months?

• What are my projected expenses for the first twelve months?

• What is my projected monthly profit?

 


Pick your outside management team wisely

By Chemeketa SBDC

Studies show that 3 out of 5 small businesses fail within the first year. Causes vary, but the primary reasons can usually be traced to insufficient management skills and poor planning. Paying attention to choosing the best advisors can significantly increase the odds of success. You will have at least four important “partners” — an attorney, an accountant, a banker and an insurance agent. These “partners” are your outside management team.

Step One: Make A List

Generate a list of potential partners in each of the four areas. Look for leads online, get personal referrals, get other business owner referrals, check with the local, state or national associations, check with suppliers, or vendors for your industry.

Step Two: Research

Establish reputability. Check with the state commission and/or regulatory board of the profession and find out if they have a referral and/or an ethics board. A person who does not follow the rules of his/her own profession may not handle your business properly either. The team member does not have to exclusively specialize in your exact business, but should have knowledge of your industry and special challenges facing small businesses.

Step Three: Interview

Once you have narrowed down the list, arrange for a personal consultation with each. (It is wise to ask whether they charge for the initial consultation – many do not.). Before the meeting, write down a clear statement of what you expect the person to do for your business. Be open and honest. State that you are in business (or starting a business) and are looking for an attorney (accountant, banker, insurance agent) to work with you over the life of your business. Some specifics to cover at a first interview:

• Accessibility – How quickly can they respond to your needs? Will it be two to three weeks before you can get an appointment? Is this acceptable to you?

• Costs – You won’t get exact costs but you should get a range of fees for the types of service/products you need.

• Experience – What percentage of clients in your industry does this specialist serve? If they have none, you probably don’t want to be at the beginning of the learning curve.

• Personal chemistry – Does this person listen to you? Does he/she present a variety of options and explain them to you? Are you comfortable working with him/her?

Look for people who have experience in small business. Look for partners who are willing to help you learn how to do much of the “up-front” work. Look for professionals who are willing to discuss costs associated with services. And finally, look for individuals who are willing to do an annual evaluation of the services you use/need.

This outside management team can make a big difference in your ability to minimize the risk and maximize the opportunities for your business success.


Keep motivation for your business growing

By Chemeketa SBDC

Small business owners are required to wear many hats, often at the same time. It is not uncommon for the business to drain you of energy and motivation, regardless of how much you enjoy it. When that happens, remember these tips to help you remain motivated in your work and living.

Find your passion. As you reflect ask yourself, “Why did I start my business in the first place?” When you tap into the real motivation that’s driving you, you’ll become more eager to take action. Staying focused on this purpose will feed your imagination, and drive and enthusiasm.

Appreciate your customers. Customers are the reason you have a business. If you empathize with them, understand why they seek out your products and services, your customers will notice, patronize you, and bring you more customers.

Set honest goals. A critical step to remaining motivated setting reasonable and achievable goals for yourself and your business. Create a list of goals that are both longer and short term. Then prominently display your short term list, along with an inspirational quote, in a place you can see them, so that you are reminded to strive for them daily.

Schedule your days logically. There are certain times of the day that you are going to always be more productive than other times. Get to know your most successful work schedule and then plan your days carefully to make the best use of that time. Once you establish a daily rhythm, you will stay happily motivated by your work.

Limit distractions. Distractions are one of the most problematic things when it comes to staying motivated. Keep your work area clean and organized, check your email, Facebook and other distracting sites on a specific schedule, with designated times to keep these manageable.

Treat your team with respect. No business grows without a team and the business owner is the team leader. At its simplest, a wise truism emphasizes that if you keep doing what you’ve always done, then you will keep getting what you’ve always gotten. If you want your business to grow, then you need to motivate it.


Three great surprises when you sign up for our new newsletters!

By Chemeketa SBDC

We are customizing the information we send to you based on your business needs.

To get up-to-date tips and information about upcoming SBDC events, follow this 4-step process:

1. Click this link
2. Enter your email address and click continue
3. Enter your first name and choose the list that best suits your business needs
4. Click Sign up

Sign up before March 25th to be entered to win one of the following three prizes:

1. Lunch with our director, Marcia Bagnall
2. $25 Amazon gift card
3. Collection of three great business books

Each month you will receive tips on topics relevant to your business needs (marketing, human resources, accounting, customers, management/leadership, etc.).