Starting a New Business Part 7 - The Business Plan

The Business Plan
There are lots of templates available for different business plans and there are even sites where you can pick up specific examples, but I would recommend that you don't spend too much time selecting a template its your content that is important.  Some templates:

Enterprise Ireland Business Plan Template

Fingal County Enterprise Board Business Plan Template

Dublin City Enterprise Board Sample Business Plan

Business Planning Software Product Tool

You can also create your own, basic business plan sections would be:

• Executive Summary - Concise and interesting summary of the whole plan
• Company Description - what we do, how we do it, why we do it
• Product or Services - Product, Price, Place, Promotion, People
• Market Analysis - Size, Competitors, Target, Trend, SWOT Analysis
• Strategy and Implementation - Premises, equipment, operational plans 
• Marketing Plan - Advertisement, Web site plans, 
• Management Team - Management team, staff requirements, staff plans
• Financial Analysis - Profit and Loss, Cashflow, Balance Sheet, Assumptions

Once you have selected a template, for this purpose the elephant, then eat the elephant one bite at a time, it is amazing how the structure comes together when you take just one section and focus on its content and it does not have to be perfect first time.  This is an ongoing process do not expect to have your business plan written in a few days it will evolve with your business idea, your target market, your products, your prices evolve and before you know it you will be ready to write the executive summary, your one page pitch at the start of the document. 

It can be a time consuming process to get all of your creative ideas, facts, market analysis information into a structured document - The Skills Academy can help here - we meet with you once each week to gather your business information and we structure draft by draft your business plan to reflect your data.  This process is quicker and our business mentor can also keep you focussed on the end result and on areas of your business plan which may be weak.  

Call us on 01 4939433 or 085 1676143 to discuss, or email theskillsacademy@eircom.net

Starting a New Business Part 6 - Financial Equity, Grants and Loans

Financial support is a key requirement when starting up a new business and there are a number of schemes available to assist new and developing businesses in Ireland. 

Grants

The following list gives details of some bodies that may provide grants or other financial assistance, it is not the only options:

• County Enterprise Boards    County enterprise boards develop economic and entrepreneurial activity at city and county level.  They offer a variety of financial support package to assist the start-up, development and expansions of small businesses in the manufacturing and services sectors employing ten or less people.        
• Enterprise Ireland   Enterprise Ireland is the government agency responsible for the development and promotion of the business sector.  They can provide financial support towards the cost of establishing, growing your business.  The funding is typically a mix of equity and grant aid and is targeted at manufacturing or internationally trading services of companies intending to employ 10 to 249 employees.
• Seed Capital Scheme  An employee who leaves employment and invests by means of shares in a company, which carries on a new business, may claim a refund of income tax paid in previous years. An unemployed person may also avail of this facility.

Investors
There are many potential investors out there if you go looking family members, friends, companies who may offer investment.  The Irish Investment Network  is a service that matches entrepreneurs with angel investors. They do charge a fee to match your proposal with potential investors but this only gives you the contact you still need to do the work selling your idea to the investor.


Other Business Loans
There are companies out there that will also offer business loans albeit at a higher rate of interest than the banks an example of this would be First Step Micro Finance.  There is also an option to agree loans with family or friends.



Bank Business Loans
Take time to look around at the major bank lenders and to those promoting small business packages, I looked at AIB, Bank of Ireland and NIB.  Have your business plan ready, especially finance sections we covered in part 4,  to go through with them

• Some offer 2 years transaction free banking
• Some offer 2 years internet business banking
• Some offer discount vouchers to business tools
• European Investment bank loans 2.66%
• Standard business loans vary 3.85% to 4.15%
• Business overdraft facility average 8%

Starting a New Business Part 5 - Bit of a Distraction

Before we look at financial equity, grants and loans it's a good idea to examine the types of questions that investors or grant aids expect you to be able to answer.  Watching Dragons Den videos is a great way to look at those that were successful and WHY and those that failed and WHY.  

Using this information test your own business idea.
Do you have clear answers to some of their questions.
Watch lots of these videos and create yourself a checklist of potential questions.
Then practice, practice and practice your responses!

Dragons Den Ireland - The First Deal

Dragons Den Ireland - The First Refusal

Dragons Den Ireland - Bin Trasher

My Summary of watching these three videos:

• Know your market size and direction
• Know what business model are you using to make profit
• Compare and contrast to others on market
• Know the profile of customers
• Know your competitors
• What does the product cost you and what can you sell for - margin
• Distribution mechanism
• Marketing Strategy
• Simple ideas can go far

   

Starting a New Business Part 4 - Financial Projections

Finances where to start?  There is no point in jumping in looking for grants and loans and equity you first need to figure out the business projections.  So there is no getting away from producing projected profit and loss accounts, projected cash flow statements and projected balance sheets.   This can be a daunting step but if you keep your information simple your projections can be reached with a bit of work on your part and support from an accountant. 

Let's see if we can break this down into simple parts to get you started 

remember look at this month by month forward for at least two years.

Projected Profit and Loss Accounts

1. List all of your possible overheads, examples:
• Advertising
• Insurance
• Rent
• Wages and PRSI
• Phone bills
2. List your projected sales each month on products and services
3. List the cost to the company for the products you are selling

Guess what you now know your Gross Profit = Sales minus Cost of Sales and your Net Profit = Gross Profit minus Overheads - the start to your Projected Profit & Loss Accounts.

Projected Cash Flow

Being profitable does not necessarily mean being liquid. A company can fail because of a shortage of cash, even while profitable.For your company to survive the cash flow is a key component.  Cashflow is basically the movement of cash in and out of your business you will have to remember things like:

1. Bills have to be paid on time
2. You may have to pay your suppliers before you can sell your product
3. You may operate on credit sales where companies take 30 days to pay you
4. Cash sales are good for cash flow
5. Look month by month at receipts (money in )  and payments (money out)

Guess what you now now your Cash flow and can see your closing balance each month.  This can help you decide if you will require an overdraft facility for the initial few month of business.

Projected Balance Sheet

The balance sheet is a snap shot of your companies financial position at the end of its financial year.  It basically summarises the company assets, liabilities and net worth (shareholder equity).  Assets are what a company uses to operate its business, while its liabilities and equity are two sources that support these assets.

Assets = Liabilities + Shareholders' Equity

The balance sheet was the difficult one for me but when you have all your figures a few hours with an accountant can provide you with the necessary data for your business plan.

The Skills Academy can provide you with a mentor to get you started on the right financial track.

Starting a New Business Part 3 - Fun with Business Names and Strap Lines

I am going to jump in now with some fun stuff - your business name and your strap-line.

There is no real science to creating a great business name and strap line. Being witty, being hard hitting, playing around with metaphors, rhymes, alliteration, and so on, are all good ways to start off. 

                          Have fun with this process         

Use brainstorming techniques and throw out all the words that could possibly describe you and your business then look at all associated words and don't judge just get all the words out in front of you.  These can be used to create many different strap lines and variations on names. 

Playing around here does not have to cost you any money you just need creative thought and the vision of what you want your business to represent, its core values.

Many businesses use the rule of three - Aristotle wrote about it in his book Rhetroic.
 

Put simply it is that people tend to easily remember three things.  So maybe the strap line can be three words that people will remember:

• Beanz Meanz Heinz - Heinz Beans
• Stop, Look and Listen - Road Safety Authority
• Always Low Prices - Asda
• Every Little Helps - Tesco
• Just do it - Nike
• Finger lickin’ good - KFC
• Vorsprung durch Technik - Audi
• It's Miller Time - Miller
• I'm Lovin It - McDonalds

Then again many times businesses use just a visual logo, however your brand needs to be developed for people to recognise your logo.  If you did not know the brand then would you know what these companies represented - but their brand is so big we all know.

     

Have fun thinking of names, strap lines this process helps you really identify your business values and purpose.

The Skills Academy can provide you with a mentor to get you started on the right track.  

Starting a New Business Part 2 - Developing your Idea

You have an idea in fact you probably have lots of ideas, but how do you develop your idea into a business.  I have had many many business ideas and got quite excited about their possibilities - but the hard work is turning that idea into your vision your passion and your business.

To develop your idea you have to go through a process of deep examination:

• develop your idea, visualise what you see as the end result
• whats your mission your vision for the future
• ask yourself do I want this, is my lifestyle ready for this
• evaluate your idea ask yourself lots of questions why, what, where, why not
• look at who your potential customers are, what are their needs 
• how can I stand out from my competitors, do I have a unique selling point

This can be a difficult process but remember do not be put off by the fact that someone out there has already done something similar, if you have the passion and the vision you can get some of that market share.

Begin with the end in Mind - Stephen R Covey

If you don't make a conscious effort to visualize who you are and what you want in life, then you empower other people to make decisions for you.  And as I have often heard people say if your ladder is not leaning against the right wall, every step you take gets you to the wrong place faster.

• Visualize your direction and result
• Develop your mission statement
• Imagine what success feels like
• See a successful end
• Decide your value system
• Have goals

Set goals for developing your business idea and map out how you will achieve them.

The Skills Academy can provide you with a mentor to get you started on the right track. 

Starting a New Business Part 1 - Useful Information

This week The Skills Academy are going to look at many of the websites, information, books, skills that can be used when looking at starting your own business. In spite of the recent recession many individuals are determined to start out in their own business and some of these tools are of huge benefit.

Bank of Ireland have an excellent Business startup online training course - which is free. 


You can also go to your local library and rent out the book - Starting your own business - a workbook.
I got my copy at my local library.

The enterprise boards have many links, useful advice, business plan templates and case studies.

Don't get distracted from your business idea because of information overload, there is so much information around you can spend all your time reading what to do rather than actually doing it - I was that soldier - but having been through the experience I have now learnt the benefits of planning my business planning.

The Skills Academy can provide you with a mentor to get you started on the right track.