The Role of a Business Plan and Business Model

By Sara Beam

@Sara_A_Beam

Are you thinking about starting your own business? Have you thought about writing a business plan? Have you thought about your business model? No? WELL YOU SHOULD!

A business plan is like the skeleton or road map of your business, a business model is how your create value for your business. Both are essential for success.

So lets talk about business plans, what does it do for your company?
Imagine going on a trip, somewhere you have never been before, and just going off your gut and not being able to use a map along the way when you get lost. Unfortunately so many entrepreneurs start their businesses off gut feelings and assumptions. Because of this, they get lost along the way, forget certain aspects of their business and sadly fail. This  infographic shows what the business failure rate over the years and in certain industries:
Staff-infograph_Startup-failNow as you can see, not having a business plan is not the only reason a business would fail, it could be a multitude of things, however, I believe that without a business plan your business is headed down the path for failure before it even starts.

A business plan does the following for a company:

  • Shows potential investors what they are about to invest in, they like to see that you know your stuff.
  • Gives you something to refer back too when you get bogged down in all the crazy stuff that comes with being an entrepreneur.
  • Helps you figure out before hand whether or not your business is actually feasible.
  • Communicates to your board of directors, your intentions.
  • A business plan is something that will open your eyes to the possibilities, the potential down falls or the unknowns of your business.

My very first piece of advice to anyone wanting to start a business is to write a business plan.

So how do you start writing a business plan? There are many different options:

  • Business Plan Pro – a software for writing a business plan
  • Ask a mentor/adviser for assistance
  • Take a course at a local college

Other helpful tips:

  • Don’t be afraid to share your business plan, but don’t share it with the world. This is your intellectual property so protect it.
  • If you share it with friends and family, don’t let their opinions and thoughts get in your way.
  • Edit, edit, edit and don’t be afraid to change things along the way.

Now get to writing that business plan, good luck!

Be a Skillful Sailor, Risk vs Reward

By Sara Beam

c677628a2cecbdcc36b5076724544247

Picture Source

Smooth seas never made a skillful sailor, these words could not be more true in the lives of entrepreneurs everywhere.

This picture brings me to the thought of with Risk comes Reward, but how do you define each?

Risk

is defined by Webster’s dictionary as a possibility of lose or injury

Reward

is defined by Webster’s dictionary as something that is given in return for good or evil done or received or that is offered or given for some service or attainment

So now that we know what each means, how can you tell if a risk is worth a reward?

These are a few questions you can ask yourself, that I have come up with, to evaluate the risk vs reward for an entrepreneur:

-If you took action, what would you be giving up to do so?

-Would you be willing to give that up for the end reward?

-Is the action/risk in line with your business plan? mission statement? ethical?

-Is it in line with your dream? your passions?

-How long will this risk effect you and your business?

-Will you be able to recover your assets quickly? do you have a plan to recover?

Ask yourself these questions before you jump right into a decision and really evaluate your answers.

Often times entrepreneurs are blinded by the reward of doing something and they do not think about the risks involved, it is very important that you always analyze a situation from all aspects before jumping into a decision.

However don’t let this scare you, in this blog post about risk vs reward for entrepreneurs, you will see that taking risk is a good thing as long as you do your research. The blog post talks about more often than not, if you do your research you will benefit from taking a risk, you just have to have the guts to do it!

Tell me your thoughts and opinions,

Do you think the risk is worth it?

Also, since we are sticking to a sailing theme today, I thought this Mark Twain quote was appropriate to leave you with:

“Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.” – Mark Twain

@Sara_A_Beam