Starting a small business is no small decision. But despite the countless sacrifices and challenges small business owners face, an overwhelming 84 percent of small business owners would do it all over again!
When you tell friends and family you are about to take this step you will be inundated with advice (good and bad), most of this will be “write a business plan”, “you’ll need a business plan” – but do you really? Well, the answer is NO!
Don’t write a business plan instead build a business model, then go and test, review and adapt it until it works, you can do this in four easy steps:
- Determine what success is. Work out what success means for you and what business must generate in cold hard cash to achieve it. This is your ultimate success metric.
- Build a Business model. Build a model based on your vision for your business by answering a number of questions such as, Who is the customer? What is their problem? How will you solve it? What will you charge? What will it cost you?
- Test. Use the model to create the smallest business possible to sell your proposed product/service to customers you’ve identified. The only proof of a viable business is one where customers will actually pay for the product/service.
- Review and Adapt. Use the invaluable insight generated from testing to understand what works, what doesn’t and make the necessary changes, then test it again.
When the model works then scale-up to deliver your success criteria. This might be a part-time business, a full-time business, or even a some-time business depending on what you want to achieve.
Business planning belongs in established businesses not start ups
Business planning is an important tool for developing businesses. However, to be effective it needs real data to work from. A start-up operating under conditions of extreme uncertainty does not have this resource, until that data can be generated…
Start Small- Test – Review – Adapt – Scale
Because for a start-up, a plan based on guesswork can often prove fatal!