Most creatives probably tremble at the thought of creating a business plan, and most likely keep pushing it to the back burner until eventually they need one and throw something together that isn’t complete. I’m going to show you an easier way to go about creating your business plan, with basic steps that shouldn’t be too daunting, if you take them one at a time.
So, what is a business plan?
A business plan is meant to guide your business in the right direction and document your thoughts and ideas for your business. It’s a structural tool that can keep you, your employees and your business on the correct path. The first purpose of a business plan is to identify the aspirations of the business. Second, it’s needed to determine if these aspirations are feasible in the current economy. Third, your business plan is needed to outline the steps you will take to reach your main objective. When I create my business plans, I like to lay it all out there first, and then start to remove pieces that are irrelevant. Think of your business plan as writing a book; you’ve determined the ending, but now you need to fill in how you will reach that desired ending. You will want to be able to hand this business plan over to investors, peers, banks, attorneys, etc, so it’s important to keep a defined look. But, since we are creatives, don’t be afraid to play with the layout and colors, just don’t get too crazy! Keep it readable, clean and professional.
The basic elements of a business plan
1. Executive Summary – this is a one-page nutshell of your business. It includes the background behind your business, your mission, your vision and your tagline/message (if you have one). Keep it short and to the point. The rest of the business plan will go into much more detail.
2. Target Customers/Ideal Clients – this is where you will explain who your business is targeting, who your ideal clients are; their personalities, what they like to do, how old they are, their income level, how much they are willing to spend on your products and/or services. A survey is definitely a good idea to help gather information on your ideal client.
3. Competition/Competitive Advantage – this is where you will detail who your competitors are, what their strengths and weaknesses are, their business structure, and your competitive advantage, or what makes your idea better/different than theirs.
4. Human Resources – if needed, this is where you will document what staff you will need to run your business, what their skills need to be, how much experience, how much you can afford to pay them, etc. I did not need this section on my business plan, because I do not plan on having any staff in the near future. When the time comes, I will definitely add this section to my business plan. It would be wise to add an intern description here, if you plan on having an intern soon. This would layout the groundwork for what they would be responsible for.
5. Vendors/Supplies – this is where you will determine what outside sources will be needed to run your business. Are there any products that you must purchase on a weekly basis (jewelry supplies, paper) or do you use certain products for your clients (USB drives, cards, shipping, boxes/packaging materials)? Put all of these items here, their costs, what category they fall under (supplies, client gifts, packing/shipping, etc). You will need these for you financial plan later, but this section will detail each of the costs.
6. Marketing Plan – this is where you will show how to get your products and/or services in front of your ideal clients. What social media profiles are they on, are they bloggers, do they read certain blog, do they attend conferences? All of these things will help you figure out where, when and how to find your perfect customer. Your marketing plan is actually an entirely different document outside of your business plan, but laying out the general ideas here is great.
7. Operations – this is where you document how to get the job done in the most efficient way. What are your routines for your projects? What order do you follow from the first time you talk to the client/customer to when the client/customer has the final product delivered to them? Describe your operations as if you were teaching 5,000 people how to work at your company. Document everything.
8. Financial Projections – this is where you determine how much money you need to open/run your business and where you will get this money from. Most creative businesses are able to start their companies on smaller budgets, because they tend to not need real estate, and already own the large equipment needed to get the business going. Put your financial forecast on here; how many products do you want to sell, how much do each of your products cost, what is the yearly total? How much did you spend on supplies? What is your profit for the year? You want to be able to show an investor why and how your business is going to make money, so be realistic.
A visual representation
I recommend taking the business plan one item at a time. Schedule a time every Sunday where you tackle a part of the business plan. Or, if you are feeling really ambitious one night, tackle a couple of them. Either way, don’t stress yourself out. If you aren’t in a business planning mood that day, then don’t do it. Plan time when you can concentrate and your brain is able to think long-term.
- Write the business plan in your own voice. No need to be stuffy, you are a creative and the person you are presenting this business to will already know that. Creatives are great at creating their own unique voices and styles, so make sure you show that here.
- Keep your business plan versatile. It is very likely that it will change as your business grows, so be sure to document these changes.
- Stick to it! You should know your business plan inside and out, almost like a very long elevator pitch. When you make decisions for your business, you should take your business plan into account.