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Small Business 101: Part II, Writing an Effective Business Plan

In Part I of the series, we reviewed some of the most common business structures to get our brains geared in the right direction. Now, if you’ll remember, I will be approaching this as if I were planning to start a business as consultants in the entertainment and technology industry. Chances are that unless you have a specific and well-developed idea, product, or service in mind, that you’re basically taking a shot in the dark.

What is a business plan?

Every business should have a business plan, even if it has operated thus far without one. It’s not so much about the document as it is about the thought process and critical thinking that goes on during the writing phase. A business plan is meant to help you focus your ideas, goals, think more effectively about your capital, and prepare for future obstacles as well as anticipate opportunities. You need to determine your priorities, distinguish your constraints, and optimize the tools at hand.

But I still haven’t provided a definition.

See your business plan as a dynamic framework for the business. Your business plan will include a company description, background on key members of your management and execution teams, cover your business strategy and implementation, market analysis, a financial plan, and an executive summary.

Here’s how I the plan for my company would look (the following has benefited from Entrepreneur’s wisdom):

EXECUTIVE SUMMARY

Introduction

Entertainment Solutions Consulting (ESC) is a young consulting firm dedicated to serving the needs of a rapidly growing industry in the full range of the business cycle. With a knowledgeable staff of a wide variety of strengths collectively working together to assist clients, ESC will be able to offer a more balanced quality service than many of its competitors.

The Company

Entertainment Solutions Consulting consists of eight business consultants, with each specializing in a particular discipline, including business development, sales, marketing, management, technology, human resources, metrics, etc.

ESC will target the mid-sized to large businesses which dominate the biggest portions of the market though the firm will offer services for start-up companies as well with the intentions of maintaining these relationships over the long term.

ESC will be established as a California based LLC with five principal partners, each of whom owns a 20% share in the company. Mr. Ash Ketchum brings in experience in the arenas of gaming, hunting, and tracking and has held various titles including Pokemon Master and honorary Elite Four member. Mr. Steve Jobs is relatively new to the scene, but has made a modest name for himself through his work at a humble company called Apple Computer, Inc. Mr. John Smith brings with him a lifetime of gaming and video game development, etc.

The Market

The entertainment industry is one of the biggest industries in existence and the term requires some elaboration. Entertainment Solutions Consulting will focus primarily on video games, films, board games and other interactive games, eBooks, and several other consumer-side technologically-relevant products.

Talk about the competition and what differentiates your business from them, and even mention your competitors specifically.

Financial

Each of the five partners will provide $20,000 which will cover the bulk of the start-up expenses. The rest of the financing will come from the Bank of America 10-year loan in the amount of $100,000. Combined, these funds will be sufficient to cover the company’s expenses throughout the first year of operations, which is the most critical from the cash flow standpoint.

MISSION STATEMENT

Entertainment Solutions Consulting aims to offer comprehensive consulting services. ESC will focus on providing personal and specialized services to meet each client’s specific entertainment needs.

KEYS TO SUCCESS

ESC’s keys to success include:

  1. A group of professionals with a broad range of specialty areas that complement each other.
  2. A high level of experience in these specialty areas.
  3. A team approach on most consulting projects.
  4. Many business contacts among the consultant group.

COMPANY SUMMARY

Entertainment Solutions Consulting is startup firm which will focus on providing a wide range of business consulting services to large and established companies as well as those in the earlier stages of operations. ESC is a team of eight business consultants. Each consultant specializes in a particular discipline including business development, sales, marketing, management, technology, human resources, metrics, etc.

COMPANY OWNERSHIP

Entertainment Solutions Consulting was registered as a California LLC, equally owned by…

START-UP SUMMARY

Co-owners Edris, Ash Ketchum, Steve Jobs, … and … will each provide $20,000 investments which will cover the bulk of start-up expenses. The rest of the financing will come from the Bank of America 10-year loan in the amount of $100,000. Combined, these funds will be sufficient to cover the company’s expenses throughout the first year of operations, which is the most critical from the cash flow standpoint.

This is where you insert a bar or some other type of graph broken up by expenses, assets, investments, and loans. Then include an excel balance sheet for your business.

SERVICE DESCRIPTION

Entertainment Solutions Consulting offers a list of services or business owners to choose from, depending on their business needs. Services include business plan preparation, marketing campaigns, product development, design services, IT consulting, e-commerce consulting services, operation advising, etc.

ESC is flexible, working with its clients in the fashion preferred by the client, be it on-site, remotely or a combination of both. ESC typically works on a project in a team fashion to assist the client in all areas of the business simultaneously. This allows for all involved parties to be in sync in terms of understanding the interconnections of all functional areas of the business.

SALES FORECAST – include graphs of your forecasting.

MANAGEMENT TEAM – Go over team’s bios and their individual past accomplishments.

BREAK-EVEN ANALYSIS

ESC’s Break-even Analysis is based on the average of the first-year figures for total sales by salaries, bonuses costs, and all other operating expenses. These are presented as per-unit revenue, per-unit cost, and fixed costs. These conservative assumptions make for a more accurate estimate of real risk. Such analysis shows that ESC will break-even by the x month of operations.

Now, if after reading this, you’re determined to write up your own expanded business plan, click through this link here and follow the directions. You’re at a crossroads now, and I promise you that this initial preparation stage of your efforts could make or break the success of your businesses’ future.

I combined or completely omitted several very important steps all into one in this post. Steps such as finding start up money, naming your business, determining your business structure (though the last post cover this), obtaining your license/permits, determining your business location, obtaining insurance, creating an accounting system, etc.

But like I’ve said before, there’s a method to my madness. Now that you’ve got in your possession either a complete business proposal, a rough outline, or even just an idea of what you’re up against, we can backtrack and go over some of the specific behind these steps.

Some more business plan templates:

Catering and ballroom rental business.

Real estate brokerage

Athletic Shoe Store Franchise

Hair and Beauty Salon

Internet Cafe

Web Design Business

 
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Posted by on February 14, 2011 in Small Business 101

 

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Small Business 101: Introduction

Today begins part 1 of a series of posts dedicated towards helping you start your own business: Small Business 101. Just the thought of starting your own business can be overwhelming. Well I’m glad you’re reading this because I can tell you right now that it doesn’t have to be like that. I will break up the steps for your reading convenience; go at your own pace.

I predict that this will span beyond 8 posts, with each entry covering a new step or topic. While I recommend you go through them in the sequence I have myself ordered, feel free to browse through the titles and content and decide where you might need some help and throw out whatever doesn’t apply to you.

As an example, I will approach the series as though I am considering starting a consulting firm in entertainment and technology.

And I almost forgot to mention: even if you have no intention of starting your own business any time soon, I highly recommend you keep up with the series. Who knows, you might change your mind—and a little bit of learning never hurt anyone (disclaimer!).

I’ll be updating the below list with every new post, just click on the link to be taken to that page:

Table of Contents

  1. Part I, Business Structures
  2. Part II, Writing an Effective Business Plan
 
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Posted by on January 12, 2011 in Small Business 101

 

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Mobile Business Apps

Take care not to underestimate the potential value that mobile business apps have to offer. From Apple’s iPhone to Google’s Android to the Blackberry, and so on and so forth, there is an already huge – and exponentially increasing – demand for new and innovative apps.

Needless to say, this demand has been met by thousands upon thousands of eager developers; many of the brightest minds in software today have even entered the arena to try their luck. Unfortunately, however, it seems that for every positive app added to the market, you will have to sift through four other (relatively) useless ones. Not to say that the enormous supply is necessarily a bad thing, it’s just that each individual has different appetites, but the question arises: how does one find those apps tailored to their own needs?

Here are some useful apps I discovered through the combined might of the magazine Entrepreneur, word of mouth, and the Apple Store that I recommend you check out:

  1. Quickoffice Connect Mobile Suite: Microsoft Office productivity suite with access to cloud services. This app allows you to work with documents and spreadsheets on the go (open, edit, and share). iPhone, Android. $10 approx.
  2. BAII Plus Financial Calculator: allows you to calculate cash-flow analysis, amortization schedules, depreciation, and other financial metrics as well as basic trig and logarithmic functions. iPhone. $15 approx.
  3. Inertrak: as someone who freelances a lot of different projects and has multiple clients/jobs at any single time, I see the value of this app and recommend it to anyone in a similar position. It’s a task management tool geared towards entrepreneurs with multiple projects and assignments. It has various functions, from determining how you allocate your time (for those of us who struggle with time management) to calculating how you’re billing your clients and with different rates. As easy to use as any stopwatch. iPhone. $5 approx.
  4. Babelingo: the international businessman’s best friend. This app translates words and phrases in eleven international languages. Pure and simple. iPhone. $2 approx.
  5. Beat the Traffic: the usefulness of this app is not limited to the realm of business, but should prove helpful on any car commuter’s day-to-day with it’s live traffic monitoring. Also covers weather. One of its pitfalls, however, is how it’s limited to about 100-150 U.S. and Canadian cities. But who are you to turn down free software? iPhone, Blackberry. $0.
  6. Poynt: I already know a lot of people who use this app, so this might be old news, but this app poynts you to retailers, restaurants, gas stations, etc. all around your immediate area in real time. Also gives you directions through Google Maps. iPhone, Android, Blackberry. $0.
  7. JuiceDefender: disables mobile connectivity and other battery consuming features until you need them again. For those having trouble with the allegedly terrible battery life inherent to Google’s otherwise impressive smart phone. Android. $0.
  8. LinkedIn: I’m a big fan of LinkedIn, the Facebook of the professional world. Access your profile while on-the-go for free. Enough said. iPhone, BlackBerry, Palm webOS. $0.
  9. Easy Tie: I’m half joking with my inclusion of this app, but it really can come into use for some. To quote the Android marketplace, “Easy Tie is an app that shows you step-by-step how to tie a necktie. Knots included: -Simple Knot -Double K. -Small K. -Half Windsor K. -Windsor K…” and more 🙂 Android. $0.
  10. Dictionary of Business Terms: regular updates, useful to all, even the casual consumer. Jump on this if you frequently find yourself in compromising (embarrassing) situations where access to such a reference would help. BlackBerry: $3, iPhone: $1.

Click here for a pretty good list of 101 of the best Android apps.

Time shares it’s thoughts on the best iTunes apps.

CNN’s list of the 10 dumbest iPhone apps around.

For an article concerning the future of apps, click here.

I apologize for not including apps for a wider variety of phones, but feel free to comment with your own favorite apps 🙂

Source: “The Smartphone Gets Smarter” by Entrepreneur‘s Jason Ankeny.

 
4 Comments

Posted by on November 17, 2010 in Business/Technology

 

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