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The Commons Problems For Not Having a Business Plan and Why You Need One

I have been on countless Free business start-up courses, so I was quite clued up about the importance of creating one. However, the main point that all these courses stressed was that you needed a business plan if you were going to approach the banks or other organisations for financial assistant. The business plan would be my way of proving on paper how the business would be successful. The business plan would obviously include what the business was about, but most importantly to the investor that the business would work and that there is a demand in the market place for what I was offering, which would also include how much revenue I would generate based on research.

To be fair, if I was investing my hard earned cash into someone’s else business I would like to see what they are talking about in black and white, because some people have the gift of the gab but cannot deliver on what they say. So I understand the concept of needing a plan. However, a lot of start-up including myself was not looking for financial assistant from anybody, so I overlooked the importance of having a plan. Because I knew what the business was about and how much salary I wanted to earn each year I didn’t really see what the big deal would be if I just started without one.

Having a business plan does not guarantee success because they say that a high percentage of new businesses fail within the first year of trading. This could be due to many factors such as not making enough money, poor customer service, not keeping up with the latest trends or just simply trying to sell to the wrong target audience. On the other hand some businesses that have been around for many years and who started without a plan are now facing challenges within their business because they never documented how they would continue to achieve positive results when they left the company or even died. The business was then passed on to someone else to run who didn’t know what the business core values or vision was.

Writing a business plan can be pain staking boring and time consuming but having one in place comes with so many benefits which include:

· A document which outlines your vision.

· Helps you to be clear about where you are going and tells you if you are track.

· Obtain finances from the banks or investors

· Evidence that there is a need for your product and service and that people will pay for what you are offering.

· A document that can be given to someone else who will run the business just like how you envision it to be run if you left or passed away.

Last year I went to a business networking event and spoke to numerous business owners/entrepreneurs who said they were looking for more clients/customers. When I asked if they had a business plan 90% of them said that hadn’t. They obviously must have thought that just turning up to an event with a handful of business cards would be enough to generate more leads. How wrong could this be? Without a proper marketing strategy in place (which would be included in the business plan) their networking efforts could simply just be a day out of the office.

If you don’t have a completed draft business plan right now, I would encourage you to start creating one today. If you spend at least a couple of hours a week on each section of the plan, you will end up completing it in no time, plus you will be more clearer about the direction the business is heading!

Small Business Grants For Minority Business Owners

Setting up a business from the scratch can be a tough choice for enthusiastic entrepreneurs, especially if they fall in the minority section. Arranging for the funds and dealing with the expenses can be risky and daunting. The government has thus, initiated varied assistance programs for the minorities interested in small businesses, assisting and boosting them for their endeavor.

There are numerous plans, programs, monetary funding and aid for you under the Federal Assistance for Minorities’ Small Businesses. Go through the list and apply today to accomplish your dreams of having an independent career.

Financial Assistance for Minorities’ Small Business Owners

Firms and business owned by the minorities are offered financial aid in the form of loans, grants, counseling, assistance and training to help them run, expand and compete in the federal marketplace. The aid programs for enthusiastic minority business owners are listed below:

SBA 8(a) Business Development Program

The Business Development program helps firms to qualify by providing training workshops, counseling and technical and management guidance. The program also helps these businesses to compete in the federal marketplace by providing opportunities in the government contract space.

For program qualification some minority groups have already been categorized as economically and socially disadvantaged. These groups include:

• Native Americans

• African Americans

• Subcontinent Asian Americans

• Hispanic Americans and

• Asian pacific Americans

Apart from these groups, other individuals can also be considered for the program if they can provide substantial documentation and evidence suggesting racial discrimination and economic disadvantage.

SBA supports the certified firms by providing business development assistance. It also provides a Mentor-Protégé program which pairs the mentor firms with protégé firms so that mentor firms can provide assistance.

Small Business Administration’s Minority Owned Program

The SBA’s Minority Owned Program offers varied federal resources for the success and growth of your business. It helps in the initiation, financing for the startup, strategically developing and then the overall growth of business.

SBA’s HubZone Program

The program is engaged in promoting for the economic development and growth of underdeveloped areas through the expansion of small businesses in these specific sectors. It encourages in attaining more of federal opportunities and support if your business in located in these distressed areas.

Business Loans

Eligible women business owners, recognized by the government, can receive low-interest loans by SBA, provided they belong to the minority section. The loans are attainable even with bad credit history report and can be repaid after a long duration of time. Enthusiastic minority women can now avail the financial assistance for their startups.

USDA Grant

The U.S. Department of Agriculture (USDA) offers funding to grantees up to $150,000 in rural sectors through the Rural Business Opportunity Grant. The funds facilitate in providing technical and training assistance to nonprofit corporations and cooperatives for their business development and growth.

Georgia-Pacific Grant

The program, initiated in 1927, helps minorities’ small businesses to set off and expand eventually through the funding program. The grant program usually funds business plans, ventures or projects for entrepreneurship that benefits the lives of the community. Minority business owners with these criteria qualify for this program.

Amber Foundation Grant

The program is targeted towards women entrepreneurs seeking to venture into the business world and accomplish their dreams. Commenced in 1998, the program offers funds to commemorate the death of a 19 year old woman who could not fulfill her aspirations. Amounts ranging from $500 to $1,500 are granted to women from different cultural groups to cover the expenses of starting and setting up a business.

In addition to small business startup grants, minority business owners can also look for assistance from their individual state governments, nonprofit organizations and government accredited agencies to kick-start their business. Make the endeavor with the finances available for a successful venture.

Your Dream or Your Nightmare: Successful Small Business Development

This is supposed to be your dream come true. Finally, your business is up and running. You’re breathing life into your big idea. You no longer have to answer to the boss because you are the boss. You’re working your business plan. You’re finding your path to financial freedom. You know your target market and you’re finding new clients. You have positive feedback on your products and services. You’re developing new technology. You’re finding additional funding. You’ve finally found the right team to work with. You have the right workspace. You can feel the exciting energy when you walk into your business each morning.

Yes, there are bumps in the road, but you’re learning to be resourceful and to move through, over or around them. Each day is long and brings surprising new challenges, but you’re gaining momentum along with new customers and increased revenue. You learn to balance the ups and downs of the market and business challenges. You learn to pace yourself. But as time passes and you analyze your business growth, you see that the trend line isn’t moving upward, it’s declining. Your plans aren’t working out as you expected. At this rate, you’re not sure how long you can continue operating. You realize that as passionate as you are about the business, the problems are overwhelming you. Your dream is turning into a nightmare.

Why Small Businesses Fail

In spite of your best efforts, your business is succumbing to one of the top ten reasons that businesses fail. (Non-prioritized list according to Jay Goltz, The New York Times, January 5, 2011).

1. Owners who cannot get out of their own way.

2. Operational inefficiencies.

3. Dysfunctional management.

4. The lack of a succession plan.

5. The math just doesn’t work.

6. Out-of-control growth.

7. Poor accounting.

8. Lack of a cash cushion.

9. Operational mediocrity.

10. A declining market.

In particular, the first four reasons are linked to how you develop and structure your business. Small business owners who seek expert advice in running their business have a better shot at overcoming these pitfalls. To address them, here are eight tips for successful small business development that are critical components for you as a small business owner.

Tips for Success

1. Be The Leader – Be purposeful about leading and designing your company for success. If you think you know everything necessary for success, and close your mind to new and different ideas, you AND your business will stop growing. Instead, find a business mentor, seek customer feedback, attend workshops, read books, keep a bias for learning and set the example for your team to learn.

2. Manage Your Passion – Don’t let your passion manage you. Just because you love shoes, doesn’t mean you should open a shoe store. Make sure you’ve identified the void in the marketplace that your business can fill; or the need that you’re satisfying. Make sure you know your target market, and understand what they’re willing to pay and do for your product or service. Most importantly, assess your financial resources. There are too many stories of entrepreneurs who had what seemed to be a great idea, but got over their heads into debt, and tumbled into bankruptcy.

3. Increase Business Value – Your greatest business value resides in your people, processes, products/services, technology and customer relationships. It’s important to understand the right combination and how you best provide it to others. Then preserve and improve on that. For instance, the fact that you guarantee same-day service, and thorough clean up by your service technicians could be your greatest value. But to provide that, you must have a sufficient number of trained technicians on call at all times; and a reliable 24/7 contact and communication process.

4. Build Your Culture – This is the DNA of your business. Whenever a client comes in contact with your business, whether face-to-face, by phone, by email, or by social media, they gain nuances and impressions that determine whether they want to continue to engage with you again. Set the tone by treating your employees the way that you want them to treat your customers. Make customer service a priority. Create an environment that is welcoming and comfortable. Ensure that the style or décor will appeal to your target market, and effectively represent your product or service.

5. Position Your Family – Do you have a family business or a business family? Does your business exist as a place to employ your family or a place to serve your clients? The wonderful family members who helped you to get started may need to evolve to different supporting roles as the business grows, to ensure that you have the most qualified people in the positions where they can perform well.

6. Develop Your Successor – Your role in founding your business is important, but none of us are irreplaceable. Constantly develop others to learn the business, and make leadership decisions based on who and what will add value to the business. When the business has greater value to your clients, you will benefit from that.

7. Understand Business Roles – Roles and responsibilities must shift as the business grows and/or the market shifts. Be flexible, clarify responsibilities, and hold the right people accountable.

8. Document Business Processes – Continually review and update your operating processes to ensure maximum efficiencies. Involve the employees who actually perform the work, and find ways to eliminate waste, rework and scrap because they all result in lost money.

So take time now to plan for your business. Becoming a small business owner is a lot like falling in love. Once you fall madly in love with a seemingly fantastic person, it’s more difficult to recognize your areas of incompatibility. Similarly, once you have a seemingly fantastic business idea that you’re passionate about, it’s more difficult to see the potential pitfalls to your success. Plan with a clear head, and a focus on how you can serve others.