a business is the American Dream – thousands
of people have done it very successfully. Unfortunately, thousands
failed. Some studies indicate that 50% of business startups close
within their first 4 years. And most of those close during the
first 1 to 2 years (1).
simple reality is that improved planning can increase the success
rate dramatically, whether you are a start up or have been in
business for some time.
Author Michael Ames, in his book Small Business Management, lists
the following ten reasons for business failure:
• Lack of experience
• Insufficient capital
• Poor location
• Poor inventory management
• Over-investment in fixed assets
• Poor credit arrangements
• Personal use of business funds
• Unexpected growth
• Low sales
of these shortcomings indicate a lack of planning and preparation.
Planning for these situations and many more are researched and
documented in great detail during the writing of a comprehensive
business plan, a document that should be completed in total prior
to any business startup. If you're up and running already, and
don't have a business plan, you can still get to work writing
one that will keep you in business. Let the Small Business Development
Center help you.
A business plan is exceptionally important for two reasons:
1. It is the roadmap for achieving success, and
2. It is a basic requirement for securing funding.
to the Small Business Administration (SBA), “A
business plan precisely defines your business, identifies your
goals, and serves as your firms resume. It helps you allocate resources
properly, handle unforeseen complications, and make the right decisions.
is no substitute for critically examining the whether your venture
can produce acceptable levels of profit and cash flow. Equally
important is your identifying, understanding and addressing all
the associated risks and barriers.
Writing an excellent business plan requires a great deal of time
and effort, but help is available. Templates can be found by visiting
the library, performing an online search, or calling the local
Small Business Development Center at 815.599.3654.
The SBDC also provides self-help seminars and private
counseling to assist document development. – at no cost. Again call
me at 815.599-3654 or firstname.lastname@example.org. Set an appointment – emails
and phone calls are returned with 24 hours.
More potentially expensive: there are also consultants who specialize
in creating customized business plans.
Owning a business can be a very satisfying and rewarding experience.
Writing a comprehensive, pre-venture business plan will greatly
enhance your possibilities for success!
Russ Simpson, SBDC Coordinator
Illinois Small Business Development Center at Highland Community
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