Re: successful business plan

"Chris South" <[EMAIL PROTECTED]> wrote:
> Two guys, out of work from the IT bust, decide to go into
> business together. We need a business plan and looking
> for the best model possible.  Any suggestion where to turn?

1) Have you two thought about relocating?  Just because where you are
presently living isn't hiring doesn't mean other places are not.  For
example, in Madison, Wisconsin, we have practically no unemployment.  Anyone
that wants to work can find work ... and that includes IT people.

2) Avoid the Small Business Administration and SCORE like the plague.  Small
Business Development Centers live in the fairyland of academic and/or are
where those that couldn't hack it in the real world of business go to lick
their wounds.  SCORE is simply a bunch of grumpy old men waiting to die.

3) If you're serious about starting up your own business, do what I suggest
in my standard advice to all wannabe entrepreneurs.  It is as follows:

"What I recommend you do is determine what your sales territory is.  What's
its radius?  Double that and add a healthy 10% more distance then go and
talk to people out that distance that are in the same business you want to
start up.  Literally, drive there.  Do not do the following over the phone
or email or through snail mail.  Show up on their doorstep during the slow
time of their business day.  Tell them that you want to start up a similar
business at such-and-such a location and if they would consider you
competition.  If they say you would be, drive further away from your
proposed business location until you find a business that says you're not.
If you have to go to a different country, do so.

Once you find a business that says your two territories won't overlap, ask
if they wouldn't mind answering some questions about how to start and run a
business like theirs.  Play to their egos.  Have a list of questions written
out on notepad, but do NOT write down their answers.  Instead, bring a tape
recorder (yes, put it right out in the open ... no need for spyware ... and
besides it plays to their egos as their words are being treated as worthy of
being recorded) and concentrate on getting as much information out of them
as possible ... as well as picking up the other half of the answers they
give in body language.  If they say something you don't understand, speak up
and ask for clarification.  Let them wander off your list of questions since
where they wander to might be a place you never thought of asking questions
about and should have been.  But keep an eye on the questions you've written
down and try to ask them all before the interview concludes.  Of course,
always yield to customers that come in.

After you've interviewed one owner, go home and digest what was said.
Listen to the tape on your way home.  Think over it all.  Adjust your
business plan accordingly.  Adjust the questions on that notepad and on your
next free day, head off in another direction and do the same thing.  Try to
interview at least twenty businesses.  Interview the good, the bad, and the
ugly.  If you're lucky, you'll interview one that is going out of business
or has just went out of business so you can hear the dark side.  Likewise,
interview those businesses you think are bad.  Keep in mind that since
they're still in business, they are probably doing something right ... if
just being the only game in town for your products/services.

Share as you give.  Let them know what you think is a good idea.  Ask them
to read over your business plan right there before you.  Naturally, don't
leave a copy of it behind.  What one of these business persons is going to
tell you will be better than ALL the advice from all the business professors
on the face of the Earth.  Even from the ones that are going out of
business!

Don't forget these individuals after you interview them.  Send them a nice
thank-you snail mail letter for taking the time to answer your questions.
When your business opens, send them an invitation to come and see it.

And don't stop doing this after you open your business.  At least once a
month (if not once a week), do the above again.  In fact, you'll very likely
get more out of these interviews AFTER you open your business than before
you did.  After you open your business, you can really start to talk shop
since you're now currently running a shop.  This worked great for a
little-known starting-out pizza-parlor owner by the name of Tom Monaghan ...
the founder of Domino's Pizza.

Lastly, see if the good ones are willing to sit on your Board of Directors
(or Board of Advisors, if you don't want to give them any control power).
The rest of your Board of Directors should be made up of marketers.  Your
Board of Directors should help you keep the big picture in mind and an eye
on the future."

Additionally...

"Work on a business plan.  Regardless if you're going to get a business loan
or not.  A business plan forces you to think of all aspects of your
business.  Question every aspect of it.  Think how you can do it better,
cheaper, and faster.  Always remember to K.I.S.S. it.  Keep It Simple,
Smartass.  [Yes, I know it is usually said as "Keep It Simple, Stupid", but
it is the smartasses that make things more complex and difficult than they
need to be.]  And forever keep in mind that this is a business you're
starting and a business is to turn a profit.  It doesn't turn a profit and
it's just an expensive hobby of yours.  As for how much time to invest into
your business plan, studies have shown that those that work less than six
months on their business plan have a 90% failure rate.  Those that work six
months or more on their business plan have a 90% success rate.  And to start
off, get a copy of Michael Gerber's "The E-Myth".  It's real value is
helping you determine if you're a Technician, Manager, or Entrepreneur.  Be
honest with yourself and you'll save yourself a lot of grief."

And finally...

"Lastly, ONLY buy used.  Never buy anything that doesn't ABSOLUTELY have to
be new.  All it has to look like is being in good condition ... and not even
that if it's in the backroom and your customers will never see it.  Go to
sheriff auctions, business liquidation sales, garage sales, etc. and hunt
for bargains.  Find a place to store these bargains during this collection
phase.  Keep your start-up expenses as low as possible and buying used is
the best way to do this.  If you do buy something new, it should be with a
great deal of thought on why it has to be new and not used.  Again, if the
customers see it, it only needs to look to be in good condition and that's
it."

Good luck!

Scott Jensen
--
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