Creating a Money-Making Business Plan

In my experience (at least with the small businesses I’ve worked with), a business plan is often considered an “unimportant” waste of time, and many small business owners forego creating one.  The truth, however, is that a Business Plan can be incredibly beneficial for a business.  Not only can a business plan create a “Guide” for a company and its employees, but a good plan can also be taken to the bank in order to try and raise funding for a small business.  It can attract investors as well, and it can help focus a business owner’s vision in order to make the business as profitable as possible.

While there are tons of business plan models on the internet today, I can’t help but want to throw my own cap into the ring as well.  There are the business plans that a lot of general businesses use to satisfy mentors (or spouses), and then there are the types of business plans I’ve worked on, the type that big businesses pay tens of thousands of dollars (and hundreds of thousands) of dollars before they ever so much as sign a rental-lease agreement.

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The difference between a “General” Business Plan and a Business Plan that Makes Money comes down to one very important thing…Research.

When a small business owner includes research into a business plan, they are showing banks and investors that they are not going into a business venture blind.  A well-researched business plan shows forethought, logic, and realistic thinking.

Therefore, to create a business plan that will help raise money, a business should include the following elements in their business plan:

  1. The Mission Statement: In Bookkeeping Money-Saving Tip # 15: The Mission Statement, I discussed the importance of having a Mission Statement.  It is just as important to put that Mission Statement into the Business Plan.  Consider it the “Sales Pitch” of the Business that basically tells an investor the Business’s main goal.
  2. An Introduction:  The introduction is a fairly simple concept.  You create a page or two (or three) about the basic business concept.  What is the business selling?  If there is a location, where will that location be?  Will the business have an inventory  and if yes, where will that inventory be kept?
  3. Demographics:  Demographics are an excellent option to add to a business plan because it exhibits that you know who your ideal, targeted customers are and who they can be.  The demographics can help a business see where they should be focusing their marketing dollars, and how to theme their business to attract those ideal clients instead of creating a business that tries to “attract everyone.”  (Read Paint a Target on Your Customers for more information on how to do your own demographic analysis.)                                                             teamwork 2
  4. Competition Analysis:  You know the expression, “Keep your friends close, but your enemies closer”?  This expression is just as true in business as it is in life.  You should know what your enemies (ie, your competition) are doing in their businesses, because every choice they make could potentially harm or help your own business.  Therefore, creating a section that lists ALL of your local competition, as well as what products they are selling (that you may or may not sell as well) and what prices those products are marked at.  The more you know your competition, the more you will be able to create a business model that grinds theirs into the dust (should that be your wish).  Either way, it shows investors that you have a strategy to stay afloat despite what your competition is doing.
  5. CompassLocation Analysis:  A large majority of businesses draw their customers from within 10 miles of their location…TEN MILES. However, the more unique that business and its products are, the farther distance a customer is willing to travel in order to buy what that business is selling.  On the flip side, the less unique a business and its products are, the smaller the distance a customer is willing to travel to make a purchase.  For example – Disneyland has a very unique product; people are willing to fly from all over the world to experience the unique product that Disneyland offers (and that no one has been able to yet duplicate).  Another example – Souvenir shops.  Souvenir shops all sell the same products, and they all try to rent space where the tourists are.  The end result, tourists have so much choice on what souvenirs to buy and where to buy them, they don’t need to go far from their hotels to get what they want.  (In fact, they often buy from within the hotel).  So, in order to create a competent location analysis, you need to include the demographics and competition within YOUR 10-mile radius.  (You can read more about Location Analysis in my article entitled:  BOOKKEEPING MONEY-SAVING TIP #4: Analyze Your Business Location.)
  6. Marketing Plan: At this point, you should know your competition AND your customers, so you should have a pretty good idea how you can target your marketing campaign directly to your ideal customers.  Let your investors know as well.  Include a section just about marketing.
  7. The Dollars and Cents:  No investor is ever going to invest in a business that looks as if it is going to fold its doors as soon as it opens (unless that business is a non-profit).  Investors want to know that a business is going to make money and that they will recoup their initial deposit.  Therefore, the dollars and cents is one of the most important things to include in the Business Plan.  If the business is already open, then bankers would ask for a “Profit and Loss” Statement, as well as a “Balance Sheet.”  But whether the business is in operation or not, another excellent idea to include is the “Pro Formas” or basic monetary projections.  You can create a Budget and include it Graph line: up and down 1in the dollars and cents section, and you can project from that budget how you plan to make more money (or save money).  Calculate Budgets with Low Income-Expense Projections, Mid Range Income-Expense Projections, and High Income-Expense Projections.  That way, the investors will know that the business will still say afloat even in “Hard Economic Times.”
  8. An Executive Summary: The Executive Summary is basically the bare minimum summary of what the business has created plans to accomplish.  It takes the main points from each section, and presents them in a direct manner.  The Executive Summary is basically your “In Conclusion” statement, however, this summary is going to go at the BEGINNING of your Business Plan.  Most investors never really read past the Executive Summary (unless there is something in the Executive Summary that doesn’t make sense), so in essence, the Executive Summary can be the main section that makes or breaks your business plan’s goal:  to raise capital.   Therefore, make sure your Executive Summary has ALL the main items you want an investor to know, and put it right after your Business Plan’s Introduction.  Consider the rest a guide for the business and backup for the more thorough investors.

While I cannot guarantee that this business plan format will raise capital (after all, there are many other factors that investors take into account besides the business plan), I will say that a well written business plan can tip funding in a business owner’s favor.  You really have nothing to lose by creating a thorough, well-researched business plan – but you do have everything to gain.

The Email Subscription List

EmailOne of the best things that any business can do is to generate an Email List, especially, an Email SUBSCRIPTION List.  With an email list, bookkeepers can email invoices and sales receipts to customers.  Even better, the advertising department (or person) can use an Email Subscription List to send out advertisements to customers and thus generate additional sales.  If nothing else, having an email subscription list gives a business an opportunity to remind customers that they exist – that they have products that might interest the customer at any time of year, and to offer extra incentives for getting them to “come in” to the store.  Having an email list, you can save hundreds and thousands of dollars on advertising while still making sales.

To further drive this point home, I am going to use a quick example from the blogging world.  in the blogging world, there is a saying that is repeated over and over again.

That saying is:  “There’s money in the list.”

Some bloggers will even go so far as to say, “Your list is like an ATM machine.  When you want money, you go to your email list and send out a sales email, then Boom!  Instant Cash.” 

You see, in the blogging world, bloggers believe that you don’t need a thousand customers to have a profitable blogging business.  All you need is a few loyal customers that you can sell to again and again.

The same holds true for the business world.  When you need to up your sales, send out a “Special Sale Email” to your list and watch your bottom line take a jump.

So how do you go about building an email subscription list for your business?

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Here are five strategies to get you started: 

  1. Email Subscription Company:  If you have a website and you sell products online to customers all over the country, then the first thing you will want to build a successful subscription list is to subscribe to a company like Aweber or GetResponse.  These companies can help you subscribe and have your customers “Confirm” their subscriptions so that you aren’t marked as “Spam”.  As an added bonus, when subscribers “Confirm” their subscriptions, then you know that those people WANT to be contacted about your specials and other news.  Aweber and GetResponse handle all of those steps, and all you have to do is set it up, and then send out the occasional “Broadcast.”
  2. imageA Widget On Your BlogIf you have a blog or website, then you should have what is called a “Widget” on your blog that encourages people to join your email list.  It is a very simple way to capture email addresses, and you can make custom widgets from your Email Subscription Company.  If you don’t opt for the Email Subscription Company, then you can use a “Plug-In” from your blog site to create a list.  Our Custom Aweber widget looks like this (just to give you an idea):
  3. The Fishbowl:  This is a trick that is commonly used in the Mary Kay world to get leads and contacts.  The consultant basically puts out a fishbowl whenever they do a special event, then they encourage potential leads to fill out a mini-questionnaire with phone numbers and email addresses.  The same can be done for any business.  A simple $2 fishbowl right by the register, along with a mini-questionnaire about customer service or a request for email addresses is often all that is needed to get the email address.  Just make sure to put “Would you like to be notified by email about our specials?” on that min-survey so that you only email the people who are receptive to it.  (Another way to do this is to just have a “Guest Book” or sign up sheet near the register, and ask every customer if they would like to join your list as you make a sale.)  [ad#Leaderboard]
  4. The Free Lunch: Something that goes very well with the fishbowl is the “Free Lunch” prize.  Of course, if you aren’t a restaurant, then you don’t want to offer a free lunch, but you can offer anything from an “Instant Discount” to a monthly promotional product (that maybe you got for free from a vendor).  Basically, you’re offering a bribe for their contact information.  The nice part about this, however, is that they don’t have to fill out a form.  They simply small salad with limedrop in their business card.  It saves you a bit on printing out surveys, and still gets you the contacts.  Only downside is that you spend a little bit of money in order to give those monthly prizes, but the upside is a list you can sell to again and again.
  5. The “Freebie” Bribe:  For online sites, the “free lunch” is known as a “Freebie” and it is also a bribe that goes with “getting the contact info.”  This bribe usually comes in the form of a digital product, like an informative ebook (ie PDF file), an audio interview, an informative video, etc.  This kind of giveaway is fantastic for anyone who has a Subscription List with Aweber or GetResponse, especially because these companies will send out the freebies for you.  It is a huge timesaver, and is often worth the $20 fee to maintain.  (Again, remember that this is a chance for you to make a ton of money by emailing your customers over and over.)

Once you have your email list – whether its 20 people or 2,000 – you then begin making additional sales right away.  BUT, if you don’t go with a Company like Aweber or GetResponse, then you NEED to make sure you don’t become a Spammer.  Sending out mass emails can make the email companies mark you as Spammers, as can ignoring your readers requests to be removed from your email lists. To avoid these things without a list, read my old article entitled:  How to Send an Email Blast Without Getting Spam’d.

There are plenty of other ways to get email subscribers, but these are just a simple view that can be implemented immediately.

What are your favorite ways to get email subscribers?

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How to Brand Your Business

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The following is another excerpt from our newest eBook,“How To Start A Lucrative Virtual Bookkeeping Business,” which will be officially launched tomorrow – June 30th, 2010.  I realized that although the book is largely about starting a bookkeeping business, I’ve actually put some of my best business advice in the book as well.  Today is the last day to get it for 50% off, and be entered to win the 8GB iPod Touch, because once it’s launched the price will be $29.90.

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This is the E.T. Barton Brand Logo

In business, branding is putting your mark on everything you own.  Some brands are logos or pictures that are easily recognizable – like the Nike’s checkmark logo.  You see that logo and you immediately think, “running shoes.”  McDonald’s Golden Arches is another recognizable brand.  When you see that logo anywhere in the world, you immediately begin salivating for French fries and a Big Mac.  Some other obvious brands are the AT&T bars, the Wendy’s Fast Food red-haired girl, and the castle in the Disneyland logo.  People just have to see these logos and they know what they are, even if there are no words with that logo.  On the flip side, if you even say the words Disney, AT&T, Nike or McDonalds, those logos immediately pop into your head – largely because the name and logo are branded together.

So in case I’m not being clear enough, branding can be described as a logo, a catch phrase, a song, an environment, a reputation, or even a style, all melded into one solid, memorable element intended to “brand” a company into a customer’s mind.  Its purpose is to generate a feeling or a belief within a customer simply when they come into contact with the business or business product.  When used correctly, it catapults a company into the top echelons of their market.  And when you use it correctly, it can make you the Go-To Business in your area, your industry, and possibly even on the Internet.

Having done my spiel (i.e. monologue) about what branding is, let’s look at what you can do to brand your business, and therefore your product, so that you and your company will become memorable.  You want your brand to cross all channels of branding so that your business really sinks in with your clients.

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Now, if you already have a business name, some of the following information can still be of help to you.  However, if you don’t have a business name yet, consider ALL of the following things as a package before you choose a name.  If you think of the following items as interlinked elements, you will be much more successful at creating a brand then if you “winged it” right from the beginning (i.e. just dove into the deep end while holding your breath).  Here are the things you need to consider as a whole when creating your brand:

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  1. Naming Your Business: What name have you chosen for your business?  Does it relate to your name, your location, or your industry?   Is it an easy name to remember or a difficult one?  Is it easy to spell?  Where will it be located in a phone book or directory?
  2. Choosing a Logo: What image can you select that would represent your chosen business name, your industry, your office location, etc?  What pictures relate to the business name you have chosen?  Is it an attractive logo?  Is it easily recognizable, or does it look like another companies logo?  Is it a standard logo or a custom logo?
  3. Creating a Catch Phrase: Have you ever heard of an Elevator Pitch?  It’s a common phrase in the Mary Kay world, as well as the publishing world, because it’s based on the premise that you have to make an impression on your customer in less than 30 seconds.  You have to spout off something witty, funny, or philosophical in the time it takes to ride an elevator.  Therefore, thing about what phrase, expression, song or rhyme you can come up with and deliver in one sentence (for your business cards and website), or in one elevator ride. 
  4. Selecting a Website or Blog Domain: Is the business name you want available as a website domain name?  Is the domain name easy to spell?  Can you get the “.com” version of the title, or do you have to go with some less popular domain like “.org” or “.net?”  Is there any related names you can choose instead?
  5. Your Email Address and Signature: Once you choose your website, you want your email address to reference that website so that people can easily remember your address if they need to contact you.  For example, ETBarton@OneHourBookkeeper.com is easier for people to remember when finding me then etnsuz@yahoo.com, which is my personal email.  I usually answer people from the etnsuz address because it is my main address, but it is very difficult for people to remember that address, while the first one is much easier.  I’ll admit, it is a difficult name to remember, but when I created etnsuz, I was traveling with my friend Suzanne.  We created ETnSuz together so that anyone we met would remember us as a unit and write to us at one site – a yahoo site.  However, Suzanne never checked the email, and when our travels were over, it became my personal email.  I use etnsuz as my brand across all sorts of social networking sites, even though ETBarton is easier for people to remember.
  6. Your Name or Pen Name: For anyone who’s ever read the “About” section on our website, they know that I like to keep my thumb on the pulse of the publishing industry.  In fact, I am an active member of a national romance writers group (RWA), as well as a board member of my local chapter.  One of the funniest things about being in a romance writer’s group – besides getting to read a lot of kinky love scenes – is the names.  Everyone in the group has a pen name, including me, and some even have multiple pen names.  Obviously for me, my mother did not name me E.T., but Erica.  Yet, in my romance writer’s group, people know me as Talia Clare.  Both E.T. Barton and Talia Clare are brands I am creating for my ideal customers – which are my readers.  I write business articles, credit articles, and bookkeeping articles as E.T. Barton and I publish them in various places on the internet.  I write Historical Romance, Mainstream Romance, and Writing Advice articles as Talia Clare.  I also write my father’s memoirs under Erica Hamilton, my maiden name and his last name.  Therefore, when someone sees how I published any blog I write, they will know exactly what type of article that article is going to be.  In this way, you too can brand your personal name into a pen name or catch phrase of sorts that is easy for your customers to remember.  In the same way, you can use your name or nickname as a marketable brand.
  7. Your Mission Statement: You may think you don’t need a mission statement – and maybe you don’t – but you should at least have a goal in mind for your business.  What exactly is it that you are hoping to do?  Are you simply hoping to make money and be independent?  Or do you have a particular client-type in mind?  Are you looking to make yourself a niche-bookkeeper, someone who works in one particular industry…like construction, retail, restaurants, or maybe for used car lots.  If you can come up with at least one solid sentence that states what you hope to do with your company, you can use that as a part of your brand.

There are many other elements you can use to brand your company, but these 7 are the main ones that are easiest to manipulate.  By combining them together, you can create something memorable that will promote your business to even further success.

Once you do come up with a brand strategy, tell us what your brand is in the comments.  That way, you can inspire other people as well to create a brand that works for them.

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