Brian's Introduction

By Brian Walsh (Founder & CEO of Entrepreneur.co.za)

We hear about business plans all the time when referring to entrepreneurship. What amazes me though, is that most people seem to think that the purpose of business plans is simply to acquire finance, and that they are only relevant when we start our business. In truth though, life is far too disorganised to simply approach your business without a plan. To achieve anything in life, we need to plan. After all, if you don’t know where you are going, how on earth are you going to get there?

Business plans are about much more than simply doing what you need to do to start a business. Plans have three core ingredients:

• Exploring your chosen business, your purpose and vision, market research and your business and revenue models.

• Considering your objectives and your strategies, and steps towards achieving them.

• Finances – how much capital you need, your cash flows etc.

The first core is essential in determining whether your idea is viable. You have to answer critical questions such as what business it will be, market relevance, what need does your business fulfill, competition to your business, what makes your business different, why you would succeed in this business, your business model etc. This information is crucial to business success, or the odds are very good that you will fail before you even start. Also in order to get any support, be it financial, moral or partnerships, you’re going to need this information.

The second core, objectives, strategies and steps to achieve them, is something you should be refining and redefining on a daily basis. If you have a step by step plan and you don’t achieve what you are trying to, then it is easy to go back and see where you may have gone wrong. Even better is being able to foresee where things aren’t going to work out as planned, and changing your approach accordingly in good time.  The definition of insanity is ‘doing the same things over and over again and expecting a different result – by planning what you do and changing your modus operandi where necessary, you can adapt to get your desired result.

The last core is your financials where you need to determine how much money you need in starting the business, how it will be invested, and most importantly, your cash flows. If you don’t know how to do cash flow management and projections, I suggest you familiarise yourself with this before you go any further.  The thing that has kept me alive through the tough times and created the opportunity for me to ultimately succeed, is the fact that I run cash flows on a daily basis. I have both personal and business cash flows – I know exactly what is coming in, where it will be spent and what I need. I make decisions daily on what is paid and when.

Cash flows are the financial life-blood of a business, and I am talking about the daily and weekly management of cash flow, not just projected cash flows relevant in your business plan.

So, remember the old cliché – those who fail to plan, plan to fail – because planning is more relevant to being an entrepreneur than in any other area of your life.

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