Self-employment: Business Plans

If self-employment is something that you are considering, it's important to approach it in the right way. Aside from the obvious of having an idea of what your business is going to do (aka. what service are you going to offer and/or what products you are going to sell, it's also important to consider either writing a business plan or hiring someone to write a business plan for you.

Business plans are important to any new or existing business because it can serve as a guide for you in starting your business, running it and growing it. Having a well-written plan will help you think about the aspects and details that are important to your business that you may not have considered before.

For example, what if you are the sole employee of your business and you become seriously ill for a period of time. How are you going to continue running your business? Will you be able to hire a replacement who you trust and is capable of running everything? Will you have to shut down for a period of time? If you shut down, how will you start up again? How will it affect your business? 

Another example is if you are selling a product that you make (say necklaces) and in order for you to make your product you must purchase beads and chain from a supplier. Perhaps your supplier does not have the beads and chains that you need. What are you going to do? It's important to think about this type of thing and how you will solve the problem in a situation like this. Maybe it's a case of before you open your business, find a back up supplier so that if your regular supplier doesn't have what you need, then you can get it from your back up.

Another reason to have a formal business plan is funding. If you are starting a business that will have a large cost of operating (rent, supplies, expenses, etc) then you will likely be approaching a bank or private lender for funding. In this situation, you will need a well-written, thought out, through plan that shows potential lenders and investors that your business has a real chance of succeeding before they will take the chance on you. If you go into a bank with a vague idea written on a napkin, you will not get the financial support you need.

Another reason for a business plan is setting and working towards your short and long-term goals. Trying to run a business without any goals will not work. Some of the types of goals that you should be setting include

• strategic- for example, increasing the number of a specific client/customer type within a specific time frame
• operational- for example, increase output of finished projects or jobs
• financial- for example, to break even by the end of a specific time frame
• marketing- for example, to increase sales to repeat clients/customers by a specific amount

There are many reasons for having a business plan before you start your business and there are many other factors that go into a business plan (financials, customer analysis, market analysis, competitor information, marketing, etc) a lot of it really comes down to helping you plan for everything that could arise in running your business (for at least the first operational year or two), figuring out your goals and helping you stay on track for achieving them, helping you to stay on track financially, maintaining an understanding of your customer demographics, and your competitors and more.

Starting a business without a plan is just asking for a disaster. It can sometimes work, but it's rare and with your business why would want to take the risk?

For more information about what Event Elements & Business Solutions can do for you with regards to business plans or any of the other services we offer, please email us or give us a call at 905-924-5687.