Creating Your Business Plan

Good resource on creating a business plan found at entrepreneur.com. If you have a great idea, then that is the first step in the right direction. While you could probably get going without putting your idea to paper, it wouldn't be recommended by most. The business plan gives you the opportunity to thoroughly think out your marketing plan, which could ultimately be the success or failure of your business. In addition to the marketing plan, you'll get an opportunity to put down "what if" financials.

What I find most important about the business plan is that it gives you credibility when talking to potential investors or partners. It'll show that you have really thought through all aspects of the potential business and you are serious about action.

What is the Slogan of Your Business?!?

Every great business must have an even better marketing strategy. Part of every marketing strategy is a slogan that people will remember and correlate with your product or service. Take a look at the attached video to see what other companies have done and start thinking about what fits your business!

Entrepreneur Magazine

What a great magazine for an aspiring entrepreneur. In this particular issue of Entrepreneur Magazine it speaks of the success story of Tazo Tea and how it was ultimately sold to Starbucks. It talks about how Steven Smith, the founder of Tazo Tea, has been a serial entrepreneur his whole life. Steve differs from many people in that he has stuck with a particular interest his entire career, which happens to be tea! This might not work for everyone but it certainly gives truth to the fact that you should stick with what you're good at. Use your competitive advantage!

To Franchise or Not to Franchise?

It seems so easy, right? You invest some sum of money, depending on the size of the franchise, open up shop and the customers just start flowing in. If life were that easy everyone would do it, right? I think a franchise can be a decent opportunity for the right person, in the right situation. Franchises appear to offer a sense of stability and this can be reassuring, especially if you are considering leaving a comfy corporate job, but buyer beware!

Out of pure interest and curiosity, I called on a few franchises recently to get a feel for their requirements and what I could expect. I won't mention any names, other than that I called a sub shop and an ice cream shop. I know they are both in the food industry, but I was looking for start-ups that didn't require an exorbitant amount of start-up capital and were relatively new entrants to the market I stayed away from the popular names such as Dunkin Donuts, Tropical Smoothie, Einstein Bagels, etc... because they were quite expensive to get in to and didn't seem practical for the purposes of my query.

What I came to find out is that even the newest franchises require a lot of fees and money up front with not that great ROI. The sub shop I called on informed me that I was lucky because they had a corporate franchise for sale in my area. The shop had been open for a few years now and they would be able to send me a P&L statement through 2011 YE. The asking price was $175,000 and the EBITA was only $20,000. With limited growth potential, didn't seem like the best opportunity.

As entrepreneurs it is worth the risk and the time to create your own venture. If you are choosing to go out on your own then it is because you want to work for yourself. Embrace this and pursue your passion. Don't forget about the WHY!

Manufacturing

Great read about manufacturing on the Huffington Post. Manufacturing has been at the forefront of the news lately and everyone's prediction is that the U.S. will soon regain its stance of manufacturing supremacy. This particular article sticks out to me because it mentions how small businesses will be at the heart of this new manufacturing 2.0. It is in our nature as entrepreneurs to want to change things and seek out better solutions. We can get creative and take something, like a 150 year old factory, and turn it into a fully functional site.

Whether you own your own business or work for a company, it is without doubt that your time is valuable and scarce. That being said, if you have the entrepreneurial "bug", as I call it, you must find time to pursue your passion. Looking out into the future, as any successful person must do, it is clear to see that manufacturing will be apart of our lives. Take advantage!

Not Sure Where to Start???

So, do you find yourself wanting to start a business but you just aren't sure where to start? As I was browsing the internet, I found a resource that might be of assistance to the aspiring entrepreneur. Check out the business idea center on entrepreneur.com

I think after looking through all of the suggested business ideas, you just might find something that you can run with. Remember these are only ideas meant to get your creative juices flowing. It is up to you to take the idea to the next level. Always try to differentiate your idea and make sure you are doing it for the WHY, not just to get rich.

A Great Book to Read

I must recommend Trust Agents: Using the Web to Build Influence, Improve Reputation, and Earn Trust. The principles mentioned in the book are applicable to many aspects of your life. Time and time again it seems that people are always trying to gain something from a relationship. You will be much more successful in both your personal and business life if you put others first.

How Did They Do It

An interesting read from the Reuters Blog on how 4 young entrepreneurs made it to a million dollars by the time they were 21-24. A common theme is that they are not actually concerned with making a lot of money initially. The Entrepreneurs are just pursuing a business that they are passionate about.

Think Outside the Box

1) Don't Start Without a Business Plan

Once you have figured out the WHY, you will need a clear plan of action. A business plan allows you to clearly define your goals and how you intend to reach them.

2) Don't Get Stuck in the Past

While it is important to retain the value from your past experiences, you don't want to let them stand in your way. Learn from your past and plan for your future.

3) Don't Fall into a Discount Trap

BELIEVE in yourself and your product. Unless you plan on opening a business the size of WalMart, do not try to compete solely on price. Differentiate your product or service from your competitors and win customers that way. It may take longer to acquire customers but you will have a much more viable business in the end

4) Don't be Afraid to Fail

You can not let fear become a barrier to your success. It is inevitable that your business will hit a bumpy road on its way to success. Learn what doesn't work and adjust your sails to the wind.

5) Think Outside the Box

Be willing to approach things differently. Use your creativity to gain an advantage on your competitors.

How Much Are You Worth??

It is completely understandable to be nervous about venturing out on your own. It is reasonable to expect to earn at least the same amount of money that you are currently. Here are a few things you should consider when setting your price.

1) Set a reasonable goal as to how much you would like to earn. You may want to check out salary.com to find comparative wages.

2) Don't forget about Uncle Sam. You will be responsible for paying your own taxes. A good rule of thumb is to add a factor of 15% to your salary.

3) Include your overhead expenses. These are expenses such as rent, utilities, phone, advertising, etc...

4) Figure out your billable hours for the year. You don't want to simply multiply 40 hrs per week x 52 week in a year. Include holidays, sick days, and vacation. Don't forget to include non-billable hours. This will be time you spend hunting for new clients or doing paperwork.

5) Add up your operating costs and divide by billable hours. This will give you your estimated hourly rate.

Almost done...

6) Factor in a profit margin. Somewhere betweeen 10% and 30%. This will come in handy if you ever choose to expand or get a bank loan. It also doesn't hurt to build a little money up in the bank in case business slows down at all.

Calculating your hourly rate this way is important if you want your business to succeed because it is based on your actual costs and needs. While you will see others with lower hourly rates, dont be scared into competing on price. Sell yourself and the service you are offering.

The Golden Circle

Simon Sinek gives a great talk on how great leaders inspire others. He talks about what he calls "The Golden Circle." At the very heart of the circle is WHY?. Why do you get out of bed in the morning? Why are you doing what you do? People don't want to be sold with WHAT you have rather they want to know WHY you do it. This is a must watch for anyone considering starting their own business. Please let me know your thoughts.