One page business plan: Time effective business planning for SME business owners

Incite Management, a Sydney based small business consulting firm, trained a handful of small business owners on the subject of how to prepare a one-page business plan. The workshop was organised by NSW DSRD.

Yes, a one page business plan! Small business owners, who don’t have time to prepare a full scale business plan must invest a few hours to build and maintain this one-page business plan.

Here is a summary of the concept from my notes at NSW Department of State and Regional Development’s (DSRD) workshop on business planning on 27 August 2008 in which a consultant from Incite Management presented this concept.

Introduction

The purpose of a business is to create and keep a customer. Businesses fail because of lack of sales, whether initial or repeat sales. One of the greatest business planning challenges is to develop a loyal customer base that deliver greater profits. 

Key components of value in a business

It is important to keep in mind how small businesses are valued. The key components that go into a business value are:

• Customer base
• Staff (that can operate without you)
• Systems (that deliver productivity and competitiveness)
• Products and services
• Distribution into other markets
• Positioning
• Scale (Procedures that a new employee can act out, franchise, licence)

Differentiation and positioning are key

The key to competitive advantage is differentiation. Decide what is your core competence and then write your positioning statement. 

This process will help you answer some of the vital questions of 

• Who you are? 
• How are you different? 
• What is the quantified benefit to customer you provide?
• What are the benefits derived from your offering?
• What is your core competence? Examples – organisational effectiveness, product excellence or customer intimacy
• What is needed in the market?

Strengthen your positioning statement with a risk reversal offer such as guarantee on the product, money back promise if unsatisfied etc.

The One page business plan revealed

After you have done the above exercise, write you business plan:

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One Page Business Plan 

Name of the business:

Market segmentation: (Notes: Include size, trend and maturity)

Ideal customer: (Notes: What they look like and where to find)

Customer trends: (Notes: What is their impact on the business)

Key success factors (Notes: What do customers look for in a supplier)

Core competency:

Postioning statement:

Competitors – Direct and indirect (Notes: What is their impact on the business)

Financial projections for five years:

• Market size
• Market growth rate
• Sales 
• Sales growth rate
• Market share
• Net income in dollars and %

Critical issues: (Notes: Are key success factors addressed?)

Key strategies: (Notes: Are key success factors addressed?)

Planned results:

Key action plans: (Notes:Include when by)

Sales growth thru, profit growth thru

Risks (Notes Include assessment – Low, medium and high)

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So, that was the format of a one-page business plan. Well, it may not be exactly one page but it surely is a quick plan that takes days and not weeks to prepare. It helps a business owner structure their thinking about their business into the most important areas of positioning and results as opposed to operations.

UPDATE
I had the opportunity to visit the Gazelles Web site today. Verne Harnish who specialises in growth of small business and extensively coaches and mentors them has prepared this one page strategy plan. Download page of one-page-strategy-plan.