Business Planning Basics Tooele SBDC 4 Week Program Ryan Murray, MBA, CBA Elora McGovern

After this class you should: Be able to improve your leadership capacity in business Know how to write the management section of your business plan Understand the importance of surrounding yourself with the right people Avoid the pitfalls of “bad management” that will ruin any business

Leadership What is leadership? “Leadership is intentional influence.” – Michael McKinney Anything you do or say will be repeated Good or bad Tires

5 Leadership lessons you learn from your children Kid President You are a Role Model (watch what you say and do) Honesty REALLY is the best policy Inspires trust and admit your mistakes Focus on Others’ Needs Balance challenge and support Develop the next generation Be a leader who inspired growth and responsibility, not failure

7 things Successful leaders do They put relationships first Make connections and keep them They know that meaning matters Know how your work works with the whole– not just your piece They use humor Builds positive emotions They lead and live with their strengths Know how to leverage your unique blend of strengths with others They manage pessimistic thinking Find control, “this too shall pass,” compartmentalize They make their own luck Sue goals with passion, don’t back down, brushes failure off, DON’T QUIT They manage their energy Works within their most efficient energy cycles

Business Plan – Management Section Owners Key Employees Advisors

Business Plan – Management Section Owners People who have a significant equity stake Key Employees Individuals who are critical to the success of your business Advisors Qualified individuals with a significant interest in the success of your business who don’t have a significant stake

Business Plan – Management Section Owners People who have a significant equity stake Resume Style Key Employees Individuals who are critical to the success of your business Resume Style Advisors Qualified individuals with a significant interest in the success of your business who don’t have a significant stake Name and Title

Business Plan – Management Section Owners People who have a significant equity stake Resume Style Owners can be Key Employees Key Employees Individuals who are critical to the success of your business Resume Style Key Employees can be Owners Advisors Qualified individuals with a significant interest in the success of your business who don’t have a significant stake Name and Title Advisors should only be advisors

Things to Consider for your plan Banks/investors often want the management section first on the business plan Getting the right team is essential for success Don’t include non-relevant experience You can include resumes in the appendix Don’t “pad” your management team (everyone should be actively involved in the success of the business If you are missing key people take the time to get them (First Who, Then What

Characteristics of a great leader Personal Management Assessment Tool If you answered yes to 10 or more You need to work on developing your management skills If you answered yes to 5-9 There are too many areas of concern to create a great company If you answered yes to 2-4 You still have some work to do before you will experience lasting success If you answered yes to only 1 Any 1 of these negative habits will significantly limit or ruin your chances for becoming a great company

Hedgehog Concept Good to Great, Jim Collins What is your passion? Where can you be the best? What is your profit model? Solve: Profit model = Profit/X Focus

Homework Create a list of your management team Contrast this with a list of key responsibilities, talent, experience needed Write up the management bios Identify your weaknesses as a manager/leader Create a plan of action for overcoming these weaknesses

Business Registration Entity Types (some of the most common) Sole Proprietary Partnership LLC S-Corp Non Profit Etc For entity types and info Online registration

Business License Business license is done through the city or county Business registration is done through the state

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Putting It All Together Product/Service Relative Price Point Target Market Market Mediums Marketing Strategy Revenue - Expenses = Profit Market Opportunity Management Successfully identifies a need Is capable of meeting that need Eliminates all bad behaviors and cultures Has a clear focus and direction (mission) The financials are used to measure the success and track improvements

Putting It All Together Static Information Company Profile Name Entity Location Mission Statement Company Vision Product/Service Menu Market Research Operational Manual Company Policies Dynamic Information Management Marketing Strategy Financial Forecasts Financial Statements

6 Sections 1.Company Profile – A brief overview or explanation of your business 2.Product/Service – An analysis of your potential sources of revenue 3.Market Opportunity – Your portion of the revenue the total market will pay 4.Marketing Strategy – A detailed plan explaining exactly how you will sell, to whom, and at what expense 5.Management Team – Getting the right people doing the right things to make it happen 6.Financials – Measuring it and tying it all together