{"id":9444,"date":"2020-01-23T18:23:23","date_gmt":"2020-01-23T18:23:23","guid":{"rendered":"https:\/\/jboitnott.com\/?p=9444"},"modified":"2020-06-21T22:29:08","modified_gmt":"2020-06-21T22:29:08","slug":"use-your-business-plan-to-see-if-your-business-idea-works","status":"publish","type":"post","link":"https:\/\/jboitnott.com\/zh\/use-your-business-plan-to-see-if-your-business-idea-works\/","title":{"rendered":"Use Your Business Plan to See if Your Business Idea Works"},"content":{"rendered":"

Entrepreneurs can sometimes become so enamored with their own business idea that they don\u2019t know if it\u2019s viable. Recent statistics from the\u00a0Small Business Administration (SBA) Office of Advocacy<\/a>\u00a0show that about 20 percent of small businesses fail during their first year, and a third make it to the 10-year mark.<\/p>\n

While it\u2019s good to be passionate about your goals for your company, it\u2019s better to be realistic about whether your idea can go the distance.<\/p>\n

A\u00a0business plan<\/a>\u00a0can prove why you should (or shouldn\u2019t) pursue a certain business idea.<\/p>\n

Use your business plan as a validation checklist<\/h2>\n

Your business plan outlines the purpose, opportunities, and challenges linked to your business idea. Spend time conducting\u00a0in-depth research<\/a>\u00a0on market demand and audience interest. Additionally, search for and collect evidence that your business idea is sustainable and fresh. Look for ways to demonstrate how your business idea satisfies a specific market need.<\/p>\n

Your business plan must list specific examples and use cases. This evidence illustrates how your product or service idea fills that need, for how many people, and for how long. In assessing the competition, demonstrate how your business idea can better solve customer problems.<\/p>\n

Once you can provide positive proof that you have a marketable, sustainable business idea, you can move on to the next step. Otherwise, go back to the drawing board and evaluate a fresh idea.<\/p>\n

Talk to potential customers<\/strong><\/h2>\n

As part of your business plan research, talk to people who fit your target customer profile. These potential customers may have insights about what they need and what they\u2019ve tried previously. They can also tell you why those products or services haven\u2019t worked for them.<\/p>\n

Most people who fit your target profile will have some opinion about your solution and its usefulness or appeal. These target audience members might also provide ideas about how to make the product or service work better for them.<\/p>\n

After you get this crucial perspective on your business idea, document respondents\u2019 impressions of your business plan. It helps to include both supportive and critical comments to balance the perspective. From there, you can weigh both sides and decide whether to move forward, pivot, or start over.<\/p>\n

Show your working document to an advisor, mentor, or industry analyst<\/h2>\n

After incorporating this extensive research, your business plan should be a detailed document with qualitative and quantitative evidence that supports your business idea. The plan will also address any challenges or potential barriers.<\/p>\n

At this point, advisors, mentors, or industry analysts can give you an experienced,\u00a0unbiased opinion<\/a>. Like your potential customers, these expert sources may also have suggestions about how to tweak your business idea to make it work.<\/p>\n

These professionals will be particularly interested in certain findings, such as your SWOT analysis and competitor environment. Industry analysts and advisors will also be able to add to your findings on external factors. These factors might include a PESTLE (political, economic, social, technological, legal, and environmental) analysis. The results of that analysis can provide further insight on how your business idea may fare.<\/p>\n

Use your business plan as a financial spreadsheet<\/h2>\n

According to a\u00a02017 National Small Business Association study<\/a>, lack of capital is a common reason for startup failure. The same study noted that at least 25 percent of the small business owners they surveyed couldn\u2019t get enough funding to sustain their business.<\/p>\n

That\u2019s why it\u2019s important to outline financial feasibility. From this analysis, you can see if you have a viable business idea and help investors realize the value of funding it.<\/p>\n

The financial spreadsheet helps determine startup and operational costs. The data also reveals when you may start generating revenue and how long it might take to become profitable. From there, you can determine whether you have or can raise the money necessary to sustain the business from startup to launch.<\/p>\n

The business plan budget can show you how much it will cost to operate without revenue. It will also help you gauge how long your business can last on a specific amount of funding before you need revenue to sustain it. Both you and potential investors can see if the demand you detailed in your business plan is likely to deliver the projected revenue.<\/p>\n

If all these factors align, then you can proceed. Otherwise, you\u2019ll need to revisit all aspects of the business plan to see if you can realistically change it to create this alignment. Without this alignment across all the elements in your business plan, your business idea may not survive. And it\u2019s always better to know that before you move forward so you can save yourself time and money.<\/p>","protected":false},"excerpt":{"rendered":"

Entrepreneurs can sometimes become so enamored with their own business idea that they don\u2019t know if it\u2019s viable. Recent statistics from the\u00a0Small Business Administration (SBA) Office of Advocacy\u00a0show that about 20 percent of small businesses fail during their first year, and a third make it to the 10-year mark. While it\u2019s good to be passionate […]<\/p>\n","protected":false},"author":1,"featured_media":9445,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[594],"tags":[],"class_list":["post-9444","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-plan"],"yoast_head":"\nUse Your Business Plan to See if Your Business Idea Works - John Boitnott<\/title>\n<meta name=\"description\" content=\"Use your business plan to see if your business idea works. 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