...do you find yourself referencing once a week, once a month, once a year? is it helping you stay grounded? how is it benefitting you?
I don't understand the question.
I have written two business plans. Both times I talked myself out of opening a storefront. Given today's economy, I'm glad not to have a rent payment.
leah...Thanks. That needed to be said. I read at least 10 posts every week where someone is leaving their job to open a new business (not just bakeries) and probably 75% of that amt closing up shop and don't know what to do for insurance, paying bills, mortgage is late. There is the cutest little house on a busy street that has been a hair studio, children's clothes and 2 bakeries with another bakery to be opening soon! I am so tempted to answer those starry eyed posters and advise to not give up their full time job plus benefits, but don't want people to think I am raining on their parade.
The first part of the question is in the topic! Well, Ill rephrase, with no words missing! Who out there has written a business plan? And if youve written one, how are you utilizing it? Do you reference it alot or rarely? How is it benefitting you?
Thank you for your response Leah, i see how youve utilized your plans.
Minicuppie, so you have written a business plan?
Im writing one now-taking a loooong time, to edit, revise and mostly to just see how the economy is imploding on itself. Waiting to see if the next step is worth it.
Anyone else out there?
I wrote one, and I did a financial plan too. It wasn't easy and it took a LOT of time and effort. I can't say that it has done me any good in MY SITUATION. I finished it the week the banks locked up the vaults and after that they wouldn't look at me anyway. It gave my family FAITH that I was actually serious this time. I still can't convince a bank to take a risk on me... but the bank of DAD and lending bank of Mom and the follow your dreams grandma money did. =) I actually rewrote it and revised it with every piece of knowledge that came my way. I had my
'nice dreams' plan which accounted for the bank loaning me everything, buying everything new and paying someone else to do all the grunt work.
'Yeah right' plan for when the city bakery went up for sale for 300K and I looked into buying it (uuuhhhh no- no way!)
'other location' for the original location I was planning on and waited 8 months for-- and started with all new equip in the plan, and as I picked stuff up free and at auctions, I kept adjusting it.
'real life' that was the plan that I keep using... it's the one that account for my new location, my shoestring budget, my used equip, my credit card account payments, the contractorrs fees, etc... and it keeps changing as i learn new stuff-- like can't have fridges, gotta have a commercial cooler, can't have burners without an ansel system, can't have a oven without having a hood, etc....
I'm very close to opening and I don't look at it as much as I used to... but it really makes you think about more than just cakes. with that said, I say WRITE IT. it will make you look at much more than just the fun of making cakes. It makes you think about rent, utilities, taxes, legal fees, accountants fees, misc expenses, and if it's a good financial plan it will plot out the next year or so, reminding you that it's not about getting open or through the month, it's about making a LONG term plan.
I have a business plan that I have drafted for the 1st 3 years of my business. I use it as a guide and compare it with my monthly P&L statement (just an excel doc.). I think regardless of your business plans it is important to put in the time and research so you become a good business owner.
My cake business is not a normal one for the reasons stated above, too scared of rent, utilities, going out of business etc. It might sound weird but I have converted a room at my home into a certified (with the state) kitchen. There were a lot of crazy rules and many details but I have a place where I can legally run my cake business out of...and unless we move I never have to go out of business!! This process would have been so much harder had I not taken the time to draft a business plan.
I had the help from an MBA student and several business people (my lawyer, accountant & insurance agent)...the process took about a month and ended up being 20 pages!!
Ive written a business plan. There are many beneficial reasons for taking the time to do the research to complete your business plan. If you are applying for a loan, the bank will need to see it. Even if you dont need a loan, its an opportunity for you to learn more about your market and business. You may also discover that your potential for profit could be so much greater than you ever imagined (of course, thats depending on your location, and what you are offering).
For example, if youre opening a wedding cake only studio, there are many options you might want to sell for additional income at pure profit that you may not have considered like coffee, bottled water, soft drinks, ornaments, gumpaste toppers and flowers, separator plates and pillars, toasting glasses, knife/server sets, dummies, deliveries, extra options, and custom design elements, along with rental fees for specialty stands/plateaus, fountains, stairways, or the like.
If youd like to open a full-service bakery, many of the options above would apply in addition to offering more than cake products, like the expected pastries, muffins, brownies, cookies, etc. (Are you prepared to spread yourself this thin to do it all, or hire the necessary help so you arent busting your butt?)
Id say that your business plan should be like your business bible in that its important to get it as accurate as you can, realistically, to how youd like to operate, therefore you will be able to refer back to it as you go, and when needed.
Yes, it takes a long time to gather the information and compile it in a useful form, but youll be glad you did rather than jumping in without considering everything. Hopefully, the knowledge you gain from your research will make it all worthwhile and give you the positive insight you were hoping for. (It took me nearly 4,000 hours over almost seven months to write my business plan, and its 77 pages long!)
When you wrote Waiting to see if the next step is worth it, if you mean the next step of your plan (because you arent finished yet), let us know what specific section you may need help with.
If you mean because of the economy, I can offer this... the baking industry in general, has been called recession proof. In the U.S., Americans will tend to patronize restaurants less often during tough times and choose to cook at home more often, but the wont normally turn on their oven to bake desserts. Americans are more likely to continue purchasing bakery items on impulse or convenience. In other countries, the results may differ greatly during a recession. For example, the worlds largest bakery foodservice provider, CSM (based in the Netherlands), who already owns the majority of U.S. baking facilities and manufacturers of baking products, recently purchased the Best Brands Corporation (based in Minnesota) on February 4, 2010. They realize that Americans wont go without their baked items... sales continue to rise in the U.S., while sales are extremely low in Europe. You should be pleased to participate within a thriving industry. If the U.S. market is good enough for CSM, it should be good enough for those of us in the U.S.!
Sorry if I answered with more information than you asked for! Good luck!