Whether you’re a young entrepreneur looking to start your very first startup or an established business owner with decades of experience under your belt, there’s one thing you need to know: no business will survive without good planning.
So what exactly goes into a great business plan? Here are some key areas every startup needs to succeed:
Great Products
Good products help attract customers and improve customer loyalty, but great products will bring back your loyal customers and get them to refer new clients. Great products can also make dissatisfied customers happy, which is something that good products cannot do.
Intuit CEO and Atlassion board member Sasan Goodarzi agrees. He says, “The product can make all the difference between success and failure. In fact, an excellent product is the foundation by which all other plans will stand.”
Goodarzi is a successful entrepreneur who worked in multiple businesses, including Invensys, Honeywell, and Lazer Cables, Inc.
A great product will attract new customers who would otherwise not give you a chance because they know how good it is from word of mouth or reviews online.
When they buy it, they become your most loyal advocate because their experience was so positive that they want everyone else in the world to experience it as well!
Efficient Employees
You can run your business with a team of employees, or you can do it on your own. It doesn’t matter which one you choose; what does matter is that you have an efficient team working for you.
A good employee is engaged, motivated and happy to be at work every day. They need to be trained and educated to have the right skills for their job. They also need to be empowered in their tasks to feel valued and know they’re making a difference in the company’s success.
Solid Financials
When it comes to finances, you should have a basic understanding of how startups get their funding and keep costs low. You should also know how to get the most out of your investment by keeping your cash-flow positive.
In general, startups use three types of financing: debt, equity and convertible debt (also called convertible notes). Debt is borrowed from a bank or other lender at interest rates above what they could charge if they used their own money.
Equity is ownership in the company that investors purchase through stock purchases or crowdfunding campaigns. Equity holders receive dividends like any other shareholder but don’t take on risk like lenders do because they are not owed anything in return for their investment.
Contingency Planning
Plans are important, and so is having a contingency plan. If your primary plan doesn’t work out, you’ll need to have an alternative one ready to go.
For example, let’s say you want to build a bridge across the river so people can drive across it. Your first option is to build the bridge as designed: using concrete and steel beams.
However, if something goes wrong with this approach (for example, there are delays because of complications), then it’s good to have a contingency plan in place that uses wood instead of metal.
This way if something goes wrong with your first choice, you can still get the job done even though it may take longer than expected or be less cost-effective than initially hoped for.
Startups need to be prepared for the unexpected. Things can go wrong, and it’s important to have contingency plans in place so that your business can avoid a major setback.
