I was sitting in the Nine Bar ( a coffee bar in Fitzgerald's Bicycles) when I got an idea for a seasonal business. By the time I was ready to pay my check, I had the whole "plan" on how Teton River Shuttle would work in my head. I would shuttle vehicles for those that were fishing or recreating along the Teton River. I determined that if I used my bike, I could forgo gas costs, as well as paying another driver to help. I realized that it would be a lot of work, but my other business was in fitness, so I saw it merely as another challenge.
I can understand how many might make the assumption that I was also an avid cyclist, considering many residents in Teton Valley are and the idea did come to me while I was sitting in a bicycle shop. However, I can assure you that assumption could not have been any further from the truth. At the time, I currently owned an old, circa 1990's Cannondale, and I rode it maybe two to three times a year. That was the extent of my cycling knowledge.
Thanks to the generous support (without judgment I might add) from Habitat, another local bicycle shop, I was still able to turn a profit fairly quick. However, if I had written out a business plan, I may have been a little more prepared for the other challenges and saved myself a lot of time and money.
It's not uncommon for small town businesses to start on boot strapped efforts and they too make the assumption that if they are not in need of outside capital or investments, they simply don't need a written plan. As both a business owner and former executive director of the Chamber of Commerce, I've come across several business owners who don't and often fail as a result.
While bootstrapping is one of the most effective ways to ensure a positive cash flow, it alone is not enough. How will that positive cash flow sustain? What do you think will offer the best return and what can you add or remove if it isn't? How do you measure up to your competitor and how will you convince others that you do? Writing a business plan will help answer these questions, but the process alone will often reveal the questions you didn't think about. Finding, or at least considering, the answers to these questions upfront and documenting them will be especially helpful when you are feeling overwhelmed, discouraged, or even ready to throw in the towel.
Investors and banks care about one thing; how and when will they get their money back. The process in which you specify this in your plan, forces you to be realistic about it's validity, Can you really produce profits within 6 months? How will you pay your bills if you don't? Remember, your time is money, which is no less valuable than outside capital. You will be thankful to refer back to your plan and objectively consider what may or may not be working.
Should your business succeed, which is obviously the goal, you may want to sell it. Being able to show potential buyers the blue print to your success ensures them that the business will not die with you. It provides them a baseline for future success and prevents them from wasting time or money on efforts that have already been made. They are paying for your experience, insight, and years of testing, but only if it's well documented.
The world needs your unique ideas and services, just make sure you recognize ( and articulate) them well!