Henry Abbey

Henry Abbey , a talented author who has a knack for creating stories that captivate and engage readers. He’s been writing since he was a child and tasted success with his first novel at only 19. His works are available to read on the businessdoom website, where readers can find stories of romance, mystery, and adventure from the mind of Henry Abbey.

A Simpler Plan for Startups

This article is part of our Business Planning Guide—a curated list of our articles that will help you with the planning process!

Business advisors, experienced entrepreneurs, bankers, and investors generally agree that you should develop a business plan before you start a business. A plan can help you move forward, make decisions, and make your business successful.

However, not all business plans are the same, and not every business needs the same level of detail.

You might develop a fairly simple business plan first as you start a small business, and that might be enough for you. You can also start simple and then elaborate as you prepare to approach bankers or investors. This is an excellent use of the Lean Business Planning methodology, based on a simple Lean Plan combined with regular updates and revisions.

A simple business plan example
For a simple business plan example, imagine a woman making jewelry at home and selling it at a local flea market on the weekend. A business plan could give her a chance to step back from the normal flow and look at ways to develop and improve the business.

The planning process should help her understand her business. It should help her define what she wants from the business, understand what her customers want, and decide how to optimize her business on her own terms.

She might benefit from developing a simple sales and expense forecast, maybe even a profit and loss, so she can plan how to use and develop her resources. She might not need to create detailed cash flow, balance sheet, and business ratios. A simple business plan may be just what she needs to get going.

This first stage of a plan, what we call the pitch, focuses only on a few starter elements. The mission statement, the problem you’re solving for your customers, your solution, and market analysis, give you a critical head start toward understanding your business.

However, not all startups are that simple. Many of them need product development, packaging, retail fittings and signage, office equipment, websites, and sometimes months or even years of payroll before the sales start. Unless you’re wealthy enough to finance these expenditures on your own, then you’ll need to deal with bank loans or investors or both—and for that, you’ll need a more extensive business plan.

Startup company or not, the plan has to meet expectations.

What kind of business plan do you need?
One suggestion for getting started is to develop your plan in stages that meet your real business needs.

A few key topics might be enough to discuss the plan with potential partners and team members, as a first phase. You may well want to add a basic sales and expense forecast, leading to profit and loss, as next phase. Adding business numbers helps you predict business flow and match spending to income.

Ultimately, the choice of plan isn’t based as much on the stage of business as it is on the type of business, financing requirements, and business objective.

Here are some important indicators of the level of business plan you’ll need, even as a startup:
Some of the simpler businesses keep a plan in the head of the owner, but every business has a plan. Even a one-person business can benefit from creating a plan document with ideas written down, because the process of producing a plan is useful and valuable. And you can do a simple Lean Business Plan in less than an hour.
As soon as a second person is involved, the need for planning multiplies. The plan is critical for communicating values, goals, strategies, and detailed implementation.
As soon as anybody outside the company is involved, then you have to provide more information. When a plan is for internal use only, you may not need to describe company history and product features, for example. Stick to the topics that add value, that make you think, that help support decisions. When you involve people outside the company, then you need to provide more background information as part of the plan.
For discussion purposes, simple bullet point lists are enough to get a plan started. Try describing your mission, objective, keys to success, target market, competitive advantage, and basic strategies. How well does this cover your business idea? Try using a Lean Plan template to get you started. Or you can use bullet point lists of strategy, tactics, and milestones, as in a Lean Business Plan. Be flexible and adapt what feels right to you.
Can you live without a sales and expense forecast? Sometimes the one-person business keeps numbers in the owner’s head. However, it’s much easier to use some tools that can put the numbers in front of you, and add and subtract them automatically. That’s where a plan helps.
Do you really know your market? A good market analysis can help you see opportunities that might not otherwise be obvious. Understand why people buy from you. What are the needs being served? How many people are out there, as potential customers?
Do you manage significant amounts of inventory? That makes your cash management more complicated and usually requires a more sophisticated plan. You need to buy inventory before you sell it.
Do you sell on credit? If you are a business selling to businesses, then you probably do have to sell on credit, and that normally means you have to manage money owed to you by your customers, called accounts receivable. Making the sale is no longer the same thing as getting the money. That usually requires a more sophisticated plan.
Do you do your taxes on a cash basis or accrual basis? If you don’t know, and you are a very small business (one person, or maybe two to three people), then you’re likely to be on a cash basis. That makes your planning easier. However, most businesses big enough to work with a CPA and have separate tax statements use accrual accounting because they want to deduct expenses as they are incurred, even if they aren’t fully paid for. By the time you are using accrual accounting, you’ll probably need more sophisticated cash flow tools, and a more extensive business plan.
As you approach banks and other lending institutions, expect to provide more detail on personal net worth, collateral, and your business’ financial position. Some banks will accept a very superficial business plan as long as the collateral looks good. Others will demand to see detailed monthly projections. No bank can lend money on a business plan alone; that would be against banking law. A good bank wants to see a good plan.
If you’re looking for venture investment, take a good look at your plan. Professional investors will expect your plan to provide proof, not just promises. They’ll want to see market data, competitive advantage, and management track records. They’ll want to see robust and comprehensive financial projections. True, you’ll hear stories about investors backing new companies without a plan, but those are the exceptions, not the rule.
So, however you cut it, your business plan is very important, even at the early startup stage, and even if you can keep it in your head. Before you purchase business stationery, rent a location, or get started on any other similar logistics, you should have a business plan.

Need help writing your business plan? Read this article on how to write a business plan, download a free business plan template, or look at some business plan examples. Want your business plan written for you? Have an MBA write your plan in five business days with LivePlan’s business plan consulting.

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What Is a Business Plan?

This article is part of our “Business Planning Guide“—a curated list of our articles that will help you with the planning process!

What is a business plan? In its simplest form, a business plan is a guide—a roadmap for your business that outlines goals and details how you plan to achieve those goals.

In this article, I’ll explore the sections of a business plan, as well as:
Who needs a business plan
How to choose the right kind of business plan
The key components that every business plan should include
How to use your plan to achieve faster growth than your competition
To start, don’t swallow the obsolete idea that the business plan must be a long, formal document as if it were some term paper you have to write. That’s not true anymore. While every business has huge benefits to gain from going through the business planning process, only a small subset needs the formal business plan document required for seeking investors or supporting a commercial loan.

Most of us need just a Lean Business Plan, for internal use, with just bullet point lists and important projections. Good businesses always keep their Lean Plan up to date.

The lean business plan is great news because it makes the planning process much less daunting. You start simple and grow it organically. You don’t do anything that doesn’t have a business purpose, so you don’t describe your management team (to name one example) unless you need that section for outsiders. More on that in the section on the Lean Plan.

And furthermore, even for those of you who do need to produce a business plan document, the task of writing a formal business plan today is much less daunting than it used to be. These days, business plans are simpler, shorter, and easier to produce than they have ever been. Gone are the days of 30- and 40-page business plans—modern business plans are shorter, easier to write, and—thankfully—easier to read (and you could always have our MBA business plan consulting experts write a business plan for you if you so choose).

Let’s start with the basics.

What is a business plan?
If you’ve ever jotted down a business idea on a napkin with a few tasks you need to accomplish, you’ve written a business plan—or at least the very basic components of one. At its heart, a business plan is just a plan for how your business is going to work, and how you’re going to make it succeed.

How long should your plan be?
Typically, a business plan is longer than a list on a napkin (although, as you’ll see below, it is possible—and sometimes ideal—to write your entire business plan on one page). For me in practice, and for most real businesses, it can be as simple as the Lean Plan that has a few bullet points to focus strategy, tactics, milestones to track tasks and responsibilities, and the basic financial projections you need to plan: cash flow, budget, expenses.

How should you present your business plan?
A note on format: business plans should only become printed documents on select occasions, like when you need to share information with outsiders or team members. Otherwise, they should be dynamic documents that you maintain on your computer.

The plan goes on forever, meaning that you’re constantly tweaking it, because you’re regularly evaluating your business health, so the printed version is like a snapshot of what the plan was on the day that it was printed.

What Is a Business Plan? Read More »

How to Identify Your Strengths and Weaknesses

What are you good at?

That’s a question we all want to know about ourselves, as well as the question that occasionally comes after it: What aren’t you good at?

If you don’t know how to answer those questions about yourself, keep reading—I’ll help you come to a better knowledge of yourself.

When I was 14, I discovered a strength I didn’t know I had. My older brother had purchased a home gym, but there was one problem neatly expressed in three words: “Some assembly required.”

After a few hours of working together with very little to show for it, my brother huffed off, cursing under his breath and leaving me alone with the sheet of assembly instructions. Little by little, I worked through each step until later that night, the gym stood ready for action.

That day I learned that I had an ability that my brother didn’t have at the time, and it meant I had something of value to offer.

If you’re thinking about starting a business, identifying your strengths and your weaknesses isn’t just an exercise to make you feel good (or bad) about yourself. It’s a process that will allow you to understand how you can be most effective at what you do, and where you’ll need to improve if you want to be successful.

In this article, I’ll help you identify your strengths and weaknesses. To do so, I’ll walk you through creating some lists, talking to people you trust, taking a personality test, and trying new things.

  1. First, create two lists
    Before you use any outside sources to help identify your strengths and weaknesses, I’d recommend that you spend about 30 minutes alone creating two lists.

Your first list is going to be centered on your business or entrepreneurship goals. Call it something like, “Skills Needed to Succeed.”

Don’t worry about whether you’ve thought of every possible skill required for your business to succeed. This is meant to be an overview, and is fairly general. Depending on your business, it might list things like, “an understanding of the market,” “business development,” “website development,” or “product expertise.” Once you’ve completed your list, highlight the skills that you already have, and put a star next to the ones you think you’ll need to develop. Then, set this list aside—you’ll come back to it later.

The next list you’re going to create requires you to be completely honest about yourself. You can create two columns, one called “Strengths” and the other called “Weaknesses.”

Depending on your personality, you’ll find one of these columns a lot easier to fill out. I can only encourage you by suggesting that you do your best to be objective. Don’t beat yourself up over what you think are major flaws, and don’t overestimate how great your strengths are. Just write them down, and move on.

You also don’t need to have a comprehensive list of 100 strengths and weaknesses. If you’ve included more than 10-15 items in each column, then you’re probably starting to focus too much on strengths and weaknesses that aren’t that significant.

Examples of what you might add to this list range from aspects of your character, like “calm under pressure” or “achievement-driven,” to technical skills you may have, like “HTML expertise” or “project management experience.”

The purpose of this list will be to start off with some general ideas that you have about yourself, and then get input from other sources to help you refine your list.

To help you think about what to include in your strengths and weaknesses, try asking yourself questions like:

What am I good at?
What have others complimented me about?
What have others had to help me with on more than one occasion?
Which projects and tasks seem to drain my energy?
Which projects have I spent hours on without getting tired?
What are my hobbies, and why do I like doing them?
After you’ve spent some time honestly assessing your strengths and weaknesses, it’s time to get input from those closest to you: a significant other, your mentor, close friends, or family members.

  1. Talk to people you trust
    The problem with using a list of strengths and weaknesses that only you’ve completed is that you have a biased opinion of yourself. Most people think too highly of themselves, or too little of themselves.

If you’re like me, then you somehow manage to do both at the same time. We all need some kind of “sounding board” to help us gain clarity and get closer to the truth about ourselves. That’s where other people come in handy.

Try thinking of three to five people whose opinions you trust, and who have had the chance to live or work with you for an extended period of time. You want people who have observed your behavior and character in a number of different situations. For most people, that group will include a significant other, perhaps a mentor or advisor, a best friend, one or more siblings, or your parent(s).

The length of your relationships isn’t the only thing to consider. The most important thing is whether or not you value or trust their opinion of you. Some friends and family members will be too biased—they either think everything you do is amazing, or their opinions have been hurtful and destructive in the past. Carefully select people who have a good track record of being balanced and helpful, even when they’ve needed to tell you something that you didn’t want to hear.

Once you’ve got a group of people selected, reach out to them. You can go out to coffee with each of them, or simply send an email with some questions and ask for their honest feedback.

When you reach out to them, make sure you give some context as to why you’re asking for their opinion. Tell them that you want to start a business, and that in order to be successful, you’re trying to take stock of your strengths and weaknesses. Ask them what it is about you that they think will contribute to your success. Then, ask them to tell you the weaknesses you have that may cause you to fail.

As you receive feedback, start adding more details to your two lists. You’ll start to see that some of the strengths and weaknesses you listed are confirmed by those you trust, while others that you listed aren’t as significant to the people who have spent time with you.

Refine your lists.

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How to Come up with Hundreds of Business Ideas

This article is part of our Business Startup Guide—a curated list of our articles that will get you up and running in no time! It’s also part of our Bplans guide to coming up with a great idea.

For some people, coming up with ideas is as easy as spotting chewing gum on the sidewalk. For others, it’s nearly impossible.

For me, new idea generation isn’t just easy, it’s something I’m doing all the time and often without trying. I do not believe this is an innate ability, but rather a “skill” that I’ve learned and practiced over the entire course of my life.

While this “learning” has primarily been subconscious, as I’ve run into more and more people who struggle to come up with new ideas, I’ve made an effort to become conscious of how I do it and where I do it best. The fact that research on the subjects of creativity and innovation has become so popular certainly helps too.

I fully believe that anyone who puts in enough practice and who makes a conscious effort to notice problems and identify needs can improve their ability to come up with new ideas.

A brief bit of science before we dive into how to come up with ideas:

Good ideas are networks
The brain is largely composed of neurons—about 100 billion of them. Connected together, they form a nervous system that is capable of making decisions, sensing surroundings, and issuing commands to our body.

How we think, what we think, and what we’re capable of, are largely a consequence of the connections these neurons have made with one another.

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Tips for Coming Up With Your Million-Dollar Business Idea

This article is part of our Business Startup Guide—a curated list of our articles that will get you up and running in no time!

When I was a kid, I knew exactly what I wanted to be when I grew up. I was going to be the next Boris Vallejo! (You know, the famous fantasy and sci-fi artist who always painted ripped, shirtless men and buxom, bikini-clad women atop flying dragons and Pegasuses—yeah, I wanted to be him.)

There were two problems with my future career plans though: 1) I wasn’t very good at art, and 2) my parents made it clear there wasn’t a snowball’s chance that they would pay for me to go to art school.

With my adolescent dreams up in flames, I decided to get back at my unsupportive mom and dad the only way I knew how: I became an entrepreneur. And that choice became a different kind of fantasy entirely.

My Story
I stole the ideas for my first startups from other people. In the early 1990s, my brother was working for a company that was going through the roof selling shareware software via catalog. We thought, “Hey, we can do that!” And we did, until the internet came on the scene a couple of years later and left us holding our floppy disks in our hands.

My next venture didn’t fare much better. I tried to catch the specialty coffee wave and was swept under a tsunami of Starbucks’ venti lattes.

With my third business, I didn’t even try to be original—I purchased a custom framing franchise and piggybacked to success on someone else’s name.

What I’m saying is, I’m wholly unqualified to offer startup advice.

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Post-Crisis Digital Trends That Will Reshape Your Business in 2020

Uncertainty is the most daunting part of entrepreneurship. That uncertainty has likely been compounded exponentially this year. But one thing is certain— in a time of crisis, innovations have assumed a head-spinning pace, rendering outdated approaches extinct and causing many companies to completely reinvent the way that they work.

The first stage in this crisis was survival. Cutting costs, revisiting forecasts, and stabilizing your business. But that can only get you so far, and you now need to be looking past COVID-19.

You’re not forgetting it or avoiding the practices that have saved your business so far. Instead, you’re maintaining your crisis plan while looking for previously non-existent opportunities to gain traction going into 2021.

Today, the analysts of McKinsey Digital agree that the crisis has led to emerging business opportunities, and the recovery from COVID-19 will be primarily digital. So what can small business leaders do to emerge from the COVID-19 crisis as winners?

Let’s explore the latest trends in information technology and 4 practical tips for how your business can leverage them during your recovery.

Tech Trends For Businesses in 2020-2021
Many technology trends that have slowly been making traction, have seen an unprecedented boost in the past year. You’ve likely noticed a few of them as you’ve transitioned your team to working remotely or explored launching an eCommerce platform. But here are a few others to be aware of going into the end of 2020.

Marketplaces Like Upwork
Just like on-demand delivery services, freelancing marketplaces like Upwork will continue to gain popularity. Driven by job cuts and budget reductions urging businesses to hire more freelancers, online freelancing platforms will enable companies to tap into expanded pools of global talent and hire qualified workers.

Similarly, there will be more opportunities for companies to enter the freelancing platform creation market. Whether it’s better service, streamlined applications, or greater job curation, there are plenty of ways to disrupt this emerging service.

Artificial Intelligence
AI has been a consistent presence and focus for startups and technology companies over the last 10-years. And while it’s been useful for incremental functionality in the past (think iPhone and Siri or Tesla and self-driving cars), now, it’s truly becoming a major business disruptor. Not only because of its capability to accelerate and automate rule-based processes but also because it helps achieve better operational efficiency and reduces human error.
AI is also likely to be your greatest asset for business recovery. Here are just a few things you can do by leveraging data analytics:

Gain a better understanding of changing customer preferences
Discover new business opportunities
Identify and eliminate bottlenecks in your operations
Minimize and better allocate advertising costs
Provide greater customer support through automated chat
For entrepreneurs looking to start a business or for established businesses looking to pivot their business model, you can use AI to build as-a-service operations. Take delivery service apps like Instacart for example, that use AI analytics to garner insights about customers and their behavioral patterns. There are still plenty of industries prime for these types of services, as well as room for competition in current ride-sharing, food delivery avenues that are worth exploring.

Internet of Things
While AI helps businesses make sense of their data, the Internet of Things (IoT) helps capture and deliver data from a plethora of interconnected devices. Simply put, IoT is a combination of sensor and data analytics systems, helping businesses aggregate metrics to make more accurate decisions.

In a post-COVID-19 world, IoT is becoming the main driver of telehealth, helping physicians remotely monitor patients’ state and automatically alert them to urgent conditions. It’s also improving remote doctor visits, allowing for patients and doctors to have more versatile check-ups, without having to meet in-person.

The benefits of IoT even expand into products and services. In the supply chain management space, businesses are leveraging these data sources in app development for smart inventory management, logistics, and merchandising. As of today, IoT applications are present in the manufacturing, automotive, agriculture, energy sector, logistics, and hospitality industries, to name a few.

Cybersecurity
The increase in remote work is making cybersecurity one of the top post-COVID-19 priorities. The amount of disparate connections to sensitive data is increasing and so are the potential targets for perpetrators.

The top cybersecurity threats this year have included phishing, IoT attacks, cryptojacking, the evolution of ransomware strategies, state-sponsored attacks, and crypto-physical attacks. In other words, the opportunities for data breaches are increasing and the methods to do so are becoming more and more intricate.

In 2020, data breaches are among the greatest cybersecurity concerns, with health records, corporate intellectual property, smart cars, and connected devices being the most vulnerable targets. As of today, tech companies increasingly rely on data encryption and blockchain technology for resolving cybersecurity issues, which is becoming more readily available.

5G Network
5G is a next-generation cellular network technology which has a number of advantages over 4G: it has wider coverage, greater data bandwidth, higher speed, and lower latency. As such, it has the potential to transform the world as we know it and improve the functionality of self-driving cars, smart cities, AR/VR, and facilitate machine-to-human interactions.

5G mobile service is expected to be implemented by 2030, but 2020 marks the start of the deployment of the 5G telecommunication network. The long-awaited advent of the 5th generation mobile networks will act as a major impetus for accelerated development and adoption of most of today’s groundbreaking technologies.

These trends will develop in synergy, with 5G. Supporting the spread of IoT, propelling the further increase in applications of AI and data analytics, and creating the need for sophisticated cybersecurity solutions.

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Reasons to Create a One-Page Pitch Before You Plan Before Write Business Plan

A business pitch or elevator pitch is not only a crucial tool for getting investment, it’s also one of the best tools you can use to flesh out your business concept, iterate it through different variations, and find a business model that works and will turn into a profitable company.

But, shouldn’t you have a solid business plan before you build a pitch? I don’t think so. If you think of your pitch as a tool to develop strategy instead of just a vehicle for selling ideas to investors, you’ll find that there are many reasons why you should start with your pitch and develop a formal business plan (if you need one) later.

This is not to say that you shouldn’t have a plan. That would be like trying to go on a trip without a map.

A traditional business plan just isn’t the right format to flesh out your initial business strategy. The problem with business plans isn’t the planning process, but the format of the output. I suggest writing a 1-page Lean Plan first—it’s the elevator pitch version of a business plan.

Reasons to Create a One-Page Pitch Before You Plan Before Write Business Plan Read More »

How to Develop Your Business Strategy

I love the Michael Porter quote here because it’s so true, and more so the more you dig down into the front lines of real business, such as small business and startups.

Strategy is what you’re not doing. My favorite metaphor is the sculptor with a block of marble—the art is what he chips off the block, not what he leaves in. Michelangelo started with a big chunk of marble and chipped pieces off of it until it was his David.

Business strategy is focus
At the real-world level (my favorite), strategy is like driving and sex: we all think we’re pretty good at it. But simplifying, doing today what will seem obvious tomorrow, is genius.

I say the best strategies seem obvious as soon as you understand them. Furthermore, it seems to me that if they don’t seem obvious after the fact, they didn’t work.

Strategy has to be easy to define. I like the simple LivePlan method, which I explain here. But aside from that one, I’ve also worked in depth, during my consulting years, with several competing strategy frameworks, and every one of them works well if it’s applied correctly and executed. And furthermore, I say you can also define strategy with a simple summary, story, or a small collection of stories, which I’ll also explain here.

  1. The LivePlan simple strategy method
    Think of it as the heart of the business, like the heart of the artichoke. It’s a group of core concepts that can’t be separated: problem, solution, market, and identity. Don’t pull them apart. It’s the interrelationship between them that drives your business.

The problem you solve
We forget too often, so start with this: Your business is not about you, what you like to do, or what you want from it. It’s about your customers. And, most important, the problem you solve for your customers.

Theodore Levitt changed marketing with his pivotal piece “Marketing Myopia,” which includes this important reminder:

People don’t want to buy a quarter-inch drill, they want a quarter-inch hole.

And this also famous quote, about railroads:

They [the railroads] let others take customers away from them because they assumed themselves to be in the railroad business rather than in the transportation business.

Real businesses solve problems and to develop an effective business strategy, they have to know what problem they solve. For a social media company that posts updates for its clients, the problem it solves is not social media—it’s getting the word out, and getting people to know about their clients’ businesses.

Consider a bicycle retail store. Maybe it solves the simple problem of where to buy children’s and family bicycles, service, and accessories, which is one problem. But maybe it solves the problems of the mountain bikers and racers who want a lot of expertise, specialized bicycles, equipment, and know-how, which is a different problem.

You also need to understand what business you’re in. The bicycle store might be helping families with kids bicycles as they grow, or it might be offering real expertise to the serious bikers. Those are different businesses.

  1. The solution: Your product or service
    Your solution to that problem is your product or service. Focus on the true desired end result for your customers—the holes too, not just the drill.

Take the bicycle store for example. One solution is a bike store catering to families with children and casual bikers. Another very different solution is a bike store catering to bicycle enthusiasts, such as serious mountain bikers and racers. It’s not just a bike shop; it’s a general bike shop, or one for families and hobbyists, or one that caters to serious cyclists.

That’s strategy at work.

  1. The market: Who buys your solution
    Your identity influences your choice of target market.

The bike racing shop focuses on attracting enthusiasts, offering expensive high-end bicycles and equipment. The family-focused shop focuses on attracting parents with kids, concentrating on medium-level bikes, trailers, and family-friendly accessories.

Keep your business focused on specific target markets. That bike racer shop owner has to know his products are too expensive for the families, and the families bother the high-end enthusiasts in the shop. Likewise, the family bike shop shouldn’t scare away its target market with very expensive racing bikes.

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