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Maybe you couldn't exactly see the light bulb glowing over Douglas Palmer's head as he made the connection between people who purchase lighting for their game rooms and his upcoming business plan class.
But the connection turned out to be quite a bright idea: Palmer, who works part time at a lighting store, joined forces with his partner, Bryce Kumka, to create the Darting Lamp, a dartboard floor lamp.
Of course, transforming that first spark of ingenuity into a business plan wasn't so simple, but for Palmer, 23, and Kumka, 22, hard work paid off--their business plan won first place in the 1999 Enterprise Creation Competition, a business-plan contest sponsored by Ball State University in Muncie, Indiana, and Miami University in Oxford, Ohio.
Competition judges were impressed with the partners' preparation and give-and-take-style presentation, says Larry Metzing, a competition judge and president of the corporate division of Indiana Business Resource Inc., an Indianapolis business intermediary specializing in mergers and acquisitions. Says Metzing, "In their presentation, they answered all the questions you would raise if you were considering investing money in their idea."
To Plan Or Not To Plan?
So why do you need a business plan?
A business plan is a very good way to explore the feasibility of a new business without actually having to start it and run it. A good plan can help you see serious flaws in your business concept--you may uncover tough competition while researching the market section or find that your financial projections simply aren't realistic. On the other hand, a careful business plan that doesn't predict failure can be a rare comfort and motivator to proceed.
You're also likely to need a business plan when seeking financing. Bankers, venture capitalists and other financiers rarely provide money without seeing a plan. Less sophisticated or less unbiased investors, such as friends and family, may not require a business plan, but they probably deserve one. Even if you're funding the business with your own savings, you owe it to yourself to plan how you'll expend the resources you're committing.
It's also a good idea to realize that a business plan is not a one-time exercise. Just because you wrote a plan when you were starting out or raising money doesn't mean you're finished. A business plan should be rewritten or revised regularly to get maximum benefit from it. Commonly, business plans are revised yearly.
Excerpted from Business Plans Made Easy (Entrepreneur Media Inc.).
After you've thought of potential names [for your business], compile a list of your competitors' names. If some of your ideas are too similar to your competitors' names, remove them from your list.
Excerpted from Start Your Own Business (Entrepreneur Media Inc.).