The Business Plan – Hold On to the Napkin

Hmm, a blog called “Your Business Plan – Hold On to the Napkin” would seem to contradict one of the things I do, i.e. Business Plans.  But, allow me to explain.

Sometimes You Really Do Need a Full Business Plan

There are numerous reasons you may need a full, Detailed Business Plan.  Some of the reasons include obtaining financing, your business is highly complex, you are trying to change the direction of a business, or you simply are the type who needs details.

The Trouble With a Full Business Plan

If you have had a formal business plan before or even have one now, think about how you actually utilized it.  If you are like many, you ether referred to it very little or, after a short period of time, not at all.  Getting wrapped up in day-to-day activities, unexpected changes in the economy or competition, and host of other reasons are why a plan often ends up in drawer, never to see the light of day again.  I could go on, but you get the point.

Before you go to the trouble of developing a formal, detailed business plan, consider whether sufficient reasons exist to justify the time and effort needed to develop it and then to monitor the execution.

Hold On to the Napkin

All of us have heard of businesses that were started with a brief outline or diagram drawn on a napkin or piece of scrap paper.  There are a multitude of explanations as to why this is sometimes sufficient and may even be superior to a formal plan.

  • With a new business, making accurate projections is extremely difficult and maybe impossible.
  • As a start-up progresses, we often find that the business takes on a form quite different from what we imagined.
  • Simple plans identify the concept (Vision), the company’s Core Principles (Values), and potential customers and how they benefit (Purpose).
  • Simplicity is easier to communicate to owners and employees.
  • Just like simple plays in sports are easier to execute, so it is in business.

Since Vision, Values, and Purpose are generally unchanging and easier to remember than technical details, they serve as a guide to keep you on track.  Add just enough details to help you identify goals and some of the actionable steps to achieving these goals.

If this seems just a little to informal, then add a little more detail (but not too much).  This is easier to modify and use to identify next steps than a full business plan.  Of course, some businesses need more detail for certain areas, but still be a brief as possible because you will be more likely to use the plan.

So think about it.  When it comes to a plan, you may just find that the KISS principle (Keep It Simple Stupid) can be followed by restricting your initial planning to what will fit on a napkin.  Oh, and don’t forget to Hold on to the Napkin.  In fact, whenever you use another napkin, let it be a reminder to think about that simple guide you developed and consider if you are on track.

Should you like to know more, contact us at: AimCFO – Contact

As always, your comments are welcomed.

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4 Responses to “The Business Plan – Hold On to the Napkin”

  • Saved like a favored, I actually like your weblog!

    • Chris S - Your Small Business CFO:

      Thank you. Happy to know you like the blog, Please sign-up for our RSS feed or email notification of new blog posts. We look forward to your feedback in the future.

  • Amazing, your article is very extraordinary. I have to say that from now your blog will turn into one of my bookmarks. Keep it going buddy !

    • Chris S - Your Small Business CFO:

      We are glad to hear you think this blog was extraordinary. One of the things we do is try to look at business issues from a slightly different perspective. Please sign up for our RSS feed or email notifications of future blogs.

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