4 Weeks down, 48 to go. Wow, time passes by really fast. Since I first announced my one year project challenge, 4 weeks have already passed. I’ve done some market research and data analysis, but I haven’t done as much as I would have liked to. I have to admit, I really took it easy during the Holidays and it was really nice! I played a lot of Wii with my son. So here we are, at the end of week 4.
For the past few months I’ve read many articles that present the almighty business plan as a counter-productive tool for business success. In fact, both scholars and well rounded “business men” have made comments on the topic. Take the OnStartups blog for instance that just posted yesterday a series of startup advice (see post here), including avoiding business plans. Although I agree with many authors and bloggers that the business plan is a heavy-weight document that we all eventually throw out the door once we’re actually in operation, it does serve a great purpose when you’re first starting your business. It helps you plan and reflect on your business strategy and objectives. If that’s the only thing the business plan will help you achieve, then I would say it’s certainly worth doing a few drafts. But the reality is that, as far as I know, you still need a business plan at one point or another to get some financing.
If you take a step back and look at the individual profiles of those in favor of abandoning the business plan all together, you’ll probably notice that they have either an MBA, started one or more companies in the past, have considerable business experience, or a combination of these. But what about entrepreneurs that are at their first company startup and that don’t have formal business education and training? Can’t we argue that going through the exercise of putting together a business plan will provide tremendous value to the individual? The basics of a business plan will help you reflect and build your business objectives, your marketing strategy, and build a financial plan. If you’ve never done this before, would you know how to calculate your startup costs, put together interactive and inbound marketing strategies, put together a balance sheet and an income statement, etc.? Think about it, the process of putting a business plan will definitely help new comers better prepare their business.
However, let’s all remember that planning without execution won’t lead to success. Execution is key; you can succeed without planning if your execution is strong, but you’re unlikely to succeed if your plan is strong but your execution is weak.
I’d like to conclude this article with some basic market statistics that I came across while doing my market research. According to a 2009 report from Euromonitor International, the 2008 Global clothing industry was worth US$ 1.1 trillion, where 89.5% of this market value was attributed to clothing and 10.5% to footwear. Not a small market indeed! By the way, the underwear market seems very profitable! But no, that’s not where I’m heading if you were wondering.
