Your LivePlan Small Business Plan – Document Your Operations
The operations section of your LivePlan small business plan is used to describe your business location, as well as the technology and equipment that will be needed to operate your business.
Location and Facilities
Location, location, location.
It has to be the most popular adage when discussing real estate.
A great business idea but terrible business location may be a bad combination.
And for many businesses that depend on prime real estate, there can be a fine line between success and failure when it comes to location.
One location in a small town could prove successful while the same business in a location one block over could prove disastrous.
Heavy foot traffic could be critical if you’re opening a retail business, but for some service based businesses could be a distraction.
You have to decide what is best for your business.
You may also be starting a business where you need warehouse space, so the location may be important, but for a different reason.
You may need easy access to the interstate system to ship your product.
Finally, you may be starting small or have every intention to operate your business out of a home office.
With the technology that exists today, working from home is easier than it ever has been, and this is a totally viable option for many small businesses.
If having a physical presence and good location is important for your business, you should work with a commercial real estate tenant broker.
Many listing agents take advantage of unknowing tenants when they represent themselves in a leasing transaction and don’t have experience with commercial real estate.
You can search a directory of brokers and view commercial real estate listings on websites, such as Loopnet.
Check out an example of this section of LivePlan here, and then complete it for your business.
Technology needs can cover a lot of areas and are constantly evolving and changing.
In this section, you should identify what your hardware and software needs will be.
Hardware needs could include needing to purchase computers, laptops, tablets, other mobile devices or some combination.
If you are selling directly to customers, you should indicate what kind of point of sale system you will use.
Depending on what industry you are in, you may have additional hardware needs unique to your industry.
After identifying your hardware needs, you need to think about what software you will need.
Consider what accounting, customer relationship management and other software specific to your industry is needed and document all of these needs in this section.
As a small business owner you should also stay up to date on technology trends.
Currently, small business technology trends include an increase in mobile technologies (iPad over iMac) and a reduction in on premises hardware in favor of cloud technologies.
SaaS, or software as a service, is also big.
In the past you would buy some off the shelf software outright and own it but the way most software companies sell their product has evolved.
Take a software package like Quickbooks for example.
In the past, you would buy Quickbooks desktop software one time and own it with no additional out of pocket costs.
You would likely upgrade the software to the newest version every few years but it was always a one-time transaction.
Today, in response to the current trends, Quickbooks is heavily promoting its Quickbooks online product.
This is in response to the increased popularity of cloud technologies and the more preferable SaaS business model.
Now, instead of buying Quickbooks software one time and installing it on one computer you access your financial records in the cloud on their servers and pay a monthly fee.
This allows you to access your financial information from any computer that is connected to the internet and also provides options for accessing the info using mobile apps.
I use Quickbooks as an example because, as far as small business accounting software goes, they are the biggest player in the game.
The changes that they have made in recent years are reflective of the shifts that have been made by most small business software companies.
Spend some time gaining an understanding of the current trends in technology related to your small business and then document what your needs will be.
Also, identify any outside resources you will utilize to help with these needs.
Equipment and Tools
If your business will require any major purchases, use this section to document them.
Identify what you will need to purchase and when you will make the purchases.
Some purchases may be required before you start the business, while others may not be made until after it is started and there is some positive cash flow.
You may also identify purchases you plan to make in the mid and long-term, if appropriate.
And you may identify who you will purchase from and why if you have already identified your preferred suppliers.
Finally, indicate how much you have budgeted for these purchases.
This section is another that will vary widely depending on your business.
Many may not deem it necessary to include this section at all, as many businesses will not require any significant equipment.
Therefore, I am not going to spend a lot of time elaborating, as this section should be self explanatory.
Thinking through and budgeting your startup and ongoing operating needs is very important.
If you don’t do it right early on, you could be faced with a predicament that you never want to be faced with; not enough cash to pay your rent, payroll, or buy that important piece of equipment your business needs to get to the next level.
LivePlan helps you get your operations plan in order and manage your cash flow so that running into this scenario is less likely.
Check out an example of how I completed the Operations Plan in the example LivePlan you can get access to here.
Then, complete it for your business and move on to the next section, Milestones and Metrics.
TheEmbarkment.com is on a mission to bring you as much quality, free advice and guidance as possible. In order to carry out our mission, we have partnered with several Companies who help support us financially. When you purchase certain products or services using links on TheEmbarkment.com, we may receive a small commission. You can read our full affiliate disclosure here.