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Henry Ford, founder of Ford Motor Company and often regarded as one of the most successful businessmen in American history, once said, “Before everything else, getting ready is the secret of success.”
A business plan — defined by the World English Dictionary as “a detailed plan setting out the objectives of a business, the strategy and tactics planned to achieve them, and the expected profits, usually over a period of three to 10 years” — is the key piece to starting up a business. It’s a blueprint that will contain everything there is know about a proposed business: The demographics, projections, logistics, competition, budget, and design, and it has to be well executed, well researched and without flaws.
Check in with the pros
The new carwash investor should start with the International Carwash Association™ (ICA), the industry’s largest trade association, which offers up help and advice on their website, www.carwash.org. The Association also has financial tools, templates and a loan payment calculator for investors to test the viability of their plans.
For even more advice, we turned to business plan expert Kylon Gustin, who is president of BusinessPlanAdvice.com. He has been quoted in Bloomberg Businessweek, The L.A. Times, and is now offering his advice to the readers of Professional Carwashing & Detailing. Below are his tips on what to do, and not do, when preparing your business plan.
Top 5 tips
Here are Gustin’s top five tips to consider when preparing a business plan:
Big mistakes you shouldn’t make
It takes more than making sure your t’s are crossed and your i’s are dotted, a proper business plan takes a lot of research and homework.
According to Gustin, cash flow, or lack of cash flow rather, is what causes most businesses to fail, so when planning your financial projections be sure to have realistic revenue projections (a long ramp-up period) and a clear understanding of your cash flow.
“With a carwash business, that is primarily cash or credit card, calculating your cash flow will not be too difficult,” he said. “Your greatest challenge is to properly anticipate how long it will take to acquire regular customers. Of course, marketing will play a major role here.”
Set aside the time
Constructing a quality business plan takes longer than anyone thinks, Gustin said.
The time it takes, he said, is based on:
“I've seen people write a business plan for their own business in eight hours. For some it takes months. Business plan software, like Plan Write for Business, or hiring a consultant can ease the pain and shorten the time,” Gustin said.