Business plans are often very important, but most of the time they are just a plan to try to convince other people, like banks, investors, partners, etc., that you know what you’re doing with your business. It is true that, if executed correctly, a well-written business plan can also contribute significantly to your success. It can direct you, keep you on course, and act as a vehicle to get you where you want to go, especially in these days when so many external forces bombard you. When you consider the fact that 51% of small businesses fail within their first five years, a plan can be crucial to your success.

Hence, why create a business plan? I’d like to demonstrate a completely different kind of business plan to you. What would happen if you developed a business plan solely centered on your life’s goals? Are you aware that you have visions of your ideal way of life? Make a business plan that could help you realize those goals. What would your company look like if it provided you with everything you desire in life? What kind of compensation would your company require from you? Why not incorporate that into a business plan? Create a business plan that demonstrates precisely how your company can provide you with the salary you need to support your dreams. Isn’t it preferable to let your business do the work for you rather than the other way around?

Have you ever stopped to consider how unique your position as a business owner is? Owning a business is the only way I can think of that will give you as much control over your success. When you work for someone else, you are completely dependent on them for your future. Whether you work for a small business or a large corporation, it doesn’t matter. They hold the reins of your future. Other than owning a business, the only thing that might count is if you inherit or win a lot of money that would give you everything you want in life.

So, why make a business plan the conventional way when you could first make one that could help you achieve your goals? Have you ever considered putting together a plan like that? Would you be able to? Do you have time to complete it?

Well, let’s at least see what’s involved if you don’t know or are unsure.

The steps you would need to take are listed below.

You would first need to be familiar with all of your current business numbers. The plan will be based on this. You will need to be aware of:

what your average monthly sales are right now 2. what your current monthly average for materials costs are: What your current monthly labor costs are on average? What your current fixed costs are on average each month? What your average monthly variable costs are currently What is your monthly average of seven transactions per customer? how much you make on average per transaction, in dollars what your monthly profit is on average is 9. what your monthly profit margin is on average is 10 In addition, you will need to know the percentage of capacity your business is at right now; the salary you want; the number of years you want to plan for; and the following information:

• What percentage of sales do materials cost you?
• What percentage of sales is spent on labor?
• And what percentage of sales is spent on variable costs?

What’s the point of knowing these percentages? Your variable expenses, labor costs, and material costs will move in the same direction as your sales do. They will follow very closely the same percentage as your current company. As an illustration, let’s say that your monthly material costs are $20,000 on average and your monthly sales are $100,000 on average. That amounts to 20% of your total sales ($20,000 x $100,000) If your monthly sales were, on average, $200,000, what would your material costs be? It would still be 20 percent, but it would be 20 percent of $200,000, or 40,000. You can therefore project your material, labor, and variable expenses using these percentages. How does it work?

However, this is not achieved by your fixed costs. No matter how much sales change, they remain the same. This is why the call has been fixed. These are costs like rent, taxes, utility bills, phone bills, salaries, and insurance, among others. Many business owners do not take this into account. They simply combine all of their costs. However, if you combine all of your expenses, you will never be able to make an accurate plan. You must separate your fixed and variable expenses if you want to predict higher sales and expenses.