Im just trying to start an ec business.At first I was just going to jump into itand go. Ive been a electrician for 15 yrs working only in the commercial and some industrial markets. I found a govt sponsored self employment course and signed up.The course is 8 wks and covers taxes,bookkeeping,marketing,insurance,credit and collections etc.The end result of this course is you have to come up with a business plan resulting in about a 60 page report.I have never owned a business before and I dont have a lot of money in the bank to finance the costs of hiring employees.This business plan is quite overwhelming as i find it hard to figure out which direction i am going to head in without actually starting the business.Iam thinking i may have to go the residential route to get quicker cash flow to start,but with my lack of experience i think i might be to slow to make any money wiring houses as my price has been to high in past quotes.Becoming a ec is not quite as easy as i thought it would be 4 wks ago. has anyone else ever created a business plan for their company?
I believe it depends on your goals. I am a 2-man shop, and my accountant, a seasoned CPA who is a partner in a firm that also does business planning for small to medium sized companies, feels that I don't need one at this point. He drew that conclusion after several tax preparation sessions in which we spoke generally about where I am right now, and how I feel about my business. Some people will benefit from a business plan, some will not.
BTW, I'd be willing to bet that many bankrupt businesses have had business plans. If you are just starting out, you'll be more worried about paying your bills 5 weeks from now than where you will be 5 years from now.
[This message has been edited by Redsy (edited 04-07-2006).]
without a plan (not necessarily a 60 page full plan- but at the least a written set of goals and target) you will begin to feel like the proverbial hamster in the wheel. You will bust your tail all day every day, and not get where you don't even know you want to go.
Many businesses that failed had plans, many more didn't. Many businesses that succeeded didn't have plans, many more did. What's going to give you better odds- knowing where you want to go and figuring out how to get there? or just running in a circle all day?
What's better for your employees? showing them where you plan to go and where they can advance? or running them ragged with no idea where they are running to?
run your business how you want, just make sure you don't hurt the industry in the process.
A business plan, will not mean your going to survive, or go bust, it gives you a road map, and you can change the roads, anytime you desire, when you go out for looking for backing, for the business, why do they want your business plan, and past performance, before they invest, accounting records alone, do not describe the methods, you use, to meet your goals, a business without direction, may not be worth much, at sale time.
The plan, does not have to be pages long, just an outline of your goals.
What services are you offering? What area do you intend to operate? Will you own, or rent your business property? What will the gross income be, at year end? Will you have employees, how many? What equipment will you need? What are your expected costs of operating? What accounting methods are you planning to use?
[This message has been edited by LK (edited 04-07-2006).]
As you're finding out, there are about ten jobs that you have to do (or hire to do). You need to do three or four of them very well, and the rest fairly well.
For example, if you get the phone to ring, sell jobs well, install well, but then are lousy at collections, you'll be in trouble. If you don't track jobs to see if they were profitable you'll also be in trouble.
It's always harder at the start because you have more expenses and no client base for repeat business. Some people start their business evenings & weekends while keeping their day job until they get a large job & client base.
Maybe some of us have a biz plan but don't have much written out.
Is this a fair example of an EC start up?
Year 1 Work by yourself, pay your bills only, & eat.
Year 2 Work by yourself, pay yourself a 1 year apprenntance wage, & eat steak once a while
Year 3 Work by yourself, pay just a bit more then year 2, eat out once a while.
Year 4 Hire a helper. Pay him just a bit more then you, take you and your helper out for lunch once a while.
Year 5 Make more money then your helper, take your wife out to a nice dinner, & take your 1st vacation somewhere for a few days.
10 year goal make more money then you wife.
You might ask who the biz plan is for. I think some start-ups write them to get a bisiness loan. For those they just have templates and PC programs. The plan might not have much value if it is some genaric fill in the blank. While less are more just a plan of attack. My guess is the class is looking for a stuffy long fill in the blank template.
I'm based in NJ. I know the NJ roads really well and can get anywhere in NJ without a map. (this is like being a good electrical technician)
But I want to get to Las Vegas, NV. (This is the land of the Electrical Contractor) I know the roads to get out of Nj, I may even get through Pennsylvania and into Ohio. But then, I'll probably get lost. Maybe take a wrong turn into Kentucky or Iowa.
I may eventually get to Las Vegas, but after how many wrong turns and how much backtracking.
Or I can buy a map (it can be a basic map, just the highways) to get me from NJ to Las Vegas in one try. I might miss some of the by-ways, shortcuts and other opportunities that a detailed map might show me. But it will definately get me to the promised land faster than trying to do the trip without a map at all.