As promised, here are the questions asked during the “The Lies You’ve Been Told About Business Planning” webinar that we did not have time to address.

Q: Hello. We are a small manufacturing company in business for 3 years producing a few products for 2 separate companies. We are currently branding two of our own products, both entering very different markets: One for hardware store sales, another for precision rifle sales. For the hardware sales we are wondering how best to market. Try the Tommy Boy face to face, use distributors, or sell outright to a large brand manufacturer? I would like to keep control of the product; my partner is more for outright sales to a large brand manufacturer. If it is a good, useful, inexpensive addition to commonly-used tools, how do you decide? This is our first attempt for our own branded products.

Tim Berry: I’m sorry, but this is a serious question, requiring a serious answer. It depends on who you are, your strategy, your resources, strengths and weaknesses, and a lot of other considerations. No way to generalize or conjecture from the basic situation description here.

Q: What is the impact a business would make when applying for a business loan?
Tim Berry: Assuming you meant “business plan” and not just “business,” then start with realizing that regardless of what the bank has to say, you don’t want to apply for any kind of a loan without a business plan to help you evaluate what you’re using the money for, what you need it for, your returns, the risks, the interest and repayment expenses, and so on. Never borrow money without looking at projected results and risks and so on first. Aside from that, although some banks will make a loan based on collateral alone, good banks want to see your business plan because they don’t want to make a bad loan. Even if they are protected, they want the plan to make sense for you as well as for them. Relatively few banks will even review a loan application without a business plan to go with it.

Q: How do you know when you have reached the point of diminishing returns with respect to research and ferreting out data? What are indices?

Tim Berry: Yes, that’s one of those critical questions that everybody tries to answer. We’ve all seen people with analysis paralysis, and we’ve all seen people who just wing it without trying to get decent information, and neither extreme is very attractive. Somewhere in the middle there’s a judgment call on what’s enough information to guide decisions.

One thing that helps is realizing that you’re dealing with uncertainty about the future, and no amount of research and data is going to eliminate uncertainty. The past doesn’t predict the future, at least not always, and not very well. Get enough information to guard against just making a wild guess.

Some people will never have enough information. Some people will have enough information immediately, even though they have none. Be somewhere in between.

Q: When you have a great business plan for a high-end service, how do you find investors?

Tim Berry: “Service” is a bad word for investors. Although there are exceptions, services are harder to scale up to the kind of volume that gives investors reasonable hope of exits with money. Services can be great businesses for the owners, but without a good shot at a lucrative exit to liquidity, they aren’t so great for investors. Investors like products. And yes, you might have the exception to the rule. It happens.

I had some friends who took a high-end service and productized it by building installation and customization into the price, which made it into a service that looked like an expensive product, both to its customers, and to the investors. They made money with it.

Finding investors is a huge topic, book length, in fact. If you search the categories “angel investment” and “venture capital” on my timberry.bplans.com blog, and those two categories plus “startup financing” on my upandrunning.entrepreneur.com blog, you’ll get more of my input than you’ll ever want.

Q: When you sell your service, do you advertise the service you have or the perception you want your client to see?

Tim Berry: Not sure. Do you want the client to see something different than what you’re actually delivering? Would it help to understand the perception you want your client to see and then make sure you deliver that, so you get delivery and marketing messages in alignment? I don’t think I understand the question.

Q: What is your opinion of Ronstadt’s Financials?

Tim Berry: I don’t feel comfortable sharing my evaluations of products that compete with my own. When I developed Business Plan Pro back in the middle 90s, Ronstadt’s had a lot of market awareness, but I haven’t seen it in 15 years or even heard of it in 10. In the meantime, we’ve done 12 new versions of Business Plan Pro during that same timeframe. If I didn’t think Business Plan Pro were the best tool available, I wouldn’t go into the office every morning

Q: I need a bank loan for my startup business. Is it essential to have a business plan to do this?

Tim Berry: Very similar question answered above. To elaborate, while it is possible to get a bank loan without a business plan, it’s a lot harder. Banks that do that tend to be less professional, and it’s not a good idea for you either, because there should be a plan to make sure you need it, want it, can repay it, and will put it to good use. The misunderstanding, though, is that the business plan you do for the bank has to be the huge,formal, scary business plan. That’s not so. Keep it short, summarized, concise, and easier to do. Do just what you need, not the whole thing.

Q: Can you repeat the last statement?  The plan is useless, but the planning ….

Tim Berry: It’s from Dwight D. Eisenhower, former president, leader of the allied forces in the invasion of Europe that ended World War II: “The plan is useless, but planning is essential.”

Did you miss the webinar? Check the video out here!

The 3rd annual  Global Entrepreneurship Week at UnleashingIdeas.org is ending today. Palo Alto Software was pleased to participate once again in this event. As in years past, we added to the conversation about entrepreneurship by offering some one-on-one time with our President and founder, Tim Berry.

On Wednesday, Tim spent an hour going over the lies and myths that are out there about business plans and business planning. He also took some time to answer some questions from the audience. We didn’t get to all the questions asked, but Tim addressed them later in the day and we’ve posted them in a separate blog post here.

Honestly, I think he could have talked more to that subject, but an hour was all we had time for.

If you missed the event, don’t worry. We recorded it and we’re posting it here for people to re-watch or enjoy for the first time.  If you like it, tell us. We want to know if there are other topics you’re interested in hearing about.

For more information on the Global Entrepreneurship Week and Unleashingideas.org check out their website and see how you can participate.

‘Chelle Parmele
Social Media Marketing Manager

Business plans are a waste of time? Don’t bother? Nobody’s going to read it anyhow? Do you think setting goals and steps to implement them are a waste of time? What about establishing how to measure progress and performance, setting it down, and then tracking it, so you can optimize your management? Do you think focusing resources on priorities is good for business? Do you want to control your own destiny, or are you okay with just taking things as they come, and reacting?

November 14-20 was the third annual Global Entrepreneurship Week. This year, for the third year in a row, we offered a webinar, now an online video, on business planning. The theme this year is the top 10 lies about business planning.  Here’s the recording:

Some of the lies are worth a bit of scorn: Waste of time, ha! As if managing were a waste of time. Just do a pitch? More important, it gives me a chance to get into business planning for the rest of us; the plan-as-you-go business planning technique, just a bit at a time, just enough to manage your business, not a big document, but a plan.

Would you take a trip without planning it? Would the plan be a big honking document? Would it matter to you whether anybody else read it? Would having a plan mean you couldn’t change it when a flight got cancelled?

Does the term "free webinar" worry you? I promise: no selling. It’s about business planning. No product is mentioned. Yes, it’s sponsored by bplans.com (an entirely free site) and Palo Alto Software, publisher of Business Plan Pro.

(If you don’t see the video here, you can click this link for the original on Youtube.)

As part of Global Entrepreneurship Week 2009, I presented a webinar titled “Build Your Business, Not Just Your Business Plan, on  Thursday Nov. 19, 2009. The recording of that webinar, plus an additional segment of questions and answers, is now available on YouTube.

If for any reason you don’t see that video embedded here, you can also click here to go to the original on YouTube.

Here’s the original announcement, below. The register link has been revised to take you to the recording instead.

Survey says…

Every now and then you have to stop guessing about what your customers are doing and actually ask them. This fall, we conducted a survey of over 650 entrepreneurs and business planners who are using our software. Their responses yielded some helpful information for others tackling the most challenging aspects of business planning.

As part of our series on “Back to Fundamentals” in business planning for Global Entrepreneurship Week we’ve posted an article about our survey, what it tells us, and you, how to use survey results in developing and planning our marketing strategies, tactics and programs.

Click here to read our Planning tips from Palo Alto Software customers article.

For those of you who attended Monday’s Back to the Fundamentals webinar, you heard a lot of references to some websites, books and blogs.

For the reference of those people looking for more information and for those of you who weren’t able to make it to the webinar, I’m going to put a reference list here.

If there are any that I fail to include here, please leave a comment and I’ll track it down and get it for you.

Tim Berry

Blogs : Planning, Startups, Stories, Up and Running,  Tim’s posts at HuffingtonPost, Tim at Anita Campbell’s Small Business Trends, Planning Demystified at AllBusiness.com

Books:  The Plan-As-You-Go Business Plan book and website, Three Weeks to Start-up

Slides: Download the slides from Monday’s webinar as well as other presentations Tim has given over the years.

The webinar itself will be available for download starting today at our video site   eta: This link is fixed now, sorry about that!

Resources: Palo Alto Software products,  Business and Marketing calculators, more planning video’s.

I hope that was helpful, again, if I’ve missed anything or you’re wondering about a particular resource or website, just comment!

‘Chelle Parmele
Social Media Marketing Manager
Palo Alto Software

Interesting article today on Businessweek.com about the importance of recognizing your business costs and getting them under control now verses later, when it could be too late:

“…by recognizing the problem early and making moderate reductions, small firms can avoid more severe cuts later on, financial experts say. Companies that ignore warning signs can erode their profits with rising costs, and those that borrow to meet those costs can wind up insolvent.”

How many of you are looking at your personal or household budgets and cutting expenses? Change vacations plans? Did you dump those magazine subscriptions that you don’t need?

Why wouldn’t you do the same thing at your business?

The answer is, you would! No question. Right?

Now, here’s the next question. Are you being smart in your cuts, or are you looking at the highest costs and slashing them without really looking down the road and seeing what the cut is going to do to you later on? How many of you immediately shut down your advertising campaign? Canceled all your trade show appearances? Eliminated a position or two on your staff?

Let me say this again. Cutting your business costs now verses later is a good idea… but making sure you make the right cuts is going to make the difference between having a strong and functioning business and a “just hanging on” business down the road.

You are in business now because you made smart choices. Keep that up. Pull open your budgets, study your cash flow, your planned vs actuals, your forecasts. Adjust them for the good, the bad and the really really ugly. Be brutal in your projections and then look at your costs.

Make a plan. A good plan.

Now is not the time for guess work and hasty decisions. You can’t afford it.

‘Chelle Parmele
Social Media Marketing Manager
Palo Alto Software

Have you signed up for the Back to the Fundamentals webinar with Tim Berry? There’s still time! Register Right Now by clicking this button

There’s a lot of talk in the media and the blogsphere about the economy and how businesses will be reacting to the climate. Many are guessing there will be layoffs coming in the next several months. PR and Marketing departments are tightening their belts and some companies are cutting those departments altogether. Pretty scary times. But they don’t have to be.

If you look carefully, you’ll find a small but very vocal group of business advisers and business owners who are being smart and not reacting blindly to what is happening in the world.

They’re sitting down with their budgets, their management teams and consultants and really looking at what needs to happen to ensure their businesses survive.

If business is slowing down, what are you doing to ensure your customers keep coming back? If your competitor slashed their advertising budget, isn’t this the time for you to add a couple more budgeting dollars to pick up where they’ve left off? That expensive marketing tool or reporting system that costs you thousands of dollars a month – have you checked to see if there’s a low cost alternative that does pretty much the same thing?

Don’t doom your business by reacting too strongly to what’s going on. Sit down and make good decisions about where your money is being spent and where it will do even more good in the future.

Please join us November 17th, 2008 for a special webinar by Tim Berry on the importance of going Back to the Fundamentals of business.

Sign up for Tim Berry’s Webinar!

Taking a little time out here to make a couple announcements:

1)  We had a bit of an issue with our blog and some of you were not getting any of the blog posts in your RSS feeds for a while. We’ve fixed that and you should be able to see all of them now. We apologize for the rush of posts all at once, but hope you enjoy all the great “new” content you missed! Things should be smooth sailing from here on out.

2)  We’re going to be participating in the Global Entrepreneurship Week, November 17th-23rd. We’re getting all the specifics put together, but I’m going to give you a sneak peek!

Keep checking back for more details and some outstanding articles and posts all centered around getting back to the basics of your business. (If you’re interested in attending Tim Berry’s webinar on the 17th, make sure to register soon! It’s first come first serve and space is limited! Click the picture for more information.)

3) Palo Alto Software’s product Email Center Pro has released version 2.0!   Internally, several Palo Alto Software employee’s are participating in a “solidarity experiement” where we’ve all committed to … well, I’ll let Jason tell you all about it. Head over to our Dead-Simple Software blog to read all about the things we’ve decided to give up or do in the coming weeks.

That’s it! That wasn’t so bad now, was it?

‘Chelle Parmele
Social Media Marketing Manager
Palo Alto Software