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Business Plan...

K

KeepFraming

Guest
This is going to get kind of messy, so please bear with me. I am in the process of writing a business plan, and wanted to get some input. One of the questions I am pondering is if there will be steady cash flow...I am looking for statistics to include as far as what services are in demand...The second part I am looking into is what the best way to maintain records would be...Perhaps someone had a horror story of unrealistic expectations and suggestions on how to avoid that at all costs
 
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Jim Miller

SPFG, Supreme Picture Framing God
Originally posted by KeepFraming:
"...I am in the process of writing a business plan, and wanted to get some input. One of the questions I am pondering is if there will be steady cash flow..."

Whether there will be cash flow depends on your plan. If your growth goals are big and your working capital will take the hit, then you might choose to lose money for a while. On the other hand, if your budget is tight and you need to have immediate profit, then you can start out lean and develop a plan to expand more slowly. This is harder and requires careful budgeting of money for certain things at crtain times -- I suggest you build a detailed timeline, and budget for every cost item you need to cover in the first quarter, first year, and so on.

If your business new and you have no history to go by, then you need to plan more carefully. I suggest you get together with S.C.O.R.E (Service Corps of Retired Executives) through your local SBA (Small Business Administration) office. No single counselor will be able to give you all the answers, so review the backgrounds of several and choose the ones you want to work with.

Talk to bankers and real estate agents about the local economy -- where it stands compared to other areas, where it's headed, etc. You may gain some valuable insights by asking questions of people in the financial mainstream of your community.

"...I am looking for statistics to include as far as what services are in demand..."

The trade magazines have lots of information, but PPFA's latest survey has the latest, most accurate, most relevent information you can find anywhere. It is full of eye-openers.

"...The second part I am looking into is what the best way to maintain records would be..."

For order history, material usage, and sales tracking, get a framing software program; there are several good ones.

For accounting, I suggest QuickBooks Pro 2000. It is a very powerful program. If you're not an accountant, I suggest you get cozy with one and have him/her set up your program as much as possible. Keep the accountant for quarterly (or at least annual) financial audits, too. It might save you serious headaches down the road.

"...Perhaps someone had a horror story of unrealistic expectations and suggestions on how to avoid that at all costs."

The problem with unrealistic expectations is that we don't know they're unrealistic until it's too late. Plan, plan, plan. Ask, ask, ask. No matter what, you'll get stuck in the mud somewhere along the way. Prepare for the unexpected, and be determined to do whatever it takes to make your plan work. If you do, then it will.

One more suggestion: Take lots of classes at trade shows. There is excellent training and education available to framers now, including courses on how to set up and run your business.

Happy Holidays and good luck.


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Jim Miller, CPFcm; GAFP Committee Member
 
K

KeepFraming

Guest
(QUOTE) "On the other hand, if your budget is tight and you need to have immediate profit, then you can start out lean and develop a plan to expand more slowly. This is harder and requires careful budgeting of money for certain things at certain times -- I suggest you build a detailed timeline, and budget for every cost item you need to cover in the first quarter, first year, and so on."

The budget will be tight, most certainly a bootstrapped business! Expansion and growth will be slow, from the point I am at right now I see that we will be limited in what we can produce and the volume we can do at first. At present, I project being able to produce 5 pieces in a day. It will be a one-man operation. Now, obviously being able to do the work and actually GET the work are two separate issues! In the future, I see my shop servicing the corporate market. For the intermediate time, I hope to build up relationships with the buyers in that field through smaller projects, for example producing for lawyers their exhibit presentations for court (the pictures drymounted) I am trying presently to think of more ideas of how and where I would like the business to be in say 5 and 10 years. I have been stuck in the creative process for some time...a picture frame is a picture frame...This is probably my naivety showing, but honestly that was my first thought. Given that, I thought, "Well, there is gas stations, convenience stores, grocery stores, etc., that are on almost every block...so, even though they sell the same product there either
1. Is enough business to go around or
2. They are in strategic locations convenient to customers or
3. They are doing something different (after all, there may be many...but for every one there is another that goes out) That is some of my basic thoughts as of right now, please do feel free to tell me I am totally wrong, need to do more research, or even (hopefully!) am on the right track but the thinking needs to be more through. I must say that I admit I do not know 1% of everything I WISH I knew, but that is why I am asking questions, so I hope you can appreciate that even though my questions may sound simplistic or even wrong I am in the process of learning and hope to grow in my understanding of this industry as much as posable. Thank you for allowing me this learning curve



On a personal note,
Dear Jim,
Your insights and advice have been very helpful. I appreciate that you took the time to offer your time to help me out with my questions. May you have a very safe and Happy Holiday and nothing but success in the New Year!
Avril
 
A

alan beitz

Guest
Jim , just reading your ideas on running a business - we started out about 8 years ago after doing all the research we thought we needed -no business plan -too scarey to think we might fall in a heap and also there were no full time picture framers in the area , the nearest being 300 k.m. away. I went and had a chat to my bank manager re. lease finance for machinery etc. and he laughed and laughed . Said this town wasn't big enough to support a business such as this -being a knowall who can't be told I went ahead and did it the hard way -in the back shed at home using tools that I already had -it helps to be a carpenter as well - A friend with a bit of vision loaned me the cash to buy a brand new guillotine and we haven't looked back - We moved into shop in the main street last November and we have just completed our first years trading in the business area -people have finally worked out that we have moved. It seems to me that more important than a business plan is a big dose of stubborness and some good friends with a lot of faith in you The best of luck to anyone just starting out - you will get quite a few gray hairs in the process but its worth it.

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Alzy
 

Jim Miller

SPFG, Supreme Picture Framing God
Originally posted by alan beitz:
"...I went and had a chat to my bank manager re. lease finance for machinery etc. and he laughed and laughed . Said this town wasn't big enough to support a business such as this..."

I had a similar conversation with my banker in 1988, but there was a difference -- I *had* to borrow money from the guy. So, I had to prove to him -- on paper at least -- that my business would be a good loan risk. And I did. What surprised me was how much I learned in the process of making the busines plan that convinced him.

If I could have started without the loan, I probably would not have assembled the plan that has served us so well all these years (with revisions, of course -- all part of the plan).

"...being a knowall who can't be told I went ahead and did it the hard way..."

The hard way? In retrospect, how could you have done it easier? That's the insight a good business plan provides up front.

"...It seems to me that more important than a business plan is a big dose of stubborness and some good friends with a lot of faith in you..."

Well, stubbornness could be called determination, and that's necessary even with an outstanding plan. As for "good friends with a lot of faith", I don't have any of those; you are very fortunate.

Here's to another great year...(he said, as he proudly raised his $2.00 glass of wine)
 
M

Marc Lzier

Guest
<BLOCKQUOTE>quote:</font><HR>Originally posted by Jim Miller:
Here's to another great year...(he said, as he proudly raised his $2.00 glass of wine)
<HR></BLOCKQUOTE>

I might be that I'm not a big booze drinker or that or I'm just a really huge idiot (I'm sure some folks would hazard a guess on either side); But is a $2.00 glass of vino a good or a bad thing? And is that for cost for the glass, the wine, or both together?
 
A

alan beitz

Guest
dosen't really matter as long as it's a red - this seems to to go hand in hand with the business that we are involved in and lastly I don't tkink we would have succeeded without good friends

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Alzy
 
A

alan beitz

Guest
Sorry Terry but pineapple juice brings me out in a rash - your area of Australia produces the product that I am rather fond of -a mans got to have some vices and red wine is one of mine - bye for now
 
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