Posted by Often budding entrepreneurs ask me how to divide the time from the business idea, to writing the business plan, to opening the company and then running it for… here the term “indefinitely” falls most often… How to plan the time from today to, say, 3 years from now, taking into account all the necessary steps that have to happen and that I myself have to do in order to achieve what I intend?
Whenever I advise people who want to start their first business in life or just do some venture, regardless of the form of business, to think about “how much time they have to achieve what they intend to achieve.” The point is that sometimes they are students who have relatively a lot of time ahead of them, don’t have major commitments, can make more mistakes, and more often those mistakes can be corrected. And sometimes they are people in their 40s or 50s and, for example, have another job, but want to expand their running “after hours” business or start something “from scratch.” These are completely different life, work and family situations that need to be taken into account when thinking about your business or even as a hobby.
At this point, I will point out that we will now detach ourselves from the organizational and legal form of the business activity being conducted. Any company – be it a popular business run by an individual or a company – is just a legal “vehicle” for conducting business activities in accordance with the law. One can also add to this the possibility of running one’s business based on civil law contracts with one’s customers and suppliers as an individual. In our considerations, this is not relevant for now. In the future we will describe the various possibilities of doing business, but this is quite a complicated issue.
So let’s return to time.
Let’s divide the time interval from today to, say, 3 years from now into 3 periods: (1) planning, (2) preparation and (3) action.
First of all, the planning period is the first of the time frames that you need to spend in order for anything in your life to occur. The planning period is the time when you should think about many aspects of the business that you will have to think about, understand, come up with ideas for, and resolve at some point anyway. It’s better to do it now, without the costs incurred, the friendships made (e.g., long conversations with a potential partner), the effort to prepare and… hope. The planning period is just to turn hope into high certainty of what, how, when, where and with whom you need to do to achieve what you want.
When it comes to hope in business, I have to quote a sentence I read in a book by creator, book author Ryan Holiday titled. “Timeless Hit.” He writes that “faith and hope have nothing to do with lasting success”. I love repeating this phrase to myself and to people who are planning their business or managing a department, team or even a larger part of some organization. Give up hope, plan your preparations and actions.
If you want to learn more about what Ryan Holiday says, check out his YT channel:
The planning period can last up to several months. When I teach Business Plan subjects, we devote an entire semester to it with students. This is enough time to think about why I want to run a business, what products or services I want to sell, how to promote my business, etc. The results of such work should result in a coherent document containing all such thoughts. It is sometimes said that a good business plan can be 1-2 pages of A4, but I don’t think so. Just describing products or product lines usually takes more space, let alone a sales plan, general financial plan, etc.
Secondly, the preparation period is based on how big the preparations should be. If we want to open a store, 2-3 months is probably enough for a small renovation, stocking (ensuring a minimum number of units of the product line being sold) and some promotional activities. However, if we are planning a more complicated business activity – creating handicrafts, selling our own e-books, etc., then probably these times will be longer. What we need to do during the preparation period follows directly from the business plan prepared at the planning stage. Of course, you shouldn’t go overboard with the preparation – sometimes it’s a good idea to start a business, which means simply selling products or services, even if we don’t yet have everything we would ideally need to open a business with a champagne shot. However, minimal preparations are needed – otherwise, opening a business can be compared to building a rocket going to Mars, which we intend to build in already in flight.
Third, the period of operation of the company begins with the start of sales. Yes, not from the registration of the business or the signing of the articles of association, but from the start of business activity. Of course, these two moments can meet in time, but they can also be far apart. I will tell you about the variants to choose from in another post. But now let’s focus on the period of the company’s operation itself. For what period can you plan? For a year, two, three? I usually advise writing a business plan for a year, especially now, when the economic and international situation is as uncertain as ever in our recent Polish history. Twelve months is enough time to develop a business idea “from zero to…” – To what (to what amounts) it depends on the idea, the degree of determination and luck. And after that time you can decide what to do next with the business you have, whether it is worthwhile and profitable to continue doing what you are doing, or to change your life.
In future posts, I will describe why it is worthwhile to approach running a business as a project, defined in time from… to…, and how the phenomenon of making something worthwhile differs from making something pay off.