Time & Cost To Prepare a Business PLan
- Learning curve. If you choose the do it yourself method and you are not familiar with how to prepare a business plan, then you need to factor in the time it will take to learn how to prepare a business plan, the cost you place on your time to do so and the cost of any materials or courses. The learning curve is not a factor if you utilize a business plan consultant to prepare the plan.
- Market research. The cost and time depends on the complexity of the research required and whether or not you do it yourself or utilize a professional. Research for many business types is often publicly available if you know were to search, while for some other business types the research may have to be more extensive or even developed from scratch which adds to the time and cost.
- Formulating ideas and gathering basic data. This is generally your time in putting together the basic data and thoughts before starting to write the business plan. Examples are sales volume, expenses, etc. Some people utilize a business plan consultant to help in this process but your involvement is still necessary.
- Preparing financial projections. You will usually have to go through a number of iterations to arrive at realistic financial projections based on the sales and expenses you come up with. It helps if you have some basic understanding of financial statements, otherwise you may have to engage the services of a consultant or CPA.
- Writing the business plan. Once all the basic data and information is available, it will take a professional a minimum of a week to complete the business plan and probably more if you are doing it yourself. The actual amount of time and cost will depend on the particular case and it's complexity and the number and type of changes made along the way.
- The impact of low quality work. There is nothing more expensive and time consuming than low quality work. Be careful not to choose a business plan consultant based on a low price criteria. Make sure that he or she has the required practical business experience and credentials to properly serve your needs. Beware those that quote you an unrealistically low price to prepare a business plan only to later find out that what you get is an off the self business plan with cosmetic changes or a fill in the blank approach. These type business plan consultants normally lack actual business expertise and unable to properly advise you or custom prepare your plan. The result is that you will most likely have to start over again or totally loose your opportunity.
- Middle of the road approach. It is often advisable to adapt the middle of the road approach to preparing a business plan, whereby you engage the services of a business plan consultant to either assist with guiding you through the business plan writing process, or review and critique your completed work or take the lead in writing the business plan with your input of the basic ideas, data and business specific information. This reduces consulting time required, increases client identification with the plan and improves implementation.
- Another method is to purchase a good business plan software package that can be used as a tool to guide you through the mechanics and organization of the business plan but you will still need to create the plan yourself.