Writing Your Plan
- A Simple Business Plan – or Just a Profit / Loss Projection – is Better Than Nothing At All
- Would you build a house without a plan? – How about your business?
This is especially critical in trucking as there are so many small things that can negatively affect profitability. On this page, we have summarized the key issues used in the planning process.
We first review why businesses plan, followed by some sobering statistics. We then cover a typical plan, but with the four topics that are most important to a trucking business. If nothing else, you need to know what your numbers are telling you.
MAIN REASONS TO PLAN
- Identify factors for success and failure
- Detail how to favorably influence factors that determines success
- Make you think about each part of your business and how they fit together
- Think about realistic, attainable goals for “daily decisions”
- Show others your intelligence of your business and industry
SOME STATISTICS TO PONDER
—Less than 5% of businesses prepare and use a formal plan
—Bankruptcies are at an all time high (1 in 100 households involved per year)
—Primary problems are caused by job loss, divorce, credit, unforeseen expenses and taxes
—As a nation, we are now spending more money than we are making
—Less than half of the people have adequate personal insurance and retirement plans
—Most people switch companies, have problems or fail due to not having communicated their “personal expectations”
MAJOR COMPONENTS OF A PLAN
There are many resources available to help you write a business plan. We have summarized how we take textbook planning, look at the relative value to small trucking businesses and have summarized it in the following.
- Packaging – It is a calling card for your business so it should be attractive and professional (not flashy).
- Title Page – It should also be simple and identifies it as a plan with your business name, address, phone and date listed
- Executive Summary – This would be an overview of everything in your plan. One may be needed for those who do not understand our industry, but it is not usually needed as most who you deal with do understand the business.
- Financing Proposal – This would be for equipment purchases, etc. Like the Summary, it is usually not necessary, as the people you deal with understand the industry.
- Business / Industry Description – THIS IS A MUST to show others your knowledge of both our industry and what segment you are going to focus on (van, flat, regional, etc.).
- Operating Information – THIS ANOTHER MUST for both yourself and anyone you business with. It is here where you identify exactly who is going to do what in your business.
- Marketing Plan – One is not needed if you are contracting to known entity (like a fleet…)
- Financial Plan – THIS IS THE MOST CRITICAL PART OF A PLAN – you need to know yours inside out. This is your profit and loss projections explaining what numbers goes into each category.
- Organization Plan – THIS IS A MUST where you show your key personnel with their qualifications.
If you do nothing else, at least prepare a basic financial plan. It is at the core of all good business planning.