It makes sense to have a business plan, right? I mean we are professional people, we understand the value of planning and there is no way we would be heading into something as massive as setting up an Independent HR Consultancy without having a solid plan in place.
So what is a Business Plan? Googling for ideas and templates (have to love those templates!) can quickly lead to overwhelm – but remember that these are often business plans that are being written in order to apply for funding or a Business loan – if you are writing a plan for yourself then it doesn’t need to be anything like as detailed as those.
Your Plan could include;
- Pre- launch activities – if you are in the pre-launch phase then having a programme of actions in place to build up awareness and visibility before your official launch can be a good way to really get off to a good start.
- How many hours a week are you intending to work? – Unless you plan this then a new Business can very easily take up all of your time and before you know it that life of time freedom that you imagined can seem like a very dim and distant dream. Take a realistic look at the number of hours you have available to work and when you want to work – early mornings; conventional business hours; in the evenings; at the weekend; during the school holidays. Set your intentions right from the start.
- How much money do you want to make? – This may feel like an area where it is futile to do any planning – particularly before you actually have any clients. Knowing what your income goals are, combined with knowing how many hours you have available will go a long way towards helping you to set your prices at a realistic level, understand how many clients you need to be aiming for and making decisions about what services you need to be selling.
- What are you intending to charge for your services? – A lot of people fall into the trap of charging rock bottom rates for their services, particularly in the early stages of setting up a business – your business plan should include details of how much business you are going to need to achieve at whatever level you are setting your prices in order to achieve your income goals.
- How are you intending to package up what you are offering? There are a lot of different options available and how you choose to offer your services can have a significant impact on the income levels you will achieve.
- How are potential clients going to find out about you? – Marketing and visibility can be a significant challenge and is often an area where HR Professionals have little or no experience so it can be a very steep learning curve.
- What do you need to invest in? It can be a shock to the system to go from a corporate role where everything you needed was (usually) provided for you and you may have had a budget to everything having to come out of your own pocket. If you aren’t careful then your money will very quickly run out but also it is a mistake to try to bootstrap everything and spend as little as possible.
- What are the options for Marketing? Social Media, Business networking, referrals, advertising, joining industry bodies, direct mailshots, video marketing, paid lead generation… the list of possibilities is very long – so which ones are right for you?
- Are you going to need additional support and if so how much will it cost? The temptation can be to set up a business where you do everything yourself and consider your time to be a free resource. All this will do is drain away your time, doing tasks that aren’t suited to you and prevent you from having time to do all of the income generating activities that you should be doing. If you don’t want to go down the route of employing people then there are a huge number of Virtual Assistants and Specialist service providers that can do those tasks in a fraction of the time at very affordable rates and – let’s be honest – they will almost certainly do a much better job.
- Are you going to set up a Business that specialises or do you want one which provides General HR services? This is a big debate that there isn’t really time to cover here – the vast majority of Independent HR Consultants are offering all HR services to anybody in any industry that employees people. So do you want to pitch into the crowd and hope to be seen or are you willing to reduce your potential pool of clients but be much more visible to the Industry group that you have chosen to specialise in?
So to get back to the original question – Do you need a Business Plan for your Consultancy Business?
I am suggesting that the answer is both Yes and No
No – you don’t need a formal, 50 page document that you sweat blood and tears over for months on end and which goes into excruciating detail about projected income etc.
Yes – you do need a plan. A short, but very important statement of your goals and intentions that is really just for you and will probably be a work in constant progress. The benefits of this plan are largely to be found in the process of putting it together – having to think about what you want and how you are going to achieve it, understanding what is important to you (and what isn’t), having a means of measuring your progress as you go along.
Your Business Plan is your informal contract with yourself. It is something you should be looking at, referring to and amending every day – it is your roadmap to success.