Business and strategic planning for social enterprises

A business plan, on the other hand, is about business, which is to say about money.

A business plan is a scale model of your enterprise. You model your environment, feed in the expected inputs, and see what figures come out the other end. A realistic simulation will prepare you for the actual production, will help convince your partners that you have done your homework, and will force you to clarify the assumptions you depend on to make it all work.

Writing a business plan is useful to:

• Formalise your ideas
• Structure your priorities
• Test your project's viability
• Demonstrate to funders and partners that you know what you're doing
• Help identify responsibilities
• Help you work together with your partners
• Help you ask the right questions AND provides some of the answers
• Identify areas where you need to find out more
• Provide you with a map to guide your progress, and stops you from getting sidetracked.

Mission statement/goals/objective

All the elements that aren't about money are carried over from your strategic plan. They don't change; what happens now is that you have to realistically assess how much the inspiration they have for you is worth to other people.

The situation report

It is here that you feed in the results of your surveys, your SWOT analysis, your judgements of the trends and your evaluation of the competition. Facts are better than estimates, and estimates are better than guesses, but even guesses are better than not putting anything down. Guesses provide a starting point for later refinement, and a marker for what elements the budget is particularly sensitive to, and a reminder that decisions have to be taken no matter what.

Plans

• The outcomes that have to be achieved,
• The steps that will be needed to get there,
• The schedule for these to be done,
• The people who will need to do them, and
• What they will cost.
• Project management software may be useful for this stage.

Marketing plan

With those being your goals, and that being the environment you're operating in, how can you market your vision to the community? What image are you projecting, through what materials? What PR/media relations/advertising is going to be needed to feed your appeals? What target groups are you distinguishing? What marketing methods will you use?

Decide on the answers to these questions and set your objectives. Develop an action plan that will lead you to these ends, and develop performance indicators that will enable you to monitor the processes. Key performance areas here might include:

• Your relations with the media
• Your success in gaining sponsorship
• Your success at crowdfunding from the general public
• Projected sales of goods and services
• Product service delivery standards
• Resources analysis (including human resources plan)
• Your resources which include human resources and budget for marketing and communications

Your resources plan should cover both human resources (with a note of the systems and policies you have in place to support them) and material resources (buildings, equipment, transport). As above, the plan should result in measurable performance indicators.

Operational plan

The operational plan covers your delivery of products and services. What do you do? How do you do it? Again, the plan should result in performance indicators.

The budget (financial plan)

The heart of the business plan is the budget. Everything else in the plan is there either to feed assumptions into the budget or explain the conclusions that emerge from the budget. It won't come at the front of the document, but it has to come at the head of the process.

What you count in your budget will to some extent depend on the details of your business, but a fairly standard example might be:

Income

• Crowdfunding
• Investments
• Philanthropic grants
• Special event income
• Sale of goods/services
• Sponsorship
• Interest received
• Other income

Expenditure

• Salaries/wages
• Superannuation
• Insurance
• Bank charges
• Rent
• Advertising/promotions
• Legal/accounting fees
• Supplies
• Office equipment
• Stationery
• Utilities (power/light/water)
• Travel costs
• Subscriptions/affiliation fees/memberships
• Taxes/GST (if applicable)
• Repairs/maintenance
• Casual labour
• Depreciation
• Evaluation

Miscellaneous expenses/sundries

Include the previous year's actual figures and next year's projected figures. Key assumptions should be flagged as footnotes and referred back to the situation analysis.

The budget is its own performance indicator.

Evaluation plan

While many companies may look only at the bottom line of the financial report, social enterprises need to be able to report both on financial soundness and on people and planet mission outcomes. Evaluation needs to be built into the structure of the operation - and needs to be carefully costed into the budget.

Timelines

Your strategic plan should be for three or five years, with yearly reviews. Your business plan should be re-done each year, with six-monthly reviews, and should be re-done when you are contemplating significant new options or threats - either when applying for new grants or when facing salary increases.

Finding help

Do you know someone with experience in small business planning? If they don't have time to write a plan for you, perhaps they will mentor you while you learn.

Could a local company sponsor an employee to help you do this? Could you get help from a business student?

Some cheap software available online provides templates for business plans but they will need considerable work to be adapted to the circumstances of your own case.

Writing tips