Talk to any entrepreneur who has more than one business and you’ll find a common theme. The second time round, they had a business plan.

Andrew Ferguson co-founded Gravitate with business partners John Lennard and Duncan Watt in 2001. The aim was to provide high quality web publishing services to a wide range of industries.

“We worked out the different components of a rough business plan relying on the individual skills that we each had. Two of us had some financial background already and I had a marketing degree so we believed we had the know how and skill to get the company up and running,” says Ferguson.

But he feels they fell into a trap. They neglected the discipline of formal business planning and ended up just responding to opportunities when they arose rather than making conscious decisions to drive the business to where they wanted it to be.

Without a formal plan they tended to take the path of least resistance, he says, rather than making the harder choices that might not have provided immediate revenue but would have set the company up for a better future.
It’s not a mistake he’s repeating as he launches his second business, a web application sold as a service that’s a spinoff of Gravitate.

“By having a plan in place we are going out and driving sales and marketing initiatives in a much more focused way because we know exactly where we are trying to get to.”

A business plan defines the products and services you offer and what needs to be done on a regular basis to be successful. Key components include a mission statement or executive summary. Whether it’s one line or ten pages you need to have a clear understanding of who you are and what you want to achieve.
Glynn Rigby, director of Business Line Ethics (BEL) agrees that having a business plan makes it easier to keep that focus.

BEL’s complexity made a plan imperative.

“We have a product that crosses so many different corporate environments so we needed a clear idea of how we would approach such a diverse array of clients,” says Rigby.

BEL helps companies capture critical information that impacts on their bottom line and assists employers with legal compliance. “Our business plan gave us a clear way forward in terms of how we would roll the service out by taking a soft version to market for testing and then a more complete rollout to key clients,” says Rigby.
The business plan was also used as a guide during the difficult process of estimating the level of financial investment from the outset.