I am guilty of leaping first and looking for the net as I free-fall, of shooting from the hip and then looking to see that the target is shoulder-high. So it was with opening our house as a B&B.
We had our first guests, the delightful Jeff and Joanne, in mid-January. A few weeks later, we enrolled in an 8-week course on how to write a business plan that was offered through the Bluffton Center for Entrepreneurs. And at the end of the class, we were clutching an Oscar and a star-shaped acrylic award for First Place in the Ropp Triplett Business Plan Competition.
Mark remembered to thank his agent.
All kidding aside, we are thankful to Kathy Keller with the Small Business Development Center at Rhodes State College in Lima for walking us through the steps of writing our plan. It often felt like driving down a dark township road with no headlights, or contemplating a Zen koan.
What will your monthly sales be for the first year?
"Kathy, how are we supposed to answer this question?" I whined, reading through the business plan template she had provided us. "That's, like, pulling numbers out of thin air."
"Yes," said Kathy.
Complete Monthly Income, Cash Flow and Balance Sheet Projections for Years 1, 2 and 3. Be sure to include an explanation of how you came up with these numbers.
"So, this is where I'm supposed to type, 'made 'em up'?" I said, baffled.
"No," said Kathy.
She explained that a lot of this is guesswork, but of the educated kind. It's based on what other B&Bs and hotels are charging, what kind of occupancy rates they have, what occupancy rates we expect to have and what expenses will follow us from month to month.
The process seemed daunting. Not just the writing of the plan, which was tough enough, but the collection of the data necessary to make it hang together, to make it make financial sense. I'm not super good at financial sense.
How are we going to get all this information? What data will we need so that we feel comfortable making certain assumptions, and where are we going to get it? And where's the nearest bucket of sand, so I can go hide my head in it?
We filled in the blanks, little by slow. How many guests will we have this year? We started guessing how many people would be interested in booking a room in May, when Ohio Northern University has its law school and undergraduate college graduations, and went month to month from there. How many people would buy a jar of applesauce? We shrugged, and thought five sounded reasonable. I have five siblings, so I can at least force them to make a purchase.
Then again, I'd have to offer them the Friends and Family discount, so there go my merchandise profits.
And on it went, like that, from Section 1, Executive Summary, to Section VI, Marketing Plan.
When it got sticky, as it often did at midnight with piles of paper strewn about the dinner table and many blank spots left in our template, Kathy's oft-repeated aphorism echoed in my head: "Businesses don't plan to fail, they fail to plan."
Congratulations to our classmates and fellow competitors, Paula Scott of PS Editorial Services in Bluffton, which took second place, and Ted Spencer of the vintage and antique store Winding Road Sales in Wapakoneta. May we all succeed as a result of planning.