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Business development
experts stress the importance of consumer initiative and ability to
complete a task. They tell us that people who are likely to be successfully
self-employed should not have to be "spoon fed." However, taking initiative
does not preclude being provided with direction, rationale, and support.
Developing the business plan requires a wide range of skills and knowledge.
Most potential business owners you will work with have not developed
a business plan before. Many are capable of developing a plan but their
skills are undeveloped. That is why we recommend they work with a business
development consultant who will guide them with developing their business
plan. Possible sources of assistance are listed in Chapter 7, "Resources
and Resource Partners." In this chapter, we outline appropriate roles
for the consumer, counselor, and business development consultant.
The Consumer's
Role
The potential business
owner ultimately is responsible for:
- Deciding what
business to pursue
- Conducting a
feasibility study
- Developing a
business plan
- Obtaining necessary
permits, licenses, and insurances
- Hiring employees
- Securing business
start-up funds
- Developing customers
- Locating suppliers
- Starting the
business.
The Counselor's
Role
In addition to
the counseling relationship, your role in the self-employment process
also includes:
- Explaining VR's,
the consumer's, and any other organization's (e.g., business development
consultant) role in the self-employment process
- Clearly communicating
the self-employment process that will be followed including how agency
decisions will be made for pursuing self-employment
- Communicating
whether and how the agency will help with training, developing a business
plan, and VR funding of the business
- Helping the
consumer decide which business to pursue
- Deciding which
assessments, if any, will be used
- Guiding the
feasibility study including conducting or co-conducting any assessments
and interpreting the results to determine whether or not to proceed
- Providing information
necessary to assist the consumer with developing a business plan
- Supporting the
consumer and being the liaison between him or her and consultants
and lenders
- Reviewing the
final business plan to determine the agency's contribution, if any
The Business
Development Consultant's Role
The business development
consultant:
- Does not develop
the business plan, but guides the consumer through the process with
expertise and a realistic perspective
- Recommends potential
funding sources
- May help assemble
a funding package
- Readies the
consumer for meeting potential funders
- Suggests marketing
strategies
- May conduct
a feasibility analysis
- May make recommendations
on the viability of the proposed business
The consultant
should have experience in developing business plans. Be aware, however,
that this does not ensure that he or she will develop a realistic, quality
plan. You should ask for an individual's or organization's credentials,
interview past customers, and talk with local bankers or lenders. Counselors
should not expect a consultant to rubber-stamp a business plan without
explanation or involvement on the consultant's part. When asked to do
this, a small business consultant may provide some feedback and recommendations,
but will be concerned about his or her business' reputation and liability.
What
Would You Do? A Case Example
The feasibility
study indicated that Arnold was a promising candidate for self-employment;
however, his disability and education level made written and spoken
communication very difficult. Jo, Arnold's VR counselor, understood
the importance of having the consumer take responsibility for
writing his or her own business plan but she doubted Arnold's
ability to develop a business plan. She did, however, believe
that Arnold knew what he wanted to do, knew how to do it, and
had the ability to do it. The ideas were in his head and he simply
needed help in transforming them into a written plan so that others
could see the merit of his proposal.
Jo's schedule and state guidelines, did not permit the level of
involvement she thought was needed in this case. Her solution
was to recruit people from Arnold's support system, and hire a
business consultant with whom she had worked before. Arnold's
sister, Barb, agreed to assist Arnold and acted as a facilitator
between him and the consultant. She sat in on Arnold's next meeting
with Jo. At that time, Jo explained to both of them what a good
business plan should include and suggested sources for gathering
the information Arnold would need. Jo also explained that Arnold
should provide the ideas and whenever possible, he should do the
research himself and do his own writing of ideas and findings.
During the consulting interview, Barb helped Arnold draw out the
key points of his proposal, the consultant recorded them and asked
his own clarifying questions. Barb made sure Arnold understood
the consultant's questions, and she made sure the consultant limited
his role to only helping clarify and articulate Arnold's ideas.
Together, Arnold, the consultant, and Barb were quite a good team.
From Arnold and Barbs' materials, the consultant produced a concise
and well-written document; Barb facilitated the flow of communications
and supported Arnold in researching and writing when necessary.
Arnold initiated ideas, did research and writing, and made decisions.
Jo was satisfied that the resulting business plan met VR standards
and very importantly, it was Arnold's plan. |
Case Studies
Case 1
As a new consumer
of VR services Celia came to her first VR meeting knowing she wanted
to be self-employed as a dog groomer. Her feasibility study, which included
the Beginning to Develop Your Business Plan questions, the Monthly Personal
Living Expenses Worksheet, and the Business Assessment Scale, indicated
she was a good candidate for pursuing self-employment. Although she
was able to answer the preliminary questions about her proposed business
her confidence flagged at the prospect of developing a complete business
plan on her own.
Understanding this apprehension, Celia's counselor, Ben, gave her a
copy of the VR agency's business plan guidelines and an example of a
good business plan. He explained that her community houses an organization
that teaches people to develop business plans and that this same organization
would work with her to develop her business plan. He gave her the organization's
address and phone number. She contacted the agency, signed up for and
completed the classes. Using the organization's library, the community
library, other sources, and with guidance from both Ben and the business
development consultant, Celia developed a viable business plan and a
successful business.
Case 2
Felicia came
to her first VR meeting knowing she wanted to own an aquarium and speciality
fish store. Like Celia, Felicia's feasibility study was positive and
she displayed the same lack of confidence in her ability to develop
a business plan. But in this case, Felicia's counselor, Carol, told
her they could not go any further in the process until Felicia returned
with a business plan. Felicia left without any further guidance.
Determined to follow through, Felicia called her bank and visited the
commercial loan banker who gave her a business plan outline and forms
to complete but did not explain the forms or their purpose. The banker
was very discouraging about how much collateral she would need and about
the possibility of the bank funding her small start-up business. She
worked through the forms as best she could and developed a plan that
she submitted to Carol.
Carol said the plan did not meet the agency's criteria for committing
to a business, but she did not provide an example of an acceptable business
plan. Carol made two suggestions: that Felicia try again to develop
an acceptable business plan, or that Felicia seriously consider another
employment goal. Carol also expressed her opinion that Felicia did not
have the capability to start or run her own business. Feeling defeated,
Felicia took a job as a receptionist/office worker for an insurance
agency.
Case 3
After a few
meetings with VR, Habib reported to his counselor, Mark, that he had
thought a lot about self-employment and thought that was what he wanted
to do. He did not know exactly the kind of business he wanted to start
but thought he might want to try publishing an newsletter for outdoor
enthusiasts. Habib believed that because of his disability, a head injury,
and because he had to stay at home to care for his ill wife, he could
not work for anyone else, but that he thought it would work to be self-employed
so he could determine his own hours.
Mark had worked in the community for some time and had established a
large network of contacts. Because this was how he had worked in the
past with others who wanted to be self-employed and because Habib was
reluctant to initiate phone calls to strangers, Mark began calling all
the people he could possibly think of who could help Habib. He explained
all about Habib to his contacts and set up meetings so Habib could talk
about his idea. The contacts provided Habib with advice on how to open
such a business, names of other people and organizations to contact,
and suggestions for reading materials.
Armed with all this information, both Habib and Mark were enthusiastic
about the possibilities. Mark was ready to start following the leads,
but he had been cautioned by one of the contacts to lay low and let
Habib take control from this point on because this was to be Habib's
business. Habib needed to start taking control because Mark would not
be there after the business opened. This was hard for Mark to accept
because he thought he was just assisting by opening doors for Habib.
However, Mark respected the advice and explained why from this point
on Habib would be expected to take the lead, but that he would be there
to provide encouragement and suggestions when Habib needed them.
Habib contacted some of the people. When some did not return his phone
calls, he contacted Mark and complained, but would not make follow-up
calls himself. He wrote for information on publishing, called the school
to take a computer class but did not sign up, and got some of the books
on developing a small business from the local Small Business Development
Center but did not read them. After several meetings with Mark during
which they discussed Habib's next steps and Mark provided prompts and
encouragement, nothing changed. Mark told Habib it appeared he would
not be a successful business owner and that they should start looking
at other options. Habib subsequently found work as an editor for a local
publishing firm. He was able to arrange part-time in-home care for his
wife so he could work both at home and in the publishing firm's office.
Case 1
Discussion: Celia, the dog groomer, had everything going for
her. She had initiative. Her counselor, Ben, facilitated the process
by showing her what the agency expected, by giving her a copy of a good
business plan to review, and by suggesting a resource in the community
to contact. Celia contacted that agency, registered for and attended
the classes it offered, and used the agency's resources to help her
develop her business plan. By taking advantage of the agency's resources
and guidance she educated herself and develop a strong business plan
and ultimately a successful business.
Case
2 Discussion: Although she also demonstrated initiative, Felicia
was not as fortunate. She worked hard to develop a business plan, but
neither her counselor, Carol, nor the banker provided guidance on how
to start a business. Even though she knew Felicia was apprehensive Carol's
attitude of "If she is qualified to run a business, she will figure
it out" helped set Felicia up for failure. Felicia's attempt to
develop a business plan was punished by Carol. In a different situation,
it is likely Felicia would have succeeded.
Case
3 Discussion: Mark
was doing what he had done in the past to help someone be self-employed.
Mark began the process with Habib in tow, but later when told that it
was best for Habib to control the process, Mark retreated to the role
of advisor, supporter, and liaison. However, Habib did not take initiative
or complete the activities needed to develop a business plan. After
realizing Habib's inability to take initiative or complete activities
necessary to develop a sound business, Mark suggested it was time to
look at other options.
Chapter
5 Study Guide: Who Does What in the Process?
- The _________
develops the business plan.
- Three
of the main functions of the counselor in the self-employment process
are ____________, ______________, and _________.
- The
counselor must be able to read and understand a business plan because
in most cases he or she:
a. Reviews the final business
plan
b. Evaluates the business plan to determine if the agency will or
will not support it
c. Determines the agency's contribution
d. All of the above
e. None of the above
- Consumer
initiative and ability to complete the steps in the self-employment
process are indicators of potential success. True_____ False______
-
In most cases consumers should (work with a consultant/work on their
own) to develop a business plan.
Study
Guide Answers: Chapter 5 - Who Does What in the Process
© July 1998, 1st Revision June 1999, 2nd Revision February 2001
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