Hello my name is Tom Montgomery.

I have had the good fortune of owning and operating a small business for more than ten years.

I have a short story to tell that I hope will help you. 

I was driven to have my own business no matter what risks I had to face. 

In 1982 I purchased a franchise to sell computer supplies.  I left a good job and set out to own and operate a small business, I was thrilled to be in that position. My dream to become an entrepreneur was taking shape.

In the first six months of business I had hired a salesman and an assistant and I had to make payroll for all of us; it was a scary time. 

The good news was we had already established 600 customers and they liked the way we took care of their computer supply needs.  Maintaining customer loyalty meant everything.

That was my first lesson on how important customer retention is to any business.

We forged ahead not knowing for certain where we were headed.   

I needed to get cash to survive.

The need for cash created the next important lesson.

I needed a solid business plan to attract investors in the business.

All during this time, we continued to grow our customer base and the need for cash was getting greater.

I went to the Small Business Association (SBA) to get help with my problem.  They understood my issues and were willing to provide some excellent advice.  They also knew a number of "angel" investors.  These are people who have successfully run organizations and businesses and were willing to invest in businesses that showed promise.

So I prepared several presentations to angel investors.

That is where I found how important a good business plan is to survival.

• I needed good financial information (P&L), balance sheet and funding sources, a breakeven analysis, cash flow projections, a receivables strategy, etc, etc.
• a good marketing plan
• a good sales plan
• an operations plan
• an employee retention plan
• a supplier plan - how was I going to continue getting the goods we sold
• a risk management plan (insurance to cover loss)
• an exit strategy (if I ever wanted to sell the business or bring in partners)

It was difficult to put all this information together but this is what investors required before they will even consider funding a business.

It taught me the importance of planning and served as an excellent roadmap to becoming a successful small business.