Creating a Business Plan for Your Real Estate Investing BusinessPosted on August 3, 2014 by
Getting Started in Real Estate Investing by Creating a Business Plan
with Special Guest, Chip Cross
If your goal is to become a successful real estate investor, you need a PLAN. For every successful business that was launched with a well-thought-out business plan, it seems you can find an equally successful one that was launched with nothing more than some scribbles on the back of a napkin. In fact, the contrarian approach may be the one you hear most about — i.e., entrepreneurs dismissing a business plan as something they wrote and then stuffed in the bottom of a drawer.
But there is new data recently reported after a survey was done that asked thousands of businesses questions about their their goals and business planning. The responses showed that those who completed business plans were nearly twice as likely to successfully grow their businesses and/or obtain capital as those who didn’t write a plan. Here is a breakdown of the numbers:
2,877 people completed the survey. Of those, 995 had completed a plan.
- 297 of them (36%) secured a loan
- 280 of them (36%) secured investment capital
- 499 of them (64%) had grown their business
1,556 of the 2,877 had not yet completed their plan.
- 222 of them (18%) secured a loan
- 219 of them (18%) secured investment capital
- 501 of them (43%) had grown their business
Regardless of the type of company, the growth stage of the company and the intent for the business plan, the analysis above found that writing a business plan correlated with increased success in every one of the business goals included in the study. These were: obtaining a loan, getting investment capital, making a major purchase, recruiting a new team member, thinking more strategically and growing the company.
The authors of the study concluded: “Except in a small number of cases, business planning appeared to be positively correlated with business success as measured by our variables. While an analysis cannot say that completing a business plan will lead to success, it does indicate that the type of entrepreneur who completes a business plan is also more likely to run a successful business.”
So there you have it: you’re better off WITH a business plan than without one. In fact, based on the survey, you are twice as likely to grow your business or achieve funding if you have taken the time to write a business plan.
This month at the Charlotte REIA Meeting on Thursday, Augutst 7th at 6PM at the Crowne Plaza Charlotte Executive Park located at 5700 Westpark Dr in Charlotte, NC (map) where our special guest speaker Chip Cross will be teaching us how to create a business plan whether we are just starting a business or have been running a business for years.
Chip Cross is a native of Marion N.C. Chip graduated from Clemson University with an MBA. He served as Director of Leadership Development for Western Carolina Industries, a 550-member Employer Association in Western North Carolina. During this time he worked with over 150 companies and training several thousand supervisors and management personnel in leadership development.
Chip became a part-time real estate investor 15 years ago as a part of his retirement plan. He and his wife, Penny, currently own 40 rental units in their real estate business and an additional 60 units as their share of a partnership real estate business they are involved in. Chip began working with his first private lender in 2014 and has purchased 4 homes at bargain prices which are producing a positive cash flow for his business and an attractive rate of return for his private lender. Chip believes in continuing education and has invested in Jay Conner’s Private Lending Course.
Chip has mentored several students in the development of their business plans. Many of his students have practiced presenting their business plans to local professionals; following a similar format to the one used on “Shark Tank.” He has personally written two business plans: one for his personal real estate business and one for his partnership.
Chip is very excited to have the opportunity to speak to Charlotte REIA. He plans to share “lessons learned” from his experiences in real estate over the past 15 years and a format for developing a business plan for your real estate business. The session will be interactive; drawing on the knowledge, expertise, and “best practices” of those in attendance as they work through the development of their business plans.
*Please Note: Meeting agenda is subject to change.