MANA and Agency Sales magazine have long advocated for independent manufacturers’ reps to have a business plan for their agencies — and not only have the plan, to but update it regularly. The adage “If you fail to plan, you plan to fail” comes to mind as reps are constantly reminded of the importance of updating and communicating the existence of their business plans to principals.

Even the quickest review of articles that have appeared in the association’s monthly magazine over the years will reveal a constant reference to the importance of business plans. Then there’s the contents of innumerable MANA special reports, questions posed during MANAcasts and counseling sessions, not to mention the agendas of the many MANA seminars that have been conducted — all referencing the need for the creation of business plans.

All the advice in the world is great, however, but there comes a time when someone is tasked with writing the business plan, and that’s when the real world intrudes. How many times has the individual tasked with writing the business plan complained that “I’m busy selling, I don’t have time,” or “We don’t need one right now, I’ll get to it later.”

Spurred by comments such as those, as he conducted a MANAcast earlier this year, MANA member Sid Ragona, Ragona Scientific, Pittsford, New York, suggested the use of a simplified, one-page business plan, streamlining the process for reps.

According to Ragona, “Trying to get reps to write a business plan is a notoriously difficult task. Most of the time people can’t see the return on investment for developing a business plan. They view it a bit like running in place and just wasting time. Basically, they don’t know where to start and what to include.”

One-Page Plan

In lieu of a lengthy and often detailed business plan, Ragona recommends a one-page business plan as a starting point. “The idea for this isn’t necessarily new, it’s been around for a long time. What I’m talking about here is just one sheet of paper that has nine different blocks on it. This is something that can be completed in a period of 30 minutes and it lets you tell your story in a clear and concise manner.”

In advocating for the one-page business plan Ragona, who also serves as a mentor for SCORE in Rochester, New York, cites many of its advantages vs. the traditional lengthy business plan:

• Length — The first major difference is the length of the document. Typically a business plan can run 30-60 pages — “give or take 10. The one-page document is just what it says it is and can be written on a board or posted on sticky notes.”
• Time — “A typical business plan can take weeks or months depending upon the agency’s commitment to include everything. The one-page effort can take all of 10-20 minutes.”
• Agency Rationale — According to Ragona, “Typically the major reasons for writing a business plan are to enable an agency to secure an investor or as part of the plan to sell the company. Conversely, the one-page plan is a model describing the operation of the agency. To a large degree it is a snapshot of your operation that includes all aspects of your agency. It can be argued that if you are compelled to write a business plan, the one-page plan should come first.”
• Psychology — “Suppose that after devoting considerable time and effort to creating a business plan that predicts the future for the agency going out three to five years, things change and the plan doesn’t pan out. What can happen is that the plan is seen as a failure by all of the agency’s personnel. Conversely, the one-page plan is an easy document to sit in front of and simply tweak as time goes by and changes occur in the agency’s operation.”
• Excuses — “An agency can come up with any number of excuses for not writing a business plan. There’s very little excuse for not coming up with the one-page version.”

Having made those salient points during the course of the MANAcast, Ragona went on to fill out a typical one-page plan to show how simple and easy the process is.

Completing the Template

He began his presentation by making use of a template comprising nine boxes. In the center of the template is a box labeled the “value proposition.” To the left of the value proposition are three boxes entitled “key partners,” “key activities” and “key resources.” “These are all the things you need in order to create value,” he explained.

To the right of the value proposition section are three more boxes: “customer relationships,” “customer segments,” and “customer channels.” According to Ragona, “It’s whom you deliver value to.”

Located on the bottom of the template are sections devoted to “cost structure” and “revenue streams.”

According to Ragona, “To some degree the boxes on the left are internal to your organization. The boxes on the right are external and represent your customers.”

Value Proposition — located in the center of the template. Ragona maintains that “If you don’t have a value proposition — or don’t know what it is — then you don’t have a business. You have to know your value.” He added that a value proposition is specific to your organization, but in general terms a rep might state, for instance, that ‘We don’t get paid until the principal gets paid’; ‘you know the territory’; ‘you’ve been in business x-number of years’; ‘you have, and use, a database.’”

He explained that the above are propositions that are probably common to all reps. Moving on from there and with the use of bullet points, “You can list the value propositions that are specific to your organization: the territory that you specialize in, what institutions and customer base are local to you, your geographical location, number of salespeople and service personnel, types of synergistic products that you already represent, references from existing customers.

“You should be able to have 10-20 items listed here as they all represent the value that you bring to the table.”

Customer Relationships — In this, the first of the three boxes occupying space to the left of the business value proposition, reps should detail how they stay in touch with customers. “You must have customers in order to have relationships. Then the question remains, what type of relationships do you have? And, keep in mind that this is going to be different for each agency. Is it just email, phone, and the occasional personal visit? Or, do you have a number of repeat customers? Can they be customers that would provide you with references? Do you just meet them at trade shows, or do you have personal relationships (i.e., dinners, social visits)? Do you consider some customers as personal friends? How you interact with them all becomes part of your story.”

Channels — It’s here that reps should list what means they employ to deliver their value. “The types of things that should be listed — in bullet points — include participation in trade shows, conducting virtual meetings, others ways you communicate with customers (i.e., email, texting, etc.), online product demonstrations, joint visits, etc. These are all an integral part of your story.”

Customer Segments — Are they industrial, universities, research facilities, OEMs or hospitality? “Principals want to know who you’re servicing. Enumerating what your customer segments are is important because that’s how you tell your principals what field you play in.” It’s important to go so far as to attach percentages of business conducted with the various segments.

Key Partners — No rep can perform the job without assistance and sometimes we forget all those individuals we depend upon in order to perform our jobs. That’s why it’s important to list everyone you can’t do without. That includes legal counsel, accountants, IT pros, virtual assistants, travel agents, banking resources, loyalty programs you participate in, associations (e.g., MANA), etc.

Key Activities — A full list of all the activities your agency participates in that allow you to deliver value. “Up until Covid that would typically include trade shows, prospecting, joint calls, marketing, social media. The word ‘key’ here means that if you took that activity away, your organization would have great difficulty operating.”

Key Resources — “What are the key resources your agency depends upon that you can’t do without? They would include employees, database, security for the database, furniture, inventory, the building you occupy, and the vehicles you use. Include anything you have that’s required for you to conduct your business.

Cost Structure — An agency’s cost structure develops from its key partners, activities and resources. “All of these cost something. It’s important to look at this box and try to make a determination of locating where cost can be reduced. Do this at the same time you make an effort to increase the revenue stream.”

Revenue Streams — The final box to consider is that “As reps you may have multiple revenue streams, e.g., acting as a stocking rep and/or providing consulting services. You may want to mull over the idea that you should have a second one-page business plan that concentrates on your consulting business or any other type of business/service you provide. You may be operating under the same business name, but conducting two fairly different businesses.”

In closing, Ragona stressed how simple and easy it is to construct such a business plan. In fact, his entire MANAcast presentation took about 30 minutes to complete. “You don’t even have to write out your plan. You can use sticky notes and post them on a whiteboard. No one has to sit there working over a detailed business plan. You can simply look at the board, digest the information you have there, and easily explain it to people. On top of that you can make changes on the fly.”

The entire MANAcast devoted to this subject may be found in the member area of the MANA website (www.MANAonline.org).

MANA welcomes your comments on this article. Write to us at [email protected].