Signed, sealed and delivered: why you should create

Signed, sealed and delivered: why you should create a contract or proposal for yourself

Just as you would never enter into a professional agreement with someone without a contract, this holds true in dealing with yourself and your personal goals. Take the time to determine your goals for the next five years and get them down on paper. Having an official document that states your intentions for your business is a powerful motivator, and can also serve as a road map when you get to an "all right, now what?" juncture in your company's development. Two good formats for your agreement with yourself are contracts and proposals.

Contract: A simple contract stating your goals, intentions and plans for your business can be sufficient to start you out. Your contract can be one page or several pages long, depending on what you choose to promise yourself in regards to your business. Be sure to include the time commitment you plan to invest (part time, full time, part time that develops to full time); what you ultimately envision your company to be (your "dream job"); and the steps you will take to get there. You can even include your intentions to give yourself a break once in a while and the motivating factors behind your startup venture. Make sure to sign and date the contract. If you have supportive friends or family members, ask one to sign as a witness-and maybe even help you stick to your goals along the way.

Proposal: Though a proposal is a more complicated document than a contract, taking the time to write a great business proposal is worth it for the detailed plan of action you end up with. Most business proposals are exhaustive resources. They are several dozen pages long and list just about every bit of information pertinent to your business you should keep in mind. The components of a standard business proposal are as follows:
* Statement of Purpose: This is your reason for writing the business proposal in regards to your company. Most business proposals are written with the intention of explaining why the business will work to a bank or group of investors, in order to obtain funding. For goal-setting purposes, your statement of purpose should be a brief summary of your business goals to serve as a framework for the rest of the document.
* Description of Business: In this section you describe the industry you're working in and what function your company performs in that business: usually sales, service, information or product provider.
* Location: Take a page or two and describe where your business is located (home office or outside location). List the benefits and drawbacks of operating your business from your chosen location.
* Management: This segment could also be titled "All About Me." The management section details the experience, knowledge and resources you will bring to the company. If you are running your virtual corporation in conjunction with a partner or key employee, their contributions should also be listed here.
* Market: What segments of the consumer population will be interested in your product or service? Identifying your market early on will give you an enormous edge and help you target your marketing efforts to your best advantage.
* Competition: Researching what other companies in your industry are doing can help you plan your own strategy for success. In this section, try to describe both the strengths and weaknesses of your competitors so you can avoid making the same mistakes.
* Personnel: Do you already have a business with a few employees? Do you plan to hire anyone in the next five years? In this section you will write about your future staff: how many people you will hire, whether they'll work part-time or full-time, what their duties will be, and where your labor pool will be (local or telecommuters).
* Business goals: Here's where you take those points you mention in the Statement of Purpose and expand on them. This is the fun part to write. Capture everything you want to accomplish with your virtual corporation so you can look back on your plans and say "I've done it!"
* Summary: The summary of a business proposal restates the introduction and ties everything together. It is an affirmation of your intentions. After you get through everything that comes before it, you'll probably know more about your business goals than when you started out, and your summary can reflect that new knowledge.
* Financial data: Unless you're an accountant, you probably won't enjoy this part-but if you can make financial plans for your business, you'll be in much better shape down the road. If nothing else, calculating your income projection for the next few years will help you determine the best areas to concentrate the funds you allocate for business purposes. In the resource section at the back of this book, you'll find some references to materials that will help you create income projections and balance sheets for your virtual corporation.