MasterCoach Solutions

Business Planing for Life Coaches

You know that all you want to do is coach and you are good at it – so why do you need a business plan?

A risky business?

If you are newly setting up as a coach you know you are taking a risk.

There are many wonderful coaches out there but they do not all make a fabulous living Coaching. In fact, recent research by the International Coach Federation found that the average income from coaching was $26,150 for part-time coaches and $83,671 for full-time coaches. Only around 15% of coaches earn over $100,000 a year.

The current economic climate poses an additional challenge as people and companies reduce spending and investment in personal development.

This is not to say you should give up on your idea of setting up in business but you do need to be business savvy to create a sustainable business.

This means being clear about your finances and how you will get clients and keep getting clients. Managing your cash flow and effective ways of generating clients will be the lifeblood of your business. Getting these two things right will ensure you can keep doing the thing you love – coaching.

A reality check

Think of your business plan as a reality check. It enables you to step out with a clear idea of where you are going and what resources you need to get you there. The more realistic your planning, the firmer foundation from which to grow and be successful.

Can you answer the following questions?

• How will I know if my business is successful?
• What investment do I need to make? (This is not only money but time and training).
• Do I have a clear idea of the people who will pay for my Coaching Services and what they are willing and able to pay?
• What is my survival budget and how long will it last me?
• What skills do I have to be successful in business and which skills do I need to develop?

Do some research on your potential clients, on what other coaches are doing and offering and take a long hard look at your finances – over at least 3 years.

If there are skills you don’t have, you need to think about how you will develop these skills or be willing and able to find someone else to do the things you can’t do.

You can ask yourself:

• What do I know and can do?
• What don’t I know or can’t do?
• What can I find out by research or from other people?
• What do I need to learn as I go along or from experience of trying things out?

However good your plan, there are things you will not know until you try them – so you need to be willing to change your plan and your approach as you begin to see what works for you.

It takes time to set up a successful business and you will need to stick at it to see things through. But, you will also need to be able to make some hard decisions about when to abandon a project or idea.

Rethink and refocus

Planning is not just for those new to business.
If you have been in business for a while, your plan can help you review and refocus your direction.

Can you answer these questions:

• Is my business successful?
• Am I achieving the bigger picture as well as the day to day running of my business?
• Am I finding this business personally fulfilling?
• Am I making sufficient income?
• Do I need to step up my game?
• Do I need any help?
• Where does my focus need to be?

Your business plan needs to include a realistic evaluation of what you have achieved so far, your financial position and indicate where you need to shift or grow your business.

Evaluate your client base – is it healthy and are you effectively generating new business? If not, identify different ways of doing this which may be more successful.

• Which aspects of your business drain your energy and distract you?
• Where would you be better focusing your time and energy?
• What are you avoiding doing that is having a negative impact on the business?

Your may need to invest in additional help or marketing activities or develop your products or services so they are better focused to meet the needs of your clients.
Map out whether and when this will result in increased business, or higher income – so you can see if it is worth the investment.

As an established business person you will have developed contacts and professional networks and used a range of business services.

How can these contacts help you grow and develop your business? You may, for example, be ready to start working on joint ventures , or to draw together a small group to work on specific projects, or strengthening your referral system.

What do you need to create a good business plan?

Research

This means getting a good idea of who your clients are, the service they want and how they want it delivered. If you have been in business for a while, what do you need to drop, develop, change or enhance?

Where are your clients and how can you reach them? What future trends do you anticipate that will increase or decrease your client base? If you have been in business for a while – is it beneficial to increase, decrease or shift your client base?

What is the competition like? Who else offers what you do and why would clients choose you instead? Does your business communicate your individuality? What makes you distinct and distinguishes you from others and how will you communicate this?

Realistic Timescales

If you have limited time or money to invest in your business it will grow more slowly.
If there are skills and knowledge you need to acquire this also takes time.
Take these into account when planning.

An accurate financial forecast

You need to be clear on your business running costs and to be able to cost your time.
Some key concepts you need to understand to do this are:
• Break-even point
• Turnover
• Profit

Marketing

Here you need at least one method of getting clients that works, as well as a means of marketing your business if you are also delivering coaching and doing all the other business activity.

There is no need to go it alone, as there is support out there. This support ranges from working with a business coach or mentor, to accessing a whole range of resources supplied by government agencies and departments. You can even consider taking a college course.

So why not:

• Have a look at what is on offer at your local college
• Seek out your local business groups associations or Chambers of Commerce
• Use the small business associations websites and government funded-organisations to get information (for example Business Link in the UK)
• Contact the Tax and Revenue offices for information on taxes and record keeping
• Contact local government offices for information on licences and business rates
• Get information and advice through your coaching professional body

Then you can get planning for an even more successful coaching practice!

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About the Author

Sonia Thomas is the Editor of Coaches Plus, the online resource centre for coaches. Just visit us today to pick up more free life Coaching Business resources.