In the business boom of the late 1990s, software for preparing business plans was itself a big business. With plenty of venture capital available, a good-looking boilerplate plan could mean the difference between a company being founded or an idea foundering for lack of financial support.Then the bottom fell out of the venture capital market, and business plan software languished, though the need for business plans for obtaining credit kept this application from vanishing completely.
These days, there seems to be some interest once again in financing new businesses, but even more important, there is a growing awareness that a solid plan is necessary for the growth of an existing business.
Fortunately, this segment of the market didn't just disappear.
At the same time, business plan software is not the same application as budgeting software. There is some overlap in processes, and even the use of the end product. But the two applications are more synergistic than interchangeable.
Planning software, such as budgeting, is used to prepare an operating plan for management to follow in the near term. By planning out goals, both financial and operational, management is creating a roadmap for the business to follow, and a benchmark to determine how much of that roadmap the business has actually achieved.
A business plan is a bit different. While it may (and usually does) incorporate budgets, the major intent of most business plan software is to lay out the intent of a proposed business, detail its management structure, and project its marketing and operating possibilities. That's not to say that a business plan application can't be used for operational management, but only that day-to-day operational management is usually not the focus of the application.
The user of each type of application also tends to be different. Business planning applications are often used internally, while business plan software is a common tool in the arsenal of accountants and consultants, who often guide clients through the process.
This is often a good approach, even if the application offers wizards to its users, a feature common in this type of application. While a wizard can help a user navigate the process, your experience with all of the players in the process - from the user making up the plan, to the potential investor, to other similar enterprises - makes you a valuable resource when actually constructing and fine-tuning the business plan.
THE SAME, YET DIFFERENT
We looked at six popular business plan applications. To some extent, they are all pretty similar, using boilerplate text and a spreadsheet-like matrix of financial projections. There are, however, differences both in approach and in methodology. Some of these differences might be more important than others.
Regardless of the approach taken, we think you'll find an appropriate product. None of the seven packages requires a particularly powerful PC, and all will run very nicely on most laptops, should you want to take the application to the client.
AUTOMATE YOUR BUSINESS PLAN 2006
A number of products that we reviewed come with books on the process of constructing a business plan. Some of these books are excellent tools, even for professionals with considerable experience in the process. The Automate Your Business Plan 2006 software is really a useful adjunct to Linda Pinson's excellent tome on business plan construction, Anatomy of a Business Plan. That's in addition to a well-written manual.
As with most of the products in this roundup, AYBP 2006 uses boilerplate documents and spreadsheets. The application itself contains an editor and spreadsheet, though you can specify that AYBP use Word and Excel, if they're available. Wizards walk you through the process of creating a plan, and unlike some of the other vendors' offerings, there is no collection of sample templates for different types of businesses.
Still, we found AYBP very easy to use and navigate, and the product makes it simple to work on a business plan using several computers. A choice in the file menu places all of the documents and XLS spreadsheet files into a single Zip file, which can be burned to a CD, put on a USB Flash Drive, or simply e-mailed to another PC. The application also allows you to save the plan in PDF format.
Automate Your Business Plan seems to be targeted at the novice user, which makes it a perfect package to give to clients who are thinking about launching a new business or product. Even if they don't need to actually build a plan for presentation to a third party, going through the process of constructing a plan may lead them to examine some areas that they would not ordinarily consider.
For example, the first step in using the software is a section titled "Before You Begin" and includes a subsection on exit planning. That might seem strange, but your eventual plans for exiting the business, such as selling it, leaving it to family, going public, and so on, will have a definite impact on some of the financial constraints that are used in projections.
For the low price, AYBP and its adjunct book Anatomy of a Business Plan are a quick and affordable course in the business plan process.
JIAN BIZPLANBUILDER V. 10
BizPlanBuilder was one of the first business plan creation applications, and is now in its 10th revision. It's interesting to see all of the uses that Jian suggests for BizPlanBuilder. In addition to angel and venture capital investors, Jian suggests that BizPlanBuilder be used for nonprofits writing grant requests, for applying for an SBA loan, for completing an MBA project, and even for filing a plan to emerge from bankruptcy.
All of these (and others) comprise legitimate uses for not only BizPlanBuilder, but for most of the other products reviewed in this roundup. It also goes to illustrate some out-of-the-box thinking.
As with several other products, BizPlanBuilder is supplied with a book - Business Black Belt, by Jian founder Burke Franklin. This is more a collection of business tidbits than a tutorial on constructing a business plan, so it may be more suitable as an interesting read than a plan-writing how-to. The actual product documentation fills this need just fine. Also included are short talking-head videos of Franklin explaining or pointing out certain features of the software.
The software itself is a collection of document and spreadsheet templates. These are populated with the use of wizards that walk you or your client through the process of constructing a business plan from start to finish. The result is a comprehensive and professional looking plan. As with many of these types of applications, BizPlanBuilder uses a lot of boilerplate to create a plan. This may or may not be a problem. To be honest, many business plans look alike, as business schools tend to teach this process using a standard format.
While BizPlanBuilder does incorporate wizards, it also uses Office as a base to construct the plan, so you will need copies of MS Word, Excel and PowerPoint to extend the presentation.
With a price of roughly $100, BizPlanBuilder is inexpensive enough to give to your clients to let them start to flesh out a plan that you can later refine. You can think of it in the same vein as the client questionnaires that you send out at the start of tax season.
PALO ALTO BUSINESS PLAN PRO PREMIER
Palo Alto Software's Business Plan Pro is another veteran in the area of business plan software. Next year, 2008, will mark its 20th anniversary.
The creator of Business Plan Pro, Tim Berry, was a consultant for years in the area of preparing business plans before starting the company, so the software reflects real-world experience. It also includes a book, Berry's Hurdle - The Book on Business Planning, a step-by-step guide to creating a business plan that will be useful to both experienced plan creators and novices.
Unlike several of the packages we reviewed that require Microsoft Office, Business Plan Pro Premier contains its own editor and spreadsheet, though it can easily export both kinds of documents into the equivalent Office applications if desired. This capability makes it easy to get very fancy, especially if you or your client has a lot of experience with MS Office.
Palo Alto offers one of the most extensive sets of sample plans we've seen. There are more than 500 of them, including such esoteric businesses as an herb farm and a martial arts school. Constructing a plan, or modifying one of the samples, appears to take more effort than with some of the other vendor's products, as the boilerplate in the few sample plans we examined was rather sparse. Actually, this is probably a benefit, rather than a disadvantage, as the descriptions that you and your clients come up with are likely to be closer to what's envisioned than boilerplate.
Business Plan Pro Premier can import financial history from QuickBooks, so if the plan being constructed is for an existing business, rather than a completely new one, actual financial history can be used as the basis of financial projections. The software also allows you to incorporate exit strategy details - something that's becoming a lot more common, especially when going to venture capitalists looking for start-up capital.
PLANGURU CONSULTANT EDITION
Strictly speaking, PlanGuru is more of a planning tool than it is a tool for constructing business plans. It's also the only product in this roundup that is specifically designed for and targeted at accountants and consultants, rather than their clients. It's included here because PlanGuru addresses what is probably the most difficult part of business plan construction, and the part of the process that you are most likely to be involved in - financial forecasting.
A critical part of any business plan is the financial projections. This is the part where the plan has to justify the investment or loan being asked for by showing that the business is reasonably expected to show a profit. Many of the other products included here have the ability to do multiple-year forecasts, with breakdowns by quarter or month over the period shown. For that matter, so does Excel. Because this financial projection capability is only a part of a typical business plan application, it often tends to be somewhat limited in the way it can calculate forecasts. If it does not have this limitation, it will often be too complex for the typical non-accountant end user.
PlanGuru doesn't claim to be anything but what it is: a sophisticated financial-modeling application. It's easy to enter complex assumptions and constraints, and you can create custom reports and statements with the results. Projections can include such advanced features as break-even analysis and financial ratios, which are calculated automatically.
You also can import historical data directly from QuickBooks or Peachtree if the client is creating a plan for an ongoing business, or from Excel if you or your client have already constructed models or projections.
PlanGuru is available in two editions, the Consultant Edition that we reviewed, and the Professional Edition, which eliminates some of the more advanced features, such as QuickBooks/Peachtree import and the ability to consolidate up to 20 analyses. For most plan construction purposes, you will probably find the Professional version complete enough. The Consultant Edition, however, is likely to find applications in your practice far beyond use in constructing business plans, and makes a good addition to any accountant's or consultant's tool kit.
PLANMAGIC BUSINESS ADVANCED EDITION 9.0
PlanMagic is an interesting offering. On one hand, the user interface is not very integrated, and PlanMagic was the only application we tested that did not ask or place an icon on our desktop. Rather, to use PlanMagic, you need to either access it from the Windows Start menu, or navigate to the folder that contains the templates and click on a document or spreadsheet.
While several of the other products can use Microsoft Office (if it's available), PlanMagic requires it, as it consists of Office documents in the form of Word text and Excel spreadsheets. Even the documentation is browser-based, supplied as HTML pages, though you can navigate the documentation using a non-Microsoft Web browser. If you have PowerPoint installed, PlanMagic can even use the completed plan report to automatically construct a PowerPoint presentation for your clients to use.
Rather than wizards walking you through the process, most of the work has already been done in the form of almost-completed documents and spreadsheets. Just slot in the appropriate text in the Word docs, and the desired numbers in the spreadsheets, and the plan is pretty much finished. The spreadsheet templates come complete with macros to perform detailed period-by-period analyses, charting and formatting printed reports. The software even has the ability to perform exchange rate computations if you anticipate your client operating abroad.
The Advanced Edition that we reviewed comes with several templates for a service, retail or product-oriented business, and PlanMagic has a number of other templates available. You may not get the hundreds of templates that some of the other plan-writing products provide, but in the real world, you probably don't need more than several well-written templates.
It would have been nice to have a more central set of menus to access the different parts of the system, but to be honest, we really don't foresee any accountant - or a client sophisticated enough to draft a business plan - having much trouble using the template components supplied. And PlanMagic makes up for the lack of a central menu by providing comprehensive and largely complete template plans that, when finished, provide the professional appearance and detail that plan users expect to see.
PLANWRITE EXPERT EDITION
PlanWrite takes a slightly different approach than the other products in this roundup. It still uses large amounts of boilerplate to construct a plan, but instead of providing hundreds or thousands of sample plans, it uses a very complete interview to coax you or your client into expressing the necessary narrative text in your own words.
We found PlanExpert to be very detailed in the plan areas that it covers, while still including more common areas like the financial projections and details. Small details, like a nondisclosure agreement, are important, and PlanWrite provides all of the bells and whistles to make a plan stand out from the crowd.
Another feature that we liked a lot is the audit and analysis that you can run after completing the plan. This feature uses expert-systems technology to parse your completed plan for language and sections that may have been passed over that could improve the overall plan.
The Expert Edition is one of the more expensive products reviewed here, though BRS has less expensive editions available from $49. For most accountants, the more expensive and more capable edition that we tested will be a better choice, as it offers greater assistance in building a complex and comprehensive plan, as well as a greater depth in the application's analysis of the plan when completed.
ULTIMATE BUSINESS PLANNER 4.0
Atlas Business Solutions' Ultimate Business Planner sets the bar pretty high. After all, how "ultimate" can a package that sells for under $100 really be?
Perhaps the term "ultimate" is a bit of hyperbole, but the Business Planner 4.0 from ABS does manage to be a very credible offering. As with several of the other planners reviewed in this roundup, Ultimate Business Planner uses a guided interview process to develop the plan. If you or your client decides to use one of the sample plans (ABS claims over 1,000 of these, not all of which were contained in the package we reviewed), the application will drop boilerplate into the plan, which you will then have to edit and fine-tune. In the sample plan we looked at, "Crime & Accident Scene Cleanup," the boilerplate was very terse for the most part. We did, however, find it easy to expand on the short boilerplate.
The graphs and reports are attractive, but not spectacular. When your client is looking for hundreds of thousands or even millions of dollars in financing, we expect that you or they will spend some time with MS Chart creating more striking visual accompaniments.
One area we were particularly impressed with is the financial planning part of Ultimate Business Planner. The application borrows heavily from one of ABS's other products, and is capable of producing detailed projections for up to five years.
Three of the seven products reviewed in this roundup are priced under $100. Each is strong in different areas. Automate Your Business Plan provides a sound basis in business plan construction. Jian's BizPlanBuilder has highly detailed sample plans. And Ultimate Business Planner 4.0 is particularly strong in financial planning. Which one is best for you or a client depends on what you feel is going to be the crucial area that your potential investors will look at.
Ted Needleman, a former editor of Accounting Technology, is a consultant and freelance writer based in Stony Point, N.Y.
Automate Your Business Plan 2006
Out Of Your Mind...And Into The Marketplace
Price: Software only - $80; software and Anatomy of a Business Plan - $90.
BizPlanBuilder V. 10
Jian Tools for Sales Inc.
Business Plan Pro Premier
Palo Alto Software
Price: Premier version - $299.
PlanGuru Consultant Edition
New Horizon Software Technologies Inc.
Santa Fe, N.M.
PlanMagic Business Advanced Edition 9.0
Jefferson Valley, N.Y.
PlanWrite Expert Edition
Business Resource Software Inc.
Ultimate Business Planner 4.0
Atlas Business Solutions Inc.
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