What’s the purpose of a business plan?
A business plan serves as your blueprint for how you will operate your business. Whilst it is likely that you will need to have a business plan in place when trying to attract investors or get a loan for your company, it is actually for your benefit. It provides a step-by-step guide as you start a new business or grow your current company, and it directs every decision you make going forward.
Why should I have a business plan?
Writing out your plan forces you to review everything at once: your value proposition, marketing assumptions, operations plan, financial plan and staffing plan. You’ll end up spotting connections you otherwise would have missed. Here are some of the reasons you need a business plan:
- An opportunity to test out a new idea to see if it holds real promise of success
- A clear statement of your business mission and vision
- Benchmarks you can use to track your performance and make midcourse corrections
- A clear-eyed analysis of your industry, including opportunities and threats
- A portrait of your potential customers and their buying behaviours
- A rundown of your major competitors and your strategies for facing them
- An honest assessment of your company’s strengths and weaknesses
- A roadmap and timetable for achieving your goals and objectives
- A description of the products and services you offer
- An explanation of your marketing strategies
- An analysis of your revenues, costs, and projected profits
- A description of your business model, or how you plan to make money and stay in business
- An action plan that anticipates potential detours or hurdles you may encounter
- A handbook for new employees describing who you are and what your company is all about
- A résumé you can use to introduce your business to suppliers, vendors, lenders, and others
When do I use a business plan?
A common misconception is that it is only used for new startups, however, they are a useful tool for established business that want to grow. They then become the business strategy. So whether it’s a business plan or strategy, the principles are the same, the document evolves and is continually referenced.
Here to help.
Chris Dowling regularly talks through business plans and provides valuable feedback to those wanting to move their business forward. He is always pleased to have a preliminary and no obligation chat to find out about your business and your plans. You cab contact Chris Dowling via his website.