Writing a business plan is not always something for which business owners make the time. With the constant influx of daily issues that need attending, this is certainly an understandable choice. Many ventures have limited resources that need to be employed as efficiently and effectively as possible. Creating a business plan, however, can dramatically increase a venture’s chances of success. Some studies have shown that businesses that utilize a business plan are as much as 30% more successful. In fact, one of the best things that a business owner or executive can do is to create a detailed business plan to use as an ongoing guide.
Planning is one of the most important parts of running a business, no matter whether it is a large multinational corporation trying to plan an expansion or a small business launching an exciting new product.
It is easy to start a project, but without careful planning it is like setting off on a journey to an unknown destination without a roadmap. You might manage to make it to your destination eventually, but don’t be surprised if you get really lost on the way!
Business plans are not just for investors or your banker when you’re looking for financing. Creating a plan provides numerous benefits, all of which can help you meet your goals.
Business Plan Benefits:
- Writing a business plan forces you to think through every aspect of your business. This results in asking questions that you may not otherwise ask and gaining a more realistic view of your vision.
- Putting your plan on paper makes it easier to communicate your vision to others, be it other members of your team or external parties. Articulating your vision along with your goals is critical to enlisting the support you’ll need to achieve them.
- If you plan to look for funding, private investors and financial institutions with both require a business plan to even consider providing financial support.
- Writing your business plan helps to clarify your strategy and goals, making sure your objectives will be clear. Clear objectives allow for the measurement of milestones and KPIs, helping you stay organized and on task.
- A business plan will give you a guide so you can plan for any additional resources you may need as you grow. This will help you manage your cash flow as you invest in expansion, inventory, new employees or any other necessary steps required to support your vision.
These are but a few of the benefits of creating a business plan. While it can be a lot of work it’s important to remember that you can enlist as many people as you like to participate and help you craft your plan. Including key people disperses the workload, provides for a diversity of ideas and will help getting buy-in from the people you’ll need to execute the plan. Buy-in from your key people is much easier to gain when they are part of the process. You may also want to consider hiring a consultant to help you as well, which can provide a unique perspective of your future plans.
It’s also important to remember that just because you commit to a business plan doesn’t mean that you are stuck with it. In fact, reviewing and adjusting your plan regularly is important to make sure that you are being proactive, not reactive. Whether due to market changes or just because your strategy didn’t work as well as planned, it’s critical to make course corrections as you go. Even if your plans are working well, taking the opportunity to fine tune them will only reap positive benefits.
Creating a business plan is a project that is often overlooked in businesses of all size but it’s a critical step in achieving the results you desire.