Do I Really Need a Business Plan for My Business
Most successful businesses have created a business plan at some point, usually before their start-up.
A business plan is needed to address all of the central components to starting a business. It is essential to make sure that you, as a new entrepreneur have carefully thought through many if not all, of the important components of your business. Ideally, you need to do this BEFORE starting your business.
What is a business plan?
They are generally prepared for two reasons:
1. To obtain financing for the business
2. To help determine if essential components of starting a business have been considered.
Often times with new entrepreneur’s (and sometimes even with the more experienced!) they overlook certain aspects of starting a business. So the business plan helps to ensure that most, if not all reasonable questions have been answered and strategies thought about.
Although business plans are often considered optional – they serve a vital importance to entrepreneurs.
Many aspiring entrepreneurs and even experienced entrepreneurs fail to recognize their importance. It is often considered an “optional” component of their business and should only be prepared when absolutely necessary.
It is needed to address all of the central components to starting your business. It is essential to make sure that you, as an entrepreneur of quality, have carefully considered what you are offering, how you are offering it and whom you are offering it to.
Although it may be tempting to say “I have everything in my head about my business” – could lead to a lack of clarity.
The idea of keeping everything in your mind makes it possible for you to:
- forget certain things
- remember things incorrectly or too modified to later be useful
- misconstrue thought combinations that you had at one point but later revised
- revisit ideas that you already have thought of and since dismissed…
Preparing a business plan will allow you to document what you know and have the permanent impact of writing it down.
But this is complicated – Right?
In the context of the larger corporate world a business plan is not only essential but required. Many formats of business plans are modelled after the layouts and inclusions used for larger public companies. The time frame and level of detail is much greater for large corporate entities as they are required for various interested parties (stakeholders). However, it is not necessary for smaller businesses, especially start-ups to prepare overly lengthy and complex documents.
Your business plan need not be a time consuming, uncontrollable and over-the-top difficult process!
How Can I, As an Entrepreneur Achieve This?
Through the simple process of preparing a Preliminary Business Plan you will:
- Engage in a key strategy that will help you to organize your thoughts
- Help you to focus on your business intentions.
- Apply a straightforward, step-by-step process to prepare one.
- Obtain clarity about your business.
Why is it called a Preliminary Business Plan?
Traditional business plans, like those used for large public corporations can be very complex and have the level of detail that is not required for most smaller, private businesses.
A Preliminary Business Plan is shorter, designed more for the start-up of the business and it is easier to understand and prepare.
Here are just some of the questions that it should answer:
- Describe in detail exactly what your business is to be.
- Describe whom your products and/or services are for.
- How do you plan to deliver your products/services to your customers/clients.
- What pricing do you plan to use.
- If you have a product, list the major suppliers
- Indicate whom your major customers/clients are likely to be.
- What are the risk factors that you see for your business.
- What current businesses pose as competition to your business?
- How many employees do you plan to have in the company and at what point will they become active?
- Have you completed one?
It will address all of the central components to starting your business. It is essential to make sure that you, as a new entrepreneur have thought carefully through and considered all that you need to BEFORE starting your business.
A Preliminary Business Plan is a step-by-step method that allows you to organize your thoughts and WRITE DOWN your intentions through documenting them in a meaningful way. It also provides you with a document to provide to interested parties (for example, banks, investors, etc.) if the need arises.
You need to prepare one, if you are:
- An aspiring entrepreneur who is serious about properly planning a business and would like to discover if you need one for their new business.
- An experienced entrepreneur who never has prepared one, but would like to learn how.
- An aspiring entrepreneur who is skeptical, but would like to explore the process and know more.
- Any entrepreneur who has heard about them, but are confused and would like some clear DIRECTION of what to do.