8 Reasons Having a Business Plan Is Important for Small Businesses
So many people wants to skip the issue of having a business plan when they are intending to go into a business. But is it really possible to do that? Does anyone need a business plan? Is it necessary to have to have a business plan before starting up a business? Why can’t we just jump pass the whole business plan thing. Now let me be sincere with you regarding this matter.
- For those seeking bank loans, grants etc, then you will need a very well detailed business plan for it else no bank will listen to you. For those who are seeking a bank loan, investor firms, or venture capitalist that are into funding, then be rest assured that you are going to asked to explain your business trajectory. This can only be done by the help of a well business plan. So many a time, we just think that writing a business plan will require you to write over 300 words. Nope you don’t necessarily need that volume except the need arises. What you need to do is hand to your banker or investors your business plan which explains to them that there is a market for the problem your business plan wants to solve. And it should includes your key financial statements and forecasts for the business. One of the benefits of a business plan is that it simplifies and makes your potential partners and laonees understand your business model and financial analysis. Sometimes it becomes more advantageous when you are able to present data visually through charts and graphs to them. A detailed business Plan makes things easier for you. It makes you talk less and act more. A business plan will help take you a step-by-step through the process of setting up and forecasting your financial analysis’s for your business and this will sure reduce a far more complicated spreadsheets and this will make present your numbers and gives you a confident when presenting with your plans before your investors or loonies
- It has been proven by experts that having a Business plan before you start up a business helps grow your bus 30 percent faster than. Many a time we usually think that a business plan is about Writing a business plan about producing a document that accurately predicts the future of yours business and plans for it. That’s far from the truth but also part of it. Business plan also involves writing your plan andreviewing it regularly which gives you a better stand chance to achieving your business goals and company targets. When we talk about Business planning, we are talking about your constant and regular setting and reviewing of your business goals and targets. It also involves tracking your progress toward those goals, and also make changes to your business. This you do as you keep learning more about your customers and what they want and how to satisfy them. The statistics we just talked about was gotten from experts. It was conducted a few months ago. The Studies showed that every companies that plan and review their results regularly, actually these companies do grow up their companies 30 percent faster. Apart from this, research also showed that companies that regularly and constantly use business plan to forecast the future and performance of their companies, do perform better actually. You hardly gonna see them among those statistics on companies and businesses that fail, or that experience cash flow crises, or that declared bankruptcy or that has been threatened to close down.
- You make big spending decisions with confidence.
Most at times, the challenges most business face is the when to make some decisions when the business is growing. Because they may not know if it’s time to make bold decisions or not. But you see, with a well articulated business plan, this can be taken care off. Some of these challenges to figure out are to hire new employees, when to expand to a new location, or whether you can afford a major purchase etc. The aforementioned are the major spending decisions. But for those who are constantly reviewing the forecasts of your business plans that you have mapped out, you are going to have better information to use to make your decisions and these decisions will likely be on the positive side
- There are times when you may actually have a very critical cash flow Challenges early. You don’t want to go into a business and don’t make profits. Now, one of the major decisions you might be facing as research has suggested is understanding and monitoring your business’s cash flow statement. Remember that it is your cash flow statement is among the very top on three key financial statements you ought to put together with your business plan. The other two as it where are your balance sheet and your income statement (P&L)
One way to potentially spot cash flow challenges earlier so you can take appropriate measures to avoid a cash crisis will be by reviewing your cash flow statement constantly which should be part of your business plan
review. Free business plan template
- When you have a business plan, it sure does minimize your risk. Don’t assume you know everything or much about your customers, your competition, and even about operations because as a starter, you actually know nothing but a few. And this is part of what you signed for which you are not aware of when you actually did start. They are called “uncertainty” but you can actually reduce your risk by creating and reviewing your business plan regularly. This is one the great way to uncover your weak spots, your flaws, gaps, and some of the major wrong assumptions you have made—and developed as a contingency plans.
- Constantly reviewing your business plan is a solid foundation for strategic planning and organization. Read on some of the challenges you may face as a newbie in business is to map out how your sales and revenue goals should fit with your expense budget. Your business plan is a great place to map how . Drawing a clear connection between what you’re investing in and the results you hope to achieve will help you make sure that you’re setting yourself up for success. And this is where your business plan becomes handy. Because it makes it easier to get everyone on your team on the same pedestrian. Now you can plan how to get from point A to point B and how you intend to make those plans happen. You don’t want to walk in isolation but also to your team to align toward the same vision as that of yours. This will sure be a very added advantage to increasing your efficiency as a whole. You will be able to make everyone on your team to see the bigger picture and also understand your larger goals too. Every team member should be able to understand how important their little work impacts the larger company. This will get them more interested in the company and also in meeting your goals because they now know that their piece of work really matters.
- Constantly reviewing your business plan, will sure help you set more achievable goals and milestones For every good business plan, it should be able to outline the following.
SMART goals and milestones. SMART goals are: Specific
It will be more worthless and useless if you engage in creating a business plan that has no goals or milestone attached to it. But be mindful not to set a goals and milestones for your company and your team that would not be aligned with the strategy you planned in your business plan because you will have a hard time aligning your team around the same priorities. This is to say that you are to make use of your business plan to set high-level achieve milestones. It is with this milestone you can create a meaningful goal with and also guide your sales and marketing tactics.
- Your business plan is an asset for those who want to sell my r business According to Robert Kiyasoki, businesses where created for profit making and to be sold. So if at the long run, you decides to sell your company or position yourself for acquisition, then a solid business plan will be of great help to you. Because it will make a case for higher evaluation for you. According to experts, your business plan will make your business likely to be worth more to a buyer because it will. make them easily understand your business model, your target market, and your overall potential to grow and scale of the business.
Are you wondering how to get started with writing your own business plan, you don’t have to worry yourself at all. It’s our job and duty. We will make that happen for you. For whatever business plan you desire, you can’t find them on our website, then contact us we will prepare a customized Business plan for you. You can reach us via these means.
Reasons Having a Business Plan Is Important for Small Businesses
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