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10 Business Plan Benefits You Might Be Forgetting If you think creating a business plan is not for you, think again. Here are ten ways your business plan can help you be a better entrepreneur.
By Tim Berry Edited by Dan Bova Sep 6, 2013
Opinions expressed by Entrepreneur contributors are their own.
Too many people don't bother to write a business plan because they think it's too hard or unnecessary unless you're looking for funding . That's a shame. These myths keep a lot of people from the benefits of planning.
If you're still skeptical, here are 10 benefits to business planning you shouldn't be overlooking:
- You'll stay on strategy. It's hard to stick to strategy through the daily routine and interruptions. Use a business plan to summarize the main points of your strategy and as a reminder of what it both includes and rules out.
- Business objectives will be clear. Use your plan to define and manage specific measurable objectives like web visitors, sales, margins or new product launches. Define success in objective terms.
- Your educated guesses will be better. Use your plan to refine your educated guesses about things like potential market, sales, costs of sales, sales drivers, lead processing and business processes.
- Priorities will make more sense. Aside from the strategy, there are also priorities for other factors of your business like growth, management and financial health. Use your plan to set a foundation for these, then to revise as the business evolves.
- You'll understand interdependencies. Use a plan to keep track of what needs to happen and in what order. For example, if you have to time a product release to match a testing schedule or marketing to match a release, your business plan can be invaluable in keeping you organized and on track.
- Milestones will keep you on track. Use a business plan to keep track of dates and deadlines in one place. This is valuable even for the one-person business and vital for teams.
- You'll be better at delegating. The business plan is an ideal place to clarify who is responsible for what. Every important task should have one person in charge. Your plan keeps track.
- Managing team members and tracking results will be easy. So many people acknowledge the need for regular team member reviews and just as many admit they hate the reviews. The plan is a great format for getting things in writing and following up on the difference between expectations and results with course corrections.
- You can better plan and manage cash flow. No business can afford to mismanage cash. And simple profits are rarely the same as cash. A cash flow plan is a great way to tie together educated guesses on sales, costs, expenses, assets you need to buy and debts you have to pay.
- Course corrections will keep your business from flopping. Having a business plan gives you a way to be proactive -- not reactive -- about business. Don't wait for things to happen. Plan them. Follow up by tracking the results and making course corrections. It's a myth that a business plan is supposed to predict the future. Instead, it sets expectations and establishes assumptions so you can manage the future with course corrections.
You don't need a big formal business plan to reap these benefits. Instead, think of your business plan as a collection of lists, bullet points and tables. Think of it as something that lives on the computer, not on paper. It's just big enough to do its job.
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A business plan is essential as an entrepreneur. It helps you set clear goals and guidelines for how you will manage your business. A business plan may also be needed to set employee goals, obtain funding or even to sell your business one day. In this article, we discuss the importance of a business plan for entrepreneurs, as well as a few main ...
To outline the importance of business plans and make the process sound less daunting, here are 10 reasons why you need one for your small business. 1. To help you with critical decisions. The primary importance of a business plan is that they help you make better decisions. Entrepreneurship is often an endless exercise in decision making and ...
A business plan contains detailed information that can help determine its success. Some of this information can include the following: Market analysis. Cash flow projection. Competitive analysis. Financial statements and financial projections. An operating plan. A solid business plan is a good way to attract potential investors.
Business plans are a required tool for all entrepreneurs, business owners, business acquirers, and even business school students. But … what exactly is a business plan? In this post, we'll explain what a business plan is, the reasons why you'd need one, identify different types of business plans, and what you should include in yours.
Here are 5 reasons why you need a business plan: 1. It will help you steer your business as you start and grow. Think of a business plan as a GPS to get your business going. A good business plan guides you through each stage of starting and managing your business. You'll use your business plan like a GPS for how to structure, run, and grow ...
Build a strategy. 4. Crafts a roadmap to achieve important milestones. A business plan is like a roadmap for your business. It helps you set, track and reach business milestones. For your plan to function in this way, your business plan should first outline your company's short- and long-term goals.
In business, you do not want to wing it. You want a plan -- a document that lays out the path of your company for the next three to five years so you can see the route to your goals and know ...
10. Have all the information in your plan when you're ready to sell. Sell your business when it's time to put it on the market so you can help buyers understand what you have, what it's worth, and ...
Business Plans and Their Financial Models Are Valuable to Angels and Venture Capitalists. Many entrepreneurs will eventually need to raise outside capital to grow and develop their businesses. In my experience, a business plan is a crucial tool in maximizing the chances of raising money from external investors.
Business Plan: A business plan is a written document that describes in detail how a business, usually a new one, is going to achieve its goals. A business plan lays out a written plan from a ...
A business plan is of significant importance when it comes to guiding entrepreneurs in succession planning, which involves preparing for the future transition of leadership and ownership within a business. To effectively use a business plan for succession planning, assess current leadership and ownership, identify potential successors, define ...
Writing a business plan allows you to lay out significant goals for yourself ahead of time for three or even five years down the road. Create both short- and long-term business goals. 3. Reduce potential risks. Prevent your business from falling victim to unexpected dangers by researching before you break ground.
The classic business plan writer is an entrepreneur seeking funds to help start a new venture. ... Do You Need To Write A Business Plan. 5. You can explain your strategy for hiring new people ...
Add in the company logo and a table of contents that follows the executive summary. 2. Executive summary. Think of the executive summary as the SparkNotes version of your business plan. It should ...
Here are some of the components of an effective business plan. 1. Executive Summary. One of the key elements of a business plan is the executive summary. Write the executive summary as part of the concluding topics in the business plan. Creating an executive summary with all the facts and information available is easier.
Published Aug 14, 2023. A business plan is essential as an entrepreneur. It helps you set clear goals and guidelines for how you will manage your business. A business plan may also be needed to ...
A business plan is a detailed document that sets out a company's purpose, vision, marketing objectives, financial plans, resource needs and how it will achieve its goals. It essentially works as a roadmap or a guide to how the company will function and can be a valuable tool for attracting potential investors too.
Here are 5 reasons every entrepreneur should write a business plan. 1. It forces you to think through all aspects of your startup. Entrepreneurs generally focus primarily on the "big idea"—less on its execution. While the nuts and bolts aspects of a startup, such as setting up an accounting system, may not be spine-tingling, they're ...
1. Increased Clarity. A business plan can bring clarity to the decision-making process regarding key aspects of the business such as capital investments, leases, resourcing, etc. You can't do everything. A good Business Plan will help you identify business critical priorities and milestones to focus on. 2.
But there are many reasons to write a business plan, including the following five: 1. You want to start a business. The classic business plan writer is an entrepreneur seeking funds to help start ...
A business plan is an operating document that describes the dream of an entrepreneur with the objectives and plans to achieve them. A business plan shows the viability of the business idea from every aspect. A business plan is a crucial document that is utilized by both the company's external and internal audiences.
Effective business plans contain several key components that cover various aspects of a company's goals. The most important parts of a business plan include: 1. Executive summary. The executive summary is the first and one of the most critical parts of a business plan. This summary provides an overview of the business plan as a whole and ...
As the world of business has gotten less formal and the pace at which startups come to market has sped up, many entrepreneurs have begun to question whether a business plan is necessary anymore or ...
Business objectives will be clear. Use your plan to define and manage specific measurable objectives like web visitors, sales, margins or new product launches. Define success in objective terms ...
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