Why You Need a Business Plan

Friday, March 03, 2017 , , 1 comments

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Why You Need a Business Plan

Do you think a written business plan is just for enterprises much larger than yours? Or do you think that it’s only necessary when the time comes to convince investors they should invest in your business?

Actually, making a business plan accomplishes a lot even if your business is small and you don’t need investors. The type of details included in a business plan will vary as much as businesses themselves vary. If you’re starting a sizable enterprise or making a large upgrade on a small business and if you’re looking to entice investors or taking on substantial risk, then you’ll need a highly-detailed plan.

But if yours is a smaller business with few or no employees, you won’t need to include minute details. In fact, this is when entrepreneurs think that they don’t need a business plan at all, but continue reading to understand exactly why a business plan is still critical.

Read More: How to Turn Your Hobby Into a Small Business

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When you discuss your business ideas with friends or family, your ideas may sound great, but seeing them in written form helps you understand how all the facets of your business will fit together. Just like a roadmap, a business plan lays everything out in visual format. Seeing your plan in black and white helps you clarify just what is needed and how to proceed.

You will be more likely to avoid big mistakes when you take the time to put everything into written form. In addition, you can go back to the friends or family who originally discussed their ideas with you. Give them a copy of your written plan and get their feedback.

Understand Your Market

Entrepreneurs are often passionate about the product they want to sell. That passion is vital, but don’t lose sight of reality. Not everyone will love it as much as you do. If you choose a product simply because you love it, you may be headed for disaster.

You need to be objective, rather than emotional, to research the market. Is there really a large enough group of people who really want to buy your product? If not, this is the time to re-group.

Organize and Hold Yourself Accountable

If your research reveals that your product is viable, you need to develop a plan of action to prevent yourself from veering all over the place. Put the following in writing to track your actions and confirm that what you’re doing is in line with your business goals:
  • Priorities
  • Realistic goals
  • The price for your product
  • How to attract customers
  • How to measure performance
No business plan, however, is written in stone, and you might decide to change some of those goals. That’s OK. Revise your guide/plan and continue with your long-term vision and strategy. But keep your business plan up to date.

Read More: How to Become a Successful Influencer

Why You Need a Business Plan

Monitor the Progress of Your Business

Your written plan gives benchmarks to check that your business is on track to meet the goals that you’ve set. You can determine when your business exceeds expectations and when it doesn’t. You can compare how your business is doing in relation to your competitors.

Don’t Skip Making a Business Plan

If you’re thinking about skipping the business plan, consider the implications of doing that. Consider whether you will have a better chance of success with a business plan. If your answer is yes, get started planning.

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Author: Kate Benzin

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