Businesses that use a formal business plan are 30 percent more likely to succeed, according to research by the University of Oregon. Whether you are starting a new business or are currently in operations, don’t underestimate the value of having a business plan. Business plans are imperative to give your business direction and serve as a roadmap to reach your goals and objectives.
What is a Business Plan?
A business plan is a written document that outlines the goals, strategies, and operational details of your business. It acts as a roadmap to help you achieve your goals and objectives while serving as a tool to help investors and other stakeholders understand its vision and strategy.
Key components of the business plan include the executive summary, business description, market analysis, organization and management, products and services, marketing and sales strategy, and financial projections.
The purpose of a business plan is to guide you on how to achieve your goals. It is also used as a tool to help you secure funding or loans for your business by demonstrating the viability and profitability of your business.
A business plan is not just a tool for startup businesses to use; it’s a dynamic document that evolves with your business. By regularly updating your business plan it helps you stay aligned with your business goals and adapts to market changes.
The Risk of Not Having a Business Plan
Without a well thought out business plan your business may suffer with a lack of clear focus and direction and make it challenging to achieve your goals. Without this critical document you might waste time and money on efforts that aren’t aligned with your business goals and objectives and fail to anticipate any potential challenges or threats to your business.
Business plans help you address market demands and you will miss those if you’re not prepared. If seeking funding such as capital raises or loans from banks, you will lack the clarity to present your case and the opportunity to demonstrate to your stakeholders the value of your business.
Ultimately, operating without a business plan can lead to confusion, inefficiency, and missed changes for growth.
How to Get Started with Your Business Plan
There are many template examples you can find on the web to help you get started with your business plan. When building out your business plan start with these tips:
1. Start simple
Creating a business plan does not need to be an onerous process. You can start with a one-page business plan that addresses your needs. Over time your business plan will evolve into a comprehensive document.
2. Use tools that can expedite the process
The use of AI in business has exploded in the past few years, and has many tools that can help automate business processes and increase efficiency. AI excels at data analysis and offering key insights, and can help you with your business plan.
3. Seek guidance
If you get stuck on any part of the business plan you can seek guidance by consulting a professional or attending a workshop. There are many online resources that guide you through the business plan creation phase at no cost to you.
4. Keep it dynamic
Your business plan will change as your business changes and grows. Keep your business plan document readily available and update the plan as your business evolves. It is an important document to keep current as it offers many benefits to you as a business owner.
The bottom line is that business plans are a tool to help you propel your business forward. They are a critical tool for financially thriving businesses as they provide clarity and focus for the business owner. If you haven’t yet created a business plan for your business, regardless of its size, it is never too late to do so.