Why you should have a business plan
Some business owners make the mistake of thinking that they really don't need a business plan. Other business owners have made the mistake of thinking that they just need to run their business and deal with problems as they come along. These mindsets can both be highly damaging to your business. Savvy business owners will make sure that they have a well written business plan long before they open their doors and set up their website. Successful business owners understand that how well they plan the opening of their business will have a direct effect on how successful their business ends up being.
Business owners who do not have a business plan or prospective business owners need to realize that there is little chance that they will receive business financing without one. You will need to be able to show your prospective lender that you have a complete understanding of your business and the market that you will operate in. In addition, you will need to be able to inspire confidence by showing that you and any of your management have the experience and expertise needed to make your business a success. This makes having a business plan extremely crucial to the long term survival and success of your business.
The good news is that ifyou are looking for help with writing a business plan there is plenty that is available. You can check out online sites, books, and other publications that can guide you in the process of writing your business plan. You should also have a basic understanding of what a business plan is and what should be included in it. The following guidelines can give you a basic overview of what should be included in your business plan-
- Know what to include in your business plan-The best business plans are written by business owners who know what and what not to include in them. You want to make sure that your business plan reflects your goals and your plans for your business. This will need to be based on sufficient market research. You will also need to include any information that you can about your marketing plan and your business finances. Finally, keep in mind that your business plan will be a dynamic document meaning that it will need to change over the years as your business grows and develops.
- Know what your lender will be looking for-It is crucial to understand that your lender will be looking for very specific information in your business plan. Vague guesswork will not be impressive or inspire the confidence of your potential lender. You will need to be able to back up any information that you put into your business plan. You should also understand that any lender knows that they are not really investing in the product or service that your business offers but rather in the people who run the business. You will need to be able to clearly show in your business plan that you and any of the management in your business have the necessary skill and experience to make your business a success.
- Know what the business plan outline is-Some business owners think that they can get their business noticed by presenting their prospective lender with a "creative" business plan. This is not a good idea. Your lender will be looking for a certain outline that can easily and quickly communicate to them what they want to know about your business. This outline should include:
1. A summary of your business.
2. What your business mission statement is.
3. How you will achieve your mission statement.
4. A detailed overview of your market and your competition.
5. Complete and detailed summary of everyone who works in management.