Creating a solid business plan is the first step toward success in your business venture. From obtaining funding to hiring employees to planning for expansion, a business plan can be your guide to keeping your business on track. Your business plan can keep you focused on your goals and keep you moving forward when faced with obstacles.
Communication is one of the key purposes of a business plan. It serves, in effect, as a resume for your business, according to the Small Business Administration. You can share your business plan with new and prospective employees to help familiarize them with your company’s priorities. Lenders will evaluate your business plan when deciding whether to approve your loan application. Your plan can show the profit potential of your business and demonstrate that you are prepared to handle whatever problems may arise. Such information will help instill confidence in your ability to repay.
Helping you to manage your business is another important purpose of a business plan. As a management tool, your business plan will help you evaluate your progress and provide insight into aspects of your business that need attention. As you manage your business, the experience you gain will help you to modify your plan and make adjustments according to changes in economic conditions and other circumstances. Use your business plan to establish milestones and gauge your progress against timelines set forth in your plan.
Your business plan can continue to guide you through various stages of growth as your business progresses. Use it to make decisions, such as when to hire additional personnel, whether to expand to multiple locations or whether to diversify your product or service offerings. As the business environment becomes less predictable due to advancing technology and increased competition, a strong business plan will help your company to thrive. Consult your plan to identify and cultivate niches in which your company could prosper.
Marketing and Sales
Your plan should include a strategy for marketing your business based on your market research to determine the best ways to reach your customers. Use it to create a marketing and sales plan that will work within your budget. Your plan will help you make decisions, such as whether to use radio, print or internet advertising, or a combination of various marketing channels. Will you use telemarketing or outside sales agents to contact leads and close sales? You can modify your plan as you find what works best.
These are only a few of the ways in which your business plan can guide you. The importance of a good business plan cannot be overemphasized, according to the SBA website, which adds, “It helps you allocate resources properly, handle unforeseen complications, and make the right decisions. As it provides specific and organized information about your company and how you will repay borrowed money, a good business plan is a crucial part of any loan package. In addition, it can tell your sales personnel, suppliers, and others about your operations and goals.”