Why write a business plan?
A business plan is a written document which outlines your business, covering everything from vision, objectives, strategies, products and services, sales and marketing and financials.
A business plan can help you to:
Analyse and clarify your business idea
Recognise potential problems, obstacles and issues
Plan your goals
Set KPIs (Key Performance Indicators) to track your progress
A business plan helps you to clarify your plans and is vital if you are seeking finance, funding or investment. A well written business plan can also help attract the best talent, network and contacts.
Business Plan Tips
Be clear and concise
It’s important that your business plan is written in a clear and concise manner. This will help investors and stakeholders understand your plans and business. Your business plan should include a summary along with details of how the business will make money from the outset.
Provide relevant and specific details about your business and plans
Know your market
A key area of business planning is understanding your market and your audience. Ensure you know your target market and use personas where relevant. Who will benefit from your product or service? Which competitors offer the same or similar product and service?
Know your numbers
Knowing your numbers is vital in business. Cash is king and running out of money is the most common reason for business failure. You need to be clear on your numbers across the board – from costs and expenses to sales and profit. Knowing your numbers makes it easier to plan and avoid shortfalls, as well as securing investment and finance. Understanding your numbers and cash flow planning and forecasting will also give you confidence and peace of mind, allowing you to tailor and adjust your strategy.
Writing a business plan helps you talk about your business concisely, helping you identify possible obstacles along the way.
While writing a business plan is not strictly necessary, it is a very useful planning exercise. Your business plan can serve as your reference guide, helping you to launch and scale your business. So it’s much more than simply for investors or to apply for funding or finance.
A business plan can be brief, and does not have to be long or detailed. If a document is too long, it is less likely to be read. Set out a clear structure such as:
The Problem – what gap or need is your business solving?
The Solution – how will your business solve problems?
Competitor Analysis – who are the direct or indirect competitors?
SWOT analysis – SWOT is an acronym for strengths, weaknesses, opportunities and threats. What are these for your business?
To summarise, your business plan details what your business does, or plans to do, along with the details of the problem or opportunity your business will solve, what makes your business unique and how you will implement your plans.
Taking the time to write your business plan will help you to clarify your business idea and articulate details clearly. Your plan will also help you outline your sales and marketing, fulfilment and operations. You’ll also gain a broader view of potential obstacles, issues and risks, along with ideas for overcoming or avoiding these areas. You’ll also gain a clearer view of the numbers in your business, along with investment, funding or financing needs. You’ll also be able to communicate with others – partners, investors, institutions, suppliers, contacts and customers more effectively and with greater confidence.