Business Agility Pty Ltd
Your partners in business and leadership success.
Call: +61 488 765 144
- Oct 24, 2020
The Top 5 Benefits of Having a Business Plan
Whether you’re starting a small business or exploring ways to expand an existing business, a Business Plan is an important tool to help guide your decisions. An effective Business Plan is a roadmap to success, providing clarity on all aspects of your business, from marketing and finance, through to operations, products, services, people and how you will be better than your competitors.
The purpose of a business plan is to help articulate a strategy for starting or changing your business. It defines how you will achieve your most important business objectives. A good Business Plan should help you to sleep at night if you are a business owner.
For existing businesses, a business plan should be updated annually as a way to guide growth and navigate expansion into new markets. Your plan should include explicit objectives for hiring new employees, what structure you will have, what products and services your business will provide, how you will promote them and how you will finance business operations.
If you are considering starting a business, a Business Plan can help you to check the viability of a business before investing too much time or money in it. It also provides insight on steps to be taken, resources required for achieving your business goals and a timeline of anticipated results.
The Benefits of Having a Business Plan:
1. Increased Clarity
A business plan can bring clarity to the decision-making process regarding key aspects of the business such as capital investments, leases, resourcing, etc. You can't do everything. A good Business Plan will help you identify business critical priorities and milestones to focus on.
2. Creation of a Marketing Roadmap
Marketing is an important aspect of a business plan. It helps to define your target market(s), target customers and how you will promote and place your product / service to these markets / customers.
3. Support for Funding
Whether you’re seeking credit from a bank or capital from investors, a business plan that answers questions about profitability and revenue generation is often required.
4. Helps to Secure Talent
For a business to succeed, attracting talented workers and partners is vital. Part of a business plan’s purpose is to help bring in the right talent, at the right time. Staff want to understand the vision, how the business will achieve its goals, and how they can contribute to this in their own roles.
5. Provides Structure
A business plan provides structure and defines business management objectives. It becomes a reference tool to keep the business on track with sales targets and operational milestones. When used properly and consulted regularly, it can help measure and manage your priority areas of focus.
Download your Business Plan template for $49.99 + GST here.
Many people engage us as business coaches to take a weekly / fortnightly step-by-step approach to the development of their own Business Plans, with the added benefit of our expertise and guidance throughout the process. In this way, you learn the essential aspects of running a successful business, while crafting your very own business plan over 8-12 weeks.
If you would like more information about how to create an effective Business Plan for your business, with our guidance, then please don't hesitate to contact Business Agility. We are business coaches who are former CEOs and MDs. We know what it takes to be successful in business.
Round 2 of the Boosting Female Founders Initiative is Now Open
The Top 5 Benefits of Having a Marketing Plan
Lottery West COVID-19 Relief Fund: 'Strengthening & Adapting Organisations' Grant Now Open!
Your Internet Explorer version is not supported
Why am i seeing this message.
We support most browsers but yours is now more than 5 years old and we don't support it. We recommend using a faster and more secure browser .
How can I upgrade?
For a faster, more secure internet follow these quick upgrade steps .
I can't upgrade
Speak to your IT team about upgrading. A faster more secure internet experience could benefit your whole organisation.
If your organisation still requires Internet Explorer 8 or earlier to support certain applications you can still get the benefits of upgrading. Ask your IT team to consider managing their policy using chrome with legacy browser support .
Got a smartphone or tablet?
We support all major smartphones and tablets so you can get quotes and bind on the go, or whilst your IT team upgrades your browser.
Need help? 0800 640 6600
Mon - Fri 08:30 - 17:30 (local rate & mobile friendly)
What are the advantages and disadvantages of a business plan?
Almost every business starts with a business plan. These documents are used to map out the steps you want to take to get your business off the ground. However, do these strategy documents work for all businesses?
Whether you’re an entrepreneur or an investor, business plans are considered an essential part of starting a new business . For business owners and other stakeholders, it acts as a manual that can be used to chart a business’ success. Similarly, business plans can generate confidence, helping to convince potential lenders that investment is a risk worth taking.
However, business plans can also be expensive and time-consuming to create. Additionally, there is also no guarantee that a business will succeed just because a sound plan has been put in place.
To help you decide if a business plan would benefit your new venture, this guide runs through the main advantages and disadvantages.
The advantages of a business plan
Although a business plan takes time and money to create, it can help save both in the future if done properly. Below we take a look at some of the key advantages of creating a business plan:
1. It helps you forecast future steps The primary purpose of a business plan is to give you (and investors) an idea of whether your business has the potential to be successful. By mapping out your next steps and setting milestones, you can spot strengths and weaknesses in your ideas and set targets. This is helpful as it may prevent you from proceeding with a business idea that may end up costing you money.
On the other hand, these initial forecasts may provide the positive projections you need to actually get started and even attract outside investment. Even if your business plan produces an uncertain forecast, it still provides a small glimpse of the direction your business wants to head in and how it may perform on the way. This is valuable information, both for business owners and third-party stakeholders.
2. It is required if you want to apply for credit In order to secure a business loan from an official lender, a business plan is essential. Most banks will not even meet with you to discuss financing unless you have a business plan to present. This is because financial institutions like banks and credit unions need a way to accurately gauge their lending risks.
A well-thought-out business plan gives you the opportunity to show lenders how organised and prepared you are. It should explain how your business will use any capital you are lent and how you intend to make repayments. This level of detail can help to instil confidence in your business by persuading lenders you are a good risk.
3. It helps you to identify future cash flow issues A business plan should contain detailed cash flow forecasts and analysis. This shows potential lenders how money is expected to travel in and out of your business. It can also be useful for owners to determine if/when the business is expected to have cash flow problems under certain strategies. Having this information at hand can make it easier to financially plan, ensuring the business is always properly funded.
4. It helps you to allocate resources One of the biggest challenges for new business owners is resource management. From how much inventory you should buy to setting initial budgets, these decisions can be difficult. A business plan encourages you to create a workable budget and allocate resources before you start spending. This ensures you can afford everything you need and you don’t overspend before your business can start making money.
5. It helps you better understand your competition Creating a business plan requires a great deal of industry research. While you may think you have a strong handle on what you want your business to achieve, only by analysing your competition will you be able to see the full picture. A business plan can help you produce highly valuable insights into competitor demographics. This includes existing consumer trends and preferences, as well as costing insights. These findings are not always viable without conducting business plan competitor analysis.
6. It can help to secure talent In order for a business to be successful, attracting talented workers is crucial. A business plan can help to secure this talent by setting out a clear vision for the business. From management to skilled entry level staff, by showing individuals the direction and potential of the business, you can start to build a strong and coherent team.
The disadvantages of a business plan
Business plans can be time-consuming and expensive to produce. On top of this, there is also no guarantee that they will be accurate or help you to achieve the investment you are looking for. With this in mind, below we outline a number of disadvantages when it comes to creating a business plan:
1. It may not be accurate Putting together credible business plans is a highly skilled process. For this reason, many businesses seek the help of experienced business advisors when creating one. However, even with the help of a broad range of expert opinions, there is no guarantee that what is produced will be accurate. Industries and even wider business climates can change very quickly. This means that even taking the time and money to create an in-depth business plan can be risky.
2. It can make you become ‘tunnel-visioned’ In a world where nothing is 100% certain, treating your business plan as an uncompromising manual is a bad idea. The fact is, they are nothing more than a set of forecasts. If followed religiously, these strategy documents can ultimately do more harm than good. This is especially true if you become tunnel-visioned by your business plan and fail to adapt when market forces and changing economic environments demand it.
3. It can waste precious time and money Creating a business plan can take a lot of time and money to produce. It may require the help of third-party experts, such as business advisors, lawyers and accountants, all of which will charge for their services. Additionally, it can also take you and other employees away from the day-to-day tasks involved with launching a new business. This can lead to precious resources being wasted on a task whose cost may exceed its benefits.
The above points show that although business plans represent an essential component for most new businesses, comprehensive plans may not be 100% necessary in all circumstances. Luckily, if you are looking to put one together but are struggling to know where to start, the Markel Law Hub can help. We have a simple, easy-to-follow business plan template for you to download. To learn how you can access the Markel Law Hub, click here .
COVID-19 help and guidance
Cyber & IT security guides
Risk tips and how to prevent claims
Start up tips
Need some help?
0800 640 6600
Mon - Fri 08:30 - 17:30
Local rate and mobile friendly
Frequently asked questions
Business insurance from £5 a month
What is professional indemnity insurance?
What is public liability insurance?
How to handle late paying customers
How to keep clients' data safe and secure
Planning, Startups, Stories
Tim berry on business planning, starting and growing your business, and having a life in the meantime., 10 benefits of business planning for all businesses.
(Note: I posted this Wednesday on the Small Business Administration’s Industry Word blog, where I am a guest expert. I’m reposting it here because it seems appropriate. View the original .)
And I’d like to point out that none of these benefits require a big formal business plan document. A lean business plan (as in What Business Plan Type is Best for Me) is usually enough. It takes an hour or two to do the first plan, then just an hour or two to review and revise monthly.
Here are those top ten benefits.
- See the whole business . Business planning done right connects the dots in your business so you get a better picture of the whole. Strategy is supposed to relate to tactics with strategic alignment. Does that show up in your plan? Do your sales connect to your sales and marketing expenses? Are your products right for your target market? Are you covering costs including long-term fixed costs, product development, and working capital needs as well? Take a step back and look at the larger picture.
- Strategic Focus . Startups and small business need to focus on their special identities, their target markets, and their products or services tailored to match.
- Set priorities . You can’t do everything. Business planning helps you keep track of the right things, and the most important things. Allocate your time, effort, and resources strategically.
- Manage change . With good planning process you regularly review assumptions, track progress, and catch new developments so you can adjust. Plan vs. actual analysis is a dashboard, and adjusting the plan is steering.
- Develop accountability . Good planning process sets expectations and tracks results. It’s a tool for regular review of what’s expected and what happened. Good work shows up. Disappointments show up too. A well-run monthly plan review with plan vs. actual included becomes an impromptu review of tasks and accomplishments.
- Manage cash . Good business planning connects the dots in cash flow. Sometimes just watching profits is enough. But when sales on account, physical products, purchasing assets, or repaying debts are involved, cash flow takes planning and management. Profitable businesses suffer when slow-paying clients or too much inventory constipate cash flow. A plan helps you see the problem and adjust to it.
- Strategic alignment . Does your day-to-day work fit with your main business tactics? Do those tactics match your strategy? If so, you have strategic alignment. If not, the business planning will bring up the hidden mismatches. For example, if you run a gourmet restaurant that has a drive-through window, you’re out of alignment.
- Milestones . Good business planning sets milestones you can work towards. These are key goals you want to achieve, like reaching a defined sales level, hiring that sales manager, or opening the new location. We’re human. We work better when we have visible goals we can work towards.
- Metrics . Put your performance indicators and numbers to track into a business plan where you can see them monthly in the plan review meeting. Figure out the numbers that matter. Sales and expenses usually do, but there are also calls, trips, seminars, web traffic, conversion rates, returns, and so forth. Use your business planning to define and track the key metrics.
- Realistic regular reminders to keep on track . We all want to do everything for our customers, but sometimes we need to push back to maintain quality and strategic focus. It’s hard, during the heat of the everyday routine, to remember the priorities and focus. The business planning process becomes a regular reminder.
These tips are great for beginners .
This article is a must-read for anyone looking to start their own business. It covers the basics of what it takes to get started with your future in mind!
Great article and very well written! Keep up the good work!
Either starting a business or just collaborating for a gig, It is very important to have a likewise mindset partner. And especially we are into supply and manufacturing which you explained very well.
This is an insightful read for young entrepreneurs. We understand the value of content.
I have personally never been able to plan or organize things without penning them down on a piece of paper. It helps me visualize things in a better way. Also, seeing things written down in front of me helps connect the dots. A great article and absolutely in line with my perspective. Cheers!
Wow, I had never considered the fact that business planning can help you keep track of the most important things and prioritize them. My entire life I have strived to be an organized person, and I think it is a good skill to have when it comes to a professional career. Do you know how often one should revise a plan in order to make corrections according to new circumstances and opportunities?
@Sam, generally once a month, but it depends on the nature and specifics of the business. Some can last 2-3 months without review … and you don’t necessarily correct every time you review the plan. Thanks for asking.
Thank you very much for helping the world to understand the genesis of how to plan business and make it reality in life. Business is made by minded person with great and love.
Hi Tim I appreciate you for writing this article,it has really helped me understand the importance of planning and how vital it is to a business and now to me planning is like the foundation of each and every business,keep up with the good work.
Very useful article and very well written. A business plan is important for every person who is planning to start a business because of the mentioned benefits in the article. Thanks for sharing it.
I was looking for the full list of books you recommend in each of these categories, but the link at the end of the article doesn’t seem to be working. I’m particularly interested in good “Applied Statistics” and “Statistical Analysis” books, if that helps. Could you point me to the list with your recommendations?
Sorry, all four links at the bottom of the article work for me, so I can’t help you with links. The closest thing I have to a list of book recommendations is the blog category books here on this blog, which is a list of blog posts about books, most of which are books I recommend. But I have no recommendations for books related to applied statistics or statistical analysis, that’s not my expertise.
That is really interesting that business planning can help you catch new developments and adjust. Something I have been thinking about lately is starting an online business. It has been something that seems to do well for others, and I want to find the opportunities.
I like how you said that business planning helps you keep track of the important stuff. That seems like a really important thing to do because it would allow you to progress more. Focusing on the necessary and essential would really mean that you could do more and accomplish more it seems to me.
Very good summary. I think one great benefit of developing/using Business Plans is that it will give you the chance of training your mindset and exercise the forrest-tree approach. One of the key elements of the BP is to drill down from the overall defined strategy, down to the critical success factors and define metrics to achieve them. As you gain experience, this way of thinking will become more and more embedded and I honestly believe it will help you be a more analytical person i.e. be able to better build BP’s. That is obviously my opinion, some people might argue.
Thanks again Antonio
Thank you Antonio for the welcome addition. I agree with you, another great benefit is the drilling down with the forest-tree thinking. Thanks for adding that. Tim
Hi Tim I couldn’t agree more. I could weep at the networking meetings I go to when I ask how many businesses have business plans and only my hand goes up (and those of my clients :-)) It’s how to persuade them that this really is an important thing to do when they think they are poddling along quite happily now. I’ve tried waving my plan at them and telling them it just got me a £1k grant and if they want a grant too, come to me and I’ll help them! The lot of a decent business coach/consultant can be a frustrating one 🙂
Thanks Karen, and I hope you emphasize the “coach” element in your practice, so that your clients always understand that it’s something they do, with you helping. Check out this one: https://timberry.bplans.com/2007/07/my-worst-ever-b.html (still very valid today).
And thanks for your addition. Glad to have you here.
Leave a Reply Cancel reply
Your email address will not be published. Required fields are marked *
Save my name, email, and website in this browser for the next time I comment.
Flash Sale. 40% Off the #1 rated business plan builder
Call Us (877) 968-7147
Most popular blog categories
- Payroll Tips
- Accounting Tips
- Accountant Professional Tips
4 Benefits of a Business Plan for Your Small Business
Do you need a business plan for your small business? If you are seeking outside funding, you are required to present a formal proposal. But, the benefits of a business plan go beyond finding lenders.
A strategy can help you grow your company. Think of the concept like this:
If you’re like most people, you probably wouldn’t buy a car without doing some research. You would choose one after weighing the good and bad traits of different vehicles. You’d make sure the car starts before signing the title.
It’s a similar situation with your business venture. You need to be sure your business has the potential to be a worthwhile investment.
A business plan can be a simple outline or a detailed document. Your plan is a roadmap that steers you in the right direction. A business plan is not a promise you have to keep over time.
Download our free guide on what you need to start your business to learn more, plus get a checklist!
4 Benefits of a business plan
So what can a solid strategy for building your business help you accomplish? Here are four benefits of a business plan:
1. You can get outside funding
To get funding from lenders or investors, you need to show a business plan. Lenders want to see that they are investing in a company that will last and grow. You must give lenders a plan detailing the steps you will take as a business owner.
Even if your lenders are friends and family, it’s good to organize your ideas.
A business plan helps others understand your passion and see where their money is going. Communicating clear ideas to investors helps prove you can get your business off the ground and build it up.
You’ll need to know how to write an exit strategy for a business plan as well. A thriving business is no good to your investors if they have no way to eventually cash in on their investment.
2. You gain an understanding of your market
One key piece of your business plan is knowing how to conduct a market analysis . When you conduct this study, you look at your industry, target market, and competitors. You can see trends in decisions that could help, or harm, your business.
Another great benefit of a business plan is learning from someone else’s mistakes. Learning from other’s mistakes is less time consuming and financially burdening than learning from your own mistakes. The more prepared you are to deal with the aspects of your market, the easier it might be to handle issues down the road.
3. You focus your strategies
The entrepreneur in you is eager to dive right into business. But, having a business plan can help you pinpoint the best strategies for your company. Before you take the plunge into ownership, work out the important details.
This business plan benefit also helps you prioritize tasks. By looking at the big picture of your business, you can decide which challenges to tackle first. A business plan could also help you choose which tasks to address later.
4. You can check the financial numbers
Business plans include financial projections for your company. While the projections are not a peek inside a crystal ball, they do represent a forecast of your financial health. Planning for expenses will be important for keeping operations steady.
Cash flow projections help you see if your goals are possible. They also point out trends that could potentially harm your business. The faster you spot upcoming issues, the faster you can correct problems.
Be sure that your projections match up to your expectations. Have you set aside enough money to do the tasks at hand? Double-check your numbers so you are prepared to handle your finances in the future.
Business plan parts
Here are a few items you could include in your business plan:
- Company description telling how you will meet your customers’ needs.
- A market analysis that talks about your industry, target market, and competitors.
- Services or products you will sell.
- Marketing plans for generating sales.
- Funding requests with a budget outlined.
- Financial projections from your financial statements.
Your business plan could be anything between a basic outline to a 40-page presentation. If the plan is just to keep you on track, you can cover the areas you think need to be addressed. The benefits of a business plan are not limited to a specific length, but can be tailored to your needs.
If you write your business plan for lenders, you will want a more formal, detailed plan. Include a table of contents, a summary of your business, and an appendix with supporting documents.
Does your business plan include a system for tracking finances? Our accounting software is an easy-to-use program for small business owners and their accountants. Try it for free today!
This article has been updated from its original publication date of February 19, 2016.
Stay up to date on the latest accounting tips and training
You may also be interested in:
Need help with accounting? Easy peasy.
Business owners love Patriot’s accounting software.
But don’t just take our word…
Explore the Demo! Start My Free Trial
Relax—run payroll in just 3 easy steps!
Get up and running with free payroll setup, and enjoy free expert support. Try our payroll software in a free, no-obligation 30-day trial.
Relax—pay employees in just 3 steps with Patriot Payroll!
Business owners love Patriot’s award-winning payroll software.
Watch Video Demo!
Watch Video Demo
The benefits of a business plan
1. the importance of a business plan, 2. why you need a business plan, 3. the benefits of creating a business plan, 4. how to write a business plan, 5. what to include in your business plan, 6. how to use your business plan, 7. tips for successfully implementing your business plan, 8. real world examples of successful business plans, 9. resources for further reading on business plans.
When it comes to starting a business, there are a lot of important things to keep in mind. One of the most important is creating a business plan . A business plan is essential for a successful business for several reasons.
The first reason is that a business plan helps to ensure that all of the necessary elements are in place before the business gets started. This includes things like market research , financial planning, and setting up the business structure . Without a business plan, its easy to overlook important details that could make or break the business.
Another reason why a business plan is so important is that it forces the entrepreneur to think through all aspects of the business. What are the company's goals? How will it be structured? What are the potential risks and how will they be mitigated? By taking the time to answer these questions in the planning stage, entrepreneurs can avoid costly mistakes down the road.
Lastly, a well-crafted business plan can be a valuable tool for attracting investors and partners. When investors see that a business has a clear plan in place,they are more likely to put money into it. Similarly, potential partners will be more likely to sign on if they see that the company has a solid roadmap for success.
So, if you're thinking about starting a business , don't forget the importance of a business plan . By taking the time to create one, you'll increase your chances of success and avoid costly mistakes.
Got no clue how to start your funding round?
FasterCapital helps you in making a funding plan, valuing your startup, setting timeframes and milestones, and getting matched with various funding sources
A business plan is a formal document that outlines the goals and objectives of your business, as well as the strategies you will use to achieve them. It is important to have a business plan because it will help you to:
1. Crystallize your business idea;
2. set out your goals and objectives ;
3. Identify the resources you need to achieve your goals;
4. develop a marketing strategy ;
5. Track your progress and measure your success; and
6. Attract investors and partners.
A business plan does not have to be long or complex, but it does need to cover the key elements of your business. The following sections are typically included in a business plan :
1. Executive Summary: This is a brief overview of your business, including your business idea, your goals and objectives, and your strategy for achieving them.
2. Company Description: This section provides an overview of your company, including its history, its structure, and its products or services.
3. Market Analysis: This section looks at your industry and the market for your products or services, including your target market, your competitors, and your competitive advantage.
4. Marketing Plan: This section outlines your marketing strategy, including your sales and promotion plans, your pricing strategy, and your distribution channels.
5. Financial Plan: This section contains financial projections for your business , including your income statement, your balance sheet, and your cash flow statement .
6. Appendix: This section contains supporting materials for your business plan, such as market research reports, product brochures, and letters of reference.
Why You Need a Business Plan - The benefits of a business plan
Creating a business plan can be a daunting task, but it's an important step in starting a business. A business plan can help you secure funding for your business, get your business off the ground, and make it easier to manage your finances.
There are many benefits to creating a business plan , including:
1. A business plan can help you secure funding for your business
If you're looking for funding for your business, a business plan can be a valuable tool. Investors and lenders will want to see a well-thought-out business plan that includes information on your business model, your financial projections, and your growth strategy. A business plan can also help you get a better understanding of your industry and your competition.
2. A business plan can help you get your business off the ground
A business plan can be a helpful roadmap for getting your business up and running. It can help you set goals and track your progress. It can also help you attract employees and partners.
3. A business plan can make it easier to manage your finances
A business plan can help you keep track of your expenses and income. It can also help you forecast your cash flow and manage your financial risks.
4. A business plan can help you attract customers
A well-written business plan can help you attract customers and partners. It can also help you build credibility with potential customers.
5. A business plan can help you stay organized
A business plan can keep you focused on your goals and help you stay organized. It can also help you track your progress and make adjustments to your business as needed.
Creating a business plan takes time and effort , but it's worth it. A well-crafted business plan can help you secure funding, get your business off the ground, attract customers, and manage your finances.
The Benefits of Creating a Business Plan - The benefits of a business plan
Creating a business plan is an important step in the process of starting a business . It can help you to think through the details of your business, including your marketing strategy, your financial projections, and your overall goals.
A business plan can also be a valuable tool for existing businesses. It can help you to clarify your business's direction, set goals, and track your progress.
If you're thinking about starting a business, or if you're already running one, a business plan can be a helpful way to focus your thoughts and ensure that you're covering all of your bases.
1. Keep it brief
Your business plan does not need to be long or complicated. In fact, it's better to keep it concise and focus on the key points. You can always provide more detail if needed.
2. Include all the important elements
When you're writing your business plan , make sure to include all of the important elements. This includes your company overview, your market analysis, your financial projections, and your marketing strategy.
3. Make it realistic
Your business plan should be realistic. Avoid making assumptions or overestimating the potential of your business. Be honest about the challenges you're facing and the potential risks involved.
4. Get feedback
Before you finalize your business plan, get feedback from people you trust. This can help you to catch any errors or omissions and make sure that your plan is clear and concise.
5. Be prepared to revise
Your business plan is not set in stone. As you get more experience in running your business, you may need to revise and update your plan. Don't be afraid to make changes as needed.
How to Write a Business Plan - The benefits of a business plan
When it comes to your business plan, there are certain elements that are absolutely essential in order to make it successful. Without these key components, your business plan will likely fall flat, leaving you struggling to get your business off the ground. So, what exactly should you include in your business plan ?
First and foremost, your business plan should include a detailed description of your business. This should include what your business does, what products or services you offer, and what your businesss unique selling proposition is. You should also include an overview of your target market and a marketing strategy for reaching them.
Next, your business plan should include a financial projection for your business. This should include a sales forecast, expenses budget, and a profit and loss statement . This will give potential investors an idea of how much money they can expect to make from investing in your business.
Finally, your business plan should include a management team section. This should include information on your executive team, their qualifications, and their experience in running a business. This will show potential investors that you have a solid team in place who can help take your business to the next level.
By including these essential elements in your business plan , you'll be well on your way to crafting a successful document that will help you get the funding you need to start and grow your business .
Raising capital can be a struggle!
With FasterCapital's team's help, you get your startup funded successfully and quickly!
A business plan is a critical tool for any business owner. It provides a roadmap for your business, setting out your goals and objectives and outlining how you plan to achieve them.
Your business plan should be reviewed and updated regularly to ensure it remains relevant and is achieving its goals.
1. Use it as a roadmap
Your business plan should be used as a roadmap for your business. It should set out your goals and objectives and outline how you plan to achieve them.
2. Review and update it regularly
3. Share it with your team
Your business plan should be shared with your team so they are aware of your goals and objectives and how you plan to achieve them.
4. Use it to raise finance
If you are looking to raise finance for your business , your business plan will be essential. It will give potential investors an insight into your business and help them to make a decision on whether or not to invest.
5. Use it to measure progress
Your business plan can be used to measure your progress against your goals and objectives. This will help you to see how well your business is doing and whether or not you are on track to achieve your goals .
6. Use it to make decisions
Your business plan can be used as a tool to help you make decisions about your business. It can help you to consider different options and make the best decision for your business.
7. Get feedback
Before finalising your business plan, it is a good idea to get feedback from others. This could include family, friends, colleagues, or even potential investors. Getting feedback will help you to improve your business plan and make it more likely to succeed.
8. Be realistic
When writing your business plan, it is important to be realistic. This means setting achievable goals and objectives and having a realistic view of what your business can achieve in the short and long term .
How to Use Your Business Plan - The benefits of a business plan
A business plan is critical to the success of any business, yet many entrepreneurs don't take the time to create one because they find the process overwhelming. However, a business plan doesn't have to be a long, tedious document. In fact, it can be helpful to think of your business plan as a living document that will evolve as your business grows.
Here are four tips for creating a successful business plan :
1. Keep it simple
The biggest mistake entrepreneurs make when creating a business plan is trying to make it too complicated. Your business plan should be a roadmap that outlines your goals and how you plan on achieving them. It doesn't need to be overly detailed or filled with jargon.
2. Make it measurable
Another common mistake is failing to include measurable goals in your business plan. Without measurable goals, it will be difficult to track your progress and determine whether or not your business is on track. Be sure to include both short-term and long-term goals in your plan and create a timeline for each goal.
3. Get input from others
When you're creating your business plan, its important to get input from others who are knowledgeable about business planning. Ask for feedback from your mentors, advisors, and peers. Their insights can help you refine your ideas and make your plan more robust.
4. Be prepared to pivot
No matter how well you plan, there will always be unforeseen obstacles and challenges. The key is to be prepared to pivot when necessary. Be flexible and willing to adjust your plans as needed. The best businesses are those that are able to adapt and change as the market evolves.
By following these tips, you can create a successful business plan that will help you achieve your goals. Remember, your business plan is a living document that should be updated as your business grows.
Tips for Successfully Implementing Your Business Plan - The benefits of a business plan
The term business plan can conjure up images of long, detailed documents that are created in advance of starting a business. However, the reality is that business planning is a fluid process that should be revisited and updated regularly as your business grows and changes.
One of the most important benefits of creating a business plan is that it forces you to think through the key components of your business , such as your value proposition, target market, competitive landscape, and go-to-market strategy. This process helps you clarify your business goals and develop a road map for achieving them.
Another key benefit of having a business plan is that it can help you secure funding from investors or lenders. A well-crafted business plan will include financial projections and analysis that can convince potential investors or lenders to provide the capital you need to start or grow your business.
Finally, a business plan can be a valuable tool for managing and growing your business. By periodically revisiting and updating your business plan , you can ensure that your business is on track to achieve its goals.
While there is no one-size-fits-all template for creating a successful business plan, there are some key elements that should be included. Here are some real-world examples of successful business plans to provide inspiration for your own planning process.
1. The Lean Plan: This type of business plan is best suited for businesses that are just getting started. It is focused on clarifying the key components of your business, such as your value proposition, target market, and go-to-market strategy. The Lean Plan can be created in just a few hours and is typically only a few pages long.
2. The traditional Business plan : This type of business plan is more comprehensive and includes detailed financial projections and analysis. It is best suited for businesses that are seeking investment or loan financing. The traditional business plan can take several weeks or even months to complete.
3. The One- page Business plan : As the name implies, this type of business plan can be created on just one page. It is best suited for businesses that are already up and running and just need a simple road map to help them achieve their next level of growth.
4. The Elevator Pitch: This is a short, one- to two-minute pitch that summarizesthe key components of your business. It is typically used to quickly generate interest from potential investors or partners.
5. The Milestone-Based Plan: This type of business plan focuses on key milestones that need to be achieved in order to reach your overall goal. It is best suited for businesses that have a clear vision for where they want to be in the future but need help developing a roadmap for getting there.
Real World Examples of Successful Business Plans - The benefits of a business plan
Creating a business plan is an important step in the process of starting a business. It allows you to articulate your business goals, strategies, and how you plan on achieving them. A business plan can also help you secure funding from investors or lenders.
While there is no one-size-fits-all template for a business plan , there are some key components that should be included. These include an executive summary, company overview, market analysis, product or service offerings, target market, competitive analysis, marketing and sales strategy, financial projections, and a management team overview.
If you're not sure where to start, there are many resources available to help you create a business plan . The Small Business Administration (SBA) has a helpful guide that outlines the key components of a business plan . There are also many software programs and online services that can help you create a business plan.
Once you've created your business plan, it's important to keep it up to date as your business grows and changes. Review and revise your plan regularly to ensure it remains relevant and accurate.
If you're looking for more information on business plans, there are many books and articles available on the subject. A few of our favorites are listed below.
"The Lean Startup: How Today's entrepreneurs Use Continuous Innovation to Create radically Successful Businesses" by Eric Ries
"The Art of the Start 2.0: The Time-Tested, battle-Hardened Guide for Anyone starting Anything" by Guy Kawasaki
"The Innovator's Dilemma: When New Technologies Cause Great Firms to Fail" by Clayton M. Christensen
The struggle for starting your tech startup is over!
In the Tech Cofounder program, FasterCapital helps you with every step of your journey from ideation to launching
Read Other Blogs
Quotes are powerful tools that can shape our thoughts and influence our behavior. They can...
The way we spend our money is a reflection of our values, beliefs, and priorities. Understanding...
Market manipulation is a practice that has been around for centuries. It is a strategy used by a...
The ISK black market is a complex and often misunderstood part of the EVE Online universe. It’s a...
The F-region is a critical part of the Earth's ionosphere, located at an altitude of approximately...
Every financial startup needs an accounting system to remain competitive and successful. An...
Resource allocation plays a crucial role in the overall performance and success of a supply chain....
Understanding Buy Stop Orders In the world of trading, there are many strategies and tools that...
Understanding the Importance of Trend Confirmation In the world of trading, correctly identifying...
Nine reasons why you need a business plan
Building a great business plan helps you plan, strategize and succeed. Presented by Chase for Business .
Making the decision to create a new business is an exciting yet stressful experience. Starting a business involves many tasks and obstacles, so it’s important to focus before you take action. A solid business plan can provide direction, help you attract investors and ensure you maintain momentum.
No matter what industry you plan on going into, a business plan is the first step for any successful enterprise. Building your business plan helps you figure out where you want your business to go and identify the necessary steps to get you there. This is a key document for your company to both guide your actions and track your progress.
What is the purpose of a business plan?
Think of a business plan like a roadmap. It enables you to solve problems and make key business decisions, such as marketing and competitive analysis, customer and market analysis and logistics and operations plans.
It can also help you organize your thoughts and goals, as well as give you a better idea of how your company will work. Good planning is often the difference between success and failure.
Here are nine reasons your company needs a business plan.
1. Prove your idea is viable
Through the process of writing a business plan, you can assess whether your company will be successful. Understanding market dynamics, as well as competitors, will help determine if your idea is viable.
This is also the time to develop financial projections for your business plan, like estimated startup costs, a profit and loss forecast, a break-even analysis and a cash flow statement . By taking time to investigate the viability of your idea, you can build goals and strategies to support your path to success.
A proper business plan proves to all interested parties—including potential investors, customers, employees, partners and most importantly yourself — that you are serious about your business.
2. Set important goals
As a business owner, the bulk of your time will mostly likely be spent managing day-to-day tasks. As a result, it might be hard to find time after you launch your business to set goals and milestones. Writing a business plan allows you to lay out significant goals for yourself ahead of time for three or even five years down the road. Create both short- and long-term business goals.
3. Reduce potential risks
Prevent your business from falling victim to unexpected dangers by researching before you break ground. A business plan opens your eyes to potential risks that your business could face. Don’t be afraid to ask yourself the hard questions that may need research and analysis to answer. This is also good practice in how your business would actually manage issues when they arise. Incorporate a contingency plan that identifies risks and how you would respond to them effectively.
The most common reasons businesses fail include:
- Lack of capital
- Lack of market impact or need
- Unresearched pricing (too high or low)
- Explosive growth that drains all your capital
- Stiff competition
Lack of capital is the most prevalent reason why businesses fail. To best alleviate this problem, take time to determine how your business will generate revenue. Build a comprehensive model to help mitigate future risks and long-term pain points. This can be turned into a tool to manage growth and expansion.
4. Secure investments
Whether you’re planning to apply for an SBA loan , build a relationship with angel investors or seek venture capital funding, you need more than just an elevator pitch to get funding. All credible investors will want to review your business plan. Although investors will focus on the financial aspects of the plan, they will also want to see if you’ve spent time researching your industry, developed a viable product or service and created a strong marketing strategy.
While building your business plan, think about how much raised capital you need to get your idea off the ground. Determine exactly how much funding you’ll need and what you will use it for. This is essential for raising and employing capital.
5. Allot resources and plan purchases
You will have many investments to make at the launch of your business, such as product and services development, new technology, hiring, operations, sales and marketing. Resource planning is an important part of your business plan. It gives you an idea of how much you’ll need to spend on resources and it ensures your business will manage those resources effectively.
A business plan provides clarity about necessary assets and investment for each item. A good business plan can also determine when it is feasible to expand to a larger store or workspace.
In your plan, include research on new products and services, where you can buy reliable equipment and what technologies you may need. Allocate capital and plan how you’ll fund major purchases, such as with a Chase small business checking account or business credit card .
6. Build your team
From seasoned executives to skilled labor, a compelling business plan can help you attract top-tier talent, ideally inspiring management and employees long after hiring. Business plans include an overview of your executive team as well as the different roles you need filled immediately and further down the line.
Small businesses often employ specialized consultants, contractors and freelancers for individual tasks such as marketing, accounting and legal assistance. Sharing a business plan helps the larger team work collectively in the same direction.
This will also come into play when you begin working with any new partners. As a new business, a potential partner may ask to see your business plan. Building partnerships takes time and money, and with a solid business plan you have the opportunity to attract and work with the type of partners your new business needs.
7. Share your vision
When you start a business, it's easy to assume you'll be available to guide your team. A business plan helps your team and investors understand your vision for the company. Your plan will outline your goals and can help your team make decisions or take action on your behalf. Share your business plan with employees to align your full staff toward a collective goal or objective for the company. Consider employee and stakeholder ownership as a compelling and motivating force.
8. Develop a marketing strategy
A marketing strategy details how you will reach your customers and build brand awareness. The clearer your brand positioning is to investors, customers, partners and employees, the more successful your business will be.
Important questions to consider as you build your marketing strategy include:
- What industry segments are we pursuing?
- What is the value proposition of the products or services we plan to offer?
- Who are our customers?
- How will we retain our customers and keep them engaged with our products or services and marketing?
- What is our advertising budget?
- What price will we charge?
- What is the overall look and feel of our brand? What are our brand guidelines?
- Will we need to hire marketing experts to help us create our brand?
- Who are our competitors? What marketing strategies have worked (or not worked) for them?
With a thoughtful marketing strategy integrated into your business plan, your company goals are significantly more in reach.
9. Focus your energy
Your business plan determines which areas of your business to focus on while also avoiding possible distractions. It provides a roadmap for critical tradeoffs and resource allocation.
As a business owner, you will feel the urge to solve all of your internal and customers’ problems, but it is important to maintain focus. Keep your priorities at the top of your mind as you set off to build your company.
As a small business owner, writing a business plan should be one of your first priorities. Read our checklist for starting a business, and learn how to take your business from a plan to reality. When you’re ready to get started, talk with a Chase business banker to open a Chase business checking or savings account today.
For Informational/Educational Purposes Only: The views expressed in this article may differ from other employees and departments of JPMorgan Chase & Co. Views and strategies described may not be appropriate for everyone and are not intended as specific advice/recommendation for any individual. You should carefully consider your needs and objectives before making any decisions and consult the appropriate professional(s). Outlooks and past performance are not guarantees of future results.
JPMorgan Chase Bank, N.A. Member FDIC. Equal Opportunity Lender, ©2023 JPMorgan Chase & Co
What to read next
Manage your business how to help protect your business from check fraud.
Think writing checks is a safe way to pay vendors? Think again. Learn about five common scams and how to help prevent them.
START YOUR BUSINESS 10 tips before starting your new businesses
Thinking about starting a business? Check these 10 items off your list.
MANAGE YOUR BUSINESS Inventory management can help maintain cash flow
Inventory can eat up a lot of cash. Here are a few ways to manage inventory with cash flow in mind.
MANAGE YOUR BUSINESS Banking tips for cash businesses
Learn how to keep your cash business safe, secure and compliant.