“Flying by the seat of your pants”, so to speak, is very exciting but is not a recommended way to run your business. Just remember that almost 90% of start ups never see a second year all because their owners never filed a “flight plan”. To prevent a small business from running sluggishly, the owner needs to invest in a business plan. Here are 10 good reasons for that stinking business plan:
photo credit: David Boyle in DC
1. Help you understand who your target market is and what customer problem you are trying to solve.
2. Help you understand the language your target customer uses to describe your product/service so you can craft a marketing message that he/she can relate to.
3. Help you figure out clearly where your business is headed and what critical steps you need to take.
4. Forces you to perform research to get the start up costs for your new business or for the growth you’re planning for the next phase of your existing business.
5. Gives you a sales document that you can use to raise capital at the banks or lending institutions.
6. Gives you an opportunity to study your competitors’ strengths and weaknesses.
7. Allows you, with the right financial analysis software tools, to vary your business assumptions and see the financial results without spending time or money.
8. The plan is a map by which to run the business and to checkpoint your performance and see whether you’re on course and on schedule.
9. All your key employees can refer to the business plan so that everyone is always on the same page.
10. By using it as a guide and by varying the behavior of the business or by changing the plan as needed, you can prevent yourself from repeating the same mistakes.
Always remember that you never plan to fail, you just fail to plan and that always catches up with you. You need a stinking business plan