What is a business plan for small business?
A business plan is a document that discusses the viability, risks, challenges and indicates the road to success of a business, project or startup idea.
An entrepreneurial business plan is used to combine ideas, competitor details, customer research and financial planning to show a business has a realistic change of success.
Business plans are typically used as a means to describe a business, launch a business, invest in a business, highlight risks, describe opportunities and detail the actions required for the business to succeed.
What are the benefits of writing a business plan when you have a small business?
Writing a good business plan is more than putting pen to paper or typing away at your laptop. A well written business plan combines your needs, business objectives, customer benefits, market research alongside your business details.
The combination of personal preferences and customer will help you create a document that will continually evolve throughout the lifetime of your entrepreneurial project.
Your entrepreneurial life and your business needs are connected. You will have to make your business idea work by taking your skills, knowledge and personality into account while you work to give your customers something of value.
Experienced profitable and money-making entrepreneurs might rely on behaviour patterns to intuitively understand how their business. This business skills takes time for most new entrepreneurs to develop and it’s why a business plan is very important.
Do you need a business plan?
Thinking about your business take time, but putting in the effort will make any business plan much easier to write.
The alternative to spending the time upfront is losing your business due to avoidable mistakes, poor planning or unforeseen circumstances. Planning for challenges and external events could risk your business success.
Only a few entrepreneurs can visualise opportunities without much planning or knowing how to perform business research. If you dream of being a lucky business owner or a visionary entrepreneur you will still need to plan.
Business creation is difficult and time consuming and planning simply improves your odds with a well written, researched and thought-out business plan. It makes sense to give yourself the best possible chance of surviving in the short term and thriving over the long-term.
Business plans can help small businesses check their ideas
A business plan is useful to organise your thoughts related to your business idea or current project. It’s sometimes useful to track not just your thoughts and ideas, but also how you think, so you know [how to generate good business ideas](internal link).
As a new business you will need to put everything down on paper, so you’re not losing any information and you know that you can make the most of your spare time or those moments when something pops into your head.
Every thought is precious and could help you make decisions on your next business move or business idea. Learning to work with structure will help you to collect every idea; personal, professional, entrepreneurial or random.
Combining your personal needs with your business needs
When you’re thinking about business plans, it’s often useful to ensure your personal goals are aligned with your business idea and professional objectives.
If your personal, professional and business ideas are not in step with each other, you may have to rethink your initial idea or rethink your personal goals. Deciding to pursue a business which is misaligned with your personal goals and life expectations could be source of regret.
Including a business planning phase within your entrepreneurial process means you will consider elements of your business that will constantly impact how you work. This is important if you would like a lifestyle business or a big corporations.
Customer and competition reviews will help your business
Customer research and competitive reviews are often included within business plans. This information will build on your customer thoughts and give you a better idea of the marketplace and how your customers could respond to your business idea.
You can put everything together and have a more rounded idea of your customer and how they’re likely to react to your product or service.
Different businesses need different business plans
A good business plan will help you monitor progress against your goals and your objectives. This will help you manage day-to-day tasks towards your original objective and any plans for future investment.
It’s common for different businesses to have different business plans. Sometimes competing companies within the same industry will have contrasting plans. There is not a one-size fits all for business plans.
As a small business owner or a new entrepreneur it makes sense for you to think about an appropriate business plan for your business size and customer base. It would be overkill to create an unnecessarily large and complicated document for a small business with several local customers.
This can be accomplished using the Lean startup methodology, which has become popular within highly technical industries across silicon valley.
The Lean startup methodology requires businesses to concentrate on the core elements of the business to quickly understand if the business model and business idea in its current form are viable. It’s ideally placed to rapidly test ideas and concepts and seek validation about each element before continuing with the business.
This is another method of business plan creation, but is something that is not considered the norm when talking about traditional businesses. Whichever method you choose, you should understand some of the common elements that would be included within standard business plans.
Is a business plan worth it?
A universal standard business plan template does not exist. It’s also necessary for you to review your plan multiple times from your business, personal and customer perspectives.
The whole process is a lot of work and business planning can feel like you’re moving slowly.
The world is also constantly changing and any plan will almost certainly change as soon as you start interacting with customers.
Therefore, understanding your business environment and how you will approach your entrepreneurial project will give a better chance of moving in the right direction.
Using the business plan as a check and balance for your ideas can only help your business thrive over the long-term. as good habits are enforced while helping you understand risks and challenges required for your success.
Good luck!
Comments