5 Reasons why you need a business plan
June 7, 2016
A business plan is a fundamental part of setting up your own business. Anybody beginning or extending a venture that will consume significant resources of money, energy or time and that’s expected to return a profit should take the time to draft some kind of business plan. Here are 5 reasons why you need a business plan:
Plan the future
A business plan plays a vital part in helping to manage an organisation more effectively. You will be able to understand and improve your business better by putting your thoughts down on paper. It can help you set goals and objectives and give you information on how you can achieve these.
Help grow and secure funding
An up to date business plan is essential in order to gain funding. As the market for funding is highly competitive, all lenders will require access to your business plan along with recent income statements.
Communicating a course of action
A business plan can help you focus on future opportunities and follow a particular course of action. Milestones can be set and you can focus on key tasks which will help to monitor progress. The plan can be changed quickly if it is not helping your business succeed and a more suitable plan can be produced.
Managing the cash flow
Careful management of a business’s cash flow is important if you want your company to succeed. Many organisations fail, as they are unable to pay their debts. A well-structured business plan will help you manage your cash flow and help you stay on track.
Avoid big mistakes
It is a waste of time and effort if you start up a business and it fails in a year. Many founders have learnt the hard way and didn’t have a viable way to make money. Developing and sharing a business plan can help avoid going down the wrong path, as you will have taken different factors into consideration. So start creating your business plan today for a successful future!
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