Often times we mistake a business plan as a document that is put together for a new business and then set aside after the start-up process. But really, the plan changes over time as the business develops and should be reviewed on a yearly basis.
Here are a few good reasons why you should write a business plan when starting a new business.
- To test the feasibility of your business idea.
Writing a business plan is the best way to test whether or not your idea is feasible before you start. Writing a business plan can save you time and money because it will reveal if your idea is untenable.
- To give your business the best chance for success.
Writing a business plan will ensure that you pay attention to operational and financial goals and details like budgeting and market planning. Working through a business plan will make the start-up process smoother and help you avoid problems as your business becomes eshablished.
- To secure funding.
To start a new business you will need operating and start-up capital. Having a well developed business plan gives you a much better chance of getting the money you need from established financial institutions such as a bank.
- To make business planning manageable and effective.
Reviewing your business plan can help you see what goals have been achieved, what changes need to be made, or what direction your business’s growth should take.
Writing a business plan is time-consuming, but it is essential if you want to survive the start-up process and run a successful business.