Why bother with a business plan? If you where going to go on a long trip, wouldn’t you need a map? Business plans for business people are like maps for tourists. If you don’t have a plan, and you happen to reach your destination, it will be more luck then good judgement!
Business planning is simply identifying where you are now, what your goals are and how you are going to achieve them.
The key commitment is writing it down. Planning asks you to look at future developments, consider the services you offer your customers. Get staff and other key people to have their input so that they “own the ideas”. Planning encourages clear communication within the business. The whole business should be reviewed on at least an annual basis. Fine-tuning and updates should be made every 6 months. One of the key considerations as to “why bother” is that undoubtedly one day you will want to sell your business and you will want to get the best possible price for it. A good business plan will promote your business to a third party audience, particularly a potential investor or financier.
Business planning forces you to consider the risks involved in the particular business operation that you are involved in. “What would happen if…?” is a very good question to pose to your team on a number of issues so that you can determine appropriate strategies that are then documented to be utilised as that particular event materialises. Various studies have indicated that businesses that develop a written business plan have a greater chance of surviving then those that do not.
Business plans will assist the owner/manager in running the business by incorporating performance benchmarks that have been analysed and agreed to in the business planning process that can be regularly measured and then action taken to determine reasons for variants from the targeted figure.
Okay, fess up…when was the last time you reviewed and update your business plan?
Article by Christie Lewis
Christie is Practice Manager at Alan Lewis Accountants . Besides accounting, her passion is for all things small business (and blogging, of course). You can contact Christie directly at christie@lewistaxation.com.au.
Christie has written 799 awesome articles for us at Alan Lewis Accountants – BLOG
Twitter: @christielewis
{ 4 comments… read them below or add one }
Yes I agree. I think that planning is very important for everyone if it wants to achieve something in life. And is the one that is in the business or private lives …
You’re so right… planning extends well beyond the business and should include our private ambitions.
In all areas of our lives, it’s important to pinpoint where we want to go so we can establish an action plan to get there and recognise when we are off target.
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