Importance of a business plan you must know before building your start-up

business plan
Source: People Potential

It is indeed a leap of faith when you embark upon doing your own business. More so when you happen to be believing enough of yourself to venture a step in the offbeat path by building your own start up. But while belief and confidence is very much essential to achieve what you set out to, businesses do not thrive entirely on ideas and vision. The vision works only when you have a practical plan in place that will chart out your course and goad you on along it. No wonder, a business plan assumes utmost importance when you choose to go the entrepreneurial way in order that you do not end up as yet another bankrupt and dejected soul, like so many others who give in to the lure of being achievers without however much of a clear idea of what they want to achieve. And when we say plan, we do not mean only the financial route that you need to clear out. Business is equal parts mind and money which is why business plans are so important not just to build your business but also to help it grow and thrive.

Every successful businessman needs to possess the ability to make quick and efficient decisions. Because time is money and opportunities can be lost in the blink of an eye, a ideal business plan would help you get clarity on your end goal to help you in taking logical decisions guided not by impulse but rather in consideration of its efficiency in helping you achieve the long term results. Which means your business plan needs to be a carefully thought out course of action and not some random derivation you make based on the experience of others that do not even tally down to your final pursuit. A business plan assumes importance in its aim of not letting you lose focus and persisting in your belief that ultimately will decide how successful a startup you can boast of owning.

In ensuring that you make such decisions that bode well for your entrepreneurial interests, a business plan also lets you deliberate on your own actions or the course of it. As you set about eking a plan, you attain greater clarity on your focus because you would be required to have concrete answers to all the queries that might pop up in course of your schematic decision making venture. That allows you also to rethink and reevaluate early on the feasibility of what you had intended to do, so that you do not stare at such dilemmatic crossroads later that might even disrupt your business model altogether. Any idea or aim assumes a status of being more real and therefore more achievable when you go step by step about it, dwelling at length on every probability, even when they are almost unlikely to occur ever. It lends you greater surety about yourself and bolsters your confidence further so that you remain always in positive spirits that surely will translate as success for your business as well.

One of the most important requirements for a successful business is satisfied clients. And clients do tend to go by your business plan when it comes to banking on you. Having a clear cut plan of action helps you in decision making which thereby lends you greater power when it comes to convincing the clients. Articulating in exact words the services you would be providing in the due time renders you more trustworthy because it helps clients identify you as a person beyond the mere words you speak. And of course, the clarity which we have been stressing on along also serves to ensure that your clients do not have to deal with a fumbling and therefore unassertive businessman.

Perhaps the most vital importance of any business plan rests in its premise of being also a financial guide for your venture. Jumping into the bandwagon of doing business is a risky proposition since you would be giving it your everything when you start out. Financing a business, whether you do it personally or through loans and other financial instruments, is where it can go all awry if you fail to live upto your own expectations. Securing therefore the required finance that will help you set up your business is also one reason why a plan can be of so much importance to you. Whether it be securing capital from venture capitalists or stating the purpose of your loan to the bank, a business plan is the first step forward in ensuring optimum utilisation of funds and therefore is the mainstay for any business to emerge as successful in the future.

Having a plan at hand is also important so that you can review the growth of your business. Unless you have a set idea of what yo want to achieve in the coming year, you would have no yardstick to gauge the measure of your success or otherwise. Being aware of your achievements and shortcomings is one of the prime requirements in any business. Having a business plan that you can stick to specially on days when you are completely zoned out is something that harbours extreme importance. It ensures that you have something to fall back on for a regeneration of confidence and motive in such moments when things aren’t particularly rosy. A business plan helps you by keeping you on track so that you continue to move ahead even on the tough days.

Not to mention how having a business plan in place also keeps you ready with your marketing strategy that which is crucial to manage and bolster growth. Because a concrete plan is a reliable course of action in itself, you do not have to keep yourself constantly occupied of what would be the next best move for your business. It lets you analyse the opportunity cost of forfeiting one option for the other so that you know exactly where you stand. This in turn helps you identify areas where you can improve so that you continue to enjoy steady growth. Over the years, you can even pitch a successful business plan to investors if you want to sell it for whatever reason. In preparing you for the future, whether in the business or outside of it, the importance of having a set plan cannot ever be overlooked.

Assets and liabilities are the two most commonly encountered concepts in business terminology. Proper management of both is necessary for your business to sustain and prosper, that which is infinitely facilitated by a business plan. In helping you keep track of where you stand vis a vis your possession of assets and the reimbursement of liabilities that you owe, business plans are yet another step forward in tackling financial mismanagement worries in any business. This inherently points to the importance of a business plan with regard to risk management. Like we said earlier, businesses are risky venture. Business plans then is something that allows you to cushion it so that any free fall would cause the least of likely damages. Starting off with the risk aspect of a business and concluding also with it, it should be clear by now where the importance of a properly though out business plan stands with regard to your entrepreneurial journey. It merely isn’t the crafting of your ambitions in black and white. It also is an essential documentation of your goals and the way you intend to go about them so that any setback leaves you not demotivated but rather allows you to reflect on the mistakes you did so that you know what not to repeat in the future. It affords you the luxury of foregoing a similar step forward because you can exactly pinpoint its cause of faltering at the exact stage in your business journey. From sorting you out financially to being your guide throughout, having a well though out business plan is already half the job done. That’s just how important planning a business is.