Friday, June 13, 2008
Tuesday, April 22, 2008
What is a business plan......?
I was recently on an online networking site where the question of whether a business plan is necessary was posed. There were many responses ranging from
"yes, every business owner should have a business plan"
"no, a business plan is worthless"
"only needed if you are seeking financing"
These responses are not necessarily wrong, but may stem from a particular experience someone has had with creating a business plan. So what is a business plan and is it really necessary?
A business plan is not necessary, but is beneficial to any business owner. Many business owners don't actually write out their plan. They keep the plans and goals in their head and feel they will still be successful because they know where they want their business to go. These same thoughts, goals and plans are a business plan without being written out.
A business plan that is written out allows you to view your goals and plans in further detail while examining if each aspect of your business is properly thought out. What is your target market, what expenses will you need to cover during your first three years, when can you begin to draw a salary from your business, how much salary can you draw, what is your break-even point? The list goes on. As a business owner it's important that you have carefully thought out these questions and written them down to visually see your plan. You may have thought about these questions and figured your answers in your head, but can you gaurantee you will still remember what the answers where 6 months from now or even a year from now. Will you be able to measure your business success benchmarks and milestones?
This is why every business owner should have a business plan? As an employee, you receive performance reviews with goals for the next review period. This is the same thing for a business. The business plan is the performance review for the current year with goals for the next year.
So what are the key elements of a business plan. The key essentials of a business plan are:
Executive Summary
Mission and Vision Statement
Business Description
Services/Product Description
Market Summary
Competitors
Financials
Contingency Plan
Supporting Documents
So now you know the importance of a business plan and what to include in the plan, now how do you create the plan. Register for our online course on Creating a Business Plan. Interested in starting a business, but not sure where to begin. Look for future online courses on Becoming a Business Owner.
"yes, every business owner should have a business plan"
"no, a business plan is worthless"
"only needed if you are seeking financing"
These responses are not necessarily wrong, but may stem from a particular experience someone has had with creating a business plan. So what is a business plan and is it really necessary?
A business plan is not necessary, but is beneficial to any business owner. Many business owners don't actually write out their plan. They keep the plans and goals in their head and feel they will still be successful because they know where they want their business to go. These same thoughts, goals and plans are a business plan without being written out.
A business plan that is written out allows you to view your goals and plans in further detail while examining if each aspect of your business is properly thought out. What is your target market, what expenses will you need to cover during your first three years, when can you begin to draw a salary from your business, how much salary can you draw, what is your break-even point? The list goes on. As a business owner it's important that you have carefully thought out these questions and written them down to visually see your plan. You may have thought about these questions and figured your answers in your head, but can you gaurantee you will still remember what the answers where 6 months from now or even a year from now. Will you be able to measure your business success benchmarks and milestones?
This is why every business owner should have a business plan? As an employee, you receive performance reviews with goals for the next review period. This is the same thing for a business. The business plan is the performance review for the current year with goals for the next year.
So what are the key elements of a business plan. The key essentials of a business plan are:
Executive Summary
Mission and Vision Statement
Business Description
Services/Product Description
Market Summary
Competitors
Financials
Contingency Plan
Supporting Documents
So now you know the importance of a business plan and what to include in the plan, now how do you create the plan. Register for our online course on Creating a Business Plan. Interested in starting a business, but not sure where to begin. Look for future online courses on Becoming a Business Owner.
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