There are lots of steps to take as you begin your journey to becoming a small business owner. One of the most important is writing a business plan. Many entrepreneurs know that a great business plan is important for generating capital for their startup, but the benefits go far beyond just that. Creating a business plan helps put you on a path to achieving business feasibility and success.
Business plans are for more than start-up funding
Creating your business plan early on essentially forms a foundation for starting and managing your business in its early stages. You can think of this plan as a framework to follow when your business opens, as well as a projection for where you want to be in the first few years. Careful research, planning and preparation will not only help you get your business started but also ensure that it’s sustainable in the long term.
Here are just a few major benefits of crafting a well-thought-out business plan:
- Access funding: Access to funding is, of course, one of the major benefits of putting a lot of time and effort into your business plan. The U.S. Small Business Administration (SBA) requires a business plan to be submitted alongside loan applications. Other capital sources including investors are also likely to want to review your plan before giving you funding. Without a solid plan to fall back on, your business dreams might not reach reality!
- Determine business feasibility: The process of generating a business plan also forces you to conduct market research and hammer out the details of your business strategy. Together, these things demonstrate the overall feasibility of your business. If you discover high competition in your market or realize that the logistics of your business might not be as scalable as you had hoped, you won’t be too far into the start-up process to adjust your model or pursue another venture that’s more feasible.
- Solidify business direction and growth strategies: Starting a new business can be complex. With a lot of moving parts, many business owners lose direction soon after they start. A well-crafted business plan helps steer your business in the direction you want to go with plans for growth and expansion. When writing your business plan, you should note key business milestones you’d like to hit, then detail the steps you’ll need to take to get there.
- Take your business to new heights: Business plans are not evergreen—they must grow and change alongside your business. As an owner of a thriving business, you should reevaluate and update your plan regularly to ensure you are setting and achieving bigger and better business goals. Revised business plans can also give you insight into how your business might need to shift focus or adapt due to changes in the market.
How to create a solid business plan
There are many ways to write a business plan, and some are more detailed than others. The SBA has tips and business plan templates available to help you get started.
What’s most important as you craft your plan is that you cover all the key elements, such as a market and competitive analysis, a product and service outline and a financial plan. Ultimately, you’ll need to dig deep into the details and ideal future of your business and identify the necessary funding, partnerships and strategic moves required to make the venture successful.
Along with a solid business plan, you’ll need to capitalize your business. Turn to Tenet Financial Group to receive help in obtaining SBA loans, unsecured lines of credit or establishing a self-directed 401(k) and get your business off the ground.