“Plans are nothing; planning is everything.” ― Dwight D. Eisenhower, former U.S. President.
Despite the best teams and hardest work ethics, many entrepreneurs’ ideas never become a sustainable reality. Many businesses fail because of a lack of direction and planning, causing them to get off track and lose momentum. Creating a business plan is not necessarily about the plan itself, like our former president stated, but is instead used to show that you have actually planned how you intend to move forward. This is essential to growing your business in an efficient way and is the key to convincing others of the same.
1. A Sense of Direction
As you move forward with your venture, the business plan will provide a general roadmap of where you are going. It helps to prevent you from getting lost in details that can distract rather than help you grow and expand. If you find yourself following a tangential idea that is not included in the business plan, odds are you need to take a step back and examine if the idea is beneficial for your business. If it is, add it in! There is no shame in adding more dimensions as your company evolves and pivots. Just be sure the addition adds value and makes sense within the scope of your company.
2. Internal Game Plan
As your company expands, it’s easy for team members, particularly ones who aren’t part of the management team, to become hyper focused on their department’s specific responsibilities and lose sight of the organization’s ambitions as a whole. Using the business plan as a point of reference and a reminder of how a person, project or department fits into the long-term projections helps provide perspective and keep everyone working towards the same goals.
3. Capital Raising
If you are interested in acquiring outside investors to help grow your business, then a plan is non-negotiable. Any potential investor will want to see the long-term trajectory of your company and how the smaller short-term goals build upon each other to produce the desired results. Your business plan is the perfect opportunity to exemplify your concepts in a clear, succinct format. Remember, investors are inundated with business plans and will only spend their time and risk their funds on a company they feel confident will deliver value.
4. Traction and Milestones
Writing out a business plan inherently forces you to set goals with hard deadlines. This is a great opportunity to help your team with accountability. As your company matures, you will be able to monitor your goals, see how long it took to achieve them, and what adjustments the team can make as new goals are set. Your detailed plan will not only show the company’s growth but the ability to set expectations and meet them regularly.
All the points above are important for the health of your business. No matter what your product or service is, plotting your course and writing it down is invaluable. If you find yourself struggling with deciding on how much funding to ask for, how to calculate financial projections, or even just setting realistic goals, we are always here to help you think things through. We look forward to helping you grow your business!Tags: Business Plan