Top 10 Reasons to Write a Business Plan, Part 1
I rarely work with clients who are over-the-moon excited about writing their business plan, at least in the beginning. They often view it as a necessary evil, sort of like doing chores when you’re a kid, or taking medicine when you are sick. It’s something you think you “have to do,” but you’d rather not. That’s really too bad, because it can be one of your best business moves for success.
What are the top 10 reasons you need a business plan? Below are reasons 1-5; Part 2 of this blog will have reasons 6-10. They are all in random order. Some reasons will surprise you. Also remember that writing a business plan does not have to be like doing chores or taking medicine. It can be fun – seriously! Just ask some of my clients.
1.Feasibility – Will Your Idea Work?
We call this “Fail First on Paper.” You have an idea, but you would like to make sure it will work before you put your time and money behind it. Good luck with that! Oh, you meant you would like to have a higher level of confidence your idea will work. Great. We can work with that. Writing your business plan will help you make educated guesses about your success so you don’t simply “jump off a cliff blindfolded.” Is your industry healthy and the market you are targeting large enough for success? Is there a need for your product or service? What price will you charge so you can make the profit you want? Will the market bear that price? How many units will you need to sell each week/month/year? These are the types of questions you will explore so YOU can decide if your idea is worth pursuing now.
2.Leave No Stone Unturned
Writing a business plan leads you through the planning process in a logical, straight-forward fashion. Why is this important? We are human, and we are drawn toward things we like and away from things we don’t. In business, you need to address it all. Let’s take the example of marketing and finance. Often people love one and hate the other. It doesn’t matter! You need to address both marketing AND finance in your business plan and make the best decisions for you and your future success moving forward.
3.Prepare for Left Turns
I often work with clients who start their business with one strong idea and a straight path mapped out; then, for very good reasons, they make a left turn. In other words, they change their mind. Based upon solid knowledge they head in a different direction. That can be healthy if they make the left turn based upon the information, experience and confidence they have gained since they opened their doors. What does this mean for you? With a solid plan behind you, you are much more prepared to navigate the left turns you choose to make in business.
4.Create your Action Plan for Success – Goals and Objectives
Once you have written down your top ideas, captured them on paper or your computer, your mind is free to prioritize those ideas and turn them into goals with a timeline of up to 5 years. Some people prefer to begin with short-term goals and build out to long-term goals. Others prefer to start with their 5-year goals, and then set shorter timeline goals. Either way, you will create your action plan for success as part of your business plan: your goals and the steps, or objectives, you will take to turn them into reality.
5.Curb the “Bright Shiny Object” Dragon
Small business owners and entrepreneurs are creative folks. They are easily drawn to the next new idea or more exciting task (a/k/a – Bright, Shiny Objects). Stop! This is not a good thing! When I work with clients, we work together to decide what their priorities are. If a Bright Shiny Object comes up in a business plan class or a coaching session and it is 1) not a priority, and 2) does not support a priority, it gets “parked on a shelf” for future consideration. It doesn’t go away; it simply does not get attention now. I help clients stay focused on their priorities.
Your business plan can function in the same way. In the business planning process, you will set your priorities, the goals you are determined to achieve first. If something catches your attention, decide if it is a priority or a Bright Shiny Object, and act accordingly. There’s plenty of room on the shelf, and the shelf is not going away. Stay focused!
In Part 2, we’ll tackle the next 5 reasons to write a business plan, in random order.
Robin Suomi, MBA, is an experienced small business expert and founder of Startup to Growth, LLC. Working with clients remotely through video conferencing, she helps clients answer their technical business planning questions, and also encourages them to dig deeper, dream bigger, working with them to create their Success Steps! Check out the website for ongoing How to Start a Business and Business Plan Boot Camp classes, as well as 1-1 and mastermind small business coaching.
Also check out Startup to Growth Video Library for additional small business training and professional development videos available to you online, anytime. A very affordable option.