While it’s true that some small businesses get started and begin to grow without a business plan, in general, business experts agree, that it’s an essential building block to long-term success.
The right path
New York entrepreneur and start-up mentor Dave Ronick observes, “many founders learn the hard way that they didn't set aside enough capital to reach their goals, took on partners with the wrong skills and resources, or don't have a viable way to make money.
Developing and sharing a business plan can help ensure that you're sprinting down the right path.”1
What needs to be in it?
While no two business plans are ever the same, here’s a list of ten essential items you need to include:
- Your vision – what makes this business a winner?
- Your goals – what do you want to achieve and when?
- Your people and management structure – who’s in your team?
- Your products and/or services - what are you selling?
- Your unique selling points - what makes you stand out?
- Your market - who are you selling to?
- Your competition – who are you up against in the market?
- Your strengths and weaknesses – where are your challenges and opportunities?
- Your financials and key assumptions – what funds do you need for start up and how much do you expect/need to make in the short and medium term?
- Your exit strategy – what do you want to happen to your business long term?
Why it’s worth taking the time
The process of putting together a business plan invites you to test everything from the key assumptions that inform your business to your core value propositions.
It helps you get clear on your market, say who you are, what you stand for, where you are going and explain how you plan to get there.
Dave Ronick puts it this way, “having a business plan lets you step back, and take an objective look at what you are doing and why, what you know for a fact and what you are trying to figure out”.2
Having a business plan is also about demonstrating you are in control of your business. It’s tangible proof you are working to a quantifiable and measurable process.
It’s also going to be required if you need to apply for finance to get started or grow.
Need a helping hand?
If you want some support putting together your business plan contact www.becaustralia.org.au, a national network of Business Enterprise Centres, which offers business advice and support to small and micro businesses.
There are also lots of online templates to get you started or give you a structure to work within. The Australian Government’s website www.business.gov.au is a great place to start.
Your accountant, bank or an experienced business advisor may also be able to help.
Changing over time
Your business plan shouldn’t be a one off document. In truth your business plan is an evolutionary open-ended exercise. As your business grows and changes so will your business plan.
To optimise for success update regularly.