Business plans are essential to every business large or small. This is often ignored by many small businesses. Too many times a business is started without this first necessary step.
Business plans have many different uses and should always be adjusted accordingly.
Obtain Financing
Many businesses may find themselves in need of outside funds. Most financial institutions will not just look at your credit rating or your current financial position. A business plan that projects what your business will do and where it will be in the future is vital. These institutions, investors, or lenders need to believe that you have a solid plan for advancing your business and feel comfortable that they will get a return on their investment.
Internal Use
Business plans can be used as a guidepost or a crutch for the business owner. Many plans are created and never seen by anyone but the key personel. These business plans must be reviewed and updated to make sure they stay in agreement with the actual path of the business and marketplace.
Operations
A well constructed business plan can be used to show all involved the way the business is intended to run. This allows the owner to be upfront with their employees and be very transparent with how the business is expected to operate.
