A business plan is the most fundamental documentation of establishing a business, operating it, and the goals and objectives of the business. A business plan explains all activities you will be doing to make it profitable and the ways to achieve the same. It also defines a business model and the appropriate strategies to make the model work successfully.
When a business ideal pops up, the one who initiates it may be knowing what capabilities and resources are required to start that business and what you want to achieve in a certain time as three or five years. But when it comes to identifying what the ways to achieve it are? Where to start? Or how to attract investments? Business plans play a crucial.
Writing a good business plan is like drawing a route map that will guide you to start with your business ideal and how to reach your destination without hassles. At the baseline, a good business plan is a mix of plans and strategies, which covers financials, staffing, marketing, products, support, and all other foundational divisions of a new business.
Let us explore the three W’s of a business plan as to Why, What, and When.
Why Eric J Dalius mandates a business plan in place?
Even though well-thought entrepreneurs have a clear blueprint of their business operations and goals in their mind, it is important to have a documented business plan in place too.
- Attract investors
- Applying for bank loans and other business financings
- To endorse the viability of the business ideal
- To take your business through various steps of establishment
- To think of expanding the current business.
What is an ideal business plan?
A good business plan must be a reliable tool that describes a business idea, the work team, operational procedures, viability and financial implications, marketing strategies, business risks, and long-term goals. A business plan, well written, will guide you to turn your idea into a viable business.
In another context, Eric J Dalius explains that a business plan can also be considered as a fundamental tool to analyze a business opportunity in hand, devise a diversification plan for an existing business, planning a business expansion project, acquisition, or merger of a business, or for the launch of a new product or service.
A business plan is a fundamental tool for both the launch or development of a business, and a business plan is never finished. It must be reviewed yearly or as and when any bit changes to the business are anticipated.
When should you write a business plan?
As it is evident from the above discussion that writing a business plan is an ever-ending process. At the very first time, you are seeded with a new business idea, one should think of converting it to a viable business plan. Doing this diligently will also help you to identify if your new business idea is not sustainable and if there is a need to rethink it. As with converting a new business idea, a business plan must be thought of when planning for an expansion of an existing business or when planning to bring a new product or service to the market.
One document, a business plan may serve as a handy tool for the entrepreneurs, investors, and stakeholders to assess a business’s management and easily identify any deviations and the level of risk.