What’s The Purpose Of A Business Plan?
There’s no shortage of articles and books on how to write a business plan, and to be sure, even in this age of teenage internet billionaires, a business plan still matters. But before you get to that (often daunting) task we need to begin with why: what is the purpose of a business plan?
Identifying Your Objectives
What are your goals in building this business? Are you looking to build an empire? Or just a solid lifestyle business? Are you hoping to create a family business that can be passed on to the next generation? It is important to identify both your long and short-term goals initially so the other elements of your business plan follow accordingly.
Vision and Values
At The Gents Place, we’re very fortunate to be guided by our values (learn more about them here and here). That helps us create our vision. If you want to start your own business you need to figure out what your values are so you can figure out what methods and means you are going to use to go where you want to go. A business plan is a great place for your vision to shine.
Support and Resources
Having a business plan serves the purpose of identifying the sorts of people you will need to help you on your journey, but the sorts of people you will need are the type who are not just going to sign up for Gilligan’s three-hour tour. They will want to know what your plans are and having a business plan for them will reassure them and give them a chance to examine how deeply your ideas resonate with their desires.
Work in Unison
A business plan also gives those potential team members a path to advancement. If they know what future opportunities are available, they can ask you now what they need to do in order to put themselves in position for those roles. Working in sync, with the same end goal in mind creates a clear, definitive route for all involved.
If you want an SBA loan in the United States, a business plan is mandatory. There is no way a bank is going to give you a loan and no way the government is going to back that loan unless they know how you plan to do what you say you want to do.
All these reasons are important, but perhaps the most important reason for having a business plan is that it provides a reality check. As you sit down to write it and go through all the details you’re forced to soul-search and find out if this is just an idea you want to sit around and talk about with your buddies, or the beginnings of a real business, that can bring prosperity and wealth to you, your family and many others.