“You need to write a business plan” are probably words that as a new business owner, you will have heard on many occasions.
Whilst the word “need” might not be 100% accurate (there are other methods you could approach the same goal with), having your plans written down on paper, rather than as just a rough collection of thoughts in your head will significantly increase the chances of your business being successful.
A business plan gives you the opportunity to clarify your thinking by putting things down on paper in a logical order.
By the end, a business plan will provide you with a step by step guide of what you need to do to run your business and it will help you focus on what is important.
The common analogy used is that a business plan is a bit like a road map. You perhaps know where you are now, and you know where you would like to get to, but as with a road trip, you need to plan your route – which roads you will take, where the petrol stations are, and which diversions you can use should there be a traffic jam halfway along the journey.
There are always road closures along the way!
Clearly defining the best route to get to your destination can also help you avoid “Magpie Syndrome” – something very common within the business owner community.
Magpies spend their entire lives chasing shiny things, that they then go on to do very little with – something even shinier usually comes in to view before they get a chance to reap the benefits of their find! (Do not become a magpie!) It is important to remember that new opportunities are not also necessarily better opportunities.
A business plan can also be used to think out and test the likelihood of the business succeeding. As part of the viability testing of your business, you can undertake research to assess the demand for your goods / services and put together forecasts of the likely income the business could generate.
If after first inspection things don’t seem as good as you’d hoped, changes can then be made to your business’s strategy, to try to reduce the risk of business failure. It is better (cheaper/easier to fix, without the need to repair your businesses reputation) to make a mistake on paper!
The other reason that many will put a business plan together is to access finance. This is where the word “need” may become more accurate.
Having a business plan is commonly one of the most basic requirements for funders to provide your business with either a loan or a grant. The funders will otherwise know very little of you, or your business, and so the business plan provides the opportunity for you to tell your story. It must explain both the basic and more technical elements of the business, and overall show that you have the ability and credibility to make the venture a success.
The business plan in this context is used to show that you have researched the business environment and know the actions you need to undertake to minimise risk. The bank will be quite keen to see that you are not going to lose their money through an ill thought-out venture!
The BIPC Northamptonshire’s Build Your Business programme could provide your business with a grant of up to £2,000, and the creation of a business plan will be needed should you wish to be successful.
It is perfectly understandable that if you have never written a business plan before that the task could seem unnecessarily daunting.
To help with this the BIPC Northamptonshire provide have a business plan template which you can download for free from www.bipcnorthamptonshire.co.uk/buildyourbusiness. The team also deliver a workshop & webinar session talking you through the different sections of a business plan, and the type of content to include.
You can find out more, and register for this and the other sessions available through the Build Your Business programme via https://www.bipcnorthamptonshire.co.uk/events
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