Should You Have a Business Plan?
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One of the most intriguing questions that often pops up in the mind of budding founders and aspiring business owners is that should one actually have a business plan? The appropriate response to this remains to be a definite yes. As a passionate new business owner it is quite natural to be in rush to get things done. While this hastiness might be acceptable in other operational streams, a business plan is definitely not the element you would want to approach in haste.
When thoroughly prepared, business plans can take a long time for completion. This primarily is due to the requirement of an enormous amount of data to be readily available during the conception phase. In addition, the extensive market research involved in surgically tailoring the business plan is time consuming, not to speak of the inherent rigorous financial dynamics and the associated marketing stratagem. This is where impatience on the part of the business founder kicks in, something that is best avoided. Doing away with the business plan at the earliest remains amongst the top priorities of business owners today. Let’s look at a few compelling reasons as to why spending ample time on business plan makes sense.
1. Evaluation of practicality of the original idea itself:
Writing up a thorough business plan serves as a decisive factor for figuring out whether a business idea is actually viable or not. The step, in essence, serves as a safety barricade. Scrutinizing the various facets that constitute a business plan is bound to provide a detailed view into the core tenability of the idea itself. This leads to plentiful of savings in terms of time, energy and capital investment.
2. Generation of novel ideas:
The great deal of mindflex involved in exhaustively evaluating different aspects of your business has the associated advantage of uncovering novel ideas, conceiving alternate approaches towards the same problem and discovering fresh perspectives on prevalent issues. The flexibility native to a well chalked business plan augments the creative thinking process and paves way for alleviating the most stern of challenges.
3. Obtainment of funding from financial institutions:
A budding venture requires funding, at the commencement as well as during usual operation. Established financial institutions such as banks and capital investment firms exhibit least interest in companies with poorly worked out business plans. A solid business plan lands you in a much better position to secure funds for inception, operations and expansion.
4. Have efficient planning and operations management:
A business plan has a lot to do with planning and operations management of a business venture. Ever-evolving market demands have made it utterly important for business decision makers to keep pace with the changing trends. The new objectives require the original business plan to be updated and modified on regular basis. The exercise helps you determine the objectives that have already been met and those that still require attention on the business owner’s part.
5. Attract angel investors and venture capitalists:
Having a business plan might just as well serve as the very key for having angel investors and venture capitalists seed money into your business. Sure, pitching your idea is important but that only does part of the trick - in most cases, a well-documented business plan that can be taken away and examined by the potential stakeholders is absolutely essential. A thoroughly worked-out business plan makes it easy for the future investors to carry out background checks and comparative studies to ascertain whether your venture is worthy of the monetary input.
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