A Business Plan, Do I need it?

Okey — Sat, 10 Sep 2011 10:23:36 +0000

Few days ago, I was discussing with a friend, she was complaining of how she is tired of her job. I was now asking her if she left her job what she will do. She said she has this idea of establishing a boutique where she will be selling ladies and kids wears. I said well, that is a good idea. I now asked her; do you have a business plan for this your idea? She said, what is a business plan; that her ideas and plans are in her head. I now told her it is a very big mistake to have your ideas in your head. It must be written down clearly so that it can be referred to from time to time, to help you monitor your growth and performance. What is a business plan? A business plan can simply mean a plan that works for a business to look ahead, allocate resources, focus on key points, and prepare for problems and opportunities. You can see all the things a business plan can, but it is unfortunate that many people think of business plan only when they are starting new (this is right) or when they want to apply for business loan but in addition, it helps a running business to monitor performance. From the definition, you can see that business plan is necessary even for a running business. What does a business plan consists of? It may contain a lot of things but the key things are the description of the business, the product or service, market forecasts, management team and financial analysis. Off the things listed as the component of a plan, the important thing is the cash analysis and specific implementation details. Cash flow is not all about profit, it involves the inflow and out flow of cash in the running of the business. Implementation details are the things that make things happen. They include, assigning responsibilities with dates and budgets, follow up, tracking of results etc. In summary, business plan is all about getting results and improving your company or business. Writing of business plan can be tasking for some people, but it isn’t much a difficult task. As a guide, below are the components of a business plan; a. Executive Summary- This is always written last mostly a page or two. b. Company Description: Business type, history, start-up plan etc. c. Product or service: What you are selling, ensure you focus on customer benefits. d. Market Analysis: What you know about your market, customer needs, where they are and how to reach them etc. e. Strategy and implementation: Management responsibilities with dates and budgets, you to have to be specific. f. Management Team: Background and key members of the team, details and personal strategies. g. Financial Plan: Profit and loss, cash flow, break-even analysis, balance sheet, ratios, assumptions etc. This order above is not how you must write your plan, but it is how it will appear as a finished document. Like I said earlier, the executive summary is always written last. You can see now that for every business, no matter how small, it is necessary to have a clear written down plan which must always be visited for revision in order to check your performance. Get your plan today on paper, and don’t say I have it in my head. Remember, if you fail to plan, you plan to fail.

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A Business Plan, Do I need it?

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