Every business needs a clear roadmap for success.
Here are 10 ways a business plan can put your business on the road to success:
- Helps you stay focused on your overall goal(s). Day-to-day business demands can understandably distract you from the bigger picture for your company. With a business plan, you’ll have your business’s mission statement and objective clearly defined in writing. That then serves as a touchstone for everyone who’s part of your company so you can be sure that you’re all working towards one common goal.
- Boosts your business’s competitiveness. Writing a business plan will force you to analyze your competitive market advantages. By learning more about your competition, you can lay out your strengths and weaknesses, which is helpful for knowing where you stand.
- Defines financial expectations. Profits are fuel, but cash flow rules the road. A business plan helps you balance operating expenses, raw material costs, payroll, employee benefits, and taxes with your profit.
- Establishes milestones and goal dates. Setting checkpoints is a great way to manage large business goals. Mid-course reflections and corrections will keep you on the right track before any issues arise.
- Helps define your customers. An in-depth market analysis is integral to your business plan. You’ll be able to learn about your customers’ demographics and preferred method of purchasing so you can better prepare your business to meet their needs.
- Urges you to plan for seasonality. If you’re not a new business, you already know to expect revenue peaks and valleys. Adding those details to your business’s roadmap, however, enables you to better plan for temporary staffing, employee leaves or vacations, and advertising efforts.
- Prepares your business for growth. Your plan should define how much you expect to grow your business — or not — and by when. Most owners plan to expand their customer base or offerings to generate additional revenue. However, you should remember to plan for costs such as: increased advertising expenses, additional staffing, a larger physical space, newer technology and training that comes with it, etc.
- Gives your business some cred. Running any business is hard work, but what’s driving your success? Your business plan is proof to managers, potential investors, and lenders that you thought ahead, answered the tough questions, and are in it for the long haul. Plus, your business plan can also help you attract the best crew. Highly talented individuals are more likely to join a business that has a clearly defined plan and direction.
- Be ready for the unexpected. Your plan could include saving cash in an emergency fund and/or securing a business credit card or line of credit to help get you over unexpected bumps in the road.
- Use the right signals. Whether you offer a service or a product, your business plan can serve as a benchmark to re-evaluate customer-facing messaging. Make sure your marketing vehicles use appropriate and consistent branding styles and tone that not only appeal to your existing customers, but attract new ones.