You may hear everyone telling you about the value of making a business plan, from the lender you hope to do business with all the way down to the guy that prints your business cards. In a vague sense, most people have some broad sense of what a business plan, but what is it really? Is a business plan a full blueprint of every detail that goes into operating a business or is it more of a checklist than anything else?
Define Business Plan:
By definition, a business plan is a formal statement of a defined agenda of business goals, why it is believed they can be achieved, and as importantly, how they will be achieved. It is, after all, achieving those goals that generate capital and allows for loans to be paid and new projects to be undertaken. As you can see, a business plan is in actuality a little bit of everything all rolled into one – when they are prepared correctly.
Business plans are not just for the entrepreneur looking to launch a new business hoping to attract some venture capital, they are a vital part of every well-run business from Joe’s Corner Barbershop to Microsoft. It’s true that even massive multi-billion dollar corporations use business plans. A business plan lays the groundwork out in plan terms for expansions, profit projections, potential changes in clientele demographics, and as a bonus, a nice report card of sorts for investors to peruse. Big or small, a business plan is a perfect way to see the past and make the future reality.