Every Business Needs a Written Plan

Without planning, it can be difficult for a business to survive. A written business plan can dramatically increase your probability of success by identifying potential roadblocks and developing strategies for overcoming them.

Small businesses, whether already in operation or just starting out, can benefit from a written business plan. In fact, since most small businesses operate in riskier environments than larger businesses, the need for a written business plan is even greater. Many experts say that a good part of the high failure rate of small businesses could be eliminated by the use of solid planning techniques.

How can a plan help? For new businesses, a written business plan helps in the start-up process. It provides a clearer understanding of the business and its goals. Often businesses spend a lot of time and money on product development, equipment, and marketing -- without analyzing the feasibility of the basic business idea. Writing a business plan gives you a better understanding of your ideas. It allows input from others before wasting time and resources.

For existing businesses, a written business plan forces the business to analyze its environment, its target market, and its competition. It helps identify the strengths and weaknesses of the business. A business plan promotes consistency throughout the organization and provides long-term savings of time and resources. Having a strategic plan in place during an economic downturn will help you make changes rapidly and adjust proportionately to decreased demand.

What should your plan include? There is no standard format for business plans, but there are some guidelines. The plan should give a brief overview of operations. It should include information on the market and the competition, explain manufacturing and production processes, and discuss the management and organizational structure. It's especially helpful to have the plan include benchmarks for measuring performance.

New businesses should describe the planned products and services and include timetables of critical events. Continuing businesses should describe existing products and services, give a brief history, and provide financial information. Both new and existing businesses should include future plans.

Planning helps ensure that vital factors have been considered and that changes in the firm's environment have been accounted for. A written business plan gives the business, its lenders, and its advisors a better understanding of the business's environment, which often leads to a more successful business.

If you haven't already done so, now's a good time to prepare this year's plan. We have extensive experience in preparing practical, effective business plans for all sizes of firms. For assistance with your plan, please call us.

Related Information:
        Consulting Services
        Overview of the Strategic Planning Process
        Plan To Succeed, And You Probably Will
        Setup new corporations
        Small Business Services
        Sources of Business Financing
        The New Business & Professional Advisors
        Tips for Starting a New Business

© Copyright 2002 Raymond S. Kulzick. All rights reserved. 020110.

This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance. Read Disclaimer.