WHY YOU NEED A BUSINESS PLAN IN 2022.
With all the fundings and empowerment going on recently, a business plan has become paramount that every entrepreneur must have one.
Reasons, why you need one, are as follows
- To Attract Investors:
Before investors can decide whether or not to back your business financially, they
will need to know as much as possible about how the business will operate and
how their investment will be spent. They equally want to have an idea of the feasibility of the business. All these are captured in a business plan.
- To See If Your Business Ideas Will Work:
By writing a business plan and outlining each aspect of your business, you can determine if your idea is viable through feasibility studies.
- To Outline Each Area of the Business :
A business plan will provide an overview of all aspects of the business. You will be
able to detail the who, what, where, when, and why of your day-to-day business operations, costs, and projected profitability.
- To Set Up Milestones:
By forecasting where your business will be in six months, one year, or five years, you are not only letting potential investors know your plans but also setting up realistic milestones for yourself and your employees.
- To Learn About the Market :
Researching, analyzing, and writing about the market not only provides you with an overview of the business plan but gives you greater insight into the overall market. It helps you determine your target market and how best to serve them.
- To Secure Additional Funding or Loans :
Your business plan can demonstrate that you have met goals and illustrate the company’s growth and need for additional funding. No funder will fund your business without a business plan.
- To Determine Your Financial Needs:
The process of writing your business plan will force you to analyze your financial picture. Set realistic goals and set milestones.
- To Attract Top-Level People:
Your business plan will give talented and experienced people an overview of your business. This will give them the confidence to invest in your business. Your business plan speaks for you when you are not around. You can submit it within the pool of investors and they can contact you if they find it interesting.
- To Monitor Your Business :
A business plan should serve as an ongoing business tool that you can use to monitor your progress. You can update it anytime as the business progresses. It serves as a measurement tool to measure the progress of your business from where you are to where you are going.
- To Devise Contingency Plans :
While business plans often include some contingency plans, by having the document available, you can see how and where you can make such changes relatively quickly if, and when, necessary. You can as well anticipate possible risks in the business through a business plan and set mitigating factors in motion to handle them.
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