If you are considering starting your own small business, the last thing that you want to do is being operating without a plan. You will need to know who your target customer is, how much you can make from a particular good or service and how you will best deliver it. It will also be important to consider what to do if a technological change or other interruption makes your current business model obsolete.
The Business Plan Doesn't Need To Be Long
A business plan doesn't have to be particularly long to be effective. Instead, it should only contain as much information as needed to provide a general map for your company's future. Most investors and venture capitalists only want to see who runs the company, how much money you make and how long it will take to reach profitability. Therefore, your business plan should be no more than 10 pages in most cases.
Be Flexible With Your Plan
While you want to stick to a coherent strategy to grow and expand your company, you don't want to be too rigid either. Ideally, you will use your business plan as a guide for when you have to make a tough decision relating to adding a partner, adding employees or changing your pricing model.
However, if you see that something isn't working and is holding your business back, don't hesitate to change your plan going forward. In some cases, it may not be a bad idea to completely revise or replace a business plan every few months or if the reason for running the company has changed significantly. It may be worthwhile to visit Ontario Centres of Excellence for more information.
Business Plans Help You Think About Where Your Money Comes From
It is impossible to make money unless you are willing to spend some money upfront. A business plan may help you think of where you can get the capital needed to keep your company afloat. For instance, you may consider applying for grants for small businesses, which may be more appropriate than loans.
With a grant, you generally don't need to repay the proceeds that you receive. The money is also not taxed as it is not considered income. Other sources of financing for your company may come from family or friends or from money that you may have in a 401k. Personal loans or personal lines of credit may also be viable sources of capital.
A business plan is something that all companies should have even if you have experience running other organization. It will keep you focused on what the core goal or goals of the business are while also ensuring that you have a guide to help you make the tough decisions that will surely come your way.