Q: Do you really need a business plan?

A: Yes & it is easier than you think!

1. Businesses that plan regularly grow 30% quicker than those that don’t!

Writing a business plan is not about accurately predicting the future of your company. It is the thinking and the process of writing your plan that is key. Writing a plan and reviewing it regularly gives you great insight into what’s working, what isn’t and what you need to do next to achieve your goals.

Business planning is about regularly setting goals, tracking your progress toward those goals, and making changes to your business as you learn what is working well and what is not.

Don’t believe me? Studies have proven that companies that plan and review regularly, grow 30% faster than those that don’t. As well as faster growth, research also shows that companies that plan also perform better and make more profit. They are less likely to become a business that fails, or that experience cash flow problems that have you, the business owner awake at night worrying.

2. You can make big decisions about spending knowing it is the right one.

As your business grows, some of the best problems you will have are deciding when to hire that new employee, when to buy or lease that office, or whether you can afford to buy new vehicles or equipment.

These are huge decisions for the small business owner, and if you are regularly reviewing the plan and the forecasts set out in your business plan, you are going to have better information to use to know when the right time is.

3. You are more likely to identify cash flow issues before they arise.

In order to be able to make big spending decisions, you need to understand and monitor your business’s cash flow. Your cash flow statement is one of the three key financial statements need to understand in order to plan effectively along with your balance sheet and your P&L statement (Profit and Loss).

Reviewing your cash flow statement regularly as part of your business planning process will help you identify potential cash flow issues before they arise so you can make the right decisions to avoid not being able to pay your bills.

4 . You will not secure finance without one!

If you are asking a bank or an investor for any form of funding, before they part with their cash, they are going to want assurance that you have a good handle on your small business’s current and future finances.

You don’t need to write War and Peace, but you will need to provide something that shows there’s a market for your business’s services or products and it will need to include your key financial statements and forecasts.

A good business plan should make it easy for potential investors to understand your business plans and financials.

5. Regular planning reduces your risk

As a new business owner, there is so much you don’t know—about your customers, your competition, and even about operations. You learn it all ‘on the job’. However, there comes a point where you are working so hard serving your customers, you don’t have the time to look at your business and the direction it is heading in. Or to put it more accurately, you don’t make time to do it.

Taking some time away from the day to day is key to ensuring you keep a tight grip on the direction your business is heading. It is the only way you can spot when you are slightly off track and you can make some small changes to bring everything back in line.

It doesn’t take long, yet too many business owners don’t give regular planning the attention it needs and as a result only ever achieve mediocre results at best. The successful ALL plan.

6. It’s a great way to get team engagement and ensure all your team members are aligned with your goals .

A smart business owner will plan with their team. Doing this makes it easier to get everyone on your team on the same page. The team will inevitably throw up some great ideas you hadn’t thought of and as a team you’ll be able to agree, how you plan to get from where you are now, to where you want to be.

Getting your team all working towards the same goals will increase your efficiency. You will get their buy-in from the start, and as you progress, it is then easier to track and communicate your progress.

If everyone on your team knows how their work impacts the larger company, the more invested they will be in achieving your business’s goals because they will know their contribution really matters.

7. It will help you set goals and milestones.

Every good business plan outlines SMART goals and milestones. SMART goals are:

•    Specific
•    Measurable
•    Achievable
•    Relevant
•    Time-based

A business plan without any measurable goals or milestones will not be as effective as one that clearly defines the things that must be achieved on the way to the end goal. Afterall, what is there to measure progress if you cannot tick things off the plan as you achieve them?

Start with the big goals, and then break them down into small milestones that need to be achieved on the way to achieving the end goal.

8. A good business plan will increase the value of your company!

Your end goal might be that you want to sell your business or position yourself for acquisition. Having a solid business plan will help you make the case for a higher valuation. Your business will likely sell for more, if it is easy for them to understand your business, your market, and the potential to grow and scale your business.

HOW TO GET STARTED

Easy, start small, plan for the next quarter - DOWNLOAD OUR FREE PLANNING TOOLKIT

The importance of having a plan and reviewing it regularly goes way beyond basic planning and goal setting.

The key however is to just get started. Get in the habit of regular planning. It is easier than you think!

For more advanced business planning help. Ask about our business coaching programme and even try a FREE coaching session to see how it can ACCELERATE THE GROWTH OF YOUR BUSINESS.