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Lesson 88 --- WHY PREPARE A BUSINESS PLAN?
Lesson 88: WHY PREPARE A BUSINESS PLAN?
Grammar Pattern
Why Prepare a Business Plan?

Your business plan is going to be useful in a number of ways. Here are some of the reasons not to skip this valuable tool.

·First and foremost, it will define and focus your objective using appropriate information and analysis.

·You can use it as a selling tool in dealing with important relationships including your lenders, investors and banks.

·You can use the plan to solicit opinions and advice from people, including those in your intended field of business, who will freely give you invaluable advice. Too often, entrepreneurs forge ahead ("My Way!") without the benefit of input from experts who could save them a great deal of wear and tear. "My Way" is a great song, but in practice can result in unnecessary hardships.

·Your business plan can uncover omissions and/or weaknesses in your planning process.

What to Avoid in Your Business Plan

Place some reasonable limits on long-term, future projections. (Long-term means over one year.) Better to stick with short-term objectives and modify the plan as your business progresses. Too often, long-range planning becomes meaningless because the reality of your business can be different from your initial concept.

Avoid optimism. In fact, to offset optimism, be extremely conservative in predicting capital requirements, timelines, sales and profits. Few business plans correctly anticipate how much money and time will be required.

Do not ignore spelling out what your strategies will be in the event of business adversities.

Use simple language in explaining the issues. Make it easy to read and understand.

Don't depend entirely on the uniqueness of your business or even a patented invention. Success comes to those who start businesses with great economics and not necessarily great inventions.

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