Once I met an entrepreneur who was planning for a start-up business. He needed a business plan which was mandated by the regulatory body related to the business. When he approached me for the business plan he was having a clear idea about what the business is that he is going to start. He had more than seven years of experience in that field. He felt he does not even need a business plan; only for the sake of getting approval, he needed one. But after preparing the detailed business plan he came to know the pits and falls of his idea. Now he is more alert and clear than he was earlier. Starting a business, for an entrepreneur, can be emotional, which is dangerous because it prevents you from looking into the risks and traps involved. A well-written business plan would save your business by letting you think realistically without emotions and myths. When a corporate company is in the idea of acquiring new enterprise or to expand its own business, a business plan will help in making calculated decisions. The best thing about the business plan is it saves your time, money and effort by preventing you from making a wrong step and by leading you in the right direction.
The benefits of the business plan as follows:
1. Goals and objective: You can set realistic goals and objectives for your company in both short term and long term
2. To understand market: Helps you with the better understanding of the market which you are going to enter
3. Feasibility: The feasibility of the business is visible before starting the business.
4. Form strategy: You can formulate the suitable strategy according to your business goals, needs and available resources.
5. Road map for future: It can be seen as a road map for the business. You can measure, check compare your business performance at desired interval with expected performance.
6. To raise fund: In case you are in the situation of getting finance, a proper business plan with facts and numbers will help you convince investors and bankers.
7. To know competition: It will help you to identify competitive situations and opportunities to exploit.
8. Requirements projection: Allows you to plan for initial capital and resource requirements.
9. Reference: It can be used as reference point in case of a change in the future business situations.
10. Experts opinion: Expose the areas where you need experts’ advises and opinions.
11. Hidden risks and threats: Helps you in revealing the hidden risks and threats involved in business, market and industry.
12. Exit strategy: It even helps in suggesting a better time to exit the business so that the hard earned good money will not be thrown after bad.
13. Legal requirements: As it addresses all legal and financial requirements local, state governments, unwanted legal issues will be reduced.
14. Cash flow management: It would help in cash flow management which is important when the business runs on more cash out flows than cash inflows.
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