Business Planning is Fundamental for Business Start-ups

And every new company should outline a plan prior to beginning operations. 

Venture capital firms and banks often require a written viable road map before considering providing capital and financing a new Business. Other than seeking investment from external sources, there are many benefits of a business plan. In fact, only a few companies are able to sustain their growth without a good plan.

A strategic plan can create a link between the expected benefits and out actual outcome produced by the business. A well-developed business strategy enables the company to acquire the capability to gain expected benefits from the actual produced outcomes. Strategic planning is key to assessing the business’s potential and determining its core competencies. The company then has the opportunity to align its available resources with its potential and better handle external challenges. The strategic plan includes a marketing plan to promote products/services, increase sales volume, attract the target audience, and provide a competitive edge to the business.

The Feasibility Plan

Enables project teams within a company to focus on the operational business goals. It’s a tool for identifying new opportunities through which a business can diversify and increase profit margins. The plan provides valuable data to determine whether or not to introduce a new product or service or to venture into new markets. As it narrows down the business alternatives, the feasibility plan identifies a valid reason for undertaking a new project. By evaluating multiple parameters and aiding the decision-making on the project, it enhances the success rate of the business.

An Operational Strategic Plan

Ensures that the business can identify areas that aren’t generating expected revenues, or causing losses, helping them establish what parameters to change. Continually referring to a short-term plan enables everyone within the company to understand their goals and respective responsibilities in achieving that goal. An operational plan allows businesses to review the performance of their key staff member through quality management and recognize how the team can work together to meet targets. This plan brings accountability to day-to-day tasks and enables management to identify discrepancies and take appropriate measures to resolve the problem.

With a sound growth plan in place, businesses have a clear road map to help them find opportunities for growth. Once they know how they want to expand their business, the chances of avoiding and reducing the risks involved are greater. This plan helps a business to rise above its competitors by recognizing different avenues of growth in time to secure their share in the evolving markets. As part of writing a business growth plan, studying the target market and evaluating how your company is performing puts you in a better position to decide your future direction.

With a Contingency Plan…

In place, a business can avoid unnecessary risks. When the plan lists down all the actions that need to be taken, the reaction time to adverse events becomes less, and everyone focuses on what to do without wasting precious time. It also allows a business to minimize the damage that could happen as a result of disaster and loss of production. The contingency plan ensures that business operations are not disrupted and continue running smoothly. The clarity in roles and responsibilities also reduces panic within the company.

Available on Amazon, John DeGaetano is an award winning business advisor and author of “How to Write a Business Plan” and “Business Survival Guide: The Ultimate Strategic Small Business Guide for Start-ups and Growth Planning.”

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