Have you ever tried rock climbing blindfolded?
The path of running a business is rarely travelled without encountering a few bumps along the way. Without a clear vision, your chances of making it to the top are slim – and a lot more difficult than it needs to be! That’s why a business plan is key.
A business plan is a step-by-step guide to running your business. It doesn’t necessarily have to be a formal document, but at the very least some structured and long term thought needs to be carried out before beginning. You wouldn’t start up a sandwich shop, for example, without first considering whether there’s a need for a sandwich shop in that part of town, how much stock you need to carry, how much utilities will cost, or how you will attract customers. Waiting to figure these out through trial and error would not only waste time and money, but also potentially damage customer relationships or cause financial difficulty. Talking your business plan through with your accountant can be really beneficial to give you a clear image of your finances and projections.
To be successful in the marketplace, you have to consider your position within it. Your business plan is your recipe for creating a product or service that will address a need. Flexibility is key to a successful business, and this is true for the business plan too, which should be adjusted periodically based on marketplace opportunities and changing circumstances.
A business plan hugely reduces the possibility of risks or surprises. The plan should consider the following items:
- As mentioned previously, determine the need for what you are offering
- A reasonable expectation of profitability and timescales
- What profit margin and pricing strategy will you be using? Is this feasible long-term?
- Perhaps one of the most important questions – how will the business pay you and any team members? Estimate expenses and any unforeseen “catastrophes”.
While many of these may have occurred to you already, it’s important to write it down and record your intentions and progress. A documented plan helps you determine and coordinate all aspects of your business operations, reduces the risk of forgetting anything and also allows you to analyse situations with “the bigger picture” in mind. This increases your chances of success, and can be used to ensure your business doesn’t get stuck in a rut. By determining the risks and benefits associated with any changes, your plan ensures your decisions are informed and in line with your greater business vision. So, do you have a business plan?
Talk to us today about your business plan needs – 01793 641 600 or contact us today.