I Know What I’m Doing! Why Do I Need a Business Plan?

As first seen in the Coffs Coast Advocate.

We hear it all the time. “I’ve got my plan in my head. Why should I waste my time writing it down.” Bottom line is, every business needs a written business plan. To illustrate the point we share the stories of two people who think they don’t need a plan, and give you the reasons they do.

Ron’s Story

Ron has owned a timber mill for over 35 years. He has a natural “feel” for his business. “Things are moving along just fine,” he says. “Why do I need to write a business plan?”

1. Keep on the Right Track

Taking the time to think through and put a business plan on paper will help you to clarify your future direction. If you are clear about where you want your business to head, it will make it much easier to keep things “moving along fine” in the future.

2. Face Up to a Changing World

You, your business, your industry and the world are all changing. The process of establishing a business plan will force you to consider the changes ahead and position your business for the future.

3. Get Ready to Retire

Whether you plan to sell, or will be handing the business down to your daughter, if you’ve been running a business for over 35 years it’s probably time to think about succession. A well thought through business plan will increase the value of your business when it comes time to sell, and will make it much easier for your daughter (who does not yet have your “feel” for the business) when she picks up the reigns.

Molly’s Story

Molly is a gifted and creative chef who last year opened a catering business that took off from the start. She has hired 2 assistants and the 3 of them can hardly keep pace with the orders. “I’ve got more business than I can handle,” she says. “Why would I take time I don’t have to write a business plan?”

1. Make the Right Decisions on the Fly

A business plan provides a roadmap. When you’re this busy you are going to have a lot of quick decisions. If you’ve taken the time to think through your vision and goals for the business it’s going to be much easier to make the right decisions.

2. Avoid Costly Mistakes

Writing a business plan forces you to review all aspects of your business at once. You’ll end up spotting connections or problems you might otherwise have missed. So much better to identify these problems on paper than to run up against them while you’re busy getting an order out the door!

3. Hold Yourself Accountable

In the early stages of a business it’s important to commit to your success. If your business plan is all in the mind it’s easy to let yourself off the hook. Once you write down your goals you are much more likely to commit to achieving them.

Writing a business plan does not need to be difficult. We have developed a template kit and “how to” videos that will help you to write a plan on one A4 piece of paper. Go to www.mjabusiness.com.au/business-planner to download these for free.

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