Opening any new business requires planning. A clear plan is like having a road map for a long trip. Your plan, like a good road map, should be brief.
You should be knowledgabel about your line of business before you start. You could get a job in a shop or factory that makessells similar products because there is nothing more valuable than on-the-job experience. Such experiences can enable you visualise your business by writing a plan.
The elements of a good business plan
Many potential entrepreneurs ask whether they need business plans. I would say whoever is not getting into business does not need one. Why?
A business plan outlines where you are, where you want to go and also gives you the directions you need to get there.
It demands considerable research, takes time to write, requires a lot of data and depends in part on rational projections. But despite all of that, business plans are one of the most effective tools for starting a new business.
Like a good map, the business plan shows all the important locations on your trip but omits a lot of details that would actually make using the map harder. It is a delicate balance between having the essentials but skipping the irrelevant details that are tedious and superfluous.
Writing a business plan helps you discover new ideas, see different approaches and gain fresh perspectives. Going through your business plan, will help you find new angles and approaches you never considered before, shaping and altering your initial outlook and bringing it closer to perfection.
Your final plan may be considerably different from the original and that’s a good thing— it’s a flexible tool that can help you think creatively.
The business plan is a summary of the expectations and anticipations of the entrepreneur in their future business.
A business plan raises support
If you plan to ask for a loan, interest investors, or take on a business partner, a business plan is required. Investors, and especially banks, want to see the potential of your business in facts and figures. A business plan is the best and generally only way to provide this information.
Many intending entrepreneurs want a partner. You can’t just say to your potential partner, “Hey John, let’s start a business!” John will be unimpressed.
What you need to say is “Hey John, I want to start a business and here is my business plan! Take a look at these figures. We can make a lot of money!” That should awaken his interest and if he argues with the numbers, then you go through them together and improve on the last version. Whether he takes up your offer or not, the feedback you will receive will be invaluable.
Identification of products and services
Deciding on a product line also influences shop size and equipment required, ultimately impacting on the financial analysis section of your plan. As you develop one section of your plan you add to and adjust the others.
A business plan can be a reality check
Clarifying your dream is often one of the hardest yet most useful parts of writing a business plan—but it can be unpleasant! Writing the plan often identifies flaws in your dream or can show you that your idea is bad.
Identifying problems can increase your chance of success or even make you decide to abandon the project before time and money is wasted.
Having a business idea and access to funds can be exciting for an entrepreneur. Unfortunately, this enthusiasm can also be blinding to whatever flaws may inhabit the prospective business and will ultimately inhibit it.
All failed businesses are victims of poor estimations—of demand, prices and all the other statistical aspects vital to the healthy life of a business.
Writing down a good business plan takes considerable time and effort especially if the funding is available. The business plan will help you avoid the pitfalls that would otherwise befall you later on to your detriment.
The writer is a small business owner, Busomba Supplies in Fort Portal.
SOURCE: Daily Monitor