Writing a business plan is a worthwhile activity for the following reasons:
- The process itself of thinking through the business model highlights potential opportunities and challenges at the prelaunch stage, much better than discovering them later.
- Working on the plan gives an opportunity to share ideas with colleagues and get feedback on your ideas.
- Assuming you follow a good template the process will force you to consider your competitors, cash flow, profitability and competitive advantage. All vital for survival.
- The plan becomes a calling card for other stakeholders: investors, joint venture partners, banks …
- The plan will give you a structure to compare the actual performance of the business. You should adjust the plan as your circumstances change and make it a ‘living’ document, rather than ‘stick it in a draw’.
Some will say something like a business model canvas is a better substitute. These are certainly popular, but they do not provide the opportunity for the depth of analysis and rigour of a real plan and often a real plan will be needed when you deal with stakeholders.
Lew
Lead developer of Business Plan Quick Builder – a great business plan from an easy to use template and BizzLink – the free landing page generator
Photograph by Eleventh Wave
Blog inspired by our response to a question on Quora
