To those of us solopreneurs who have no need for sizable business loans, federal grants, or skeptical investors, a business plan may seem like an unnecessary formality. No one wants to do extra paperwork, so let’s explore the burning question – ‘do I even need a business plan?’
Let’s start by weighing the pros of going through the trouble to create such a document:
Clarify your mission and focus – Clarity is the secret sauce when it comes to business, and writing a business plan will definitely get you to think about what your venture is all about.
Assess feasibility of your idea – Going through this process will give you a much better idea of whether or not your business model will be viable.
Develop a strategy for growth – Getting your thoughts down about where the business is headed is essential. Just by putting them on paper you’re more likely to remember and work toward them.
Define critical milestones – Setting some goals and milestones will help steer your efforts and allow you to measure progress and success.
Figure out financial needs – As you go through your planning and strategizing process you are likely to uncover aspects of your business that will require funding. Adding all these up will give you a good idea of what financial needs to prepare for.
Research your market and competition – Get to know who else is operating in your space and how they run their businesses. You definitely do not need to copy anyone, but do your research and try to understand what’s working and what’s not.
Understand your audience or customers – Define who would be your likely customer base or audience and figure out how they can be reached. Study their needs and interests in order to help guide your messaging to attract the right people.
Find investors and lenders – Most (if not all) investors and lenders will want to see a business plan before they jump into supporting you financially. Having a well-prepared document will show a thorough understanding of where the business is going and how it can get there.
Get future employees on the same page – If you decide to expand and hire on a partner, management team, or a whole slew of employees, sharing your business plan with them will enable them to better understand the mission of the business as well as what the future looks like – a future they will now be helping to create.
Develop contingency plans – A business’s success depends on its ability to adapt to the ever-changing world. Writing out your strategies and future goals can get you thinking about the ‘what ifs,’ and allow you time to think up potential alternative solutions.
Brainstorm future opportunities – Perhaps you have ideas that you come up with for later down the road. Document all of these in your business plan in order to preserve them so that you can revisit the list in the future.
Commit to your business intentions – While a business plan itself cannot hold you to your word, putting the time and effort into creating one shows a level of commitment and may subtly encourage you to stick with your endeavor.
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Of course it wouldn’t be fair to only address the positives, so let’s look at the list of cons:
It takes time – Time is precious and we must prioritize it. However, after reading the list of pros, can we agree that it might be worth it?
It takes thought – Yes, and quite a bit of it. As mentioned above though – clarity is the secret sauce. Getting clear on all of these points now will save time and thought later on.
You may have to learn what to include – Learning the basics of the formatting will be plenty for starting out. There are numerous resources online with helpful information and templates to get you going.
Research is required – Research is probably not everyone’s favorite thing, but taking the time to do it now will be very beneficial in understanding your market and audience.
All in all, there are loads of benefits as well as resources to help you get started. Business plans do not have to be as complicated or intimidating as they may seem. If you are a solopreneur and are not intending to apply for funding or find investors then this document is really for your own clarity.
I encourage you to give it a shot and sketch out your thoughts. Forget all the formatting at first and just focus on the content. If you decide to formalize it later, at least you will have all of the information ready to go.
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