Running your own business can be a daunting task. Does the thought of expense budgets and sales objectives throw you into a tailspin? The main reason many small businesses fail is because of poor direction and lack of forward thinking. Whether you are just starting out, or you are looking to expand your existing business, it’s time to write your business plan.
What is a business plan?
A business plan is a guide that outlines your goals and allows you to plan or map out how to achieve them. A business plan does not need to be a long formal document. It can be as simple as planning how your business is going to work and how you are going to make it succeed. Your business plan will comprise of all of the aspects of your business, such as long-term and short-term goals, sales targets and expense budgets. What’s most important about a modern business plan is its development and the thought processes that go along with that. Writing a business plan is essential to the success of your business regardless of how big or small your business may be.
Who should write a business plan?
Are you just starting out?
If your business is in its infancy, writing a business plan will help you make sense of the uncertainty you may have about your business direction. It will help map out your projected income, budget for expenses, brainstorm milestones and create tasks. Putting together your business plan will make you more aware of when and where your expenses will come from, so that you can plan for these potential hurdles before they arise. A business plan for a new business should focus on explaining what you plan to do, how you are going to accomplish this, and why you are the right person to do this. Your start-up business plan will help you plan and strategize how much money you will need to invest during your initial growth phase, and hopefully set your business up to be successful financially.
Do you run an existing business?
There are many reasons why writing a business plan for your existing business is a smart idea. Whether you are you looking to expand or find a competitive edge in the market, a business plan will help you achieve your goals. The health, wellness and fitness industries are constantly evolving, so regrouping and re-strategizing your goals is vital to staying relevant and expanding your client/customer base. You may even find new business opportunities following your market research. A business plan for an existing business will reinforce strategy, establish metrics, manage responsibilities and goals, track results and manage and plan resources including critical cash flow. One of the most essential aspects of a business plan is to schedule for regular review and revision. Research from a 2011 study from Professor Andrew Burke, the founding Director or the Bettany Center for Entrepreneurial Performance and Economics at Cranfield School and Management revealed that business growth was 30% faster in businesses that use business plans, compared to those that relied on organic growth.
Why you should write a business plan
Writing a business plan will help you prioritize your goals. It will give your business direction and will help define your objectives. It will also help you map out strategies to achieve your goals. Prioritizing your goals will permit you to focus your resources and energy on what you need to do.
Writing your business plan will allow you to gain control over your business, no matter whether you are just starting up or whether you have been at it for a while. Taking this time away from your business to strategically plan for the future will pay off in the long run. Developing a business plan gives you the opportunity to step away from the day-to-day running of your business and allows you to critically assess what is working well in your business and what needs improvement. Putting your business plan together will help you learn about the different forces and factors that may affect your success. For example, if you are just starting your Health Coaching business, try and think about how many clients you think you can manage. Whilst growth is needed for a successful business, you don’t want to spread yourself too thin as this may lead to client dissatisfaction, client attrition, and less chance of a client recommendation. Writing your business plan will also help you see where you fit in the current market and it will allow you to see potential new areas for growth. You can identify challenges you may come across and work out strategies to avoid or overcome them. Setting specific goals, timeframes for achieving them, and how you will measure performance will also help you gain control of your business direction.
If you are interested in bringing in external finances, having a well thought out business plan is a must. You may be entitled to start up grant funding or you may look to investors or lenders to help get some initial cash flow. Potential lenders and investors will only risk their time and money if they are confident your business will be successful and profitable. You need to make sure you have done your research as this will show that you are serious about your business and it will help lenders and investors understand your business idea, including your predicted profits and income streams.
Analyze yourself and your business
Before writing your business plan, it’s important to critically assess yourself and your business idea. This will help identify your personal and business strengths as well as areas that you may need to pay particular attention to, or to gain outside help with. Some questions you may like to ask yourself include:
- Do you have the necessary management skills to run your own business?
- Do you have the industry expertise, technical skills, the finances and the long-term vision to grow and run a successful business?
- Why are you starting your own business?
- What are your business and personal goals?
- Do you have the income you need to generate your initial start up expenses?
- What are the advantages and disadvantages of running your own business?
What to include in your business plan
There’s no need to start your business plan from a blank sheet of paper. Freely available business plan templates are available online that you can use as a guide and to help you get started. Here are some key points to consider when developing your business plan.
This is an overview of your business plan, and whilst it will be placed at the start of your plan, it is best to write this once you have put the rest of your business plan together.
Management and operations plan
This section will cover aspects of your business operations including your business structure, registration, your premises and location of business, any staff you may employ and the products and services you provide.
This is where you include your market analysis. You need to identify your competitors and your customers and discuss key marketing targets and strategies.
Discuss your future business plans, including your vision statement, business goals and key business milestones.
Your finance plan will discuss how you will finance your business, including costing and financial projections.
Keep it dynamic
Your business plan is a living guide that should develop alongside your business growth. Successful businesses review and update their business plans regularly, especially as their circumstances change. As a self-employed Health Coach, writing a business plan will give you a huge advantage in the health, wellness and fitness industries. It will enable you to project achievable goals and milestones and you will be able to assess where your potential bumps may arise. A little forward thinking and planning will set you and your business up for future financial rewards.