Q.Why should I prepare a business plan?
A.A business plan is a written summary of what you hope to accomplish by being in business, how you intend to organize your resources, and a road map for operating your business and measuring your progress along the way. While you may not need a business plan, creating one may make the difference between success and failure.
For a small business to succeed, it owners need to know where the company is heading and how it will get there. Although creating a business plan is a tedious task, it forces you to set goals, determine the resources you will need to meet your goals, and to foresee otherwise unforeseen problems. Creating a written business plan also enables you to:
- identify the amount of capital, or outside investment, required and when the capital or more capital will be needed;
- better manage the business as you will be able to concentrate your efforts on deviations from the plan before conditions become critical;
- look ahead and avoid problems before they arise; and
- identify your customers, your market, your pricing strategy and the competitive conditions under which you must operate to succeed, which can often leads to the discovery of a competitive advantage or new opportunity as well as deficiencies in your business plan.
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