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Solid Business Plans Form The Foundation Of Success

Aug 17, 2007
Opening a business, big or small, requires dedication, money, skill and a willingness to put in more hours for yourself than you ever did for an employer. But more than that, a successful business is one that knows its mission and goals and constantly works toward achieving those. To help launch a business, one of the best places to start is with a business plan.

But what is a business plan? And, how does a new business get one?

In essence, a business plan is a basic document that simply states what the business is and what it does. It identifies the business' goals and can also act as a resume for the new company. It also includes financial information such as an income statement, a balance sheet and even an analysis of cash flow.

The reasons for needing a business plan are many, but for companies looking for loans or investors it's especially important. The document can tell potential investors exactly who you are, what your business does and how you intend to help them make money, too. A good plan can lead to some solid investment capital, a bad one can doom chances for success.

So why is the business plan so important?

That's a fairly simple question to answer. Not only does a good business plan tell potential investors about your firm, it also guides you along the way to success. The plan helps you stay on track with decisions and it also helps your staff do the same. When your mission and goals are clearly stated, you have a measuring stick for all decisions big and small. If the decisions fit in with the plan, they're the correct ones. If they don't, they're not.

In order to create a solid business plan, you'll need to answer some pretty involved questions about your mission and your business goals. What you define in your plan will help guide you through all decision-making situations or it should.

The main questions that should be addressed by a plan are:

* What is your business? What does it do or provide? Does it serve a need? If so, what?

* What customers or potential customers do you have? How will they receive your product or service?

* How can you reach your customer base?

* Where do you intend to get startup money from? A bank? Private investors? Your own savings? Without some startup cash, few businesses can be successful. Starting from square one with a zero or worse balance account is not the way to start a business.

Whether you're creating a business big or small the success of your venture can often depend on how solid your business plan is. Although only a few seemingly basic questions are addressed in a plan, the answers to these questions can guide a firm to success. Decisions should be based on the answers and investments will likely depend on them as well. A good business plan can make a business.
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