Business plans are one of the most vital parts of planning a small work at home business. If you have an established company and don’t have a business plan then you are in the very small minority. There are questions that I always get asked when it comes to small businesses and business plans: I’ve tried to answer them in the clearest way possible.
What Is a Business Plan?
A business plan is essentially all of your thoughts, ideas and plans for your business written down into an easy to read and freely accessible (by you) form so you can easily refer to it and refer potential investors or banks to it as well. It can allow you to grow your business in a planned and understood way as well as give your development some direction so that you don’t end up making changes to your business that you didn’t plan and didn’t want.
In short, a business plan helps you to keep track of all the moving parts of a business and helps you to understand exactly what you want to accomplish and how you plan to get to these goals, as well as what you’ll do after.
Does A Small Work From Home Business Need a Business Plan?
There is a small percentage of small business owners that have established their work from home business without using a plan, but why would YOU, a prospective small business owner, risk everything and then leave the outcome to chance.
The point of a business plan isn’t to trip you up or to pin you down to a certain plan for the next 4 years. Instead it works to clarify exactly what you want to achieve and helps you to think how you’re going to achieve small business success.
The main difference between a business plan and a plan that is formulated to give some idea of how a business hopes to work is detail. A business plan works like a sidekick to make sure you’ve thought through every eventuality and are ready to face problems should they come up.
A business plan, especially for a small business, needs to be organic and dynamic and able to adapt to certain stimuli. Yes, a large banking corporation can survive an undulating market, but how will your small business fare if your market suddenly decide to move away or your product loses demand.
Will a Business Plan Be Useful For My Small Business?
Many small businesses, likely yours, will at some point need a cash injection to help them out. This is common practice and usually comes in the form of a bank loan. The problem? Banks don’t readily give out their money to every small business owner that needs a loan. This is where the business plan comes in to its own.
A business plan is essentially your business on paper, and when you do it right you can reassure banks not only that you business will be a success (they don’t really care about this) but that you will be able to pay back your loan with interest.
A business loan isn’t like a personal loan for a new house or new car; there a far more hoops you have to jump through. A business plan can help you cut through all the red tape and make is 10 times easier to get your much needed start-up funds.
Does A Business Plan Constrict My Business Growth?
The short answer is: only if you let it. Like I’ve said above, keep your business plan dynamic, it will more than likely need to adapt to some unforeseen problem or change that not even the best business owner could have predicted.
A business plan is not set in stone and is not the written future of your business for the next 4 years. It is simply a device to allow you to plan where you want to go and how you’ll get there.
You can also read what I think about having a marketing plan.