Why every business needs a business plan

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Business plans were once thought to be only for the banks. But a well thought out business plan can actually help you run your business better day to day, as well as planning for the years ahead. Use it as a tool to build your small business from a one tradie set up or to map out your retirement plan. 

Finance

You will need a business plan if you are starting out and need a bit of cash to give your business a kick off or if you're an established small business and need some capital to grow to the next level. Whether you're looking for a bank loan or approaching investors, a business plan can provide information on your growth strategies, marketing plans and long term business goals to prospective lenders. 

Using the business plan to review where your hard earned money is going can benefit your day to day cash flow situation. Are you paying too much for your business essentials such as tradesman insurance, loans (could you restructure to pay less) or stock (when was the last time you took a look around at other suppliers).

Find out what's important to your business

Tradies or small business owners often fall into two categories. Those who are happy working within the limitations of their own time. Accepting that they can only be in one place at a time. Other tradies are constantly frustrated with the catch 22 of working crazy hard one week and then having nothing on the next week because haven't had time to look for the next job or quote on prospective work.

Sitting down and writing a business plan can help to prioritise what is important to your business. Setting time aside each week to quote or find work for the coming period could be part of that plan.

Control where your business is going

By taking a step back and having a look at how and where your business is going you can make decisions on aspects which can be improved. Sometimes these changes will be for the financial benefit of your business, such as streamlining processes to allow more time for other tasks which are profitable. For example, outsourcing or automating bookkeeping, invoicing, accounting or debt collection. Other changes could work toward growing your business. Recruiting staff, moving to a larger premises, replacing ageing equipment for more efficient options or restructuring your business to give yourself more time off. All of these can be integrated into your business plan.

A business plan doesn't need to be a 20 page document with complicated financial, marketing and strategy plans. Just writing down ideas for how you would like your business to progress, what is going well, things which are not really working and reviewing the plan often to see if your business is changing for the better.