Is a Business Plan Necessary?

The plain truth is, business owners of any size that take the time to outline what they will offer, what they’ll need to start and what their goals are more likely to succeed.

What exactly is a business plan? It really isn’t a mystery; it is your plan for making your business a success. Not only will a good business plan help you in securing funds for starting your business, it can help you think about every aspect of your business, from who you plan to sell your services to, to what you’ll need before you even start selling your services.

You might even find yourself avoiding some common pitfalls of smaller businesses, such as not anticipating enough funds to keep you going for the first year of business or realizing that you may need assistance in an area you don’t have experience in, such as technical support or bookkeeping.

A business plan doesn’t have to be dozens of pages long, but it should include basic information about your goals in both the short and long term, your business and how you imagine you’ll run it, and what your start up costs will be. The following are a few things that should be included in your business plan.

The first thing in your business plan should be your purpose. Think about what you want to accomplish with your business and what your goals are. From there, describe your business. Here you can describe exactly what your business is, when and where it was formed, the structure of the business, who the owner is and who is operating it.

From there, you can describe your market. Who do you imagine your customers will be? Here, you can also go into better detail about what you’re offering, why there is a need for your particular service or goods, and what makes your business better or different from your competitors. From there, you can go on to explain how you intend to meet the needs of your market. How are you going to produce your services or the goods you intend to sell, and how are you going to deliver your goods or services to your customers?

If you’re not truly a one person business, include information about who your staff is and what they will do, as well your suppliers.

The next thing in your business plan should be your time table. Do you want to reach a specific goal in a certain amount of time? This is the area where you should detail what your financial goals are.

Finally, outline your financial requirements for starting your business. This is not the area to skimp — if anything, overestimate the amount of money you’ll need. Too many small businesses fail to count on enough operating money at the beginning and find that they have to close their doors all too soon. Don’t make this mistake!

Really sit down and itemize everything you’re going to need to get going, including advertising, your business license or fees for setting up the structure of your business, computer software, even keeping your utilities going in your home (if you don’t have any other income), plus the cost of operating your business for a fixed amount of time without profit.

Writing a business plan for your home based business shouldn’t be something to be afraid of. If anything, a business plan will help you focus, get all your goals and ideas on paper, and help guide you in making your business a success.