Why Write a Business Plan?

The most common reason for writing a business plan is to obtain funding.  A business plan is the preferred mode of communication between you and members of the financial community.  By reviewing your comprehensive business plan, funding sources are better able to understand your business.  They learn how you plan to be successful and how they can share in in your success.  A good business plan will significantly increase your chances of obtaining funding.

A business plan also helps you in the good management of your business.  In a recent study, lack of planning was cited as the most common mistake made by small businesses.  If you do not have a clear idea of your ultimate goal, and a detailed plan of how you are going to reach it, your business will probably fail.  About half the people who start a new business end up closing their doors within the first five years.

A business plan will help you organize your thoughts about how to manage your business, allowing you to monitor your progress and make course corrections as required.  Simply completing the steps required to develop a business plan forces you to introduce discipline and logical thought process into all your planning activities.  A comprehensive business plan can help you avoid failure and substantially improve your liklihood of success.

What Is a Business Plan?

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