Business Plans

What are the benefits of writing a business plan?

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2013-10-21 06:53:02

Entrepreneurs often ask, "Why do I need a business plan?". Well,

let's put it this way. Do you want a successful business? Because,

writing a well-thought-out and organized business plan dramatically

increases your odds of succeeding as an entrepreneur. Running or

starting a business without a business plan is like walking through

the dark without a flashlight. You can probably go a long way using

just your senses and relying on basic instincts. But operating in

such a manner leaves you wide open to the risk that something will

get in your way (like a competitor) and you probably won't see it

until it is too late. And just imagine all of the opportunities

that are just waiting to be grasped - but without a flashlight, ah

sorry - business plan, how will you see and take advantage of them?

The benefits of having a business plan include: * Helping you to

clarify your vision and deciding whether or not to forge ahead with

the idea. * Determining if your product and/or service has a

sufficient market to support it and whether or not it will be

profitable. * Providing an estimate of your start-up costs and how

much you'll need to invest or finance. * Convincing investors and

lenders to fund your business. * Defining your target market (who

your customers are or will be) and how to best reach them through

strategic marketing actions or expanding market coverage or reach.

* Establishing or reevaluating your competitive position within the

marketplace, by conducting a thorough analysis of the competition

(finding out where your competitor's weaknesses are and how you can

take advantage of them). * Defining corporate objectives and

programs to achieve those objectives. * Helping your business make

money from the start by developing effective operational

strategies. * Understanding the risks involved and anticipating

potential problems so you that can solve them before they become

disasters. * Setting a value on a business for sale or for legal


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