Posted: Thu 1st Feb 2024
It's fair to say that not every small business starts out with a proper business plan. It's no surprise either – this kind of planning takes a lot of time and doesn't directly affect how much you sell, but over time a good plan can play a huge part in your success.
Read more about what you'll get out of a business plan and how to create one.
Benefits of a business plan
A well-thought-out business plan can benefit you in a number of ways:
See where you're going
You can use your business plan to decide on your mission and vision and what you want to achieve in the long term. It's essentially a "roadmap" you can use to make sure you're taking things in the right direction.
Set out how you'll get there
Your business plan provides the detail about the strategies and tactics you'll use to achieve your goals. You'll talk about the market you're operating in, what your competitors are doing, and how you'll do things differently to them.
Lay out your finances
A business plan should include those all-important financial budgets and forecasts. With this information, you can judge whether you'll need funding from outside the business (and when) and keep control over the money coming in and going out.
Explain your marketing
Most business plans have a section with a marketing plan that outlines how the business will attract and retain customers. In this section, talk about your target audience, pricing and how you'll promote what you sell.
Tell potential partners and investors what you're about
A good business plan serves as a communication tool, and will be especially handy when you're looking for finance or to make a new partnership. It gives investors, lenders and partners a clear understanding of your business and its potential for success.
Manage any risks
Your business plan should identify any possible challenges and risks that your business faces, then explain how you'll deal with them. This proactive approach can stop potential issues from becoming major problems.
How to structure your business plan
You can get a business plan template online. But no matter what your plan looks like, it should always include the following sections:
Summary: A brief overview of the basics of your plan.
Business brief: Everything about your business: where the idea came from, how it's structured, and details about your product.
Market research: A detailed investigation of the market you're targeting – who makes up your audience, what's selling, where your business fits in, potential competitors and so on.
Sales and marketing: Your marketing strategy, from social media campaigns to sales and giveaways.
Production: How you'll make or acquire your product. Will you create it yourself, have someone do it for you, or buy it wholesale, for example?
Financials: An honest, detailed explanation of your business's finances, covering everything from sales forecasts and cash flow to profits and losses.
Risks: The risks your business faces and what you're doing to reduce the effects.
A business plan can work wonders for your business. Your passion and dedication are essential to running your business in London – but keeping organised, and having a good business plan at the ready, is a great way to keep you focused and to help you take your business forward.
Take our free Business Success Check to receive a personalised action plan that can help you plan ahead and get everything in place for your business to be successful.
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No matter where you're based in London, you'll find relevant support and guidance on business planning, sales and marketing and much more, as well as opportunities to connect with like-minded business owners. Visit Grow London Local now