Don’t let your business fail at the first hurdle The importance of a Business Plan

Believe it or not, there are some small-to-medium-sized businesses out there that still don’t have a proper business plan in place. And this isn’t because their owners don’t know what they’re doing; they’ve just had a great business idea, set up quickly and hit the ground running.

Before you know it, time becomes scarce and all that admin you need to do gets pushed aside because you’ve got to get on with day-to-day production or sales.

The trouble is, businesses can’t afford not to have a robust business plan in place, and here’s why. 

5 great reasons to have a Business Plan

  • You can plot the future
    And if you’ve got a good grasp of where you see your business going, your understanding of it will be better and you’ll be able to manage it much more effectively.

    Your plan can layout a number of potential scenarios, as well as pinpoint specific objectives and how you are going to achieve them. Careful consideration of this is a must if you want to ensure long-term success.

  • You can sustain growth and obtain funding
    The chances are that your business will need further funding at some point if you are planning to make it grow. Lenders like to see an up-to-date business plan to help them see where the business has been and where you want it to go.

    Your plan, therefore, needs to be written in a way that inspires prospective investors to invest in your business. In particular, you should demonstrate future ability to generate cash flows to meet financial obligations and ensure the business continues to operate effectively.

  • You can develop and communicate a course of action
    A business plan will help you to review future opportunities and then settle on a course of action – allowing your company to focus on key activities. You can use your plan to delegate specific milestones to individuals and then better monitor progress. A written plan is also easy to communicate and will induce feedback which is often useful in helping your business reach its full potential.
  • You can better manage cash flow
    The main reason businesses fail is because they become insolvent due to cash flow issues. You need a well-structured business plan, which manages funding needs in advance, to make sure this doesn’t happen to you.
  • You can prepare for a strategic exit
    If you know your exit strategy in advance, you can make better decisions in the present. And a well-written plan will clearly present the opportunity for potential investors as well as your business’s value, to make a successful exit more likely.

This probably isn’t news to you if your businesses is one those without a plan, but how can you get (the right) one in place quickly?

Well, that’s where Accountants Australia can help. One of our areas of expertise, we’ll work with you to develop a business plan that’s tailored specifically to your company and that meets your future goals.

To ensure your business is the best it can be, contact us today.

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