Plan according to the English dictionary is defined as the set of intended mutual actions. Actions through which one expects to accomplish a set goal. A business plan can be said to be intended business strategies geared towards achieving a set objective. A business plan can be defined as an official document that
describes business goal. it also includes how to achieve these goals and the time frame for which the goal is to be achieved.
A business prospectus or plan is usually of various lengths and content, depending on the nature of the business and also the type of target goal. Some plans are short term while others are long term plans. Short term plans are usually more certain and failure of such plans does not necessarily have a huge effect on the business while long term plans on the other hand are less specific. They communicate very little and failure of long term plans greatly affects the state of the business and can lead to the end of the business.
Business plans are useful to business owners at all stages of their existence. A business without a plan is like a bird without wings. And just like the old saying; “He who fails to plan, plans to fail”. Business plans direct entrepreneurs
into deciding what to do and how to do it. A written business goal can also be referred to as a plan but it is not a detailed or comprehensive one.
TYPES OF BUSINESS PLAN
WORKING PLAN: This consists of business tasks. It also includes ways they can be accomplished. They are plans on business projects, availability of materials for achieving such projects and steps to be taken towards achieving such projects. A work plan is usually for a specific period of time. It could be six months to one year.
MARKETING PLAN: This type of plan is targeted towards the price of product and distribution systems. A market plan contains the type of product, the quantity of production the unit prices and the distribution network of the product. It also includes ways the entrepreneur plan to promote his/her product.
FINANCIAL PLAN: This type of business plan presents the financial statement of a business and the intending financial measures. It includes the business budgeting, income statement etc.
IMPORTANCE OF KEEPING BUSINESS PLANS
1. It serves as a communication tool.
2. Provides insights towards developing a more successful business.
A good business plan helps entrepreneurs
in looking for investments from potential investors.
4. Helps in future forecasts.
5. Serves as a guide towards growing and managing a more successful business venture.
BUSINESS PLAN GUIDELINES
1. Note the facilities at hand which would be useful in achieving the set goal.
2. The cost of achieving the set goal.
3. Other options available that would be useful in achieving the set objective.
4. Ask yourself; is the risk more than the profit?
5. Note also the time you have to carry out your plans.
For a business that is yet to be started up, positioning of the business should be considered.
You might want to read “how to start up a business”
In another article, i gave a comprehensive step by step explanation on “how to write a business plan”
Check it out and start writing your plans today! If you have any questions, you can ask in the comment section or send me a mail. I would love to hear from you!
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