There are tons of articles to praise the positive effects of the business plan, but on the contrary, there are also tons of articles to condemn the business plan! Regardless of the time you take to complete your business plan, your business plan is subject to time variations and changes. Why ? For the simple reason that it is by definition impossible to predict how a new activity will develop if it finds its customers, how long it will take before it becomes a success. One can therefore wonder if it is really worth spending time writing it.
The business plan: there is no simple matter
You have already opened several clothing stores in different districts of Paris and, in light of your success, you have the desire to open stores in major French cities, so you use your business plan to model your new store and you follow closely, but you have forgotten that the clientele in the provinces is hardly identical to the Parisian clientele, and there one encounters a great obstacle.
In conclusion, your business plan is already more or less fake. But is that reason enough not to? The answer to this question is clearly “no” and for several reasons.
What does a business plan contain?
But let’s start by remembering what a business plan or business plan consists of? This is a document that explains in a structured way what the future entrepreneur wants to achieve, when, with whom, by what means, aims for what results and how his project can be viable and profitable. In particular, the project manager describes his future activity, his products or services, his market, the risks they incur and how he anticipates them, the main development stages he envisions, the profitability model, the team he wants to surround himself with.
The business plan: 4 good reasons to implement it
In the nature of the matter, the business plan therefore makes it possible to fulfill 4 goals:
- that 1st goal is for the entrepreneur to verify the viability of his project by ensuring that every aspect that constitutes it (legal choices, financial means, commercial strategy, industrial tools, communication media, human resources, etc.) has been subject to in-depth reflection, that risks have been measured and solutions found.
- that 2nd goal of the business plan must make it possible to obtain the necessary financial resources to initiate and implement the project. Whether it is a loan to finance the purchase of equipment or a need to finance a cash change or an investor’s return to capital, it will be necessary to convince whoever has the money to put it into your business. But you are far from alone. The requests are overwhelming. Bankers and investors can therefore afford to make a choice based on their criteria: minimizing their risks while maximizing their profits. For this, they want to know where you are going and you will need to detail, argue, concrete and verifiable data to support them to get their support for your project. The business plan is used for this.
- that 3rd goal of the business plan is to convince your partners to trust you: a supplier, a service provider, an incubator that you want to integrate, etc. Everyone will be sure in advance of the seriousness of your project: so reassure them, show them your business plan. Your professionalism will be an important asset.
- that fourth goal of the business plan is to give you the opportunity to follow up on your project. Feel free to update it over time and as you develop. It will serve as your compass, showing you the direction to follow to always stay in control aboard your ship.
Not making a business plan means taking the risk of making mistakes on multiple levels.
Therefore, if you do not make a business plan, you deprive yourself of the opportunity to more thoroughly verify the seriousness and viability of your project, to find the necessary financial resources for the realization of your project, to convince the partners whose need to follow along . you, to have a monitoring tool for the implementation of your project. Wouldn’t that be a shame?