Smart entrepreneurs understand the importance of having a good business plan – not only it is an indispensable tool for fundraising process, but it is also help businessmen crystallise their strategy and evaluate their process.
One of the most common uses of business plan is when you planning to encourage external investment into your company. This is important because most funders will not consider putting money into a company without seeing a well-written and convincing business plan. Thus, your job is to make your business plan understandable, can meet the requirements of your potential investors, and can make their qualifications and requirements.
Another purpose of business plan is strengthening the strategy of your business. This is the reason why the entrepreneurial team to go through this research and analysis systematically, creating a better foundation for strategy. If you are able to write down the perfect strategy, your team will be on the right page and fruitful discussions can be started which are better to get out of the way at this early stage while plans are still much more flexible.
Lastly, a business plan is used to evaluate your business’ progress. Businessmen use their business plan to see how well the results of the business stack up to the projections made early on. The use of financial statements can make this task a lot easier.
If you would like to learn more about business plan, you can check out this article published at Small Business WA: http://www.smallbusiness.wa.gov.au/business-topics/planning-structures/business-planning