Why you should plan your business

“Fail to plan = plan to fail”

Why business starts need good planning.

You have a great idea for a new business. You think it could really work. You can  see where the market is and who the customers will be.

You start the ball rolling.

Stop. You have forgotten something – planning. The failure rate for new business starts ups is really high. My guess is that the reason for this is that people launch into it without thinking. More specifically, without planning. Entrepreneurs like to following inspiration – they do not always go with the perspiration.

Once you get into the cut and thrust of day-to-day business operations you won’t have time to think and plan. You will always say “I can’t top to do a business plan. I’d too busy”. I know how you feel.

Most people who start businesses these days fail to allow time to plan the business properly. They do not see the need for this. When things get tough – as they always do – there is no plan B, there is no contingency. This is where the whole enterprise is it risk of failing.

All businesses – whether corporate or sole trader – need to have a business plan. Both the text about goals, missions and markets and also the spreadsheets that predict turnover, income, expenditure and the bottom line for at least the year ahead.

This is not an academic exercise. You will need a business plan to open a band account. You should use your plan to spot where the stress points will be in your monthly forecasts – enabling you to plan ahead and avoid financial problems.

I set up a new social enterprise company and after our first six months of trading we are solvent, we made a small profit and we are really looking forward to the next six months.