Musings of the Sundarman

Why do I need a Business Plan for my small business?

Do you know how to build a business? Do you know what it takes to run a successful company? The following key points will help you to build and maintain a business plan. This is the first step to help you achieve your goals of creating and running a successful business.

From the moment your dreams of a small business become a real option, plan for everything. You will decide on your business name, structure, and financing as well as obtain a business license. The first item a small business owner should consider is the structure of the business. She should carefully evaluate the advantages and disadvantages of forming an S corp, a limited liability corporation, a C corp, sole proprietorship or partnership structure. Creating an LLC or limited liability company is one of the popular forms of business registration in the United States.

Because making informed business decisions is the key to becoming and remaining successful, market research to determine customer needs should be an important step in the early stage of any new business initiative. So, how can you get ground truth about the viability of your business idea? The answer is market research. Market research gives businesses essential information on customers, competitors, and market. However, it is not only about agglomeration of data about the market or the customer base. It is not at all uncommon for small business market research to be ignored or not completed.

Have you ever wondered why some individuals achieve much faster results with their business ventures than others? The answer is strategic planning. If you are starting a new business, strategic planning prevents you from jumping without a parachute. In strategic planning, the objective is to work out specific strategic approaches and required daily actions that help your business reach its vision. A strategic business plan provides a framework and foundation for a business to run. It is a description of how you will achieve your goals.

Writing the business plan may seem overwhelming at first, but if you break the plan down to bite sized pieces and work on one section at a time, it becomes more manageable. The executive summary is your business plan in miniature, a one to two page digest of the entire document. Developing the financial projections for your business plan may seem a daunting task. When creating the pro forma financial statements and revenue projections for your business, you should be optimistic, but realistic. A budget forecast for a startup business predicts the upcoming performance about financial projections and forecasts along with financial models. Part of your obligation as a small business owner is to understand all the tax liabilities and conditions imposed by the government on small businesses.

Product or Service design and development is critical and a business owner devotes much of her time to the design and creation of her business' main product or service. A definition of the product, the size of the market, potential competitors and a SWOT analysis are very important components of the business plan, apart from the financial projections.

A carefully designed strategic plan of marketing supplemented with thorough research can really bring prospects to your business. So market research goes hand in hand with good marketing, so that you know you’re pitching your business in the right way to the right people.

Your business plan must include some description of your plan to sell your product or service. This is the sales plan. For example, the plan should talk about the sales process fulfillment system used to sell the product and to get the product into the customer's hands.

Although not as glamorous as marketing, company operations form the backbone of the business going forward. It hardly matters what type of business you are in, operations management and efficiency are at the root of your company's success. Operations covers all aspects of the business from product design, product development, through marketing, sales, fulfillment and financial reporting. An operations plan should be part of your business plan.

The progress of any business is largely dependent on the individuals performing as a unit or team. Sales management, operations management, leadership and managing teams are important components of success .The guidance the leader provides by managing the team environment is critical to assure the teams meets. Effectively build the business relationships and life-long customers your company needs to succeed with an outstanding product, efficient customer service and maintaining a personal contact with the customer.