Business plans may seem outdated or tedious, but did you know that investing the time and effort into planning your business has been proven to help you grow 30% faster? Not only that, these businesses have been proven to achieve their goals quicker, and are less likely to fail or experience detrimental cash flow problems.
Many people don’t actually understand what a business plan is all about, let alone why they’re critical to success. The importance of a business plan comes from the process of creating one. This process challenges you to decide what’s most important to you when starting or growing your business, and requires you to strategise and plan exactly how you’re going to achieve your primary goals.
In an industry like the health industry, competition grows by the day, making it even more important to consider whether your business is viable, in demand, and promising.
So let’s get into the nitty gritty about why you need a business plan to improve your chances of success!
As we just discussed, business plans are all about strategy. They help you figure out exactly what your business goals and vision look like, and allow you to make critical decisions in order to make these dreams a reality.
Without any clear direction or strategy, a business owner will struggle immensely making decisions. While on the other hand, an entrepreneur with a solid business plan answers many tough questions before they even arise – things like marketing strategy, and the products and services you’ll offer. Simply “winging it” and hoping for the best just doesn’t cut it if you want your business to survive and thrive!
This process also requires you to analyse the broader landscape, allowing you to better understand the market, your competition, and the tastes and preferences of your clients. These factors are vital to consider when deciding how you’ll differentiate your own business, and also allow you to prepare for potential disruptions and other insights into the landscape that you likely would have overlooked otherwise.
- Avoid mistakes
This strategic vision also means you can avoid making common mistakes which cause many small business to fail in their first five years including:
- Ensuring there is a demand for your services
- Cash flow issues or lack of sales
- Not investing in the right team to support them (whether that’s not hiring enough staff, or not employing people with the right skill sets or not upskilling themselves in the right areas)
- Understanding where the gaps lay between what you offer and your competitors so you can stand out from the crowd
- Pricing mismatch (either too high or too low)
Business plans can help you avoid these mistakes, as they help you to pinpoint potential issues before they come up!
Business plans require you to plan out your sales and revenue projections against your expectations and expenses. Comparing the two will help ensure you’re setting yourself up for success, and not taking more risks than you can afford.
Reviewing these figures regularly can help you identify any potential cash flow problems in advance, so you can take action to prevent the problem or minimise the damage to your business.
- Set and communicate objectives and goals
Since your business plan makes your strategic vision clear to yourself, it’s equally as useful for communicating this vision to your team and employees. You’ll be able to communicate exactly where you want your business to go, and how you foresee yourself getting there.
This helps motivate the entire team, and gives them a clear idea of the expectations you have of them. What happens when you are THE TEAM? It promotes efficiency and dedication, and can actually really engage and excite all involved, to see the bigger picture, instead of just the day-to-day operations.
If everyone is buying into your goals, they’ll become much more achievable, and you can all work together to get there from day one!
Setting achievable goals is critical for a business plan, as this means you can clearly assess whether you’re reaching milestones, and make changes where necessary. Every goal should be SMART: Specific, Measurable, Achievable, Realistic and Timely. This way, you can ensure your goals are aligned with your overall business strategy, and know without a doubt whether you are performing to your expectations or not.
One thing we do as one of the first modules in our Unique Experience with our clients is not only create goals as part of the Business Plan module, but we establish an action plan to help our dietitians achieve everything they are working towards. If you’d like to know more about about Business Planning Module, visit https://theambitiousdietitian.com.au/individual-services/
- Compare performance with expectations
As we just touched on, regularly reviewing your business plan is really important as it helps you track your performance and progress towards your goals. This allows you to make changes as necessary in order to help you get to where you want to be.
If your business plan clearly sets out SMART goals and objectives to help you get from A to B, you can very clearly identify areas of weakness, and areas where you’re excelling against your own expectations. This helps identify changes that need to be made to the business to increase your chances of success, and see your vision come to fruition.
Should you ever require funding or financial backing for your business, the first port of call of any investor, bank etc is checking your business plan. They need to see you have your business under control, and have a clear vision of where you see things heading. You need to be able to prove there is market demand for your services, that your financial statements and projections are promising, and that you have a solid idea of how you’re going to see your strategic vision become a reality. And this is all super simple if you’ve put in the time to craft a thorough, thoughtful business plan.
As you can see, business plans are non-negotiable in determining whether your business will succeed. If you’re willing to invest time, money and effort into ensuring your business goals are a success, why not take the time to think about the long-term goals and operations of your business and clearly articulate these for yourself and your team – after all, it could be the make or break for your business!
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