Small Business Planning 101
December is National Write a Small Business Plan month. If you’re thinking about starting a small business and aren’t sure where to start, writing a business plan is your best first step to success. You wouldn’t start out on a cross-country trek without a map, so why would you try to start a business without a business plan?
A business plan precisely defines your business, identifies your goals and serves as your firm’s resume. It helps allocate resources, handle unforeseen complications and make good business decisions. Because it provides specific and organized information about your company and how you will repay borrowed money, a good business plan is a crucial part of any loan application. Additionally, it informs sales personnel, suppliers and others about your operations and goals.
The importance of a comprehensive business plan can’t be overemphasized. One of the greatest benefits is that putting a plan together forces you to sit down and map out exactly how you expect to make your business idea successful.
Despite the critical importance of a business plan, many entrepreneurs drag their feet when it comes to writing one. But just as a builder won't begin construction without a blueprint, eager business owners shouldn’t rush into new ventures without a business plan.
If you’re already in business and you don’t have a business plan, it’s not too late. Especially if you’re looking for financing to grow and expand your existing business, because if you don’t already have a business plan, your lender is going to want to see one.
Four Core Questions to Consider
There are four core questions to answer before you begin writing your business plan. What service or product does your business provide and what needs does it fill? Who are the potential customers for your product or service and why will they purchase it from you? How will you reach your potential customers? Where will you get the financial resources to start your business?
Although there is no single formula for developing a business plan, key elements include the following: Executive Summary, Market Analysis, Company Description, Organization and Management, Marketing and Sales, Service or Product Line, Funding Request, Financials and more.
For detailed information on developing a business plan, sample business plans you can review, visit the “Plan your Business” section of the SBA’s website at sba.gov/business-guide/plan/write-your-business-plan-template. In addition, the SBA has several resource partners who can provide business planning assistance to entrepreneurs. Visit SCORE at score.org, the America’s SBDC Iowa at iowasbdc.org, the Iowa Women’s Business Center at the Iowa Center for Economic Success at theiowacenter.org/womensbusinesscenter and the Veterans Business Outreach Center at vetbiz.com for more information.
Learn more about starting and growing your business at sba.gov.
Learn about other “How to Start a Business” resources in The Partnership’s Small Business Resources Hub or sign up for the Small Business Resources newsletter and stay connected for information about upcoming events, other resources and the latest announcements in the small business community in Greater Des Moines (DSM).