5 Business Plan Reasons: Does it require to have good business plan at all? Fact is, without the business plan, there is no money for the founder from the bank. This may be confirmed by many founders in their opinion that one must write the business plan only for the bank.
However, the Business Plan is primarily a document for the founder himself. We have compiled ten more reasons for the business plan – as well as created tools that help you with the business plan.
1. Less risk: with Business plan you rarely fail
50% of all start-ups do not survive in the first five years. In many of these cases, a business plan would have previously been able to tell whether the business idea actually has potential and can also be profitable. The critical areas of the business idea such as feasibility, target group and market potential result from a well-developed business plan.
The implementation of the start-up project is simplified by a business plan and thus the prospects for success for your idea are increased. And even with the risks of the project can be better avoided if you work proactively. It all starts with a short or gross idea or the Business Model Canvas , in order to have a first overview and a good discussion basis for the further procedure. Then write the detailed business plan only afterwards.
2. The business plan gives orientation and structure
The business plan forces you into a structured approach. If you have the first idea for a business model, you sometimes want to have done everything at once, before you can even see the entire scope of the project. Where the journey goes and how best to proceed step by step, a well-developed business plan reveals. This can sometimes bring you back to reality, because the initial enthusiasm for a company foundation drives you – and is also imperative for success – but nothing can be done. Knowledge gaps, problems and potential hurdles are only visible through a business plan. It identifies the various steps of the company’s foundation and the dimensions of entrepreneurship become clear.
3. The capital requirement is defined in the business plan
The financial plan is particularly important as a core element in the business plan . For another main reason why foundations fail, is a lack of funding. Founders estimate their capital requirements too low. In any case, you should also plan capital from the outset that you can use if it takes more time for your product to succeed in the market.
4. The business plan is the basis for your success
“Fail fast, fail cheap” – we can not advise you of this, and often found a failure to go to the uncertain target market with too little a budget, but these factors can make a business fail But if you want to start with a business plan, you should plan it carefully and adapt it, but do not start without it – The business plan is your personal framework that you can always stick to, even when things are not going so well.
5. Analyze competitors and competitors
“We do not have any competitors” – Without knowing your business idea, we can say that there is probably a competitor somewhere, but perhaps you do not know it yet, but it is essential if you want to start a company and successfully position your company. In the business plan, you will not only look at your own strengths, weaknesses, opportunities and risks , but also analyze the offers of your competitors very precisely.
What makes the competition better? What niche can I occupy? You must score where the service or product of the competition stops. Your product does not have to be better for you than the competition, but you have to work out the difference to the competition in a way that the customer can recognize it and at the best is willing to make more money for the product due to the added value to pay. In the business plan market research is therefore an important aspect.