state five reasons for a business plan

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The importance of business plan: 5 key reasons.

A key part of any business is its business plan. They can help define the goals of your business and help it reach success. A good business plan can also help you develop an adequate marketing strategy. There are a number of reasons all business owners need business plans, keep reading to learn more!

Here’s What We’ll Cover:

What Is a Business Plan?

5 reasons you need a well-written business plan, how do i make a business plan, key takeaways.

A business plan contains detailed information that can help determine its success. Some of this information can include the following:

• Market analysis
• Cash flow projection
• Competitive analysis
• Financial statements and financial projections
• An operating plan

A solid business plan is a good way to attract potential investors. It can also help you display to business partners that you have a successful business growing. In a competitive landscape, a formal business plan is your key to success.

Check out all of the biggest reasons you need a good business plan below.

1. To Secure Funding

Whether you’re seeking funding from a venture capitalist or a bank, you’ll need a business plan. Business plans are the foundation of a business. They tell the parties that you’re seeking funding from whether or not you’re worth investing in. If you need any sort of outside financing, you’ll need a good business plan to secure it.

2. Set and Communicate Goals

A business plan gives you a tangible way of reviewing your business goals. Business plans revolve around the present and the future. When you establish your goals and put them in writing, you’re more likely to reach them. A strong business plan includes these goals, and allows you to communicate them to investors and employees alike.

3. Prove Viability in the Market

While many businesses are born from passion, not many will last without an effective business plan. While a business concept may seem sound, things may change once the specifics are written down. Often, people who attempt to start a business without a plan will fail. This is because they don’t take into account all of the planning and funds needed to get a business off of the ground.

Market research is a large part of the business planning process. It lets you review your potential customers, as well as the competition, in your field. By understanding both you can set price points for products or services. Sometimes, it may not make sense to start a business based on the existing competition. Other times, market research can guide you to effective marketing strategies that others lack. To have a successful business, it has to be viable. A business plan will help you determine that.

4. They Help Owners Avoid Failure

Far too often, small businesses fail. Many times, this is due to the lack of a strong business plan. There are many reasons that small businesses fail, most of which can be avoided by developing a business plan. Some of them are listed below, which can be avoided by having a business plan:

• The market doesn’t need the business’s product or service
• The business didn’t take into account the amount of capital needed
• The market is oversaturated
• The prices set by the business are too high, pushing potential customers away

Any good business plan includes information to help business owners avoid these issues.

5. Business Plans Reduce Risk

Related to the last reason, business plans help reduce risk. A well-thought-out business plan helps reduce risky decisions. They help business owners make informed decisions based on the research they conduct. Any business owner can tell you that the most important part of their job is making critical decisions. A business plan that factors in all possible situations helps make those decisions.

Luckily, there are plenty of tools available to help you create a business plan. A simple search can lead you to helpful tools, like a business plan template . These are helpful, as they let you fill in the information as you go. Many of them provide basic instructions on how to create the business plan, as well.

If you plan on starting a business, you’ll need a business plan. They’re good for a vast number of things. Business plans help owners make informed decisions, as well as set goals and secure funding. Don’t put off putting together your business plan!

If you’re in the planning stages of your business, be sure to check out our resource hub . We have plenty of valuable resources and articles for you when you’re just getting started. Check it out today!

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6 Reasons You Really Need to Write A Business Plan

Published: October 14, 2020

Starting a busine ss can be a daunting task, especially if you’re starting from square one.

It’s easy to feel stuck in the whirlwind of things you’ll need to do, like registering your company, building a team, advertising, the list goes on. Not to mention, a business idea with no foundation can make the process seem incredibly intimidating.

Thankfully, business plans are an antidote for the new business woes that many entrepreneurs feel. Some may shy away from the idea, as they are lengthy documents that require a significant amount of attention and care.

However, there’s a reason why those who take the time to write out a business plan are 16% more likely to be successful than those who don’t. In other words, business plans work.

What is a business plan, and why does it matter?

In brief, a business plan is a roadmap to success. It's a blueprint for entrepreneurs to follow that helps them outline, understand, and cohesively achieve their goals.

Writing a business plan involves defining critical aspects of your business, like brand messaging, conducting market research, and creating pricing strategies — all before starting the company.

A business plan can also increase your confidence. You’ll get a holistic view of your idea and understand whether it's worth pursuing.

So, why not take the time to create a blueprint that will make your job easier? Let’s take a look at six reasons why you should write a business plan before doing anything else.

Six Reasons You Really Need To Write a Business Plan

• Legitimize your business idea.
• Give your business a foundation for success.
• Obtain funding and investments.
• Hire the right people.
• Communicate your needs.
• It makes it easier to sell your business.

1. Legitimize your business idea.

Pursuing business ideas that stem from passions you’ve had for years can be exciting, but that doesn’t necessarily mean it’s a sound venture.

One of the first things a business plan requires you to do is research your target market. You’ll gain a nuanced understanding of industry trends and what your competitors have done, or not, to succeed. You may find that the idea you have when you start is not likely to be successful.

That may feel disheartening, but you can always modify your original idea to better fit market needs. The more you understand about the industry, your future competitors, and your prospective customers, the greater the likelihood of success. If you identify issues early on, you can develop strategies to deal with them rather than troubleshooting as they happen.

It’s better to know sooner rather than later if your business will be successful before investing time and money.

2. Give your business a foundation for success.

Let's say you’re looking to start a clean beauty company. There are thousands of directions you can go in, so just saying, “I’m starting a clean beauty company!” isn’t enough.

You need to know what specific products you want to make, and why you’re deciding to create them. The Pricing and Product Line style="color: #33475b;"> section of a business plan requires you to identify these elements, making it easier to plan for other components of your business strategy.

You’ll also use your initial market research to outline financial projections, goals, objectives, and operational needs. Identifying these factors ahead of time creates a strong foundation, as you’ll be making critical business decisions early on.

You can refer back to the goals you’ve set within your business plan to track your progress over time and prioritize areas that need extra attention.

All in all, every section of your business plan requires you to go in-depth into your future business strategy before even acting on any of those plans. Having a plan at the ready gives your business a solid foundation for growth.

When you start your company, and your product reaches the market, you’ll spend less time troubleshooting and more time focusing on your target audiences and generating revenue.

3. Obtain funding and investments.

Every new business needs capital to get off the ground. Although it would be nice, banks won’t finance loans just because you request one. They want to know what the money is for, where it’s going, and if you’ll eventually be able to pay it back.

If you want investors to be part of your financing plan, they’ll have questions about your business’ pricing strategies and revenue models. Investors can also back out if they feel like their money isn’t put to fair use. They’ll want something to refer back to track your progress over time and understand if you’re meeting the goals you told them you’d meet. They want to know if their investment was worthwhile.

The Financial Considerations section of a business plan will prompt you to estimate costs ahead of time and establish revenue objectives before applying for loans or speaking to investors.

You’ll secure and finalize your strategy in advance to avoid showing up unprepared for meetings with potential investors.

4. Hire the right people.

After you’ve completed your business plan and you have a clear view of your strategies, goals, and financial needs, there may be milestones you need to meet that require skills you don’t yet have. You may need to hire new people to fill in the gaps.

Having a strategic plan to share with prospective partners and employees can prove that they aren’t signing on to a sinking ship.

If your plans are summarized and feasible, they’ll understand why you want them on your team, and why they should agree to work with you.

5. Communicate your needs.

If you don’t understand how your business will run, it’ll be hard to communicate your business’s legitimacy to all involved parties.

Your plan will give you a well-rounded view of how your business will work, and make it easier for you to communicate this to others.

You may have already secured financing from banks and made deals with investors, but a business’ needs are always changing. While your business grows, you’ll likely need more financial support, more partners, or just expand your services and product offers. Using your business plan as a measure of how you’ve met your goals can make it easier to bring people onto your team at all stages of the process.

6. It makes it easier to sell your business.

A buyer won’t want to purchase a business that will run into the ground after signing the papers. They want a successful, established company.

A business plan that details milestones you can prove you’ve already met can be used to show prospective buyers how you’ve generated success within your market. You can use your accomplishments to negotiate higher price points aligned with your business’ value.

A Business Plan Is Essential

Ultimately, having a business plan can increase your confidence in your new venture. You’ll understand what your business needs to succeed, and outline the tactics you’ll use to achieve those goals.

Some people have a lifetime goal of turning their passions into successful business ventures, and a well-crafted business plan can make those dreams come true.

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20 Reasons Why You Need a Business Plan in 2024

Written by Dave Lavinsky

What is a Business Plan?

A business plan is a document that details your business concept and strategy for growth. It provides details about your company, a competitive analysis, a market analysis, a marketing strategy to reach potential customers, and a financial plan so that you make the best possible decisions to start or grow your company. A good business plan will help you take your business idea and turn it into a tangible action plan for success.

What is the Purpose of a Business Plan?

A business plan serves as an essential tool for guiding a company’s direction and decision-making processes. Its core purpose is to provide a detailed roadmap that communicates the company’s mission and vision, long-term objectives, and tailored strategies intended to steer the business towards success. This living document plays a pivotal role in streamlining operations, achieving goals, and setting a foundation for sustained growth. The purposes of a business plan include:

• Creating an Effective Growth Strategy : It outlines a comprehensive plan that identifies clear steps and strategies for expanding the market presence and ideal customer base for the business.
• Determining Future Financial Needs : By creating financial projections, a business plan helps in understanding the capital requirements to fuel growth initiatives and sustain operations.
• Attracting Investors and Lenders : A well-crafted business plan is instrumental in drawing attention from potential investors, including angel investors and venture capitalists, by showcasing the growth potential and profitability prospects of the business.

By leveraging a business plan template , entrepreneurs can significantly enhance their ability to communicate their vision, attract necessary funding, and ensure that all stakeholders are aligned with the company’s strategic direction.

20 Reasons Why You Need a Business Plan

There are countless reasons why having a well-crafted business plan is essential to the success of any company. Here are top 20 reasons why a business plan is important:

1. To Prove That You’re Serious About Your Business

A formal business plan is necessary to show all interested parties — employees, investors, partners and yourself — that you are committed to building the business. Creating your plan forces you to think through and select the strategies that will propel your growth.

2. To Establish Business Milestones

The business plan should clearly lay out the long-term milestones that are most important to the success of your business. To paraphrase Guy Kawasaki, a milestone is something significant enough to come home and tell your spouse about (without boring him or her to death). Would you tell your spouse that you tweaked the company brochure? Probably not. But you’d certainly share the news that you launched your new website or reached $1M in annual revenues.

3. To Better Understand Your Competition

Creating the business plan forces you to analyze the competition. All companies have competition in the form of either direct or indirect competitors, and it is critical to understand your company’s competitive advantages or unique value proposition. And if you don’t currently have competitive advantages, to figure out what you must do to gain them.

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4. To Better Understand Your Customer

Why do they buy when they buy? Why don’t they when they don’t? An in-depth customer analysis is essential to a great business plan and to a successful business. Understanding your customers will not only allow you to create better products and services for them, but will allow you to more cost-effectively reach them via advertising and promotions.

5. To Enunciate Previously Unstated Assumptions

The process of actually writing a business plan helps to bring previously “hidden” assumptions to the foreground. By writing them down and assessing them, you can test them and analyze their validity. For example, you might have assumed that local retailers would carry your product; in your business plan, you could assess the results of the scenario in which this didn’t occur.

6. To Assess the Feasibility of Your Venture

How good is this opportunity? The business plan process involves researching your target market, as well as the competitive landscape, and serves as a feasibility study for the success of your venture. In some cases, the result of your business planning will be to table the venture. And it might be to go forward with a different venture that may have a better chance of long-term success.

7. To Document Your Revenue Model

How exactly will your business make money? This is a critical question to answer in writing, for yourself and your investors. Documenting the revenue model helps to address challenges and assumptions associated with the model. And upon reading your plan, others may suggest additional revenue streams to consider.

8. To Determine Your Financial Needs

Does your business need to raise funds? How much? One of the purposes of a business plan is to help you to determine exactly how much capital you need and what you will use it for. This process is essential for raising capital for business and for effectively employing the capital. It will also enable you to plan ahead, particularly if you need to raise additional funding in the future.

9. To Attract Investors

A formal business plan is the basis for financing proposals. The business plan answers investors’ questions such as: Is there a need for this product/service? What are the financial projections? What is the company’s exit strategy? While investors will generally want to meet you in person before writing you a check, in nearly all cases, they will also thoroughly review your business plan.

10. To Reduce the Risk of Pursuing the Wrong Opportunity

The process of creating the business plan helps to minimize opportunity costs. Writing the business plan helps you assess the attractiveness of this particular opportunity, versus other opportunities. So you make the best decisions.

11. To Force You to Conduct Market Research and Really Know Your Market

What are the most important trends in your industry? What are the greatest threats to your industry? Is the market growing or shrinking? What is the size of the target audience for your product/service? Creating the business plan will help you to gain a wider, deeper, and more nuanced understanding of your marketplace. And it will allow you to use this knowledge to make decisions to improve your company’s success.

12. To Attract Employees and a Management Team

To attract and retain top quality talent, a business plan is necessary. The business plan inspires employees and management that your great idea is sound and that the business is poised to achieve its strategic goals. Importantly, as you grow your company, your employees and not you will do most of the work. So getting them aligned and motivated will be key to your success.

13. To Plot Your Course and Focus Your Efforts

The business plan provides a roadmap from which to operate, and to look to for direction in times of doubt. Without a business plan, you may shift your short-term strategies constantly without a view to your long-term milestones. You wouldn’t go on a long driving trip without a map; think of your business plan as your map.

14. To Attract Partners

Partners also want to see a business plan, in order to determine whether it is worth partnering with your business. Establishing partnerships often requires time and capital, and companies will be more likely to partner with your venture if they can read a detailed information about your company.

15. To Position Your Brand

Creating the business plan helps to define your company’s role in the marketplace. This definition allows you to succinctly describe the business and position the brand to customers, investors, and partners. With the industry, customer and competitive insight you gain during the business planning process, you can best determine how to position your brand.

16. To Judge the Success of Your Business

A formal business plan allows you to compare actual operational results versus the business plan itself. In this way, it allows you to clearly see whether you have achieved your strategic, financing, and operational goals (and why you have or have not).

17. To Reposition Your Business to Deal with Changing Conditions

For example, during difficult economic conditions, if your current sales and operational models aren’t working, you can rewrite your business plan to define, try, and validate new business ideas and strategies.

18. To Document Your Marketing Plan

How are you going to reach your customers? How will you retain them? What is your advertising budget? What price will you charge? A well-documented marketing plan is essential to the growth of a business. And the marketing strategies and tactics you use will evolve each year, so revisiting your marketing plan at least annually is critical.

19. To Understand and Forecast Your Company’s Staffing Needs

After completing your business plan, you will not be surprised when you are suddenly short-handed. Rather, your business plan provides a roadmap for your staffing needs, and thus helps to ensure smoother expansion. Importantly your plan can not only help you understand your staffing needs, but ensure your timing is right as it is time consuming to recruit and train great employees.

20. To Uncover New Opportunities

Through the process of brainstorming, white-boarding and creative interviewing, you will likely see your business in a different light. As a result, you will often come up with new ideas for marketing your product/service and running your business. It’s coming up with these ideas and executing on them which is often the difference between a business that fails or just survives and one that thrives.

Make Your Business Planning Count

One of the most common reasons businesses fail is the lack of a clear, strategic plan that addresses key components of running a business. Business plans help in identifying and navigating the challenges that can derail a business’s success, including poor market analysis, inadequate financial planning, and an unclear business model. By taking the time to write a business plan, entrepreneurs can clarify their business strategy, identify potential obstacles before they arise, and establish company goals that will set you up for success.

About Growthink Since 1999, Growthink’s business plan experts have assisted thousands of clients in launching and growing their businesses, and raising more than $2.5 billion in growth financing.

Need help with your business plan? 

• Speak with a professional business plan consultant from our team.
• Use our simple business plan template .
• Check out our business plan examples .
• Or, if you’re creating your own PPM, you can save time and money with Growthink’s private placement memorandum template .
• Learn more about us via our Growthink Business Plan Review page

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Nine reasons why you need a business plan

Building a great business plan helps you plan, strategize and succeed. Presented by Chase for Business .

Making the decision to create a new business is an exciting yet stressful experience. Starting a business involves many tasks and obstacles, so it’s important to focus before you take action. A solid business plan can provide direction, help you attract investors and ensure you maintain momentum.

No matter what industry you plan on going into, a business plan is the first step for any successful enterprise. Building your business plan helps you figure out where you want your business to go and identify the necessary steps to get you there. This is a key document for your company to both guide your actions and track your progress.

What is the purpose of a business plan?

Think of a business plan like a roadmap. It enables you to solve problems and make key business decisions, such as marketing and competitive analysis, customer and market analysis and logistics and operations plans.

It can also help you organize your thoughts and goals, as well as give you a better idea of how your company will work. Good planning is often the difference between success and failure.

Here are nine reasons your company needs a business plan.

1. Prove your idea is viable

Through the process of writing a business plan, you can assess whether your company will be successful. Understanding market dynamics, as well as competitors, will help determine if your idea is viable.

This is also the time to develop financial projections for your business plan, like estimated startup costs, a profit and loss forecast, a break-even analysis and a cash flow statement . By taking time to investigate the viability of your idea, you can build goals and strategies to support your path to success.

A proper business plan proves to all interested parties—including potential investors, customers, employees, partners and most importantly yourself — that you are serious about your business.

2. Set important goals

As a business owner, the bulk of your time will mostly likely be spent managing day-to-day tasks. As a result, it might be hard to find time after you launch your business to set goals and milestones. Writing a business plan allows you to lay out significant goals for yourself ahead of time for three or even five years down the road. Create both short- and long-term business goals. 

3. Reduce potential risks

Prevent your business from falling victim to unexpected dangers by researching before you break ground. A business plan opens your eyes to potential risks that your business could face. Don’t be afraid to ask yourself the hard questions that may need research and analysis to answer. This is also good practice in how your business would actually manage issues when they arise. Incorporate a contingency plan that identifies risks and how you would respond to them effectively.

The most common reasons businesses fail include:

• Lack of capital
• Lack of market impact or need
• Unresearched pricing (too high or low)
• Explosive growth that drains all your capital
• Stiff competition

Lack of capital is the most prevalent reason why businesses fail. To best alleviate this problem, take time to determine how your business will generate revenue. Build a comprehensive model to help mitigate future risks and long-term pain points. This can be turned into a tool to manage growth and expansion.

4. Secure investments

Whether you’re planning to apply for an SBA loan , build a relationship with angel investors or seek venture capital funding, you need more than just an elevator pitch to get funding. All credible investors will want to review your business plan. Although investors will focus on the financial aspects of the plan, they will also want to see if you’ve spent time researching your industry, developed a viable product or service and created a strong marketing strategy.

While building your business plan, think about how much raised capital you need to get your idea off the ground. Determine exactly how much funding you’ll need and what you will use it for. This is essential for raising and employing capital.

5. Allot resources and plan purchases

You will have many investments to make at the launch of your business, such as product and services development, new technology, hiring, operations, sales and marketing. Resource planning is an important part of your business plan. It gives you an idea of how much you’ll need to spend on resources and it ensures your business will manage those resources effectively.  

A business plan provides clarity about necessary assets and investment for each item. A good business plan can also determine when it is feasible to expand to a larger store or workspace.

In your plan, include research on new products and services, where you can buy reliable equipment and what technologies you may need. Allocate capital and plan how you’ll fund major purchases, such as with a Chase small business checking account or business credit card .

6. Build your team

From seasoned executives to skilled labor, a compelling business plan can help you attract top-tier talent, ideally inspiring management and employees long after hiring. Business plans include an overview of your executive team as well as the different roles you need filled immediately and further down the line.

Small businesses often employ specialized consultants, contractors and freelancers for individual tasks such as marketing, accounting and legal assistance. Sharing a business plan helps the larger team work collectively in the same direction. 

This will also come into play when you begin working with any new partners. As a new business, a potential partner may ask to see your business plan. Building partnerships takes time and money, and with a solid business plan you have the opportunity to attract and work with the type of partners your new business needs.

7. Share your vision 

When you start a business, it's easy to assume you'll be available to guide your team. A business plan helps your team and investors understand your vision for the company. Your plan will outline your goals and can help your team make decisions or take action on your behalf. Share your business plan with employees to align your full staff toward a collective goal or objective for the company.  Consider employee and stakeholder ownership as a compelling and motivating force. 

8. Develop a marketing strategy

A marketing strategy details how you will reach your customers and build brand awareness. The clearer your brand positioning is to investors, customers, partners and employees, the more successful your business will be.

Important questions to consider as you build your marketing strategy include:

• What industry segments are we pursuing?
• What is the value proposition of the products or services we plan to offer?
• Who are our customers?
• How will we retain our customers and keep them engaged with our products or services and marketing?
• What is our advertising budget?
• What price will we charge?
• What is the overall look and feel of our brand? What are our brand guidelines?
• Will we need to hire marketing experts to help us create our brand?
• Who are our competitors? What marketing strategies have worked (or not worked) for them?

With a thoughtful marketing strategy integrated into your business plan, your company goals are significantly more in reach.

9. Focus your energy

Your business plan determines which areas of your business to focus on while also avoiding possible distractions. It provides a roadmap for critical tradeoffs and resource allocation.

As a business owner, you will feel the urge to solve all of your internal and customers’ problems, but it is important to maintain focus. Keep your priorities at the top of your mind as you set off to build your company.

As a small business owner, writing a business plan should be one of your first priorities. Read our checklist for starting a business, and learn how to take your business from a plan to reality. When you’re ready to get started, talk with a Chase business banker to open a Chase business checking or savings account today.

For Informational/Educational Purposes Only: The views expressed in this article may differ from other employees and departments of JPMorgan Chase & Co. Views and strategies described may not be appropriate for everyone and are not intended as specific advice/recommendation for any individual. You should carefully consider your needs and objectives before making any decisions and consult the appropriate professional(s). Outlooks and past performance are not guarantees of future results.

JPMorgan Chase Bank, N.A. Member FDIC. Equal Opportunity Lender, ©2023 JPMorgan Chase & Co

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5 Reasons Why You Need a Business Plan

Starting a business you should write a business plan--even if you're not raising money any time soon..

Writing a business plan  doesn't mean you have to hole away in a library for months compiling 40-plus pages of text. You can create a plan in under a month, working part time. Use a presentation format like PowerPoint or Keynote to save time, and make it easier to share your plan.

Not all founders or start-ups are the same, of course. You'll want to plan in more detail if you're raising capital or taking on a lot of risk—like investing your savings, leaving a job, or supporting a family. Less detail is fine if you aren't raising money or taking on much risk. For example, if you are writing code in your dorm room, you can experiment to find out what consumers will latch onto before thinking about implementation or financing. 

But either way, you need a plan, and here's why: 1. To avoid big mistakes: The last thing you want to do is work on your start-up for a year, only to realize you were doomed to fail from the start. Many founders learn the hard way that they didn't set aside enough capital to reach their goals, took on partners with the wrong skills and resources, or don't have a viable way to make money. Developing and sharing a business plan can help ensure that you're sprinting down the right path. 2. To counterbalance your emotions: At times during your start-up experience, you'll be manic—so passionate about your ideas you lose sight of reality. At other times, you'll be overwhelmed by doubt, fear, or exhaustion. When your emotions get the best of you, having a business plan lets you step back, and take an objective look at what you are doing and why, what you know for a fact and what you are trying to figure out. 3. To make sure everyone's on the same page: Chances are, you are not building a company by yourself. Ideally, you'll have partners, so you can launch faster, smarter, and with less need to pay employees or suppliers. Even if you don't have partners, you'll have family, friends, and advisers involved. A business plan helps get everyone involved in your start-up heading in the same direction. 4. To develop a game plan: At a start-up, execution is everything. That means you have to set priorities, establish goals, and measure performance.  You also need to identify the key questions to answer, like "What features do customers really want?," "Will customers buy our product and how much will they pay?," and "How can we attract customers in a way that's cost effective and scalable?"  These are all things you'll address during the business planning process. 5. To raise capital.  If you raise or borrow money—even from friends and family—you'll need to communicate your vision in a clear, compelling way. A good business plan will help you do just that. An October 2007 study by  Babson College  found that start-ups with a business plan raised twice as much capital as those without a business plan within the first 12 months.

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What is a Business Plan? Definition and Resources

9 min. read

Updated July 29, 2024

If you’ve ever jotted down a business idea on a napkin with a few tasks you need to accomplish, you’ve written a business plan — or at least the very basic components of one.

The origin of formal business plans is murky. But they certainly go back centuries. And when you consider that 20% of new businesses fail in year 1 , and half fail within 5 years, the importance of thorough planning and research should be clear.

But just what is a business plan? And what’s required to move from a series of ideas to a formal plan? Here we’ll answer that question and explain why you need one to be a successful business owner.

• What is a business plan?

A business plan lays out a strategic roadmap for any new or growing business.

Any entrepreneur with a great idea for a business needs to conduct market research , analyze their competitors , validate their idea by talking to potential customers, and define their unique value proposition .

The business plan captures that opportunity you see for your company: it describes your product or service and business model , and the target market you’ll serve. 

It also includes details on how you’ll execute your plan: how you’ll price and market your solution and your financial projections .

Reasons for writing a business plan

If you’re asking yourself, ‘Do I really need to write a business plan?’ consider this fact: 

Companies that commit to planning grow 30% faster than those that don’t.

Creating a business plan is crucial for businesses of any size or stage. It helps you develop a working business and avoid consequences that could stop you before you ever start.

If you plan to raise funds for your business through a traditional bank loan or SBA loan , none of them will want to move forward without seeing your business plan. Venture capital firms may or may not ask for one, but you’ll still need to do thorough planning to create a pitch that makes them want to invest.

But it’s more than just a means of getting your business funded . The plan is also your roadmap to identify and address potential risks. 

It’s not a one-time document. Your business plan is a living guide to ensure your business stays on course.

Related: 14 of the top reasons why you need a business plan

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What research shows about business plans

Numerous studies have established that planning improves business performance:

• 71% of fast-growing companies have business plans that include budgets, sales goals, and marketing and sales strategies.
• Companies that clearly define their value proposition are more successful than those that can’t.
• Companies or startups with a business plan are more likely to get funding than those without one.
• Starting the business planning process before investing in marketing reduces the likelihood of business failure.

The planning process significantly impacts business growth for existing companies and startups alike.

Read More: Research-backed reasons why writing a business plan matters

When should you write a business plan?

No two business plans are alike. 

Yet there are similar questions for anyone considering writing a plan to answer. One basic but important question is when to start writing it.

A Harvard Business Review study found that the ideal time to write a business plan is between 6 and 12 months after deciding to start a business. 

But the reality can be more nuanced – it depends on the stage a business is in, or the type of business plan being written.

Ideal times to write a business plan include:

• When you have an idea for a business
• When you’re starting a business
• When you’re preparing to buy (or sell)
• When you’re trying to get funding
• When business conditions change
• When you’re growing or scaling your business

Read More: The best times to write or update your business plan

How often should you update your business plan?

As is often the case, how often a business plan should be updated depends on your circumstances.

A business plan isn’t a homework assignment to complete and forget about. At the same time, no one wants to get so bogged down in the details that they lose sight of day-to-day goals. 

But it should cover new opportunities and threats that a business owner surfaces, and incorporate feedback they get from customers. So it can’t be a static document.

Related Reading: 5 fundamental principles of business planning

For an entrepreneur at the ideation stage, writing and checking back on their business plan will help them determine if they can turn that idea into a profitable business .

And for owners of up-and-running businesses, updating the plan (or rewriting it) will help them respond to market shifts they wouldn’t be prepared for otherwise. 

It also lets them compare their forecasts and budgets to actual financial results. This invaluable process surfaces where a business might be out-performing expectations and where weak performance may require a prompt strategy change. 

The planning process is what uncovers those insights.

Related Reading: 10 prompts to help you write a business plan with AI

• How long should your business plan be?

Thinking about a business plan strictly in terms of page length can risk overlooking more important factors, like the level of detail or clarity in the plan. 

Not all of the plan consists of writing – there are also financial tables, graphs, and product illustrations to include.

But there are a few general rules to consider about a plan’s length:

• Your business plan shouldn’t take more than 15 minutes to skim.
• Business plans for internal use (not for a bank loan or outside investment) can be as short as 5 to 10 pages.

A good practice is to write your business plan to match the expectations of your audience. 

If you’re walking into a bank looking for a loan, your plan should match the formal, professional style that a loan officer would expect . But if you’re writing it for stakeholders on your own team—shorter and less formal (even just a few pages) could be the better way to go.

The length of your plan may also depend on the stage your business is in. 

For instance, a startup plan won’t have nearly as much financial information to include as a plan written for an established company will.

Read More: How long should your business plan be?  

What information is included in a business plan?

The contents of a plan business plan will vary depending on the industry the business is in. 

After all, someone opening a new restaurant will have different customers, inventory needs, and marketing tactics to consider than someone bringing a new medical device to the market. 

But there are some common elements that most business plans include:

• Executive summary: An overview of the business operation, strategy, and goals. The executive summary should be written last, despite being the first thing anyone will read.
• Products and services: A description of the solution that a business is bringing to the market, emphasizing how it solves the problem customers are facing.
• Market analysis: An examination of the demographic and psychographic attributes of likely customers, resulting in the profile of an ideal customer for the business.
• Competitive analysis: Documenting the competitors a business will face in the market, and their strengths and weaknesses relative to those competitors.
• Marketing and sales plan: Summarizing a business’s tactics to position their product or service favorably in the market, attract customers, and generate revenue.
• Operational plan: Detailing the requirements to run the business day-to-day, including staffing, equipment, inventory, and facility needs.
• Organization and management structure: A listing of the departments and position breakdown of the business, as well as descriptions of the backgrounds and qualifications of the leadership team.
• Key milestones: Laying out the key dates that a business is projected to reach certain milestones , such as revenue, break-even, or customer acquisition goals.
• Financial plan: Balance sheets, cash flow forecast , and sales and expense forecasts with forward-looking financial projections, listing assumptions and potential risks that could affect the accuracy of the plan.
• Appendix: All of the supporting information that doesn’t fit into specific sections of the business plan, such as data and charts.

Read More: Use this business plan outline to organize your plan

• Different types of business plans

A business plan isn’t a one-size-fits-all document. There are numerous ways to create an effective business plan that fits entrepreneurs’ or established business owners’ needs. 

Here are a few of the most common types of business plans for small businesses:

• One-page plan : Outlining all of the most important information about a business into an adaptable one-page plan.
• Growth plan : An ongoing business management plan that ensures business tactics and strategies are aligned as a business scales up.
• Internal plan : A shorter version of a full business plan to be shared with internal stakeholders – ideal for established companies considering strategic shifts.

Business plan vs. operational plan vs. strategic plan

• What questions are you trying to answer? 
• Are you trying to lay out a plan for the actual running of your business?
• Is your focus on how you will meet short or long-term goals? 

Since your objective will ultimately inform your plan, you need to know what you’re trying to accomplish before you start writing.

While a business plan provides the foundation for a business, other types of plans support this guiding document.

An operational plan sets short-term goals for the business by laying out where it plans to focus energy and investments and when it plans to hit key milestones.

Then there is the strategic plan , which examines longer-range opportunities for the business, and how to meet those larger goals over time.

Read More: How to use a business plan for strategic development and operations

• Business plan vs. business model

If a business plan describes the tactics an entrepreneur will use to succeed in the market, then the business model represents how they will make money. 

The difference may seem subtle, but it’s important. 

Think of a business plan as the roadmap for how to exploit market opportunities and reach a state of sustainable growth. By contrast, the business model lays out how a business will operate and what it will look like once it has reached that growth phase.

Learn More: The differences between a business model and business plan

• Moving from idea to business plan

Now that you understand what a business plan is, the next step is to start writing your business plan . 

The best way to start is by reviewing examples and downloading a business plan template . These resources will provide you with guidance and inspiration to help you write a plan.

We recommend starting with a simple one-page plan ; it streamlines the planning process and helps you organize your ideas. However, if one page doesn’t fit your needs, there are plenty of other great templates available that will put you well on your way to writing a useful business plan.

Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

Table of Contents

• Reasons to write a business plan
• Business planning research
• When to write a business plan
• When to update a business plan
• Information to include
• Business vs. operational vs. strategic plans

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The importance of a business plan

Business plans are like road maps: it’s possible to travel without one, but that will only increase the odds of getting lost along the way.

Owners with a business plan see growth 30% faster than those without one, and 71% of the fast-growing companies have business plans . Before we get into the thick of it, let’s define and go over what a business plan actually is.

What is a business plan?

A business plan is a 15-20 page document that outlines how you will achieve your business objectives and includes information about your product, marketing strategies, and finances. You should create one when you’re starting a new business and keep updating it as your business grows.

Rather than putting yourself in a position where you may have to stop and ask for directions or even circle back and start over, small business owners often use business plans to help guide them. That’s because they help them see the bigger picture, plan ahead, make important decisions, and improve the overall likelihood of success. ‍

Why is a business plan important?

A well-written business plan is an important tool because it gives entrepreneurs and small business owners, as well as their employees, the ability to lay out their goals and track their progress as their business begins to grow. Business planning should be the first thing done when starting a new business. Business plans are also important for attracting investors so they can determine if your business is on the right path and worth putting money into.

Business plans typically include detailed information that can help improve your business’s chances of success, like:

• A market analysis : gathering information about factors and conditions that affect your industry
• Competitive analysis : evaluating the strengths and weaknesses of your competitors
• Customer segmentation : divide your customers into different groups based on specific characteristics to improve your marketing
• Marketing: using your research to advertise your business
• Logistics and operations plans : planning and executing the most efficient production process
• Cash flow projection : being prepared for how much money is going into and out of your business
• An overall path to long-term growth

What is the purpose of a business plan?

A business plan is like a map for small business owners, showing them where to go and how to get there. Its main purposes are to help you avoid risks, keep everyone on the same page, plan finances, check if your business idea is good, make operations smoother, and adapt to changes. It's a way for small business owners to plan, communicate, and stay on track toward their goals.

10 reasons why you need a business plan

I know what you’re thinking: “Do I really need a business plan? It sounds like a lot of work, plus I heard they’re outdated and I like figuring things out as I go...”.

The answer is: yes, you really do need a business plan! As entrepreneur Kevin J. Donaldson said, “Going into business without a business plan is like going on a mountain trek without a map or GPS support—you’ll eventually get lost and starve! Though it may sound tedious and time-consuming, business plans are critical to starting your business and setting yourself up for success.

To outline the importance of business plans and make the process sound less daunting, here are 10 reasons why you need one for your small business.

1. To help you with critical decisions

The primary importance of a business plan is that they help you make better decisions. Entrepreneurship is often an endless exercise in decision making and crisis management. Sitting down and considering all the ramifications of any given decision is a luxury that small businesses can’t always afford. That’s where a business plan comes in.

Building a business plan allows you to determine the answer to some of the most critical business decisions ahead of time.

Creating a robust business plan is a forcing function—you have to sit down and think about major components of your business before you get started, like your marketing strategy and what products you’ll sell. You answer many tough questions before they arise. And thinking deeply about your core strategies can also help you understand how those decisions will impact your broader strategy.

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2. To iron out the kinks

Putting together a business plan requires entrepreneurs to ask themselves a lot of hard questions and take the time to come up with well-researched and insightful answers. Even if the document itself were to disappear as soon as it’s completed, the practice of writing it helps to articulate your vision in realistic terms and better determine if there are any gaps in your strategy.

3. To avoid the big mistakes

Only about half of small businesses are still around to celebrate their fifth birthday . While there are many reasons why small businesses fail, many of the most common are purposefully addressed in business plans.

According to data from CB Insights , some of the most common reasons businesses fail include:

• No market need : No one wants what you’re selling.
• Lack of capital : Cash flow issues or businesses simply run out of money.
• Inadequate team : This underscores the importance of hiring the right people to help you run your business.
• Stiff competition : It’s tough to generate a steady profit when you have a lot of competitors in your space.
• Pricing : Some entrepreneurs price their products or services too high or too low—both scenarios can be a recipe for disaster.

The exercise of creating a business plan can help you avoid these major mistakes. Whether it’s cash flow forecasts or a product-market fit analysis , every piece of a business plan can help spot some of those potentially critical mistakes before they arise. For example, don’t be afraid to scrap an idea you really loved if it turns out there’s no market need. Be honest with yourself!

Get a jumpstart on your business plan by creating your own cash flow projection .

4. To prove the viability of the business

Many businesses are created out of passion, and while passion can be a great motivator, it’s not a great proof point.

Planning out exactly how you’re going to turn that vision into a successful business is perhaps the most important step between concept and reality. Business plans can help you confirm that your grand idea makes sound business sense.

A critical component of your business plan is the market research section. Market research can offer deep insight into your customers, your competitors, and your chosen industry. Not only can it enlighten entrepreneurs who are starting up a new business, but it can also better inform existing businesses on activities like marketing, advertising, and releasing new products or services.

Want to prove there’s a market gap? Here’s how you can get started with market research.

5. To set better objectives and benchmarks

Without a business plan, objectives often become arbitrary, without much rhyme or reason behind them. Having a business plan can help make those benchmarks more intentional and consequential. They can also help keep you accountable to your long-term vision and strategy, and gain insights into how your strategy is (or isn’t) coming together over time.

6. To communicate objectives and benchmarks

Whether you’re managing a team of 100 or a team of two, you can’t always be there to make every decision yourself. Think of the business plan like a substitute teacher, ready to answer questions any time there’s an absence. Let your staff know that when in doubt, they can always consult the business plan to understand the next steps in the event that they can’t get an answer from you directly.

Sharing your business plan with team members also helps ensure that all members are aligned with what you’re doing, why, and share the same understanding of long-term objectives.

7. To provide a guide for service providers

Small businesses typically employ contractors , freelancers, and other professionals to help them with tasks like accounting , marketing, legal assistance, and as consultants. Having a business plan in place allows you to easily share relevant sections with those you rely on to support the organization, while ensuring everyone is on the same page.

8. To secure financing

Did you know you’re 2.5x more likely to get funded if you have a business plan?If you’re planning on pitching to venture capitalists, borrowing from a bank, or are considering selling your company in the future, you’re likely going to need a business plan. After all, anyone that’s interested in putting money into your company is going to want to know it’s in good hands and that it’s viable in the long run. Business plans are the most effective ways of proving that and are typically a requirement for anyone seeking outside financing.

Learn what you need to get a small business loan.

9. To better understand the broader landscape

No business is an island, and while you might have a strong handle on everything happening under your own roof, it’s equally important to understand the market terrain as well. Writing a business plan can go a long way in helping you better understand your competition and the market you’re operating in more broadly, illuminate consumer trends and preferences, potential disruptions and other insights that aren’t always plainly visible.

10. To reduce risk

Entrepreneurship is a risky business, but that risk becomes significantly more manageable once tested against a well-crafted business plan. Drawing up revenue and expense projections, devising logistics and operational plans, and understanding the market and competitive landscape can all help reduce the risk factor from an inherently precarious way to make a living. Having a business plan allows you to leave less up to chance, make better decisions, and enjoy the clearest possible view of the future of your company.

Business plan FAQs

How does having a business plan help small business owners make better decisions.

Having a business plan supports small business owners in making smarter decisions by providing a structured framework to assess all parts of their businesses. It helps you foresee potential challenges, identify opportunities, and set clear objectives. Business plans help you make decisions across the board, including market strategies, financial management, resource allocation, and growth planning.

What industry-specific issues can business plans help tackle?

Business plans can address industry-specific challenges like regulatory compliance, technological advancements, market trends, and competitive landscape. For instance, in highly regulated industries like healthcare or finance, a comprehensive business plan can outline compliance measures and risk management strategies.

How can small business owners use their business plans to pitch investors or apply for loans?

In addition to attracting investors and securing financing, small business owners can leverage their business plans during pitches or loan applications by focusing on key elements that resonate with potential stakeholders. This includes highlighting market analysis, competitive advantages, revenue projections, and scalability plans. Presenting a well-researched and data-driven business plan demonstrates credibility and makes investors or lenders feel confident about your business’s potential health and growth.

Understanding the importance of a business plan

Now that you have a solid grasp on the “why” behind business plans, you can confidently move forward with creating your own.

Remember that a business plan will grow and evolve along with your business, so it’s an important part of your whole journey—not just the beginning.

Related Posts

Now that you’ve read up on the purpose of a business plan, check out our guide to help you get started.

The information and tips shared on this blog are meant to be used as learning and personal development tools as you launch, run and grow your business. While a good place to start, these articles should not take the place of personalized advice from professionals. As our lawyers would say: “All content on Wave’s blog is intended for informational purposes only. It should not be considered legal or financial advice.” Additionally, Wave is the legal copyright holder of all materials on the blog, and others cannot re-use or publish it without our written consent.

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7 Solid Reasons to Write a Business Plan

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The term “ business plan ” is used a lot like sugar– it can make anything sound tastier. “Strategy” is also so overused and over-marketed that it’s become hard to nail down a useful definition.

Strategy, in this context, refers to the what-to-do and how-to-do-it of achieving your business goals. And while using the lingo is one thing, actually doing the planning and strategizing is another. Many startups today suffer because their plan isn’t clear or thorough enough to guide the business. Instead their team’s too busy creating products, rallying troops and hunting for clients– and creating a winning strategy sounds like a lot of fluff when there’s “real” work to be done, right?

Without a clear strategy even the savviest solopreneur gets tossed around and distracted from what really leads to success. That said, let’s get to what you clicked for – brain food & actionable steps. Here are seven reasons to write a business plan and some guidance on getting started. Enjoy!

Reasons To Write a Business Plan

1. increase the odds of success.

Building a business is something to be taken seriously. Tons of startups fail simply because the business owners/managers fail to think things through before plunging into the unknown. We don’t want that to be you.

Business requires strategy, proper allocation of resources, refined approaches and squeaky-clean priorities. If you want your business to succeed and grow over time, creating a business plan is a no-brainer!

2. Secure Funding

Funding, funding, funding. Every business needs it and there never seems to be enough lying around. Bottom line, you have almost ZERO chance of getting funds from traditional sources like these without a thorough business plan:

• Banks & Lending Institutions
• Angel/Private Investors & Venture Capitalists
• CrowdFunding Platforms like KickStarter or GoFundMe

All of these folks are going to want to see your business plan before they’ll take you seriously.

Put yourself in this position, mentally: pretend you only have a week to prep your business plan before presenting it to an angel investor who’s ready to hand you six-figures of debt-free funding. Would you feel confident in what you have to show them? Are you ready?

3. Valuation Purposes

You can’t know how much a business is worth at first glance. Maybe it seems to be doing great on the outside, but the truth is in the numbers– in its financial health.

This is why banks and investors don’t really care what comes out of your mouth, they just want to see your business plan and skip to the numbers. How are things adding up? What’s the current estimated value and the projected valuation over x number of years?

Your business plan should have all these questions answered, and laid out in a well-formatted document with neat graphs, charts, snippets of info, etc.

4. Market Your Brand

A business needs a solid customer-base to grow, and in most cases you’ll need to have a business plan before you can gain a solid audience. You need to create a concrete, hardcopy roadmap to guide you to your destination. Of course, there’ll be plenty of unexpected obstacles to deal with along the way– but without the map, you’ll be completely lost.

A business plan will help you market your business by deepening your understanding of your:

• Marketing Budget
• Core Pitch & Value Propositions
• Targeting & Demographic Data
• Competition & Market Analysis

Unless you have an incredible photographic memory and mind-blowing IQ, odds are you can’t keep all this information organized in your mind– especially if you’re trying to run a business at the same time. Modern business planning software is simply essential.

5. Communicate Goals

Let’s say it’s time for your business to expand, to do some hiring and outsourcing.

You want passionate individuals. You want folks with similar work ethic. You want team members that will align with your brand’s culture and help it evolve– but how to find them?

Your business plan is one concise document you can splice however you want and share with whomever you want. It’ll help attract the right talent by spelling out your mission, defining your brand story, and communicating your company culture!

6. Set Management & Employee Objectives

A legitimate business plan includes specific objectives to keep the team and management on target. You don’t need to be super precise here, but rather set some general milestones and leave the micro-management to cloud-based tools like Slack, Google Docs, email, etc.

7. Provide Direction

For most entrepreneurs, a business plan is a pivot-point later on in their brand’s development– once it’s absolutely necessary to have one. But why wait? Instead of delaying your concrete planning until after you’ve created a huge mess, hop aboard and update your methodology now.

This doesn’t have to be as scary as it sounds. Over the last decade a few companies have totally revolutionized the conventional notion of business planning. Business plan software like LivePlan and Enloop are super streamlined and user-friendly. They make it easy for anyone to start strategizing!

How To Get Started

1. write it down.

It sounds like a no-brainer, but most people don’t do it. Start by simply writing down your strategy, even if you’re a team of one.

There are several benefits to having a written strategy. It’ll help you become more clear on why you do what you do. It’ll help you craft your 30-second elevator speech. Most importantly, it will solidify your strategy in your mind and allow you execute it more thoughtfully!

2. Make Copy Crystal Clear

This is where a lot of companies need the most improvement. The average strategy is too vaguely worded: “We will be the best in class…” “Provide superior service…” “To be the [insert favorite business cliché here].”

A winning strategy has to be specific. If your strategy is to grow by 25 percent in the next 12 months, detail how you plan to make that happen. What niche and communication channels will you use? Which will you avoid? You need to be able to communicate the what and the how.

3. Leverage Strengths

Your strategy should capitalize on what you already do well. Define 3-6 of your company’s strengths and make sure your strategy aligns with them.

For example, an event planner would naturally be adept with contract negotiation, schedule planning and coordinating minute details. On the other hand, real estate, maintenance and transportation might be outside the realm of their strengths, and thus should not be part of their business strategy.

4. Regularly Review Plans

I know of a CEO who reviews his business plan every week to make sure his actions are aligned. Every quarter he makes minor adjustments; every year he pulls his team together to renew their strategy. By constantly reevaluating your strategy, you can keep it fresh and applicable.

That said, in a startup it can be tempting to change your plan too quickly. If you made a diligent effort to craft a smart and specific strategy, be patient and give it time to work.

5. Eliminate Distractions

Don’t allow yourself or your team to lose sight of your goals in pursuit of the latest shiny object. If you’ve put the time and effort into creating an effective strategy, stick to it and let it filter what you choose to pursue and what you let pass by.

Review your strategy and determine whether it’s specific enough. If you believe it is, I challenge you to have the courage to let it direct your actions.

Need Help? Try Software

1. liveplan.

We believe LivePlan is the best business planning software on the market. For between $11.66 and $19.95 per month (depending on whether you buy the annual or monthly plan) you get access to their incredible collaboration features, 10 beautiful optimized themes, and much more. They’re also fully compatible with most devices!

Provided you have the data, with LivePlan you’ll be able to build a pitch-ready business plan in record time.

Enloop is also another safe, reliable option if you’re looking for high-quality business plan software.

Their free version can be buggy, but it’ll help you get a sense of their services before committing to a paid plan (ranging from $9.95 to $39.95 per month). It’ll introduce you to some of their awesome features, like their Performance Score, Multi-Currency Support, Financial Ratio Analysis and Interactive PDF Creation.

Meet the Authors

Larry Nicholson is an accredited small-business consultant and the founder and principal of BluPrint Consultants. His work involves providing guidance and management, product and service assessment, due diligence, leadership, and strategic planning advice to entrepreneurs, business owners, and leadership teams.

Aaron Armour, co-founder of Armour Martin Consulting , has been managing teams for more than 15 years, some as large as 200 employees. He has managed business units with as much as $36 million in revenue and projects with $50 million budgets. Aaron is passionate about helping managers lead their employees and thrill their clients.

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10 Reasons You Need a Business Plan (& Free Downloadable PDF Template)

In this article, we will be sharing our top 10 reasons why you should compose a business plan if you want your business to be prosperous..

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Why is Writing a Business Plan So Important?

Written by Dave Lavinsky

Most people know that writing a professional business plan is important, but they may not understand why. In short, a business plan is an essential tool for any business because it helps to organize your thoughts and ideas and provides a roadmap for your business. It can also be used to secure financing, track progress, and assess performance.

New and existing businesses of all sizes can benefit from creating a business plan. If you’re thinking of starting a business, a business plan can help you determine whether your business idea is viable and provide direction for your business. If you already have a business, a business plan can help you improve your operations, assess your performance, and set goals for the future.

3 Main Purposes of a Business Plan

So, why is writing a professional business plan so important? There are many reasons, but some of the most important are:

1. To help you organize your thoughts and ideas

Having a great business idea is one thing, but turning it into a reality is another. A business plan forces you to think through your business concept in a logical, step-by-step manner and provides a framework for taking your idea from concept to reality.

2. To attract investors and secure financing

If you’re looking to secure financing for your business, whether it be from a bank, potential investor, or other sources, you will likely be required to submit a professional business plan. Your business plan needs to convince investors that your business is worth investing in and that you have a solid plan for how you will use their money to grow your business.

3. To track progress and assess the performance

Once your business is up and running, a business plan can be used to track progress and assess performance. This can help you identify areas where your business could be performing better and make changes accordingly.

While a business plan is not necessary for every business, it is a very important tool for any business owner who wants to achieve success. By understanding the purpose of a business plan and what it can do for your business, you’re well on your way to creating one that will help you reach your goals.

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20 More Reasons You Need a Business Plan

If you’re not convinced that you need a professional business plan for your company, consider these 20 additional benefits:

1. Helps you communicate your vision and goals to others

When you have a well-written business plan, it becomes easier to communicate your vision and goals to others. Your plan will outline exactly what you hope to achieve and how you plan to do it, which can help others understand your vision and give them confidence in your ability to succeed.

A business plan can also help you get feedback from others, such as potential customers, partners, or investors. This feedback can be invaluable in helping you fine-tune your business concept and make sure it is viable.

2. Helps you identify your target market

During the business planning process, you will identify your target market, which is an essential step in any business. By understanding your target market, you can create a product or service that meets their needs and is more likely to succeed. Targeting the right market can help you save time and money when marketing your business.

So how do you identify your target market? There are several factors to consider, such as demographics, psychographics, and geographic location. Once you’ve identified your target market, you can create a marketing plan that is tailored to their needs.

3. Helps you assess the competition

To be successful, it is important to understand your competition. A good business plan can help you do just that. By researching your competitive landscape and understanding what they are doing well and where they are falling short, you can learn from their mistakes and weaknesses and improve your own business.

Additionally, knowing your competition can help you price your products or services more effectively. You can also find potential partners and suppliers by examining your competition’s supply chains.

4. Helps you develop your marketing strategy

In today’s business climate, developing the proper marketing strategies is essential for any business. Market research can be tedious and the go-to plan of action is often to position oneself in opposition to other competitors. It’s not enough anymore just to know your competition; you need an edge to stand out among them.

A well-crafted plan will help you develop a sound marketing plan. By understanding your target market and the competition, you can create a mix of marketing strategies that are tailored to your specific needs. A good marketing strategy will help you save time and money by focusing on the most effective marketing channels where your target market is most likely to be reached.

Your strategy should outline how you plan to reach your target market, what methods you will use, and how much money you plan to spend.

5. Helps you manage and grow your business

A business plan is not just a document to be created and then forgotten. It should be a living, breathing document that you refer back to regularly. As your business grows and changes, so should your plan.

Regular reviews of your plan will help ensure that you are still on track with your goals and that your strategies are still effective. It can also help you identify any areas where you may need to make changes, such as your marketing strategy or your target market.

6. Helps you make better decisions

By having a well-written business plan, you will have a guide to help you make the important decisions for your business. Your plan will outline your goals and strategies, which can help you make informed decisions about areas such as marketing, finance, and operations.

Making good decisions is essential for the success of any business. A business plan can help you make better decisions by providing a framework for your decision-making process. When you have all of the detailed information about your business in one place, it is easier to see where things are going right and where they are going wrong.

7. Prevents missed opportunities

A business plan can help you identify opportunities that you may otherwise miss. By understanding your target market and the competition, you can find potential niches that you can exploit. A good business plan will help you stay on top of changes in your industry so that you can take advantage of any new opportunities that may arise.

By taking the time to research and plan for your business, you will be better equipped to take advantage of opportunities as they arise.

8. Encourages innovation and creativity

By outlining your goals and strategies, you can create an environment that is conducive to generating new ideas and experimenting with new approaches. When you have a plan in place, it is easier to take risks and try new things without fear of veering off course.

A business plan can help you encourage innovation and creativity by providing a roadmap for your business. By having a clear destination, you can focus on the best way to get there. By understanding your competition and your target market, you can come up with new and innovative ways to reach them.

9. Helps you identify problems and solutions

A well-crafted business plan can help you identify problems early on and come up with solutions to them. By understanding your business inside and out, you will be able to catch any potential problems before they become too big. Additionally, by having a plan in place, you will be able to track your progress and see how well your solutions are working.

A solid business plan can help you identify and solve problems by providing a framework for your problem-solving process. With a clear understanding of your business and your goals, you will be able to find and implement the best solutions for your company.

10. Helps you plan for the future

Creating a business plan is not just about planning for the present. It is also about planning for the future. By outlining your long-term goals and strategies, you can create a roadmap for your business that will help you achieve success in the future.

A well-written plan can help you achieve success in the future by providing a framework for your business. By understanding your goals and the steps you need to take to reach them, you can create a plan that will help you stay on track and reach your destination.

11. Helps you avoid costly mistakes

Making mistakes is a part of any business. However, by taking the time to plan for your business, you can minimize the chances of making costly mistakes. By understanding your target market and the competition, you can avoid making decisions that could potentially bankrupt your company.

Creating a plan can help you avoid costly mistakes by providing a framework for your decision-making process. By understanding your business inside and out, you will be less likely to make decisions that could hurt your company. By tracking your progress, you can see how well your decisions are working and make adjustments as needed.

12. Shows your dedication to your business

When you take the time to write a business plan or you hire a professional business plan writer , it shows that you are serious about your business and that you are willing to put in the work required to make it succeed. A well-written business plan is a sign of a healthy and thriving business.

Creating a plan demonstrates your dedication to your business and your willingness to put in the hard work necessary to make it succeed. By taking the time to research and plan for your business, you are indicating that you are serious about making your business a success.

13. Helps you stay organized

Running a business can be chaotic and disorganized. However, by taking the time to create a business plan, you can structure your business in a way that makes sense. A well-organized business is less likely to run into problems and is more likely to be successful.

A business plan can help you stay organized by providing a blueprint for your business. By understanding your goals and the steps you need to take to reach them, you can create a plan that will help you stay on track. By tracking your progress, you can see how well your organization is working and make adjustments as needed.

14. Keeps you motivated

It is easy to get discouraged when starting a business, but by having a plan in place, you can stay motivated and focused on your goals. Having a clear destination will help you stay on course, and understanding your competition and target market will give you the motivation you need to keep going.

A business plan can help you stay motivated by providing a framework for your business. By understanding your goals and the steps you need to take to reach them, you can create a plan that will help you stay on track. By tracking your progress, you can see how well your efforts are paying off and continue to push forward.

15. Helps you understand your business

To write a successful business plan, you need to have a clear understanding of your business. By conducting a market analysis and research, you can gain insights into your industry, competition, and your target audience. This will help you determine your business goals and objectives.

16. Helps you manage your time

Time is a precious commodity for any business owner. By taking the time to create a business plan, you can learn how to best use your time and resources. A well-organized plan will help you make the most of your time by providing a blueprint for your business.

Set business milestones and deadlines for yourself and your management team and track your progress. A business plan can help you manage your time by providing a framework for your problem-solving process. With a clear understanding of your business and your goals, you will be able to find and implement the best solutions for your company.

17. Helps you allocate resources efficiently

Running a business can be expensive, and it is important to allocate your resources efficiently. By taking the time to create a business plan, you can understand your target market and how to reach them. This will help you make wise decisions about where to allocate your resources.

Finding opportunities to save time and money is essential for any business owner. A business plan can help you find ways to be more efficient in your operations. By understanding your goals and the steps you need to take to reach them, you can create a plan that will help you stay on track and achieve your desired results.

18. Helps you understand your financial situation

To make sound business decisions, it is important to have a good understanding of your company’s financial situation. A business plan can help you do just that by providing an overview of your current business finances and creating financial projections.

You can use your plan to track your progress and make sure you are on track to reach your goals. Additionally, by understanding your financial situation, you can make informed decisions about how to best use your resources.

19. Gives you a sense of control

When you have a business plan, you have a sense of control over your business. By understanding your goals and strategies, you can make decisions that are in line with your overall vision. Additionally, by having a clear plan in place, you will be less likely to get sidetracked or make impulsive decisions.

While you can’t control everything in business, having a plan gives you a sense of control over your company. By understanding your goals and the steps you need to take to reach them, you can make decisions that are in line with your overall vision.

20. Helps you become a better business owner

As your business grows and changes, you will need to adapt your business plan to reflect these changes. A well-written business plan can help you become a better business owner by teaching you how to think strategically about your business.

The ability to think strategically is essential for any business owner. By taking the time to create a business plan, you can develop the skills you need to make smart decisions for your company. A well-organized business plan will help you understand your business inside and out, making you better equipped to manage it successfully.

As you can see, there are many reasons why writing a formal business plan is so important. By taking the time to create a plan, you can ensure that your business is organized and efficient, and you can stay motivated and focused on your goals. Additionally, a well-written, professional business plan will help you make the most of your time and resources, helping you to achieve success. So, what are you waiting for? Get started today!

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15 Reasons You Need a Business Plan Whether you're just starting out, growing your business or seeking outside help, a well-thought-out business plan is the vehicle you need to get you there.

By Tim Berry Edited by Dan Bova Mar 13, 2006

Opinions expressed by Entrepreneur contributors are their own.

Why do you want a business plan? You already know the obvious reasons, but there are so many other good reasons to create a business plan that many business owners don't know about. So, just for a change, let's take a look at the less obvious reasons first and finish with the ones you probably already know about. Think of this as a late-show top 10, with us building up to the most important reasons you need a business plan.

15. Set specific objectives for managers. Good management requires setting specific objectives and then tracking and following up. I'm surprised how many existing businesses manage without a plan. How do they establish what's supposed to happen? In truth, you're really just taking a short cut and planning in your head--and good for you if you can do it--but as your business grows you want to organize and plan better, and communicate the priorities better. Be strategic. Develop a plan; don't just wing it.

14. Share your strategy, priorities and specific action points with your spouse, partner or significant other. Your business life goes by so quickly: a rush of answering phone calls, putting out fires, etc. Don't the other people in your business life need to know what's supposed to be happening? Don't you want them to know?

13. Deal with displacement. Displacement is probably by far the most important practical business concept you've never heard of. It goes like this: "Whatever you do is something else you don't do." Displacement lives at the heart of all small-business strategy. At least most people have never heard of it.

12. Decide whether or not to rent new space. Rent is a new obligation, usually a fixed cost. Do your growth prospects and plans justify taking on this increased fixed cost? Shouldn't that be in your business plan?

11. Hire new people. This is another new obligation (a fixed cost) that increases your risk. How will new people help your business grow and prosper? What exactly are they supposed to be doing? The rationale for hiring should be in your business plan.

10. Decide whether you need new assets, how many, and whether to buy or lease them. Use your business plan to help decide what's going to happen in the long term, which should be an important input to the classic make vs. buy. How long will this important purchase last in your plan?

9. Share and explain business objectives with your management team, employees and new hires. Make selected portions of your business plan part of your new employee training.

8. Develop new business alliances. Use your plan to set targets for new alliances, and selected portions of your plan to communicate with those alliances.

7. Deal with professionals. Share selected highlights or your plans with your attorneys and accountants, and, if this is relevant to you, consultants.

6. Sell your business. Usually the business plan is a very important part of selling the business. Help buyers understand what you have, what it's worth and why they want it.

5. Valuation of the business for formal transactions related to divorce, inheritance, estate planning and tax issues. Valuation is the term for establishing how much your business is worth. Usually that takes a business plan, as well as a professional with experience. The plan tells the valuation expert what your business is doing, when, why and how much that will cost and how much it will produce.

4. Create a new business. Use a plan to establish the right steps to starting a new business, including what you need to do, what resources will be required, and what you expect to happen.

3. Seek investment for a business, whether it's a startup or not. Investors need to see a business plan before they decide whether or not to invest. They'll expect the plan to cover all the main points.

2. Back up a business loan application. Like investors, lenders want to see the plan and will expect the plan to cover the main points.

1. Grow your existing business. Establish strategy and allocate resources according to strategic priority. You can find more information about growing your business with a business plan by reading " Existing Companies Need Planning, Too ."

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When you think about “writing a business plan,” what comes to mind? I know—it’s not exactly the most exciting part of launching a business. In fact, as “lean startups” proliferate and entrepreneurs conduct business in hoodies and flip-flops, the business plan may seem as outdated as a horse and buggy.

Entrepreneurs buzzing with excitement about their great new business ideas rarely want to sit down and spend weeks or months writing a business plan. As an impatient entrepreneur myself, I totally relate to this reluctance. Particularly if you’ve worked in an industry for a while—for example, you’re a software engineer and want to start your own software company—you may feel it’s redundant to write a business plan. You already know everything you need to know…right?

Another common misconception: “I don’t need a business plan, because I’m not looking for financing.” It's true that lenders and investors definitely want to see a business plan. And technically, if you’re not seeking money from outside sources, you don’t need a business plan to show others.

But the real reasons to write a business plan have nothing to do with other people: They have to do with you.

Doing some pre-startup homework and crafting a business plan now will make your life post-startup so much easier.

Here are 5 reasons every entrepreneur should write a business plan.

1. it forces you to think through all aspects of your startup..

Entrepreneurs generally focus primarily on the “big idea”—less on its execution. While the nuts and bolts aspects of a startup, such as setting up an accounting system, may not be spine-tingling, they’re essential. While writing a business plan, you are forced to consider how you’ll run every aspect of your business—marketing, managing, financing, and more. In fact, the very areas you’re tempted to skim over are usually the places where you need to really drill down. The business plan gives your startup a blueprint for success.

2. It highlights potential problems.

Would you rather uncover a major flaw in your business concept during the planning stage, or when you’ve already spent money on a location, inventory, and hiring? By spotlighting possible obstacles, your business plan lets you plan how to work around them.

3. You’ll be prepared for anything.

Even if you’re not actively seeking financing, what if an opportunity arises for someone to invest in your startup or otherwise help you launch? If your business plan is ready to go, you can hand it over and impress them. If it’s not, you’ll have to stall while you scramble to write your plan—leaving the impression your idea wasn’t well thought-out to begin with. Think like a Boy Scout and be prepared.

4. It will help you explain your concept.

Looking for vendors, business partners, or even employees for a business that doesn’t yet exist is a challenge. A business plan can help people visualize your future business and decide whether or not they want to be involved.

5. There is plenty of help out there.

Yes, a business plan involves some grunt work, such as market research and financial projections. But technology has made the planning process so much easier that there’s no excuse for skipping it. If you want in-person help, the experts at SCORE can walk you through the process of writing a business plan step-by-step. Also, read SCORE’s Business Plan Resources Page for tons of tools, templates, blogs, and webinars.

Business Plan Template for a Startup Business To increase your odds of a successful business startup, download this step-by-step business plan template you can use to plan for your new business.

Lean Business Planning for Better Management Discover the simplicity and ease of lean business planning, powerful approach to planning for any business—existing, startup or in the planning stage.

Copyright © 2024 SCORE Association, SCORE.org

Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.

How To Write A Business Plan (2024 Guide)

Updated: Apr 17, 2024, 11:59am

Table of Contents

Brainstorm an executive summary, create a company description, brainstorm your business goals, describe your services or products, conduct market research, create financial plans, bottom line, frequently asked questions.

Every business starts with a vision, which is distilled and communicated through a business plan. In addition to your high-level hopes and dreams, a strong business plan outlines short-term and long-term goals, budget and whatever else you might need to get started. In this guide, we’ll walk you through how to write a business plan that you can stick to and help guide your operations as you get started.

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Drafting the Summary

An executive summary is an extremely important first step in your business. You have to be able to put the basic facts of your business in an elevator pitch-style sentence to grab investors’ attention and keep their interest. This should communicate your business’s name, what the products or services you’re selling are and what marketplace you’re entering.

Ask for Help

When drafting the executive summary, you should have a few different options. Enlist a few thought partners to review your executive summary possibilities to determine which one is best.

After you have the executive summary in place, you can work on the company description, which contains more specific information. In the description, you’ll need to include your business’s registered name , your business address and any key employees involved in the business. 

The business description should also include the structure of your business, such as sole proprietorship , limited liability company (LLC) , partnership or corporation. This is the time to specify how much of an ownership stake everyone has in the company. Finally, include a section that outlines the history of the company and how it has evolved over time.

Wherever you are on the business journey, you return to your goals and assess where you are in meeting your in-progress targets and setting new goals to work toward.

Numbers-based Goals

Goals can cover a variety of sections of your business. Financial and profit goals are a given for when you’re establishing your business, but there are other goals to take into account as well with regard to brand awareness and growth. For example, you might want to hit a certain number of followers across social channels or raise your engagement rates.

Another goal could be to attract new investors or find grants if you’re a nonprofit business. If you’re looking to grow, you’ll want to set revenue targets to make that happen as well.

Intangible Goals

Goals unrelated to traceable numbers are important as well. These can include seeing your business’s advertisement reach the general public or receiving a terrific client review. These goals are important for the direction you take your business and the direction you want it to go in the future.

The business plan should have a section that explains the services or products that you’re offering. This is the part where you can also describe how they fit in the current market or are providing something necessary or entirely new. If you have any patents or trademarks, this is where you can include those too.

If you have any visual aids, they should be included here as well. This would also be a good place to include pricing strategy and explain your materials.

This is the part of the business plan where you can explain your expertise and different approach in greater depth. Show how what you’re offering is vital to the market and fills an important gap.

You can also situate your business in your industry and compare it to other ones and how you have a competitive advantage in the marketplace.

Other than financial goals, you want to have a budget and set your planned weekly, monthly and annual spending. There are several different costs to consider, such as operational costs.

Business Operations Costs

Rent for your business is the first big cost to factor into your budget. If your business is remote, the cost that replaces rent will be the software that maintains your virtual operations.

Marketing and sales costs should be next on your list. Devoting money to making sure people know about your business is as important as making sure it functions.

Other Costs

Although you can’t anticipate disasters, there are likely to be unanticipated costs that come up at some point in your business’s existence. It’s important to factor these possible costs into your financial plans so you’re not caught totally unaware.

Business plans are important for businesses of all sizes so that you can define where your business is and where you want it to go. Growing your business requires a vision, and giving yourself a roadmap in the form of a business plan will set you up for success.

How do I write a simple business plan?

When you’re working on a business plan, make sure you have as much information as possible so that you can simplify it to the most relevant information. A simple business plan still needs all of the parts included in this article, but you can be very clear and direct.

What are some common mistakes in a business plan?

The most common mistakes in a business plan are common writing issues like grammar errors or misspellings. It’s important to be clear in your sentence structure and proofread your business plan before sending it to any investors or partners.

What basic items should be included in a business plan?

When writing out a business plan, you want to make sure that you cover everything related to your concept for the business,  an analysis of the industry―including potential customers and an overview of the market for your goods or services―how you plan to execute your vision for the business, how you plan to grow the business if it becomes successful and all financial data around the business, including current cash on hand, potential investors and budget plans for the next few years.

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What Is a Business Plan?

Understanding business plans, how to write a business plan, common elements of a business plan, the bottom line, business plan: what it is, what's included, and how to write one.

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

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A business plan is a document that outlines a company's goals and the strategies to achieve them. It's valuable for both startups and established companies. For startups, a well-crafted business plan is crucial for attracting potential lenders and investors. Established businesses use business plans to stay on track and aligned with their growth objectives. This article will explain the key components of an effective business plan and guidance on how to write one.

Key Takeaways

• A business plan is a document detailing a company's business activities and strategies for achieving its goals.
• Startup companies use business plans to launch their venture and to attract outside investors.
• For established companies, a business plan helps keep the executive team focused on short- and long-term objectives.
• There's no single required format for a business plan, but certain key elements are essential for most companies.

Investopedia / Ryan Oakley

Any new business should have a business plan in place before beginning operations. Banks and venture capital firms often want to see a business plan before considering making a loan or providing capital to new businesses.

Even if a company doesn't need additional funding, having a business plan helps it stay focused on its goals. Research from the University of Oregon shows that businesses with a plan are significantly more likely to secure funding than those without one. Moreover, companies with a business plan grow 30% faster than those that don't plan. According to a Harvard Business Review article, entrepreneurs who write formal plans are 16% more likely to achieve viability than those who don't.

A business plan should ideally be reviewed and updated periodically to reflect achieved goals or changes in direction. An established business moving in a new direction might even create an entirely new plan.

There are numerous benefits to creating (and sticking to) a well-conceived business plan. It allows for careful consideration of ideas before significant investment, highlights potential obstacles to success, and provides a tool for seeking objective feedback from trusted outsiders. A business plan may also help ensure that a company’s executive team remains aligned on strategic action items and priorities.

While business plans vary widely, even among competitors in the same industry, they often share basic elements detailed below.

A well-crafted business plan is essential for attracting investors and guiding a company's strategic growth. It should address market needs and investor requirements and provide clear financial projections.

While there are any number of templates that you can use to write a business plan, it's best to try to avoid producing a generic-looking one. Let your plan reflect the unique personality of your business.

Many business plans use some combination of the sections below, with varying levels of detail, depending on the company.

The length of a business plan can vary greatly from business to business. Regardless, gathering the basic information into a 15- to 25-page document is best. Any additional crucial elements, such as patent applications, can be referenced in the main document and included as appendices.

Common elements in many business plans include:

• Executive summary : This section introduces the company and includes its mission statement along with relevant information about the company's leadership, employees, operations, and locations.
• Products and services : Describe the products and services the company offers or plans to introduce. Include details on pricing, product lifespan, and unique consumer benefits. Mention production and manufacturing processes, relevant patents , proprietary technology , and research and development (R&D) information.
• Market analysis : Explain the current state of the industry and the competition. Detail where the company fits in, the types of customers it plans to target, and how it plans to capture market share from competitors.
• Marketing strategy : Outline the company's plans to attract and retain customers, including anticipated advertising and marketing campaigns. Describe the distribution channels that will be used to deliver products or services to consumers.
• Financial plans and projections : Established businesses should include financial statements, balance sheets, and other relevant financial information. New businesses should provide financial targets and estimates for the first few years. This section may also include any funding requests.

Investors want to see a clear exit strategy, expected returns, and a timeline for cashing out. It's likely a good idea to provide five-year profitability forecasts and realistic financial estimates.

2 Types of Business Plans

Business plans can vary in format, often categorized into traditional and lean startup plans. According to the U.S. Small Business Administration (SBA) , the traditional business plan is the more common of the two.

• Traditional business plans : These are detailed and lengthy, requiring more effort to create but offering comprehensive information that can be persuasive to potential investors.
• Lean startup business plans : These are concise, sometimes just one page, and focus on key elements. While they save time, companies should be ready to provide additional details if requested by investors or lenders.

Why Do Business Plans Fail?

A business plan isn't a surefire recipe for success. The plan may have been unrealistic in its assumptions and projections. Markets and the economy might change in ways that couldn't have been foreseen. A competitor might introduce a revolutionary new product or service. All this calls for building flexibility into your plan, so you can pivot to a new course if needed.

How Often Should a Business Plan Be Updated?

How frequently a business plan needs to be revised will depend on its nature. Updating your business plan is crucial due to changes in external factors (market trends, competition, and regulations) and internal developments (like employee growth and new products). While a well-established business might want to review its plan once a year and make changes if necessary, a new or fast-growing business in a fiercely competitive market might want to revise it more often, such as quarterly.

What Does a Lean Startup Business Plan Include?

The lean startup business plan is ideal for quickly explaining a business, especially for new companies that don't have much information yet. Key sections may include a value proposition , major activities and advantages, resources (staff, intellectual property, and capital), partnerships, customer segments, and revenue sources.

A well-crafted business plan is crucial for any company, whether it's a startup looking for investment or an established business wanting to stay on course. It outlines goals and strategies, boosting a company's chances of securing funding and achieving growth.

As your business and the market change, update your business plan regularly. This keeps it relevant and aligned with your current goals and conditions. Think of your business plan as a living document that evolves with your company, not something carved in stone.

University of Oregon Department of Economics. " Evaluation of the Effectiveness of Business Planning Using Palo Alto's Business Plan Pro ." Eason Ding & Tim Hursey.

Bplans. " Do You Need a Business Plan? Scientific Research Says Yes ."

Harvard Business Review. " Research: Writing a Business Plan Makes Your Startup More Likely to Succeed ."

Harvard Business Review. " How to Write a Winning Business Plan ."

U.S. Small Business Administration. " Write Your Business Plan ."

SCORE. " When and Why Should You Review Your Business Plan? "

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The Top 5 Benefits of Having a Business Plan

Whether you’re starting a small business or exploring ways to expand an existing business, a Business Plan is an important tool to help guide your decisions. An effective Business Plan is a roadmap to success, providing clarity on all aspects of your business, from marketing and finance, through to operations, products, services, people and how you will be better than your competitors.

The purpose of a business plan is to help articulate a strategy for starting or changing your business. It defines how you will achieve your most important business objectives. A good Business Plan should help you to sleep at night if you are a business owner.

For existing businesses, a business plan should be updated annually as a way to guide growth and navigate expansion into new markets. Your plan should include explicit objectives for hiring new employees, what structure you will have, what products and services your business will provide, how you will promote them and how you will finance business operations.

If you are considering starting a business, a Business Plan can help you to check the viability of a business before investing too much time or money in it. It also provides insight on steps to be taken, resources required for achieving your business goals and a timeline of anticipated results.

The Benefits of Having a Business Plan:​

1. Increased Clarity

A business plan can bring clarity to the decision-making process regarding key aspects of the business such as capital investments, leases, resourcing, etc. You can't do everything. A good Business Plan will help you identify business critical priorities and milestones to focus on.

2. Creation of a Marketing Roadmap

Marketing is an important aspect of a business plan. It helps to define your target market(s), target customers and how you will promote and place your product / service to these markets / customers.

3. Support for Funding

Whether you’re seeking credit from a bank or capital from investors, a business plan that answers questions about profitability and revenue generation is often required.

4. Helps to Secure Talent

For a business to succeed, attracting talented workers and partners is vital. Part of a business plan’s purpose is to help bring in the right talent, at the right time. Staff want to understand the vision, how the business will achieve its goals, and how they can contribute to this in their own roles.

5. Provides Structure

A business plan provides structure and defines business management objectives. It becomes a reference tool to keep the business on track with sales targets and operational milestones. When used properly and consulted regularly, it can help measure and manage your priority areas of focus.

Download your Business Plan template for $49.99 + GST here.

Many people engage us as business coaches to take a weekly / fortnightly step-by-step approach to the development of their own Business Plans, with the added benefit of our expertise and guidance throughout the process. In this way, you learn the essential aspects of running a successful business, while crafting your very own business plan over 8-12 weeks.

If you would like more information about how to create an effective Business Plan for your business, with our guidance, then please don't hesitate to contact Business Agility. We are business coaches who are former CEOs and MDs. We know what it takes to be successful in business.

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7 Real Reasons Why Entrepreneurs Start Their Own Business

Posted april 5, 2022 by kody wirth.

Why do people want to start their own business? What drives them to strike out on their own?

If you’re considering becoming an entrepreneur , understanding your answer to this question is critical. Honestly, assessing your motivations can tell you a lot about your likelihood of success. Will you be able to navigate a financial crisis? Invest the extra hours to rework your strategy even when you’d rather go home? 

If you don’t have an answer to that question, it may be helpful to explore why you want to be an entrepreneur further. Let’s take a look at some of the most common reasons why entrepreneurs start their own businesses—which are probably leading you to do the same.

1. Freedom to pursue your passion

You’ve had this talent, skill, or hobby for years, maybe even since childhood. Now, you see a potential opportunity to develop a business structure and monetize it. So you decide to use your passion to start a business. 

However, you may want to take a moment to assess the potential of your passion. Yes, it makes you happy, but can it pay the bills?

When you set aside emotion and focus strictly on dollars and common sense, does your passion-fueled business idea truly have the potential to be financially successful? Don’t forget, with ongoing record inflation, you’ll need continuously increasing income to support yourself and your business. Can your passion keep you afloat? 

If the answer is yes, start writing a business plan and go for it. If not, then you should likely rethink using your passion and explore other small business ideas. Consider another talent or hobby that can bring emotional fulfillment, as well as a tangible financial reward. 

Or, do further market research into other opportunities outside of your core interests. You may find that there is another reason for being an entrepreneur is really what’s driving you.

Recommended Reading: 12 Types of Entrepreneurs Explained

2. Create generational wealth

Many people are fixated on the idea of creating wealth that can be enjoyed by their families. For some, it’s an ambitious financial planning goal derived from witnessing living examples of absurdly wealthy families. People who’ve been able to pass down highly successful businesses from generation to generation. Others simply want their kids and grandkids to be spared from the financial hardships they were forced to overcome. 

Yet, only a handful of businesses are able to survive the passage of time. Yes, building a prosperous foundation for your descendants is a worthy cause. However, there is no guarantee that they’ll have the work ethic or discipline necessary to maintain an existing business. Much less position it to remain competitive in an ever-evolving global marketplace.  

Therefore, your focus has to be on how this endeavor will improve your life right now. Yes, your hard work could benefit your great-great grandkids, and you can teach your children to appreciate your business. You can’t force them to have the same passion you do. You can only set them up for success and hope for the best.  

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3. Support community, non-profits, and other social efforts

Many new entrepreneurs have a deep desire to use their businesses as vehicles to help the less fortunate. These noble souls see starting a small business as a means to effect change.

Social entrepreneurs aren’t driven by money but rather by a desire to create a better world. In our 2021 State of Small Business Study , we found that 12 percent of respondents identified giving back to their community as the primary reason for starting a business. 

If you’re one of these generous individuals, you must never forget that business remains business. Even though you have the best intentions, this doesn’t remove the responsibility to serve the needs of your target market. To provide competitively viable products and services for your customers. Failure to do so will result in your customer base taking their hard-earned money elsewhere, leaving you and your cause, out in the cold.

4. Turn a side-project into something more

Many successful businesses were once the side-gigs of nine to five employees who were simply trying to earn extra money. One thing led to another, word got around, and after a while, that side-project earned enough to replace the nine to five job, and boom: A business was born. 

As of 2022, we found that 23 percent of entrepreneurs were either starting a side gig or trying to turn a side gig into a full business. In fact, for most people, having a side gig is just a necessary part of survival. 

Yes, it is possible to turn your side project into a full-fledged business that becomes your primary source of income. However, it’s often difficult to know when it’s the right time to step away from your full-time position. 

When should you begin to promote your business? Should you invest in business insurance? Get the necessary licenses and permits to become a sole proprietorship?

These are just some of the questions you’ll need to answer when turning a side gig into your full-time pursuit. You don’t need to immediately make it your primary work; just take steps in that direction to see how viable it can be.

Remember, this can take months or years to gain traction. Just like a seed that you plant, you need to water it to see growth. With enough time and “watering,” that little side-gig seed can become a huge tree that becomes a profitable business. 

5. Challenge the status quo

Have you ever felt like there’s a better way to do something? This is a sentiment often held by game-changers. The employees and dreamers who feel the job or industry they’re in isn’t doing something right, and it’s up to them to change the status quo. 

Disrupting current norms can be a powerful incentive for new entrepreneurs. It can also be extremely beneficial for consumers wanting higher quality products or more efficient service. Nevertheless, disruption shouldn’t be based on personal feelings or experience. Instead, it must be centered solely on customer wants and expectations. 

Will consumers actually be interested in the innovation you provide? If you truly want to shake up the status quo, it’s up to you to find out if the solution you see truly benefits others.

6. Flexibility and balance

Having more personal and family time is one of the most powerful motivations for many new and prospective entrepreneurs. Nothing beats working on your own time and not having to worry about someone else’s standards. 

It’s time to make your own clock and choose your own hours. The harsh reality, as many new small business owners discover, is that work hours tend to increase, not decrease, after launching your own business. 

This is your project, your idea, and your customers, so it’s your responsibility. Reasoning such as “I’m not feeling well” or “that’s not in my job description” no longer applies to you. When you’re an entrepreneur, you’re always on duty.

Sure, you have “absentee owners” who simply hire people and leave them to run a business. But take a look at the most successful entrepreneurs. There is one common thread—they are hands-on. Oftentimes, their level of micromanagement is borderline psychotic. 

No, you don’t have to follow in the footsteps of Steve Jobs to be a successful entrepreneur. You don’t have to spend every waking hour to ensure your business succeeds. But you must care deeply about your business and, yes, sacrifice a great deal of time to make it a success.

7. Being the boss

One of the greatest driving forces for people starting a business is taking on the title of “Boss.” 47% of new entrepreneurs surveyed said that their main reason for starting a small business involved wanting to be their own boss. 

There’s a certain aura, a distinctive swagger, that many entrepreneurs have. Unlike top-level executives or even appointed CEOs, entrepreneurs garner a great deal of respect for being the ones who took the initial risk . They’re the ones whose vision enabled them to see an opportunity and whose determination made it happen. 

Entrepreneurship is a medal worn with pride, which most onlookers cannot ignore. Why do people start their own businesses? Because many want the respect and admiration that comes with starting a business. 

If that’s your main reason, make sure you’re totally prepared for the responsibility that comes your way. You owe it to yourself, your employees, and your customers. 

Recommended Reading: 6 Requirements of Successful Entrepreneurs

How to successfully start your own business

Whatever your reason, there is one thing you absolutely must do in order to be successful—plan. This is especially true when starting and attempting to grow a business. For an entrepreneur, being prepared is often the difference between success and failure. 

If you’re seriously considering starting your own business, you can’t afford to leave anything to chance. Consider investing in a business plan builder software and performance dashboard solution like LivePlan to stay on top of your business and avoid unnecessary issues.

Confirm and test your reason for starting  

Effective planning not only helps you identify the reasons you want to start a business but also allows you to assess if your business truly has the potential to be sustainable. There’s no need to waste precious time or money pursuing an idea that won’t work. By taking the time to plan properly, you’ll be able to see clearly if your business idea is worthwhile and figure out the necessary steps you’ll need to take to bring it to fruition. 

Turn hard work into strategic work

After you have developed a plan, it’s time to act. That means dedication, hard work, and the willingness to plan. Make no mistake, if you’re not prepared to put in the hours toward your entrepreneurial dream, then you should reexamine if starting a business makes sense. 

Nothing in entrepreneurship is guaranteed, and it’s driven by strategic risk. This is why effective planning, reviews, and revisions are so vital for business owners. It can help streamline time-consuming work, eliminate unnecessary risk, and ultimately help you know more about your business.

Gain the confidence of a successful entrepreneur

Now that you’ve been reminded of just how difficult starting a business can be, there is one more requirement necessary for you to succeed—self-confidence. No one is going to fully

believe you can do it until you actually turn your idea into a successful business. First and foremost, you must believe in yourself. Without this critical element, your new business is almost certain to fail.

Why would anyone support a business whose owner doesn’t believe in its future? People are attracted to winners who showcase the capability to maintain that success. Possessing this attitude, combined with thorough, objective planning , will empower you to aggressively pursue your goal and find success as an entrepreneur. 

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Shopsabre cnc automation: the cheat code to business success.

In today’s fast-paced world of manufacturing, businesses are constantly looking for ways to gain an edge—whether it’s cutting costs, boosting productivity, or improving the quality of their products. That’s where ShopSabre CNC automation comes in: a true cheat code for businesses and manufacturing companies looking to level up their operations.

Here’s how ShopSabre CNC Automation can supercharge your business:

Efficiency at Every Level

In traditional manufacturing, repetitive tasks eat up time, drain resources, and often lead to human errors. With ShopSabre CNC automation, these tasks are handled by precise, programmable machines that operate with unmatched consistency and speed. Whether you’re cutting metal, wood, or plastics, CNC automation eliminates the inefficiencies of manual work. By streamlining the process, your business can accomplish more in less time, boosting throughput and significantly reducing production costs.

As an example of this, with the use of a CNC Router a traditional cabinetry shop can perform a full base cabinet including the shelving holes, the dados, and the parts nested & cut out in under 5 minutes.

In the end the base cabinet costs the same to the end user but through efficiency the material waste & labor savings increases the product margin & ultimately the company’s profit all while allowing them to take on more jobs or larger projects without labor constraint.

Unparalleled Precision and Quality

One of the biggest advantages of CNC automation is its ability to achieve incredibly precise results every time. With the cheat code of ShopSabre CNC automation, you can guarantee uniformity across all your products—no matter how complex the design. This level of precision reduces waste, minimizes material costs, and enhances the overall quality of your output, ensuring that your products consistently meet customer expectations and industry standards. With the utilize of Ball Screw drive technology on ShopSabre routers , you can depend on consistency & accuracy unmatched by other lower quality solutions which gives you an advantage over your competition – the precision of the CNC machine and the repeatability of the product will be defined by the quality of the technology.

Flexibility to Innovate

Automation doesn’t mean you’re locked into a rigid system. ShopSabre CNC machines provide the flexibility to quickly adapt to different projects, materials, and design changes. This means your business can pivot to new opportunities without missing a beat. The ability to easily modify designs and run multiple operations on a single machine gives your business the agility needed to stay ahead of the competition. In essence, you have a dynamic tool that evolves with your business needs.

Whether your needs are prototyping out a new product or mass manufacturing of a popular design, the CNC automation makes it easy for you to tackle anything that comes your way.

Additionally, you can expand your business with ease – bringing in previously outsourced products and giving you a new revenue stream.

Reducing Labor Costs Without Compromising Expertise

Skilled labor shortages are a challenge in many industries, but ShopSabre CNC automation helps bridge the gap. With CNC machines, a single operator can manage multiple production lines, allowing businesses to do more with fewer hands-on deck, a true cheat code to labor shortage. Instead of spending hours training new staff, you can focus on developing your existing workforce’s expertise, allowing them to program and manage automated systems efficiently. This reduces overhead costs and allows your team to focus on value-adding activities like product development and customer service.

Scalability for Growth

CNC automation isn’t just for large-scale manufacturers. In fact, it’s become even more important to smaller-scale companies, which allows them to compete on a much larger scale. One of the most attractive features of ShopSabre’s technology is its scalability. Whether you’re a small business with ambitions to grow or a large manufacturing company looking to enhance operations, ShopSabre CNC machines can scale to your needs. Automation allows you to increase production without significant additional investments in labor, infrastructure, or time—making it a key driver for sustainable business growth.

Long-Term Reliability and Short-Term ROI

Investing in ShopSabre CNC automation is an investment in the future of your business. These machines are built for durability and reliability, ensuring that your business operates smoothly for years to come. With minimal maintenance requirements and the backing of ShopSabre’s industry-leading technical support, the return on investment (ROI) from CNC automation is both immediate and long-lasting. You not only save money on operational costs but also protect your business from costly downtimes and disruptions.

Conclusion: Unlock Your Potential with ShopSabre CNC Automation

In the world of business and manufacturing, success is often a result of leveraging the right tools and technology. ShopSabre CNC automation is that cheat code—unlocking unprecedented levels of efficiency, precision, and scalability. Whether you’re looking to increase production, reduce costs, or simply stay competitive in a demanding market, ShopSabre CNC provides the tools you need to succeed.

It’s time to take your business to the next level. Explore the power of ShopSabre CNC automation and see how it can transform your operations into a high-performing, future-ready enterprise.

Checkout our wide array of products today: https://www.shopsabre.com/cnc-routers/ https://www.shopsabre.com/cnc-plasmas/

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8 Reasons Why a Small Business Savings Account is a Must

• Published August 27, 2024 August 27, 2024

Key Takeaways

• A business savings account provides financial security by serving as an emergency fund and preparing your business for unexpected expenses.
• Regular contributions to a business savings account can support future investments, tax payments, and seasonal fluctuations without disrupting daily operations.
• Having a business savings account enhances financial organization and can improve your business’s creditworthiness, offering peace of mind and better financial management.

As a small business owner, you know that managing your finances efficiently is crucial for your success. You likely already have a business checking account —and maybe even a business credit card . But what about a business savings account? Here are eight compelling reasons why you should open one today.

1. Emergency Fund for Unexpected Expenses

Unexpected expenses are inevitable in any business. Whether it’s a sudden repair, equipment failure, or an economic downturn, having a business savings account allows you to build a financial cushion. This cushion can help you cover unforeseen costs without disrupting your cash flow or forcing you to take on debt.

2. Earning Interest on Idle Funds

Unlike a checking account, a business savings account typically offers interest on your balance. This means that the money sitting in your account can grow over time, giving you a little extra income without any extra effort. Plus, if you open an Advanced Business Money Market or Premier Business Money Market account , you can earn even higher rates with no monthly service or transaction fees.

3. Saving for Future Investments

Are you planning to expand your business, upgrade equipment, or launch a new product? A business savings account is a great way to set aside funds for future investments. By regularly transferring money into your business savings account, you can accumulate the necessary capital over time. This will make it easier to fund your growth without dipping into operational funds.

4. Tax Preparation and Payments

Taxes are a significant expense for any business, and they can be particularly challenging for small business owners . A business savings account can help you set aside money specifically for tax payments. By regularly contributing to this account, you can avoid the stress of scrambling for funds when tax season rolls around.

5. Improved Financial Organization

Separating your savings from your daily operating funds can greatly improve your financial organization. With a business savings account, you can easily track your savings goals and manage your finances more effectively. This separation also makes it easier to monitor cash flow so you can budget for both short-term and long-term needs.

6. Building Creditworthiness

Banks, credit unions, and lenders often view businesses with dedicated savings accounts as more financially responsible. So, regularly contributing to a business savings account can demonstrate that your business is stable and prepared for the future. This can improve your creditworthiness and make it easier to secure loans or lines of credit when needed.

7. Preparing for Seasonal Fluctuations

Whether you run an ice cream parlor or a repair shop, chances are you experience seasonal fluctuations in revenue. A business savings account can help you prepare for stagnant periods by allowing you to build a reserve. During the busy season, set aside money to cover expenses during slower times. Soon, you’ll be able to maintain smooth operations year-round, regardless of seasonal changes.

8. Peace of Mind

Finally, having a business savings account provides peace of mind. Knowing that you have dedicated funds for emergencies, taxes, or future investments allows you to focus more on running your business and less on financial worries. This security can reduce stress and help you make better business decisions.

By opening a business savings account, you’re taking a smart step toward securing your business’s financial future. Whether you’re saving for a rainy day, planning for growth, or just looking to improve your financial organization, a business savings account is a valuable tool in your financial toolkit.

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Date: Aug. 23, 2024

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Phoenix, AZ — Diana Marie Moore, of Mesa, was sentenced this week by United States District Judge Susan M. Brnovich to 66 months in prison, followed by three years of supervised release. Moore was also ordered to pay restitution to the Arizona Health Care Cost Containment System (AHCCCS) in the amount of $21,730,674.04. In addition, the Court ordered the forfeiture of four single-family homes owned by Moore as well as 117 other items, including seven luxury vehicles, designer apparel, luxury jewelry, and artwork. All the items were purchased by Moore using the proceeds of her fraud scheme. Moore pleaded guilty to Wire Fraud and Money Laundering on July 10, 2023.

Moore admitted that she owned two behavioral health counseling services, Harmony Family Services (HFS) and Harmony Family Services II (HFS II) and that she had also submitted the application for a third behavioral health counseling service, Logan Family Health, LLC (“LFH”). All three then applied to be medical providers for the Arizona Health Care Cost Containment System (AHCCCS), Arizona’s Medicaid agency- HFS applied in 2019, HFS II applied in 2020, and LFH applied in 2022. AHCCCS approved all three applications. At the time HFS and HFS II applied to AHCCCS, Moore failed to disclose her ownership interest in the other entity. Moore also failed to disclose her prior felony conviction, which was required to be disclosed on the AHCCCS application form.

Moore further admitted that she engaged in a fraudulent billing practice targeting AHCCCS and exploiting a program that enables Native Americans to seek behavioral health treatment without first obtaining a pre-payment review. Specifically, starting in January 2020, Moore began obtaining AHCCCS identification numbers for AHCCCS enrollees by paying other providers to transport AHCCCS enrollees to the HFS or HFS II facility for a single day, and then obtaining enrollees’ identification numbers once they arrived. Nearly all the AHCCCS enrollees billed for by Moore were members of the American Indian Health Plan. After these AHCCCS enrollees left the HFS or HFS II facility, Moore would submit bills to AHCCCS, which falsely claimed that HFS and HFS II continued providing services to those same enrollees for up to 90 days. Moore regularly claimed that HFS or HFS II provided counseling services to a given AHCCCS enrollee for eight or more hours each day, five days a week, for months in a row, even though Moore knew such services were not provided. In addition, Moore submitted claims to AHCCCS, which falsely claimed that HFS or HFS II provided services to certain AHCCCS Enrollees who were, in fact, deceased or imprisoned at the time Moore claimed to have provided services.

At the sentencing hearing, the Court noted the particular harm done to the Native American populations in Arizona as a result of this type of fraud.

“The American Indian Health Plan exists to help an underserved community surmount barriers to treatment,” said United States Attorney Gary Restaino. “Defendant misused this program, and the unique identification numbers generated by it, to benefit herself -- in some cases by billing for patients she never treated, and in other cases by falsely inflating the duration of treatment. Thanks to the Internal Revenue Service for its financial acumen in bringing defendant to justice, and to the AHCCCS Inspector General’s Office for its valuable assistance.”

“The sentencing of Diana Moore should be a reminder there are serious consequences to this type of criminal behavior,” said Carissa Messick, IRS CI Special Agent in Charge, Phoenix Field Office. “IRS CI methodically works to bring fraudsters to justice and restore confidence in our public programs.”

Internal Revenue Service Criminal Investigation conducted the investigation in this case. Assistant U.S. Attorney Aron Ketchel, District of Arizona, Phoenix, handled the prosecution.

CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.

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5 Effective Change Communications Strategies for Successful Transformation

  — August 26th, 2024

Do you mind if I kick this off with some of my favorite change quotes? OK, there are so many out there it’s hard to narrow them down, but how about these?

When you’re finished changing, you're finished —Benjamin Franklin

Change before you have to —Jack Welch

In life, change is inevitable. In business, change is vital —Warren G. Bennis

Few things are more important during a change event than communication from leaders who can paint a clear and confidence-inspiring vision of the future —Sarah Clayton

We'll get back to that last quote shortly but first:

What is Change Management Communication and Why is it Important?

David Grossman,founder and CEO of the Grossman Group defines change management communication simply as: “The process of building awareness and support for organizational change. It helps stakeholders understand what’s changing and why, and how it will affect them."

"It delivers timely information and materials, ensures stakeholders receive information about what’s important, and provides ways to share feedback and ask questions.Whether you are changing technology, business practices, leadership, or a combination of things, change management communication is essential to helping people move from where they are today to the desired “future state.”

Variations of Sarah Clayton’s quote about the critical role of crystal-clearcommunication in change projects have been expressed by organization transformation experts for decades.

The Change Opportunity: How IC Fuels Organizational Success

As far back as 1995, one of the world’s leading authorities on leadership and change, Harvard Professor John P. Kotter said one of the top errors of executives was “under communicating the (change) vision by a factor of 10.”

Today it’s more critical than ever before, with companies facing constant and rapid change along with the challenge of bringing very diverse and geographically dispersed workers with them on their change journey. Why is effective communication the lifeblood of successful change programs? It ensures everyone understands the "why," "what," and "how" of the change, reduces uncertainty, fosters buy-in, and aligns efforts across the organization.

Without it, confusion reigns, resistance grows, and the likelihood of failure skyrockets, making clear, consistent communication non-negotiable for change success.In a recent blog we highlighted growing employee resistance to change because of fatigue from constant change—and we r ecommended strategies on how to manage that resistance .

The scale of the challenge was outlined last year when Gartner reported : “the average employee experienced 10 planned enterprise changes in the past 12 months alone, and they are getting fatigued. Willingness to support organizational change collapsed from 74% of employees in 2016 to just 43% in 2022.”

According to Gartner: “As the pace of change continues to accelerate, managing employee commitment to organizational change is becoming more difficult. The figures are sobering: 73% of change-affected employees report experiencing moderate to high stress levels, and those suffering from change-related stress perform 5% worse than the average employee. Effective change communications can counter these trends and support business transformation.”

Given the multiple challenges organizations face when attempting successful change, as outlined here, it’s absolutely imperative that they have the best technology at their disposal to enable them reach, connect and engage with their various employee audiences and other stakeholders.

There’s no single silver bullet for workplace comms, given the diversified nature of most companies, so organizations need access to multiple channels to connect with all their people: email newsletters, digital signage, intranets etc, which is exactly what Poppulo provides for an A-list of the world’s most successful organizations. Ifyou’d like to find out more, get in touch with us here.

How Do You Develop a Change Communication Plan?

Sorry, but that’s a trick question—the comms plan should follow the ‘defining the change’ stage—but hang on, we’ll come back to it!

Internal communicators should always be involved in change projects at the very earliest stages of development, as Helen Cunningham, Head of Global Change and Communication at Amadeus, stresses in Getting Change Right During Constant Transformation .

But that’s not always the case. In fact, it’s not unusual for communication professionals to be told, “we’ve got to change this... and we’ve got to do it now....here’show we’re going to do it. So, we need a comms plan ASAP.” It shouldn’t happen like that, but it does.

The problem is that the communication plan doesn’t come first. Here’s the sequence to build the foundation for success:

• Define the Change: The first step in any change program must be to clearly define the goals, objectives, and scope of the change. This includes understanding the desired outcomes and the steps needed to achieve them—and, crucially, who’s going to be impacted.
• Develop Strategies: Once the change is defined, strategies can be developed to guide the implementation process and how it’s going to be communicated.
• Create a Communication Plan: Once the change plan has been clearly defined and the strategies for its implementation developed, now it’s time to create a communication plan to effectively convey the change to stakeholders, address concerns, and build support.The communication plan should align with the overall change strategy and ensure that all stakeholders are informed and engaged throughout the process.

That said, significant changes that inevitably impact employees should be made at the earliest possible opportunity or you risk creating fear and concern—and lessening your chances of getting buy-in and support from the very people you need to make the desired changes. Nobody likes hearing something that’s going to impact them at work second-hand.

As Michelle Haggerty-MacKay , Chief Operating Officer and U.S. President of the change management companyProscimemorably said: “ No one says they learned about a change goo early. But many people say they’ve learned about a change too late. ”

Getting Change Communications Right During Constant Transformation

5 communication strategies for different types of change programs.

It should go without saying that at any different time, widely different types of change initiatives will be ongoing or being planned—and each requires a different approach to communication strategy.

By tailoring communication plans to the specific type of change, organizations can ensure that messages are relevant, timely, and effective in driving employee engagement and support.

In general, the main change programs include:

• Incremental Change—process improvements, policy updates
• Strategic Change—mergers, acquisitions, new market entries
• Transformational Change—cultural shifts, organizational restructuring
• Reactive Change—responses to external pressures, crises
• Technological Change—new software implementations, digital transformations

Let’s take a closer look at these categories and how to tailor change comms for them.

Tailoring Change Communication Plans for Different Organizational Change Types

1. Incremental Change

Focus on clarity and simplicity: Provide concise and easily understandable information about the changes.

Utilize internal communication channels: Leverage multiple channels and tailor them for specific target audiences like company newsletters, digital signage, intranets, and team meetings for regular updates.

Encourage feedback and questions: Create open forums for employees to discuss their concerns and provide input.

2. Strategic Change

Highlight the vision and benefits: Clearly articulate the strategic rationale behind the change and the positive outcomes it will bring.

Combine top-down communication from leadership with targeted messaging to specific departments or teams.

Provide ongoing updates: Keep employees informed about the progress of the change and address any concerns or rumors.

3. Transformational Change

Involve employees early:Seek input and feedback from employees throughout the change process.

Create a shared vision:Develop a compelling narrative that inspires and motivates employees.

Provide support and training:Offer resources and training to help employees adapt to the new ways of working.

4. Reactive Change

Communicate quickly and accurately. Provide timely and accurate information to address immediate concerns and prevent misinformation.

Emphasize transparency and honesty. Be open and honest about the situation, even if it's challenging.

Offer support and resources. Provide employees with the necessary resources and support to cope with the change.

5. Technological Change

Highlight the benefits and value: Clearly articulate how the new technology will improve efficiency, productivity, or customer experience.

Provide training and support:Offer comprehensive training programs to help employees learn how to use the new technology effectively.

Address concerns about job security:Reassure employees that their jobs are safe and that the new technology will enhance their capabilities.

Next Step: Creating a Change Communication Plan

In many respects, how to creatine a change communications plan is similar to creating any other comms plan, but a large enterprise-wide change program will be more complex and involve multiple stakeholders. But the essential building blocks are:

1. Define the change: Clearly articulate the goals, objectives, and scope of the change.

2. Identify stakeholders: Determine who will be affected by the change, their potential reactions and the information needed to address these concerns quickly.

3. Set communication objectives: Establish specific goals, such as increasing awareness, addressing concerns, and building support.

4. Identify target audiences: Work with HR to identify specific workplace audiences, including potential influencers to act as change ambassadors, and potential change resistors. Here’s a useful guide on how IC and HR can collaborate to achieve change success.

5. Choose appropriate communication channels: Consider factors like audience preferences and the nature of the change. Never exclude frontline or hard-to-reach workers. With Poppulo, you can reach all your people wherever they are on their preferred comms channel. Remember, in a workplace with multiple generations, like we have today, audience comms preferences can vary greatly. Here’s a useful guide .

6. Develop key messages: Craft clear, concise, and compelling messages that align with the change objectives.

7. Create a timeline : Establish a schedule for delivering messages to ensure timely communication.

8. Identify potential challenges: Anticipate and plan for potential obstacles or resistance to change—and as we said earlier, try to identify influencers, both potentially positve and negative

9. Evaluate and adjust: Monitor the effectiveness of the communication plan and make adjustments as needed. Check out T he Ultimate Guide to Measuring Internal Communications.

Creating Employee Feedback Loops, Fostering Open Dialogue and Building Trust

A cornerstone of any successful change management initiative is the creation of feedback loops, a critical enabler for employees to have sense of ownership and involvement in the process, which is essential for success.

They allow for open dialogue, address concerns, and foster a culture of transparency and trust. As we said earlier, employee resistance to change is increasing and making successful change even more difficult than it always has been—and fear of change is one of the main causes of resistance.

According to the change management organization Prosci: “Fear is a significant cause of resistance among employees, especially fears about job loss and lower compensation. Uncertainty about their own future and the future of the organization arises due to past experience with failed changes.

So, addressing concerns is crucial in building a positive organizational climate, a climate where employees feel heard and valued—and who are therefore more likely to be engaged, productive, and supportive of change initiatives.

A culture of open dialogue and encouraging two-way communication—where employees feel as empowered to suggest ideas as well as feeling safe to express worries or concerns—is essential to successful transformation.

By actively seeking feedbac k, organizations can identify potential issues early on, address them proactively, and prevent them from escalating into larger problems.To encourage employee feedback, organizations should:

• Create a safe and supportive environment: establish clear channels for communication, ensuring confidentiality
• Demonstrate genuine commitment to listening, and respond to employee concerns. Even if you don’t have ready answers, commit to updates as soon as possible.

Conclusion:

It's almost impossible to overstate how critical highly effective, strategically diverse, and tactically adept workplace communication is to achieve successful change—at a time when change is relentlessly constant, causing increased employee resistance because of change fatigue. Smart, open and empathetic communication can go a long way to easing that sense of fatigue as well as smoothing concerns and dialing down resistance for changes that are necessary for both the company and employees to be successful.

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What We Know About Kamala Harris’s $5 Trillion Tax Plan So Far

The vice president supports the tax increases proposed by the Biden White House, according to her campaign.

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By Andrew Duehren

Reporting from Washington

In a campaign otherwise light on policy specifics, Vice President Kamala Harris this week quietly rolled out her most detailed, far-ranging proposal yet: nearly $5 trillion in tax increases over a decade.

That’s how much more revenue the federal government would raise if it adopted a number of tax increases that President Biden proposed in the spring . Ms. Harris’s campaign said this week that she supported those tax hikes, which were thoroughly laid out in the most recent federal budget plan prepared by the Biden administration.

No one making less than $400,000 a year would see their taxes go up under the plan. Instead, Ms. Harris is seeking to significantly raise taxes on the wealthiest Americans and large corporations. Congress has previously rejected many of these tax ideas, even when Democrats controlled both chambers.

While tax policy is right now a subplot in a turbulent presidential campaign, it will be a primary policy issue in Washington next year. The next president will have to work with Congress to address the tax cuts Donald J. Trump signed into law in 2017. Many of those tax cuts expire after 2025, meaning millions of Americans will see their taxes go up if lawmakers don’t reach a deal next year.

Here’s an overview of what we now know — and still don’t know — about the Democratic nominee’s views on taxes.

Higher taxes on corporations

The most recent White House budget includes several proposals that would raise taxes on large corporations . Chief among them is raising the corporate tax rate to 28 percent from 21 percent, a step that the Treasury Department estimated could bring in $1.3 trillion in revenue over the next 10 years.

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