Business Plan Overview

Most people start a business because they want to be their own boss, or they think they can make more money doing what they do well for themselves.  They do not get into business to become bookkeepers or business managers.  However, to operate a successful business, compliance is required by many different governmental agencies, and keeping control of the financial aspect of the business is quite important. Creating a plan to know where the business is going is one of the many tasks that are often put off until the business owner is not so busy, or the project itself is viewed as optional.

A business plan does not need to be long or complicated.  It can be as simple as a list of goals for the next year with some tangible ways to get there.

The business plan should not be a project that is completed and set aside.  It should be a working document that is reviewed and revised regularly.  Once it is "started" be sure to put a date and time on your calendar to review and revise it.

Two illustrations on why a business plan is important deal with driving a car:

1. If you were starting out on a long trip that you have never taken before, would you just jump in the car and start driving?  Probably not: At a minimum you would probably get a map, just in case.  Or, you may even look at the map; plan your route; figure out how long it will take to get there; where you might stop; etc.  The same is true with a business: You can try to read the signs along the way, but often they don't tell the whole story, you need the map to make sure you get to the destination in the most efficient way.
2. How effective of a driver would you be if you only ever looked in the rear view mirror and never considered what was happening in front of you?  The same is true with a business.  While it is important to look at what happened in the past, it is potentially more important to plan for what is ahead. 

More information on this topic

Managing Cash Flow