It seems obvious: companies that take the time to understand their position in the market, set goals and objectives, and review these goals on a regular basis are more profitable.
Yet, shockingly, our research found that around one third of all small and medium-sized businesses in the UK do not have a business plan. In certain sectors this rose to around 50 per cent of all small businesses.
It’s clear that many small firms are choosing not to prioritise business plans, in favour of more immediate concerns like winning new customers and keeping old ones happy. Indeed, one of the most common reasons offered for not having a business plan was that they “didn’t have the time”. Perhaps more worryingly the research suggested that many small businesses don’t know how to put a plan together at all. Some reported that they “didn’t have anyone to help”, while others “weren’t comfortable with the numbers”.
However, it is important to get the ball rolling. Here are five top tips for writing a strong business plan.
1. Set goals
At the beginning, it’s important to understand what you want to achieve with your business. It might be a percentage growth target, a diversified client base, a profitable exit or you may simply want to earn enough to fund your current lifestyle.
Understanding and defining your goals helps to bring focus to the business and allows you to measure performance at the end of a defined period.
2. Understand how you will achieve these goals
Once you’ve defined your goals, you need to outline how exactly you will get there. Do you need to invest in technology? Hire more staff? Do you need to change offices to reduce your overheads?
Think carefully about how you intend to achieve these goals then put it down in the plan.
3. Look for opportunities
Any good business plan will show an understanding of the company’s home market place and identify opportunities and threats as a result.
This will help you to better determine how you position your company and its offering compared to competitors and in line with current market, economic and social trends.
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