You might be asking yourself, “Do I need a business plan?” They can be time-consuming and tedious to put together, and you’d probably rather be running your business than writing about how it works and creating financial projections.
Why You Need a Business Plan
A business plan is almost always necessary to obtain financing, whether you are operating a new business or an existing one and whether you’re seeking a bank loan or venture capital. (For more on winning over potential investors, read When Your Business Needs Money: Angel Investors.)
Why do lenders and investors want to see a business plan? Try to see the situation from their perspective: If you were going to give someone $100,000 or more with the hope of not only getting that money back but seeing a return on your investment, wouldn’t you want to know exactly how your money would be used, who would be in charge of it, what makes them qualified to succeed in the business you’re funding, and what the business’s assets, liabilities, cash flow and profits look like? Of course you would. Your business plan must demonstrate your company’s financial stability, growth potential and uniqueness. It must demonstrate your team’s expertise about your company and its industry and your clarity about your goals and the path to those goals. (To find out how your business can get the money it needs even when the bank says no, see 7 Unconventional Ways Businesses Can Borrow Money.)
Getting Help with Your Business Plan
If you don’t have the time, the desire or the expertise to write the plan yourself, there are several sources you can turn to for help.
-Free business plan software. Bplans.com has more than 500 sample business plans for businesses ranging from bakeries to medical billing companies to insurance agencies and self-storage facilities. You can find a plan for a business similar to yours and rewrite it to be specific to your business. You’ll learn what information to include and how to present it. If you follow a template, make sure to only include information that makes sense for your line of business, and examine several sample plans to make sure you aren’t leaving out any key categories of information.
-Paid business plan software. LivePlan will guide you step-by-step through the process of writing your business plan with written instructions, prompts, examples and video tutorials. It will automatically create error-free financial projections based on your inputs and compare your numbers to those of similar businesses. It will also generate charts and graphs to add visual interest to your plan. The result will be a professional looking document suitable for lenders and investors.
-Professional business plan writers. LivePlan also lets you hire an MBA to write an investor-ready business plan in as few as seven days. You’ll still have to do some work, since the writer can’t create a plan without information about the business and its finances that you’ll need to provide. But they will save you time on writing and bring to the process their expertise from the other plans they’ve written.
-Business plan coaches or consultants. These professionals share their expertise and experience and help you put together a professional plan, but they leave the plan writing to you. Writing the plan yourself can be a benefit in that you’re more likely to be thoroughly familiar with it and able to discuss it intelligently in conversations with lenders and investors.
Now that you know why you need a business plan and how to get help creating one if you don’t have the time or the skill to do it alone, let’s discuss the plan’s first section: the executive summary.
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