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SpinDistribute.com Article Directory

The following article was published in our article directory on February 13, 2012.
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Business Planning and why it is so Important

Article Category: Business

Author Name: Bob James

The most important factor in starting a small business is the business plan behind it. A plan removes the subjectivity in a project and helps to identify the areas needing attention, as well as defining your business goals and objectives. Just like the old saying: those who fail to plan—plan to fail. Business planning helps you to define the road map your business must take during the months and years ahead—and though you might not end up where you expect, a good plan helps map out the journey and highlights when you're offtarget.

Another part of business planning includes creating and defining a budget for the businesses' financial needs up to at least the next two years of operations. This is where you identify costs, plan for tax payments, licenses or other charges and set aside funds for future needs. A good business plan includes a marketing plan as an intrinsic part of the overall business plan.

To complete your plan you will need to, identify the current situation, define the competition, business opportunities, the strengths and weaknesses, its goals and objectives and finally set out your strategy and tactics—the means by which you can reach your goals and objectives.

When you create your business plan, ensure you set specific quantifiable goals. For instance, if you want to increase revenue or reach a particular financial target, use a specific number—don't be vague in your statements. Those preset goals help you to envisage what you want to achieve with your business and making them measureable establishes benchmarks.

Another approach to setting your business plan is to perform a SWOT analysis for your business. The term 'SWOT' stands for strengths, weaknesses, opportunities and threats. When you define the business strengths, consider the strong points of the business and the advantage it has over your competition. Thinking about the weaknesses or limitations of the business helps you to understand those aspects that places it at a disadvantage relative to the competition. Opportunities are the external chances or openings the business has in the current environment and threats represent the external elements that represent the problems the business faces.

Any worthwhile plan addresses all these issues objectively and attempts to downplay weaknesses in the business while improving or enhancing its strengths. Establishing the vision for the business along with a mission statement helps to finalize how the business is perceived by people both inside and outside the business. Develop a mission statement that encapsulates the business goals and purpose of the venture.

Part of the plan should involve identifying your customer and your target market. When you understand the dynamics of your market, it helps you to tailor your advertising and promotional efforts towards that market. While some may consider a broadbased advertising approach, once you establish a picture of who your customer is, you will have the key to your target customer and attract them to your business.

Keywords: business planning, small business

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