Innovative and defying business traditions are must to set up a startup company. But when asked many startup company founders about their business plans, you will be surprised to know that there are 8 out of 10 who responded that they did not make a business plan.
It is striking to me still that how many people are actually aware of the business plans. Apart from this, there is a myth that preparing a business plan defeats the goal of agility in business. Keeping this apart, here, we discuss why we need to take out our drawing board to build a business plan.
1) Formalize your business road map
A well-planned business sketch is a road map detailing about many things like an assessment of what you need, financial indicators, how much you will get paid and how much you will attract your customers. This assessment is no doubt a tedious one and takes more time. But building a plan pays you well in the long run. Business plans are rather inherently strategic.
Don’t confuse your business plan with a doctoral thesis or a lifetime task.
The plan should always be straight forward and yes, short and precise.
2) Analyze your market and industry
The main reason why a startup fails is because a lot of startup founders are driven by their ideas and passion but don’t have a strategic mindset. Understanding the market and the industry is important if you want to play here.
Analysis of market and the industry is a time-consuming process in planning a new startup.
The time spent on this might be significant. Spend some time on researching and learning the opponents.
3) Determine your objectives
Just close your eyes and imagine the date as five years from now. Where do you stand after five years? Are you commanding a rapidly growing empire or are you running a business that is stagnant without making any profits? It is merely important to know where you stand to plan your business.
Write a personal essay on your business goals. Even if you don’t learn anything new, by determining your objectives you tend to get a firm handle on your goals and objectives.
4) Business structures
Many young entrepreneurs feel that being incorporated is the right way to move forward. While others go with the partnership strategies without understanding the risks involved in it.
Your business structure should suit your business models and objectives. Seek advice if you are new to this field because at the end of the day you are not going to repeat this in a short period of time.
At last, we can draw a conclusion that business is founded on in such a way that the purpose would be finding money. So, plan well before you set up a startup.