Why is this important?

Every business should have an up-to-date plan to use as the road map to drive the business forward. The business plan is your business’ most important document through which you can stay on track and keep focused on its objectives.  This should be a working document, reviewed and updated regularly.

A thorough, well-constructed business plan defines the direction you want your business to take and provides documentation of the path and all the side tracks.  It is a record of the obstacles, challenges and new opportunities you will encounter and a measure of growth and performance. It provides the appropriate documentation when you need to seek financial assistance or when you are looking for an investment partner.

What to do

Formal structure

A business plan is the formal structure upon which to build your business.  It enables you to:

• define short and long term objectives
• appraise the present and future of your business
• document each stage of your business’s growth
• make periodic assessments of each area of your business
• make a smooth transition at each stage of growth
• attract customers, financial assistance and shareholder’s support

Your own business plan

Just as all businesses are different, no two business plans are the same.  Your plan must be:

• tailored to your individual business
• articulated clearly
• able to communicate the essential characteristics of your business so that interested parties can see why it is likely to be successful
• able to provide a framework to monitor and measure the actual performance of your business and to be used as a guide to enable you to make sound business decisions

Write it down!

Many business owners carry their business plans around in their heads without writing a formal document.  This often leads to confusion and lack of focus in the business.  Even spending a few hours writing down your thoughts and goals for the next 12 months can clarify your thoughts.  To really grow your business, you must develop a plan covering 3-7 years.

Clearly articulated business plans also provide a yardstick by which you can:

• measure performance
• demonstrate that your business knows where it is heading
• utilise as the starting point for developing individual departments or divisional plans
• demonstrate what staff actually do in relation to your overall business strategy
• utilise as a structure for offering incentives to your staff

Need money?

Probably the most common use for a business plan is when you are seeking an investor in your business, whether that is a private investor, or a lending institution.

An investor or a lending institution will typically look for the following three characteristics in a business it is considering investing in:

Commitment

Discussing an investment opportunity in person usually brings out much more of the passion and excitement that is driving the business forward.  Without going over the top, your business plan needs to convey this commitment.  You should use simple graphics, diagrams and charts to convey information and concepts.  Try not to use too many photographs, as they can make downloading from the internet very slow.

A compelling case

You need to quickly build a compelling case.  Professional investors know that business plans rarely improve as one reads on.  If they are not at least interested after page one, they are unlikely to proceed.  Start your plan so that the reader gets very interested on page one, and gets more and more interested as the plan progresses.  A key objective of each page is to get the reader to turn the page. Good structure will help to achieve this.

A sound plan

Your business plan should identify three important things:

• Why this opportunity should not be missed
• How it will make money
• What your business’ sustainable competitive advantages are.

You should, within the first page, show why the reader shouldn’t miss this opportunity. To do this, you must quickly show how it will make money within a realistic period of time.  The investor wants to know how he or she is going to make a lot of money, as well as other investors - including you!

Think of the business plan as a sales proposal - not for your product, for part of your business. 

The following How to Docs will allow you to create a completed business plan for your business:

• How to prepare for your business plan
• How to write your business plan
• How to review your business plan

Where to go for help

Do it yourself

Online Business Directory

NSW Business Chamber Online Business Directory connects you to thousands of businesses across NSW. With exclusive access to special offers and great deals, you will find a service provider, business partner or supplier who can meet your needs. Listing on the Online Business Directory  is open exclusively to NSW Business Chamber members.

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