5 Reasons Why You Need To Write A Business Plan (And Use It)

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Named as one of The Independent’s 20 Extraordinary Women of 2017, Ali Golds is a growth coach, speaker, and author who helps women to achieve their best - both personally and through their business. She has worked with start-ups through to multi-million-pound companies, as well as advised awarding bodies and other leading education based organisations on enterprise and entrepreneurship; culminating in being appointed lead adviser on a UK government review of entrepreneurship education, 'Enterprise For All', in 2014. 

Ali specialises in coaching female founders, particularly single mums and women who’ve experienced domestic abuse, and is passionate about empowering them to achieve economic independence. www.aligolds.com

Below are Ali’s 5 Reasons Why You Need To Write A Business Plan (And Use It)

When I started my first business in 2000, one of the things I knew I had to do was to write a business plan. It’s number one on the official checklist of Things to Do When You Start Your Own Business.

I spent a week or two hunched over my computer, researching potential customer groups and competitors, and pulling together all manner of financial information, before assembling it all in a folder, bought especially for the job; and then filing it away on the shelf above my desk and never referring to it again.

My suspicion is that I’m not alone, and that’s assuming the business owner has written a plan in the first place (I’ve met a number who haven’t). I’m the first to admit that it isn’t the most fun of tasks but it’s necessary, and extremely helpful. After all, you wouldn’t go on a long journey without a map, or into the dark without a torch – so why would you start your own business without writing a plan?

Need convincing?

1.      A business plan brings clarity

One of the things that I find useful about writing a plan is that it helps me to think through what I’m doing through the coming year, and where I’m taking my business. It also helps with anticipating potential challenges along the way (and there’s always a few of those).

2.      It’s useful for banks and investors

When you start your business, or want to borrow money, you’ll be asked to show a copy of your plan to the bank manager. It shows them a level of commitment, and also enables them to talk through your idea and perhaps offer some advice (always helpful). For those growing their business, investors will require an in-depth business plan to assess whether they’d be prepared to invest.

3.      It can highlight areas for development

I’ve had some of my best business ideas whilst I’ve been writing next years plans. The process of unpicking what went right this year, and what went wrong, and then using that incredibly valuable information to plot where I want to take my business over the coming year, really aids my creative thinking.

4.      It helps you to be more organised

Knowing that I need to achieve even bigger targets and goals over the next 12 months means that I move into hyper organised Ali mode. I consider the skills and attributes that I’ll require for any new employees, the operational arrangements for my team, my marketing and sales strategies, and the financial requirements that underpin it all. Knowing that I need this information in place ahead of time means that not only can I make informed decisions at a more leisurely pace, but I’m also less stressed about it (and running your own business is stressful enough without adding to it).

5.      It brings great satisfaction

Sometimes there doesn’t need to be a reason for doing something beyond the fact that it just makes you feel better. This is one of those moments. We often forget the enormity of what we’re doing when we start and run our own business, we just take it in our stride and do what needs to be done, missing the incredible achievements and moments of glory that just become part of everyday business life. Writing a plan forces us to reflect on the year that’s ending, and in doing so we can see exactly what we’ve achieved. Take some time to celebrate your achievements, pat yourself on the back for a job well done, and use all that experience and knowledge to plan and build an even more successful business in the year to come.