Why write a business plan?
“If you fail to plan, you are planning to fail.” Ben Franklin
The second thought that comes to mind when preparing a business plan for me is SWOT analysis. Strengths, weaknesses, opportunities, and threats. Proper planning prevents problems.
Another important aspect is a financial plan that demonstrates positive cash flow at a certain point in the operation. Having enough cash reserved until you get money flowing in a positive direction will get you to the next level in your business.
It is extremely rare for you to be profitable on day one. Tesla, for example, reported its first profit this past year after 18 years in business. Tesla sells stock to make cash flow positive. They have a plan. It helps them to raise capital.
Having a plan and sticking to it takes the emotion out of your decision making and helps guide sound choices by staying the course. Uncertainty regarding money can create emotional duress and is a quick recipe for making poor decisions. You will analyze pitfalls that could have catastrophic consequences and how to steer clear. A plan gives you confidence provided proper contingency preparation.
When you commit a plan to paper. You can better visualize goals and milestones. Hitting these goals, tells you that you are on a path to success!