Do I Really Need a Business Plan? It may not be necessary. Despite the prevailingwisdom, I simply do not believe that business plans do much to helpstartup entrepreneurs. In my experience, they merely serve as a way toshow outsiders that you’re serious about your company. Otherwise, theyhave very little benefit. However consultants and financial advisors love to tell their clients that they should have business plans.
A formal business plan is really only important if you’re looking for money. A bank loan. An outside investor. A partnership. A joint venture. When those situations arise, it’s almost always necessary to have a plan in writing. The plan should be pretty detailed too, depending on who the reader will be. It should look out over five years and include goals, risk factors, use of proceeds, prior and projected financial statements with management’s discussion and analysis underlying previous results and assumptions made about the future.
I’m not saying that business plan is not important, but when you are starting a home business its not really necessary to write down a business plan, It’s time consuming and just a waste of time and effort to build the proper plan. Unless you need outside financing, don’t go for a plan, go ahead to sell your service and grab your money.
What is true is that a business plan should not take on a life of its own. But it always better to have an plan to boosting productivity, achieving your business goals.
You really don’t need to put together a huge business plan to get started anymore. You can just go out and DO IT.
Who Does Need a Formal Business Plan Then?
If you’ll need outside funding in order to start your home business, you should expect to prepare a small business plan. Especially if you’re planning to secure funding through a US Small Business Administration (SBA) approved lender, but really for any commercial lender and even for many who are seeking venture capital or angel investor funding. But in that case, the most important thing is that you know what you’re talking about and that you’ve thought through your business idea carefully and have at least some reliable data to support the likelihood that you could be successful.
There’s nothing stopping you from preparing a business plan later on – after you’ve learned from some of your mistakes, you have a better feel for the viability of your market and the potential for income and the resources you’ll need to continue to succeed. In fact, you may find it useful to set up the outline for your business plan and fill in the details as they become apparent to you. In the meantime, try to make some money and learn what it will take to make your business a success.
During my first startup, I didn’t had any business plan or marketing plan, approximately eight years ago, I have started my garments and boutique business, needless to say I’m succeed in that business and later on, when I needed to finance of that business I had to have a business plan to show it to that bank for getting the bank loans.
The only reliable test is a real one. Market research techniques for trying to predict the market’s response to a new venture can be costly and are often unreliable. Testing for real is the assumption behind approaches such as Lean Startup. It is also what explorers do — they go and look, instead of trying to predict from a distance what they will find. Look for new opportunities. Many useful opportunities are either created by what you do early, or are only revealed once you have started and can see out there. So keep your eyes open and respond to new customers, markets and partnerships. You will also find that looking hard helps eliminate opportunities that are not right for you.
Rather than spending years planning out the blog and never actually doing it, why don’t you write a blog post and see if you like it? See if it resonates with your potential audience.
In essence, building a complete and credible plan is the final test of whether your venture has legs. The entrepreneur lifestyle is all about doing something you enjoy without undue stress, uncertainty and risk. Are you having fun in your venture yet?