Has anyone ever told you to, “Look before you leap?” If you’re thinking about leaping into a new small business, look before you leap means, create a plan.
Many businesses fail in four years and most fail in ten. There are many reasons why they fail, but the root cause is that they don’t have a good (or any) written plan.
Too often, small business owners think a plan is for getting a loan or an investor. They download a typical business plan template from the internet and fill it out. This is not the purpose of planning and isn’t what lenders are looking for. They want to see that you have thought through your business strategy and have a good implementation approach.
Also, many businesses think they build the plan once and leave it alone after that. A plan should be a living document, annually updated, and quarterly reviewed to ensure you’re on track.
New businesses should create a “Strategic Business Plan.” This contains the typical business plan items a lender looks for, but also overcomes the five reasons 70% of all plans fail. These plans are accompanied by a current “Annual Operational Implementation Plan,” which outlines steps for the year to make the business successful.
Have you looked before you leaped?