Before Writing a Business Plan, Figure Out Why You Are Writing It

'Write a Business Plan' is a dreaded phrase by many entrepreneurs. It contains three words with awful implications:
1. 'write' means more work and time commitment. Things entrepreneurs really don't want more of.
2. 'business' for many entrepreneurs is something that is intimidating. They are great at what they do, but timid about business as many entrepreneurs have never taken a business course in their life.
3. 'plan' indicates that the entrepreneur should be able to understand what is coming down the line. How quickly these plans change!

There is no correct business plan for every situation, and the commonly sought after 50-page business plan is not always the right answer. You need a plan for many different reasons, below are just a few;

- Guide yourself. Having a plan will help you get where you want to go. But do you need a 50-page plan for this? Probably not, as you want to be able to change it as your idea evolves.
- Entice employees to work for you. As a new business you have to sell the concept, yourself, and the future for employees to work for you with profit sharing, without benefits, or at all. A 50-page business plan definitely doesn't work here.
- Have suppliers have confidence in working with you. A solid business plan can give you more negotiating leverage and help them understand your business so that they can help you. But a 50-page business plan wouldn't work here.
- Get customers intrigued. This makes them willing to help in testing and makes them want to be the first person to have your new innovation. But a 50-page business plan wouldn't work here.
- Finally financing. The banks, venture capitalists, angels, and government grants all require different business plans. A 50-page business plan doesn't even work here. In fact, each bank and government grants has its own template that they like entrepreneurs to follow.

That is why I suggest that you figure out why you are writing it prior to putting your pen to paper (or fingers to keyboard).

So what should you be doing in each case listed above? The next blog will explain.