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Five Reasons You Need a Business Plan

Hamish Pryde • January 27, 2013

Writing a business plan  does not mean you have to hide away in a quiet place for weeks compiling a 20-plus page document. Chances are you will never look at the document again either because it is too big. It will have pride of place in the bottom drawer of your desk. 

A business plan on a page is what is required. A business plan on a page as developed and used here at Coombe Smith contains all you need. Vision, values, objectives, KPI's targets and 4 - 5 goals with strategies on how to get there. The plan can be for 3 months or 3 years. The business plan on a page can have pride of place laminated on your desk or wall where you can refer to each day.

You need to plan to get somewhere and a business plan is the blueprint for success. You will want to plan in more detail if you are raising capital, finance or taking on a lot of risk-like investing your savings, leaving a job, or supporting a family. Less detail is fine if you are not raising money or taking on much risk. Nevertheless, either way, you need a plan, and here is why:

1. To avoid big mistakes: The last thing you want to do is work on your start-up for a year, only to realise you were doomed to fail from the start. Many founders learn the hard way that they did not set aside enough capital to reach their goals, took on partners with the wrong skills and resources, or do not have a viable way to make money. Developing and sharing a business plan can help ensure that you are sprinting down the right path.

2. To counterbalance your emotions: At times during your start-up experience, you will be manic-so passionate about your ideas you lose sight of reality. At other times, you will be overwhelmed by doubt, fear, or exhaustion. When your emotions get the best of you, having a business plan lets you step back, and take an objective look at what you are doing and why, what you know for a fact and what you are trying to figure out.

3. To make sure everyone's on the same page: Chances are, you are not building a company by yourself. Ideally, you will have partners, so you can launch faster, smarter, and with less need to pay employees or suppliers. Even if you do not have partners, you will have family, friends, and advisers involved. A business plan helps get everyone involved in your start-up heading in the same direction.

4. To develop a game plan: At a start-up, execution is everything. That means you have to set priorities, establish goals, and measure performance.  You also need to identify the key questions to answer, like "What features do customers really want?" "Will customers buy our product and how much will they pay?," and "How can we attract customers in a way that's cost effective and scalable?"  These are all things you will address during the business planning process.

5. To raise capital.  If you raise or borrow money-even from friends and family-you will need to communicate your vision in a clear, compelling way. A good business plan will help you do just that.

By Hamish Pryde September 11, 2024
Paper is everywhere. We spend a lot of time and money moving paperwork around. But with today’s technology it is now possible to get rid of paper entirely. Digital documents are simpler, easier to store and send, more searchable and permanent. How long does it take to post a document to somebody via the ole stamp and envelope method, that is snail mail? It is more efficient and timelier to email the document. How many times do you go to print a document at home and find that your printer has run out of ink? Why do we still hold onto printing paper documents? Sometimes it’s just because that’s what we’ve always done and let’s face it change can be difficult at first. Paper alone is cheap. But when you start paying for printers, toner, servicing and maintenance, paper starts to look more expensive. Let alone the storage cost. Paper tax records for seven years can be quite a few boxes of paper. We have embraced some paperless technology as part of a modern business practice. This includes digital signatures, digital collaboration, paperless minutes of business improvement and coaching meetings, electronic work papers and my new digital notebook which I am enjoying. We send questionnaires via email to you to gather vital information to enable us to prepare your annual financial statements. This is a PDF document. Instead of printing the questionnaires you could save the document down into a folder of your choice then edit the PDF document and return to us. How do you edit a PDF document you ask? Once you have opened the document the Adobe online editor lets you do some things for free. The online editor works in any web browser and lets you add text, sticky notes and highlights. Click on the fill & sign button to the right of the document, then in the top toolbar click Iab text button. You can add text directly on the PDF document. Have a try next time you have a PDF document open. Xero and Farm Focus users can attach invoices directly to the transaction loaded into Xero. Then if you are looking at the rates expense in the profit and loss account or farm working account, you can drill down into the rates code and see the transactions. Then attached to each transaction is the rates invoice if you use this great functionality. All invoices can now be stored in the cloud. So why paperless? Productivity - electronic documents are instantly and simultaneously available to everyone who needs them. Reduce waiting times with less risk of loss or damage. Cost savings - you will save money on printing, postage and associated costs. You could pay less rent because you won’t need all that space for your files. Security - electronic documents are more secure than printed ones. Digital records can be password protected and rendered unreadable through encryption. Printed documents are only as secure as their proximity to a copy machine. Reduced Clutter - paperwork on desks and shelves are not only untidy it’s inefficient too. The organisation of digital files is simpler and your office will look much neater. That will help you clear your mind to focus on your business. Environmentally friendly - less printing means fewer trees cut down for pulp and less energy used to make and transport paper. Disaster recovery - if there is a fire or flood, recovery from the backup is much easier with digital storage them with paper. There are great help articles available in Xero or Farm Focus if you are not attaching invoices to payments already. To find out how click on the links below: If you would like to explore ways you can go paperless we can help.
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