Should I Create A Business Plan? Every Business Idea Needs A Stratergy!

A business plan is essential if you want anyone from your bank manager to an investor to take you seriously, and it means you have a blueprint to follow so you can see which areas you need to deal with, and in what order.

You should use this as a means of identifying how your progress is being made, and whether your expectations lived up to reality.

But it is daunting, so it could be worth getting in touch with your local high street bank to get some sample business plans you can use to put your own together, and the Federation of Small Businesses can also help.

To generate outside funding the plan will need to be detailed and contain elements that are accountable, such as how much each investor can expect to generate in revenue over a three to five-year investment period, and how that return will be generated.

But it is unlikely to all go smoothly, so you should get some contingency funds together - around 10-20 per cent of what you want to raise - to get you through the difficult times. If you need initial funding, your plan will need to inspire enough confidence in your bank to get any money released to you.

The following considerations should be set out clearly and concisely in any good business plan:

What you are offering: Define exactly what your product or service is. 

Why it will work: You will need to back this up with some market research, but here is where you can outline what the opportunity is and whether there is a gap in the market for it. Are the current products and services on the market inadequate or lagging behind? The more you find out, the more robust your business plan will be. 

How you are going to fund it: Businesses cost before they earn and usually more than you anticipated. Of the 500,000 small businesses that start up every year, 300,000 fail as a result of finances, according to the Federation of Small Business. This part of your plan should include how you will fund the start up and running costs, what your targets are and how will you pay yourself and relevant staff. 

What you intend to achieve: Write down your business aims, whether that is a financial target or a different goal within the industry you have chosen. Try to be as precise as you can about these. 'To take over the world' is not going to convince the bank to lend you any money. 

Who will be running your business: It could be you alone running your business, but whether it is just you or others as well, make sure you put in relevant qualifications and experience - few people will be interested in your life saving qualifications, unless you plan on being a lifeguard.

How people will know about your business: There is no point in having you business if no-one knows about it, so sales and marketing is key. You will need to fund this, and it is not cheap, so think realistically about how much you will need to do this effectively.