business planning meeting

The importance of a business plan

Business plans – they may sound intimidating and fairly time consuming, especially if you are rushed off your feet with running your company, but they can in fact be extremely beneficial in creating and achieving goals, expanding your business and improving team morale.

Think of your business plan as a road map. Although its possible that you may reach that end destination eventually, its likely you may have to stop and ask for help along the way, possibly even circling back unintentionally. With a concise roadmap, you can reach that final destination directly. Now thing of that end destination as your goal. Whether that be monthly, quarterly or annually, your business plan can take you there.

With multiple benefits for businesses in all sectors, we have collected a list of the three greatest benefits.

  1. Avoid the mistakes
    Statistics show that only roughly 50% of businesses make it to their 5th anniversary, and this could be partly down to mistakes made along the way with failure to rectify.  From cashflow to employee errors, mistakes can appear in any factor of business, especially without the clear guidance of a business plan. With accurate forecasts and calculated projections, you will be able to identify those factors which miss the mark of their predicted targets, allowing you to take the time to rectify mistakes before they become a larger issue.
  2. Increase your viability
    Whilst many businesses are started out of adoration and passion, there will need to be a drive of knowledge behind you to prove to potential customers that your company is worth investing their time in. Creating a business plan that reaches the end goal of a knowledgeable business will allow you to not only expand your clientele, but create a wealth of knowledge amongst your staff, allowing everyone to understand their role within the company.
    One factor to implement into your business plan to increase the viability of your own company is the monitoring of competitors, otherwise known as market research. Take the time to observe how other businesses within your sector engage with their customers, utilise their knowledge and sell their services. Not only may it enlighten you to new ways of operating your business, but could also warn you of the steps to avoid.
  3. Reach your goals
    Setting unachievable goals with an ‘ultimate target’ far in the future may not be as effective as it may seem. In fact, it could eventually have the reverse effect and lead to a lack of motivation within the workplace. To allow the staff to feel productive and high-achieving, why not create a series of smaller, more achievable goals on a regular basis, maybe monthly or quarterly. Checking in on these targets regularly, updating them once achieved and witnessing the improvements made over time can allow you employees to thrive off of motivation and pride, allowing your business to expand whilst staff morale remains high.

Our team at Hammonds Chartered Accountants are specialists in aiding and supporting business owners with running successful companies with achievable and effective goals. For help with your business plan, or to find out how you could write yours, get in touch with our team. Give us a call on 0203 007 4990 today.