Why does one enter into a new business? The primary answer to such a question is the desire to increase ones earnings and savings. Starting a new business basically requires a lot more from the entrepreneur than just time, effort and money. It requires a huge commitment.
It is a commitment to persevere despite all the difficulties you may encounter through your journey. Statistics show that once a new business has survived the first five years or adjustment years, it will start to grow and produce profits. Statistics also show that 80% of small businesses do not make it through the 1st year. Of those that were left, 90% would close down during the adjustment years. This is why a strong commitment is required to when starting a new business.
In all life’s endeavors, the success rate is higher if there is a plan. For a business to succeed careful planning is required. A concrete and well detailed business plan must be made. The old saying goes “if you fail to plan you have planned to failed”which is very true in business. Creating a business plan may be time consuming and at times redundant. But remember as you sweat through all the paper work that this is a necessary step, a step that may cause the failure of the entire business if not done. Also bear in mind that going through this entire process makes you prepared for most, if not all, circumstances that may arise.
A new business plan must first state the vision, mission and goals of the company. This enables all the members and staff to focus on what the business stands for. It actually serves a similar function as the Constitution. That’s how important this stage is with planning a business. The foundation and the direction of the business will be determined through this process. Target markets, sales forecasts, products, strategies and even future expansions can be written in this plan so whatever your business is, careful planning is essential.
As you plan, you concurrently research competitors and the industry. This will enable you to learn the needs or special factors that must be considered in the business. There are organizations and even private companies that offer help not only in planning but also in the purchase or negotiations for product lines, distribution systems and networking with people in the same business. Some even offer free business plan help. Take advantage of all these organizations such as SCORE to help you create your business plan.
When opening a new business, an entrepreneur should be ready to commit their finances, time and efforts to make the business thrive and survive. To ensure any level of success, a well detailed business plan is needed to guide you through this new journey.
21Mar