Why is business planning important?

The first key to success in business is planning and defining the short- and long-term goals for your business. With a plan in place, it’s your reference point to see how you’re tracking, what stage you’re at and how far you’ve got to go. It allows you to assess why you may have run into pitfalls along the way. A good plan will help you to think analytically about your business and see what works well and what doesn’t.

Sit down and work out what you want to achieve, what you need to achieve and how you are going to achieve it. Think about the strengths, weaknesses, opportunities and threats to your business.

Think about the past year and what you might have done differently in terms of budgeting and cashflow. Review your previous plans – what did you achieve and what didn’t you achieve? How can you ensure you make it happen this time around?

If you don’t know where to start or if your views differ from those working in the business with you, ask someone who isn’t emotionally involved in the business to act as facilitator.

The beauty of a plan is that it is not set in stone. By regularly monitoring your plan you can make adjustments to ensure you stay on track to meet your end goal. Or that maybe you need to move the goal posts.

Whether the business plan is a lengthy, formal document, or a short, informal one, it is a tool for you as a business owner to clarify your goals and monitor your progress.

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