Business plans get a bad rap for being stodgy, outdated, lengthy documents that no one reads. Business plans don't have to be jargon-filled, endless tomes, though. They're meant to be useful guides toward success. And that's why every business owner, even the smallest of eCommerce solopreneurs, should consider writing one.
Here are three reasons why:
1. To imagine what success looks like
What's the best-case scenario for your business, and how will you get there? A business plan outlines the problem you're solving, the key solution you're proposing, what makes your business unique, the customers you're serving, what channels you expect to utilize, costs, revenue, and how you'll measure success.
I don't know any entrepreneur who had all of those questions settled without having first recorded her opening thoughts in some form or fashion. It just so happens that's exactly what a business plan entails. Your business plan doesn't have to be 30 pages long with charts and graphs. It can be recorded on one sheet of paper and composed mostly of bullet points.
Most businesses deviate from their original business plan — in fact, 66% of startups drastically change their original plans, according to business author Ash Maurya. So, don't worry about perfection. Just get your ideas on the page.
2. To predict and prevent pitfalls
Now that you've recorded your plan, what will you do if that best-case doesn't work? Make it a point to record your current understanding of your strategy and shop it around to get advice from mentors and colleagues. They'll help you point out potential pitfalls and course-correct before or as you get started. Having a written business plan enables you to start from something and tweak the model, piece by piece.
Let's say you make custom cushions and you have an eCommerce website. You've determined your key customers are female homeowners who love decorating — you've had great luck at local craft shows, but something isn't quite working online. Maybe it's your pricing? Or your website's discoverability? Maybe you haven't fully exhausted the right channels online — what social sites or digital publications do your key customers read? Have you adequately conveyed your unique advantage, what makes your covers special? A business plan let's you target specific areas and 'tweak and test' until you get it right. It's an iterative process.
3. To convince yourself to get started
It's incredible what the exercise of putting a plan to paper can do. A business plan allows you to prove to yourself that your business is possible. So, what are you waiting for? What's holding you back? Let your business plan be the conduit for action — it's time to fly.
Depending on how much time you're willing to put into crafting your business plan, there are two resources that entrepreneurs of all stripes have used to much success: The Lean Business Model canvas, and MIT entrepreneurship professor Bill Aulet's book "Disciplined Entrepreneurship: 24 Steps to a Successful Startup."
If you have an hour to spare, start with the Lean Business Model canvas, created by Ash Maurya, author of Running Lean and Scaling Lean. Watch this 23-minute video by Maurya about how to capture your business model using the canvas in 20 minutes and use this Google Draw template created by Lucas Cervera to fill yours out.
If you'd like to dig even further into your work and write a full business plan, I highly recommend Bill Aulet's "Disciplined Entrepreneurship: 24 Steps to a Successful Startup," an easy-to-read, step-by-step guide to writing a thorough plan. The book includes many examples to guide you through the process and thoroughly explains why each step is crucial, without being overwhelming or overbearing. Aulet uses the book to teach his course 15.390 New Enterprises at the MIT Sloan School of Management. A free series of courses based on New Enterprises and instructed by Aulet and co-instructor Erdin Beshimov is available on education platform EdX. The courses are entitled Entrepreneurship 101, 201 and 301 and are a considerable time investment — those are optional!