Many things go into the development of a business. What types of products or services are going to be offered? What is the legal structure of the business going to incorporate? What type of funding does the business need to get off the ground? The business plan is the outline of the business. The plan determines if the business is even feasible as a capital venture. The legal form of the business determines the tax liability. If the business is set up as a partnership there are measures to take to ensure the future of the business. The financial aspect is important to maintaining growth, as well as starting the business. These questions are important to ascertain before beginning on the journey as an entrepreneur.
Small businesses key to success is the implementation of a plan. A business plan is important because it identifies the product or service, as well as the businesses goals. A business plan contains three main categories; the business, financial data, and supporting documents. The business category identifies the product or service, competition, personnel, and potential funding projected impact. The financial data establishes the applications for funding, equipment value, projected balance sheets, break even analysis, cash flow, and income statements. Supporting documents include personal resumes, credit reports, and letters from anyone affecting the business plan. .
The importance of a comprehensive, thoughtful business plan cannot be overemphasized. Much hinges on it: outside funding, credit from suppliers, management of your operation and finances, promotion and marketing of your business, and achievement of your goals and objectives. (Small Business Association [SBA], p. 1).
The development of a business plan is critical for outside funding agencies. The business plan is a resume for a small business. .
There are various funding sources available to small businesses.