Then it communicates why the new business is a solid investment.

For banks, lenders or investors, the business plan shows them the who, what and how of the business operations. A business plan conveys what the new company needs and convinces others to help fund its growth.

One of the central uses of most startup business plans is for raising investment funds.

Plus, many tasks exist with finding a property, securing loans and closing deals. Also important are income projections and growth or financial benchmarks. A business plan breaks down the moving pieces into more manageable portions.įor your growing real estate portfolio, those pieces include acquisition and capital improvement costs. This means a lot is going on in the early stages of your organization’s development. You have plans to acquire more and turn it from a hobby to a full-time pursuit. Imagine you own and rent a handful of condominium properties. Let’s take a look at two scenarios, involving ownership of rental property. Why Do You Need a Business Plan?Īs with the plan itself, the need and purpose for one vary between businesses. You want to answer questions like how the business works, what your goals are and how your team will reach them.īusiness plans can be internal or external, meaning it is used as a guide to get your team on the same page or an overview for those with whom you do business or to pitch to those who want to invest in your ideas. In either case, the intent is to provide a map for your business. It typically includes areas such as financial data, a marketing overview and future plans for each department in the organization. It lays out only the essential information, immediate milestones the firm wants to reach and how to secure funding to meet those goals.įor a larger or established company, the plan might be more comprehensive in a traditional format. It serves as a guide for how you manage your organization.Ĭonsidered a basic business principle for startups, business plans are helpful for all kinds of companies.įor example, a plan for a startup might be a simple one or two-page document, sometimes referred to as a lean plan. The easy answer, of course, is right there in the name-it’s a plan for your business. Let’s take a look at why your organization needs this business roadmap and how it can set you up for long-term success. From entrepreneurs with the seed of a great idea to established companies, every business needs a business plan.īut what is a business plan exactly? Is it worth the time and effort to write one?

How to make the best business plan