Is it necessary to have a business plan for a home based business? The answer is yes and no.
If you are considering running a business from home that requires outside finance, then you will definitely need some sort of business plan, and the more comprehensive it is, the better your chance of success.
If you are going to have very little expenditure and few overheads, then your business plan need only be of a more personal kind that will allow you to keep track of your projected and actual daily activity, sales targets, marketing costs etc. Let?s look at the difference between the two.
1. Using a business plan to secure finance ? regardless of the kind of business you have in mind, this kind of plan ideally needs to follow a specific format and, unless you are an experienced business person, you may be well advised to take expert advice.
Alternatively you can purchase software that will allow you to tailor the plan to your specific sector. Google ?Business Plans Academy? to find business-plans.co.uk for samples of templates for a variety of businesses, from child care to the hotel industry. Each one includes sections such as Executive summary, Description of Business, Product Summary, Business strategy, Financial Summary, Market Research, Market Trends, External Research, Market Estimates, Management Team, Business Location, Business Organisation, SWOT Analysis, Competitive Analysis, Customer Segments , Customer Demographics, Sales Strategy, Pricing Strategy, Marketing Plan, Advertising Plan , Objectives & Plans, Resource Allocation, Budget Allocation, Startup Budget, Forecast Profit & Loss Account, Forecast Balance Sheet, Forecast Cashflow, Sales & Profit Forecasts, Sales Charts & Graphs.
This, and similar, software can be purchased relatively inexpensively and will give you a professional-looking document.
2. Using a business plan to develop and maintain targets ? Since you?re not looking for finance this can be much simpler, but no less important. Statistics show that people who create and follow a business plan have a better chance of success. For The Home Based Business entrepreneur it can be difficult getting into the habit of following a structured plan, but necessary.
Simply by looking at the elements of the full business plan, it is easy to see which sections will be important to the home based business, but it can be broken down into the following fields:
- know your product & prices
- know your market area
- know your competition
- know how to get help or training
- create daily/weekly/monthly ?to do? lists
- decide whether and where to advertise and compile costs
- set realistic goals and targets
?
Another important factor is to decide whether your home business will generate immediate income, or whether you will need to consider bolting it on to your existing job or business until it does. By performing the simple exercises above, you will have a much better grasp of your likely earnings than if you start your business with no clear goals or plans.
Finally, a home based business is no different to a bricks & mortar business. It needs commitment and hard work to make it successful. Ask any small business owner how many hours they needed to put into their business when they first set up, and you might be overwhelmed by the answer.
Ask them if they would trade being their own boss to work for someone else, despite the hours, the headaches, the business planning, and everything else to boot, and in most cases you?ll get a resounding NO!
About the Author
Gloria Booth is a business owner, MLM Internet Marketer and authorised distributor for the Telecom Plus Utility Warehouse
Creating Wealth?It Works! Body Wrap is a Legitimate Home Based Business Opportunity
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