If you want to be taken seriously, you need to put thought into what it will take for your idea to actually be a successful business. You need a plan.
A business plan is a document where you outline your concept and strategy for success. It provides an overview of your potential company – what it will do, how it will generate revenue, what expenses it will incur, and who will be involved in running it.
Here are a few reasons why you should write a business plan:
Cash is the lifeblood of the business. Without it, you can’t pay bills, you can’t expand the business and you can’t pay employees. Most importantly as the business owner, you can’t even pay yourself!
Your business can show the most fantastic performance according to the income statement, with huge profits and yet have nothing left in the bank. In this situation your business would not survive. How could this occur? It could occur if you are not monitoring the cash flows of your business.
Is your business profitable? If you’re pointing enthusiastically to the balance in your bank account, and nodding your head “Yes,” you may be in for a big surprise. The fact of the matter is that cash in your account doesn’t necessarily translate into profit in your pocket. Why? Because the money you have on hand today doesn’t always reflect the payments coming due
Owning your own business has some truly amazing benefits. You can make your own hours. You can take on the projects that you want, and turn down the ones you don’t. You can work on your terms, and do it your way.
Sending an invoice, and hitting the refresh button on your email over and over again waiting for the notification that your client has paid– like your inbox is an awful freelancing slot machine that mostly dispenses spam. Without the other regular recurring revenue, overdue invoices are especially painful for small teams and solopreneurs.
There is a surprisingly easy and simple solution to keep the late and non-payers at bay. It’s so remarkably simple I’m shocked not every does it. Ready? Here we go: