When do you need to draw up a business plan?

If you go to any B-schools or any Business incubation programs, you will learn that planning is one of the fundamental tasks that the business needs to do.

In our “What is a business plan?” blog we outlined how a “Business Plan” documents all the plans and processes that the business intends to carry out for a specific period of time. The document projects not just the business’s core strategic outlook but also how to achieve the strategic goals and objectives through the core business function of Finance, Operations and Marketing. 

When do you need to draw up a business plan?

Business plan is often misunderstood as a document that is needed only when starting a business. It should be in fact created during each strategic rhythm, for eg. annually, semiannually or quarterly. 

Many businesses actually present a business plan in their Town Hall or any other annual strategic event. Companies also break down the goals in business plan into semiannual and quarterly business plan documents which makes it easier for them to track the progress of the plans on a quarterly basies. 

Apart from these routine situations, business plan can also be created for some specific needs or objectives:

  1. Applying for bank loans

Bank loans are given after a successful or a positive credit appraisal. Banks need to make sure that the party (business of individual) who is being given a loan is willing to and can repay the loan with the interest amount in the stipulated time. 

For this appraisal, the bank needs to understand the nature of your business, the potential of growth. It also needs to see how your financial projections look like and if your operating income will be sufficient to service (pay back) the loan. 

To gauge and get answers to all of the above questions, the fundamental document banks rely on is the company’s business plan. That is why, when you are applying for a bank loan, you will need to get a business plan document ready. 

Nabil investment provides business plan solution for bank applications. You can contact our corporate advisory team today. 

  1. Attracting investors and securing funding

Another way of financing your business is to attract investors who will invest in your company’s equity. 

Investors also need to understand the market potential and the growth projections of the business so that they can make an informed decision about their return expectations and the risk they would be exposed to. 

For this, often investors (Venture Capitals, angel investors, Private Equity firms) will ask you to present a business plan for your business. 

  1. Determining the USP of the business

Business plan is also essential to understand the Unique Selling Point (USP) of your business as well. Maybe the operations or your operational effectiveness and efficiency adds a unique proposition to your customers that others can’t match. For eg. maybe you have an operational capacity to produce goods / service at a faster rate than your competitors. 

Similarly, there might be other uniqueness that your business has. The business plan helps you determine this USP and also carve a detailed plan to implement operational , financial and marketing strategies so the unique value that the USP provides is delivered flawlessly to your customers. 

  1. Understanding the target market

Business Plan also helps one to understand the target market of your products. By helping determine the segment of the market which would provide you the bulk of your sales, the business plan helps you to package your products and services better for this major customer segment. 

Whatever your needs or whatever the occasion, Nabil Investment’s corporate advisory services have a pool of experts that can help you create a business plan which will act as a blueprint for your company’s success. 

Contact the Nabil Investment Corporate Advisory services team if you need to create a business plan for the above or any other purposes.