Just as an engineer or an architect uses a blueprint to build a strong structure, writing a blueprint for your California small business is also essential to establish a firm foundation.
Business planning is one of the most crucial parts in starting a business in California. The state of California is one of the most progressive states in the US. It is home to thousands of businesses, you could just imagine the competition. According to studies, if California was a country, it would be the 8th to 9th largest economy in the world.
Many entrepreneurs from this state are eager to know how to start a business in California, and the simple answer to that is to write a business plan. To penetrate and survive in the California business industry is tough, you need a game plan for your business.
However, if you still think that a business plan is an outdated document, let me enlighten you. Here are 7 reasons why every California entrepreneur needs a business plan!
Before you start a California startup, you need to determine if your business idea is actually viable or not. There’s no point in building something that will not earn profit, you’ll waste your time and energy – most specifically your resources.
It’s better to know that your business idea is not feasible early on, than to realize that it’s doomed to fail later on. By planning ahead and analyzing cash flow, sales, financial forecasts and other determining factors; you’ll be able to know if your business is capable of making a good profit.
I’m sure that you’ve read a number of articles saying that money is not an issue when building a business – you can start a business without money. Ask an accountant, an established entrepreneur, a successful business owner and other business professionals – they’ll all tell you one thing: MONEY IS EVERYTHING WHEN STARTING A BUSINESS.
No matter how small, funding/capital is highly essential if you want to start your California startup smoothly. How will you pay for government fees, operational costs, business licenses and permits, taxes and other start-up costs if you don’t have the financial resources to back-up them up?
In the process of planning, if you discover that you don’t have enough resources to finance your California small business, a business plan is a also a helpful tool to raise funds. As a matter of fact, many entrepreneurs write one because of this reason – even though not the only reason.
Having a clear and compelling plan will allow you to gain the trust of investors and lenders to fund your business. A solid business plan will convince them that your business is a reliable proposition.
It’s been your dream to start your new business, of course you’ve thought about your business goals and objectives. However, it’s better to write and jot them down, and see if they’re realistic enough based on your forecasts and analysis.
If your business goals are achievable and timely, it’s not enough to just stop there. You need to plan how to accomplish them, you need to set deadlines for every goal, push yourself to enforce those due dates and adjust or totally change them when needed.
By doing all these, you’ll always keep yourself on track – you’ll be able to work your way up with organization and efficiency.
Cash flow is the heart of business, and before you can establish a consistent flow of incoming and outgoing cash, you have to study this part thoroughly – which can only be done if you write a business plan.
First of all, you need to make a revenue estimate, you have to identify who your customers are, define your target market and the percentage of that market which you can reach. All these are essential to predict your possible cash flow. And by being able to anticipate this, you can manage it better in the future.
No matter how perfect your business idea might seem, there are always flaws that may come out later on. There’s no competition, it’s a unique idea, it’s simple to manage – these are just some of the ideas why many entrepreneurs think that they will never encounter any problems later on.
Every business, even if you plan it well, will always have certain risks and it’s better to know some of them, than to start without knowing anything at all. Before potential business problems become disasters, write a business plan so you’ll be able to create possible solutions and remedies.
There are definitely entrepreneurs who started out without writing a business plan and succeeded. However, it won’t hurt to write one, it will only take you less than a month to draft a solid plan for your California startup.
One of the major problems that many California entrepreneurs face when writing a business plan is their lack of knowledge and experience. You have numerous options to solve this problem: first, you can seek the help of an accountant to make or assist you in writing your business plan, or, you can use a business plan software.
If you’re on a budget and you want to take full control of your business plan with the use of a modern business planning tool, the second solution is your best option. If you try to check online, there are lots of business plan software solutions being advertised, but for me, LivePlan is the best business plan software that I’ve tried.
To make the task of writing a business plan easier, check out LivePlan and see if it fits your needs.