Business planning is about setting a clear plan for where you and your business are going and how to achieve goals. It also involves regular monitoring to make sure you’re on track.

Every business benefits from a business plan, whether you’re a one-person, part-time operation or a large corporation. Regular business planning helps you:

• have a clear plan of where you’re going and the path ahead
• build a business that best suits you and your lifestyle
• understand your current business skills and identify any gaps
• spot opportunities that can help you reach your end goal
• use your resources wisely — without a plan you can end up spreading your time, money and energy too thinly
• know whether to say yes or no to opportunities that come up — if they don’t support your vision, move on.

What goes into a business plan can vary, but often includes:

• an overview of your business — name, products or services you offer, revenue, key partners, goals
• an overview of your market — your customers, your industry, how many people will buy your product or service, whether you’ll sell overseas
• your marketing strategy — how you’ll get customers, the cost of attracting customers
• competitor analysis — your rivals, how your strengths and weaknesses compare, your competitive edge
• financials — your costs, revenues, growth rates, measures of success
• team — employees’ skills, skills you need, your mentors and advisors
• operations information — IT, systems, compliance.

Introduction to business finance

What you need to know about exporting

• Put time in your diary for business planning — monitoring progress regularly is good to do.
• Set short-term, mid-term, and long-term goals to help you understand the milestones you’re trying to reach.
• Do your planning offsite — getting out of your normal workplace can put you in a different mindset and help you see things you wouldn’t normally.

Involving your team in business planning can be a good thing. Don’t delegate the planning though. Having the owner or manager involved in setting the direction of the business is important.

Avoid these common mistakes:

• Getting caught up in the day-to-day running of the business without taking the time to look forward.
• Reacting to things as they pop up as opposed to setting clear goals.
• Investing time and money into things outside your value proposition. Make sure you have a clear statement that sets out how your product or service solves customers’ problems, and refer to it when you plan.
• Creating a business plan that sits on the shelf and doesn’t get used.
• Failing to regularly check in on how you’re tracking to your plan.
• Failing to think through what happens if your business grows. For example, if you might export your goods or services in future, you’ll need to prepare well in advance.