What is the Business Plan?
The business plan sets out how the owners/managers of a business intend to realise its objectives.
Without such a plan a business is likely to drift.
The business plan serves several purposes:it
(1) enables management to think through the business in a logical and structured way and to set
out the stages in the achievement of the business objectives.
(2 )enables management to plot progress against the plan (through the management accounts)
(3) ensures that both the resources needed to carry out the strategy and the time when they are
required are identified.
(4) is a means for making all employees aware of the business's direction (assuming the key
features of the business plan are communicated to employees)
(5) is an important document for for discussion with prospective investors and lenders of finance
(e.g. banks and venture capitalists).
(6) links into the detailed, short-term, one-year budget.
The Link Between the