For example, there are 3 types of business plans depending on the goal of your plan.These three types are for funding, for strategy, and for both.
And it must validate that financially it makes sense.
For example, while you might be able to get a million people to pay you $20 for a new computer, but if you can’t manufacture the computers for significantly less than $20, the business isn’t viable.
A business plan is important in that it serves two core purposes; it provides 1) financial validation and 2) serves as a roadmap.: With regards to financial validation, your business plan gives a strong indication, to both you and outside funding sources, as to whether your venture will be financially successful.
Your financial projections, if completed properly (more on this below), allow financing sources to calculate whether you’ll be able to repay your loan or provide an appropriate Return on Investment.
There are startup business plans for companies that are just forming, and there are established business plans for those who are already operating.
In addition, there are 2 business plan types based on the company’s size.
There are also 2 types of business plans based on the level of comprehensiveness.
One is a simple business plan, as previously mentioned, that covers just the basic items to give a preliminary assessment regarding whether or not the company is viable.
The roadmap gives you and your team a clear path to follow.
It keeps you focused and improves your odds of reaching the goals you’ve set.