Every enterprise needs a business plan to keep all aspects of the business under control and set out how the business will develop. Consider the following:
- A business plan is vital if you want to borrow money to show what you plan to do, how the money will be spent and demonstrate how you will repay the money. See Write a business plan: step-by-step.
- You should create a cashflow forecast to anticipate how much money is going out of and coming into the business. When you're starting up a business you'll have limited resources of cash, so it's vital to keep a close check on the money. See cashflow management.
- Trade within your capabilities - many businesses built with good products and a long list of customers fail because they simply run out of cash. This is called overtrading. Although opportunities such as buying in bulk and saving on delivery costs can be attractive once your business is thriving, in the early stages don't be tempted to lay out large amounts of money in this way. See avoid the problems of overtrading.
- Update your business plan regularly. This means having a continuous clear vision of where you want the business to go and will help you keep better control of the business and its finances.
For more information see what to include in your business plan.