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A business plan can be a complex jumble of paper or can be a smooth, easily understood plan that shows potential investors that your business idea is both possible and profitable.

Many "experts" believe that a business plan is required without regard to your current situation. Other "experts" believe that you should work on building your business and that once you have a "solid foundation" then you should build a plan if you need additional financing. Both of these opinions are too definite for the changing climate that is entrepreneurialism. There exists no grey area between these two extremes. Some times you need a business plans and other times you do not. Therefore, the question is not "should you write a business plan," the question is "does your situation require you to write a business plan?"

Now that the question has been stated, another question logically results. That question is, "what situations require you to write a business plan?" This question needs to be answered with the question, "what are your goals?" You need to think hard and answer this question truthfully. Obviously, we are all in this game to achieve success; however, success is a subjective term. You need to define success and narrowly state your goals in order to know your situation.

If the purpose of your business is to provide you with some additional income and you plan to keep your current job, then you probably may not need a business plan. The cost of preparing and compiling a business plan is probably too high when compared to your goal of bringing in additional income. However, if your goal is to have your new business idea be your primary or sole source of income, you may want to prepare a business plan in order to have the option of presenting your plan to potential investors in the case you need additional income for expansion or investment purposes.

There is no definite answer as to whether a business plan is necessary, therefore you should carefully assess your goals, and you will be able to answer the question of whether your situation requires a business plan.

Learn more about this author, Marco Angioni II.
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