most fresh starters see a good business plan as a key to success. Unfortunately, a study has shown that there is no relationship between a business plan and revenue. Meaning a good business plan does not necessarily guarantee a successful venture.
What do you think about the relationship between business plan, and business success?
August 17, 2012 at 12:19pm . These were the views we got from other Afripreneurs.
I agree with U. A lot of entrep. expend so much time and energy on writing biz plan, @d end, there is hardly enough energy, time and money to pursue the real biz. For me, I say, start doing what you want to do by writing just enough to prove to yourself that U really know where U are going (after U are sure U 've got the needed skill), then ...
August 17, 2012 at 12:29pm
Exactly Dave. The major reason they focus so much on that is that 'They are writing the plan for banks instead of their business '
August 17, 2012 at 12:41pm
Although biz plan is a guide-line but an entrepreneur must b realistic when drawing out a biz-plan focus more on the product rather than Paper.....lol.
August 17, 2012 at 12:49pm
Bassey Daniel Bassey
A former boss of mine once said all those plans look very promising and lucrative but when u finally start the business, hmm you will then realise that there are a lot of details that the business plan did not capture.
August 17, 2012 at 1:27pm
A business plan may be like a guide for a while, after that, u focus on ur business foe success
August 17, 2012 at 1:44pm
Ekenma Mba It will still continue to be a guide because business is a going concern. Once you meet your former targets, you set a new.
August 17, 2012 at 1:51pm
August 17, 2012 at 1:54pm
The relationship between a business plan and a business is important; especially in the Nigerian business environment. Like Ofunre rightly said, entrepreneurs write for banks instead of writing for themselves. A business plan is any physical representation of what you want to do that addresses salient issues like What opportunity exists in the market, why no one has taken the opportunity (If its really an opportunity), if already taken; how many competitors there are, best location, do you have enough funds to survive the initial phase, and so many more. I have seen many businesses fail due to the ignorance of these answers. Lets say your friend called on you to become a financier of his business venture; what factors would you consider in accepting the proposal? Any document that shows these factors is a business plan whether sophisticated or simple. Without a business plan, you are simply gambling. He who fails to plans is planning to fail. QED
August 17, 2012 at 1:59pm
Ayoku Omokayode Onagoruwa
Well a business plan is just a formula that tends to give the desired results but once the variables (different real life conditions and situations) are thrown into the formula, results COULD change. Entrepreneurs should be quite well informed and braced to take the right directions when the unexpected starts occurring.
August 17, 2012 at 4:19pm
Ofunre Iriobe - A) I beg to differ a little coz a business plan is either documented or not documented. In reality your #1 and #2 recommendations are business plans in themselves, whether written, meditated upon or presented in public:
1) Have a mental plan or an outline of your plans
2) Take that step to find out who your audiences are, and what they need
3) When you do, sell, sell, sell.
You cannot achieve #3 without #1 and #2 and whether you have these on paper or just in your head, the truth is you have a business plan.
the actual "business plan" changes as you progress coz there will always be hiccups along the way. For those that have formalized BPs, they often dont follow it rigidly coz what they thought possible might become a little less possible than originally thought, so they have to go for plan B/C/D. These changes are usually not documented coz they come and go. For those who have no documented BP originally, any change that comes is just part of the way things go.
In reality, everyone has a business plan. It might be a clear idea, vague plan or just a rough sketch, but without a BP, business isnt possible.
August 17, 2012 at 9:08pm
Morakinyo Mo Beckley
Ayotokunbo Ajewole, point of correction, a business plan is always documented. That said, a business plan does not guarantee any success for a business, it simply serves as a guide. Let me quote a few instances from my dissertation done a while back on the subject of Entrepreneurship - "It is well established that money cannot be raised for a venture without a business plan. The document must reflect and personify the individualities of the entrepreneurs and expresses how different the company is (Mancuso, 1985 in: Kuratko and Hodgetts 2007). Burns (2001) emphasises the importance of a business plan as it allows the owner-manager(s) to crystallise their business idea and to think through the problems they will face, before they have to cope with them. It allows them to set aims and objectives and thereby give themselves a yardstick against which to monitor performance." Furthermore the business plan "... is a written document which describes in detail, a proposed venture with the purpose of illustrating current status, expected needs and projected results of a new or expanding business (Kuratko and Hodgetts,1998). As planning is essential to the success of any undertaking, it entails formulation of goals and directions for the future of a venture and certain critical factors must be addressed (Kuratko and Hodgetts, 2007)." However, with these in place it is important to have the audience in mind when crafting this document - Barrow (2006) explains that a business plan will be more effective if it is written with the reader in mind. Mitra (2008) notes that in preparing the comprehensive business plan, several views should be aired:
a. Conveying the view of the entrepreneur – concerned with the competence of the entrepreneur and ability to show an in-depth knowledge of the venture.
b. Portraying the view of the marketplace – concerned with the marketability of the new venture.
c. Satisfying the view of the investor – concerned with the financial forecasts
Now to the most important aspect of the plan - self criticizing the risks, projections and knowing if the business will be able to fly, attract funding or not - and what alternatives plans you might consider (this is usually not written in the plan). A lot of people leave these critical aspects out of the whole planning process.
August 17, 2012 at 10:05pm
It cannot be emphasized enough that a business plan is ALWAYS documented. Until it is documented it is no more than a dream that floats around in your head. For it to become a true guiding light for your business it must be affixed onto paper for you to refer to, to change and adapt as needed.
August 19, 2012 at 12:08pm
Question by Ofunre Iriobe