Edmonton Accountant | The Value Of A Business Plan
Even if entrepreneurs are running their business without a business plan, Edmonton accountant still recommends business owners create one. Not only because business plans will help entrepreneurs grow their business. But because having one can help entrepreneurs stay on track, and overcome common obstacles.
Industry Canada did a survey of Canadian small businesses. Nordic to find out why half of all small businesses failed within five years. And they found that there were three reasons that were most commonly given. As to why entrepreneurs were not successful.
23% of entrepreneurs so that they were not able to find or keep staff for their business. 29% of failed entrepreneurs said that they ran out of money. And the number one reason for business owners in Canada to fail, which affected 42% of failed entrepreneurs. With that they were unable to find enough customers to purchase their products and services.
Since the most common reason was not being able to find customers, Edmonton accountant says business owners should realize that they can avoid this with business plan. They will identify their ideal and likely customers in a business plan. As well as come up with a marketing plan on how they are going to find those customers.
One of the most common problems that entrepreneurs have if they do not follow a business plan. Is that they have an idea of what they are going to do for their marketing. But they are not specific enough. For example, they might say that they are going to find customers by sending flyers.
However, they do not know how many flyers they are going to send at a time, or how often they are going to send those flyers. And without those specifics, can make it very hard for business owners to follow through. Or be effective at finding customers in their business.
The second most common reason why entrepreneurs fail is because they run out of money says Edmonton accountant. And that can also be helped by having a business plan. Because a business plan is essentially a budget for entrepreneurs and their business.
Without a business plan, entrepreneurs may not know if their spending is reasonable or not. They also might not know what their revenue goals are. Or how much money they need to bring into their business every month to cover their expenses.
By following a business plan. Entrepreneurs will know exactly how much revenue they need to generate each month. And what their expenses need to be at. Using that, they can see if they need to engage in more revenue-generating activities such as cold calls, or marketing. Or if they need to minimize expenses as well.
This can help business owners avoid running out of money in their business. Which will help them avoid the second most common reason why business owners fail.
When business owners understand why they should have a business plan. Even if they have been operating their business for many years. They will be able to contact their Edmonton accountant to set up and meeting. In order to work on creating this important document in their business.
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Even though many business owners might understand how important having a business plan is to their success says Edmonton accountant. They still might not have one in their business. Either because they do not know how to start creating one. Or they have started, but have become overwhelmed and do not know how to finish.
This is why going to their Edmonton accountant is very beneficial. Because they will be able to have help in completing their plan. Or to help them with the parts of the business plan they are struggling with. It is that they can create one.
Also, having someone else help a business owner with their business plan. Can help ensure that any mistakes that exist in the plan can be caught. And any entrepreneur that creates a business plan should ensure that someone else is reviewing it.
So that all mistakes can be found. Before an entrepreneur puts their own money on the line, and find out that there are critical errors in their planning.
However, if business owners have been running their business successfully for years without a plan. There are three reasons why business owners should take the time to create a plan for their business.
The first reason is they are planning on making major changes to their business in the next year or two. Such as adding a new and completely different revenue stream to their business. Or if they are planning on having huge business growth, such as doubling their size, or doubling their revenue.
And the third reason could be something like changing how they operate their business significantly. Such as making a huge technology purchase. Or upgrading an outdated system. These will require creating a new business plan. And following that plan to ensure they can navigate these changes easily.
Another reason why business owner should create a plan, even if they have been operating their business for several years. Is because they are struggling. Perhaps they are running out of money, they cannot find or keep staff. Or they have discovered that there marketing no longer works, or they cannot find customers as they used to be able to.
It is a matter what stage of businesses in, they could end up struggling due to a variety of reasons. And making an appointment with an Edmonton accountant to work on a business plan. Can help ensure that these entrepreneurs are overcoming the obstacles that they face. Regardless when in their business they encounter the obstacles.
And the third reason why an entrepreneur might want to create a business plan even though they have been in operation for many years. Is because they now need financing. Whether this is to buy a building, purchase new assets that will help them grow. Or to do renovations that are needed to their business.
Business plans can help business owners, regardless of what stage their business is in. And how long they have been in operation. And once an entrepreneur has business plan, they will more likely not only to overcome obstacles. But be more likely to grow their revenue and be successful in business.