Question:
I already have a concept and financing for a start-up restaurant. Do I still need a formal business plan?
– Bhanu Singh, Partner, Canteen 900, Forty Fort, PA
Answer:
Whether you know it or not, you’ve done a lot of the hard work, even if only in your head. Knowing that you have a clear concept and the financing assembled answered some of the key elements of a business plan, even if it’s not written up for the benefit of a lender, landlord or partner.
Still, a business plan can be a useful document for other reasons. Dr. Edward Rogoff, Lawrence N. Field Professor of Entrepreneurship at Baruch College and author of Bankable Business Plans says, "A business plan is a document written for a purpose. Often it is to obtain financing or test a concept or its viability. Sometimes it is to give the owner an operating plan against which he or she can measure progress or use to get early warning on problems."
Even though you may not need to show your plan to an external funder, a business plan can be exactly that—a blueprint to run your business the way you intend. The plan can help make sure you are meeting performance benchmarks, check your forecasting and cost assumptions, and also keep your eye on an exit strategy—hopefully to expand, franchise or sell, but if not, to get out while you can.
There are a number of business plan templates available online. Even if you don’t follow them exactly, they can provide a checklist of elements to be sure to consider.