Q: Writing a business plan sounds like a lot of work. I already know the steps I'm taking to start my new business--do I really need a business plan?

A: Yes, you do. About the only person who doesn't need a business plan is someone who's not really going into business. You don't need a plan to start a hobby or to moonlight from your regular job. But if you're beginning or extending a venture that will consume substantial money, energy or time, and that you hope will be a full-time business, you should take the time to draft some kind of plan.

While it may sound intimidating, writing a business plan isn't really difficult. After all, a business plan is just a written description of your business's future. That's all there is to it-a document that describes what you plan to do and how you plan to do it. If you jot down a paragraph on the back of an envelope describing your business strategy, you've written a plan, or at least the germ of a plan.

So what do you need to include in your plan, and how do you put one together? Your plan should convey your business goals, the strategies you'll use to meet them, potential problems that may confront your business and ways to solve them, the organizational structure of your business (including job titles and responsibilities), and finally, the amount of capital required to finance your venture and keep it going until it breaks even.

There are three primary parts to a business plan. First is the business concept, where you talk about the industry, your business structure, your particular product or service, and how you plan to make your business a success.

The second is the marketplace section, where you describe and analyze potential customers: who and where they are, what makes them buy and so on. You should also describe the competition and how you'll position yourself to beat it.

Finally, the financial section contains your income and cash flow statement, balance sheet and other financial ratios, such as break-even analyses. This part may require help from your accountant and a good spreadsheet software program. It's a good idea to buy business plan software to help you prepare your plan. The software will prompt you, making it easy to "fill in the blanks."

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