C.D. Jackson, Publisher of Life Magazine, once said: “Great ideas need landing gear as well as wings.”  The sad truth is that most people plan trips and vacations better than they plan their business ventures. It seldom occurs to them that a business plan can help—tremendously. Consider the different audiences who may read your business plan as your great idea takes off.

Bankers are primarily concerned about having their loans repaid. While they will say they are interested in a company’s long-term prospects because they want to establish long-term relationships, bankers want to be assured of a company’s ability to keep up a loan repayment schedule. Therefore, the emphasis should be on past, present, and future cash flow.

Investors are most interested in factors that can help predict growth because growth is essential to get an attractive return on their investment. These factors include the market’s likely future, the management team’s experience, evidence of fast-growing sales, etc. In addition, they want to see their investment go into marketing rather than R&D expenses. Finally, tangible assets are less important to investors because they are not as concerned with being “repaid” in the same way.

Strategic partners are necessary. Increasingly, smaller, growing companies are seeking out large corporations to provide expansion resources—mainly in the form of investment funds, distribution outlets, and production expertise. Corporate executives have their agenda. They are most interested in finding new products and services that can be integrated into the corporation’s offerings. Such issues as cash flow and sales-force planning are less critical because organisations figure they can compensate for these needs. The business plan should be concise but devote considerable detail to the strategic issues important to the corporate partner.

Your large customers are also important. These tend to be major corporations seeking long-term and significant purchasing relationships. The customers want evidence that a smaller company will be around to provide the product and service promised, as also warranty or maintenance service. For these readers, the business plan should emphasise the company’s performance record and ability to satisfy customers. “Love letters” and names of reference accounts can be beneficial.

Potential key employees seek reassurance on various issues more than any other group. They want to know that the company has a history of success and can achieve substantial future growth. In other words, potential key employees are looking for signs of security and opportunity, especially if they will be getting stock in the company. A business plan that satisfies one of the previously described audiences may be appropriate for these individuals.

A business plan to guide your company’s middle and upper-level managers must be more detailed than other plans. A plan of 60 pages or more isn’t unusual.

A company looking to acquire your business is primarily interested in its past and present record of growth and accomplishment. If the acquiring company’s executives can be excited about the past and current, they will figure they can provide input to solidify the future. Moreover, the previous sales and profits record helps determine the company’s value. A business plan similar to that submitted to a bank would be helpful in this situation.

The reasons are pretty simple if you still wonder why your company should have a business plan.

1. A business plan, first and foremost, should sell you on the firm.

2. A business plan sells others on the company. When someone asks you for a business plan, they say, “Sell me on this business. “Turn me on.”

3. A business plan gives you confidence.

4. A business plan improves your chances of success.

Moreover, with all this going for you, your business works with wings and landing gear!