Every agribusiness needs a business plan. It is like a road map. You can go on without it, but that will increase your chances of getting lost, messing up along the way, and possibly losing all your investment and even time.
Studies found that businesses with good business plans grow 30% faster than those without. Also, 71% of the fastest-growing companies have good business plans.
So, you have a vision but just before you get into the thick of it, get a good business plan. Read to the end as we tell you exactly why a business plan for agribusiness success is critical.
What is a business plan for an agribusiness?
A business plan is a document that contains information about your product, finances and marketing strategies and outlines how you will achieve business objectives.
You need one when you are starting your agribusiness.
There have been situations where agribusinesses started, and owners had to stop, seek direction, and sometimes start all over. It is always better to use a business plan to see the bigger picture, even as a small agribusiness. It also helps to plan ahead, make critical decisions, and increase the potential for success.
Why do you need a business plan for your agribusiness?
You are thinking: “Do I really need a business plan for my agribusiness idea?“
It may sound like a lot of work and may cost you money if you have to hire a professional.
Yes, you really do need a business plan if you are to see your vision become a reality. Don’t give yourself and your agribusiness up to chance with random decisions and distractions that eventually kill the dream in frustration.
You need a business plan;
1. To help you make critical decisions for your agribusiness
A business plan helps you make better decisions. The act of decision making is a constant phenomenon in entrepreneurship and particularly in agribusiness. You need to make the right ones.
In times of crisis, you can’t afford to sit back and watch everything go down. That is where a business plan comes in.
A business plan helps you determine the answers to some of the most critical business decisions ahead of time.
2. To sharpen the vision for your agribusiness
It all starts with a vision. Then a business plan brings this vision close to reality after questioning and deep research. During the process of developing the business plan, this vision is made clearer and straighter, eliminating all gaps in your strategy.
Now, this vision can be very well articulated and implemented.
Read also: Building a Solid Agribusiness: 6 Proven Tips for Sustainability and High Profits
3. To avoid making big mistakes and reduce risk
Many agribusinesses fail for lack of capital, no market need, competition, pricing, or an inadequate team. A good business plan addresses all these challenges.
A business plan after deep research outlines strategies, financial and operational plans that seek to avoid major problems that have the potential to cause failures.
Agribusiness is a risky business. However, this risk is significantly manageable with a well-crafted business plan that outlines key risks to the business and proposes mitigating measures for the identified risks.
4. To prove the viability of the agribusiness
Many agribusinesses are created out of a passion for agriculture. Passion is good. However, it is no proof of the viability of an agribusiness.
You need to plan it all out to turn that vision into reality. A business plan will confirm whether your idea makes business sense.
Market research in a business plan can give deep insight into your customers, your competitors in the agribusiness space. Market research is important for existing businesses too.
5. To secure funding
Studies show that, with a business plan, you are 2.5x more likely to get funded.
If you are planning to get external financial support or borrow from a bank, you will need a business plan. After all, anyone who is interested in giving you money for your agribusiness would like to know if it is a viable venture in the long run. Also, proof that you require the money.
Read Also: Why Do Promising Agribusinesses by the Youth in Africa fail?
6. To set and communicate better objectives and benchmarks
A business plan helps you state clear objectives and benchmarks. It also helps keep you accountable for your long-term vision and strategy and gives you insights into how your strategy is coming together over time.
Sharing your business plan with team members also helps ensure that all members are aligned with what you’re doing, why, and share the same understanding of long-term objectives.
Small agribusinesses may employ professionals to carry out tasks like accounting, marketing, legal assistance, or as consultants. Sharing relevant sections of your business plan will ensure everyone is on the same page.
7. To better understand the broader landscape
As an agribusiness, it is important you get a better understanding of the terrain. A business plan helps you understand your competition and the market. It also reveals consumer trends, choices, and potential disruptions. These insights are not always plainly visible.
In conclusion
Get a good business plan and increase your chances of success in agribusiness. Hire a professional if you have to.
Reference
The importance of a business plan – Wave
