The primary job of a business owner is to manage and run a business. Managing is a lot more than telling people what to do. It means planning, research, executing strategies, making effective use of available resources and protecting the business.
It is not always the case that a business outcome turns out exactly as planned. Hence the concept of risk! Put simply, a business is a risky investment like any other.
Being an entrepreneur involves risk taking. But that doesn’t mean taking unnecessary risks (e.g. speculative risk). Part of the business planning process should be about minimizing risk.
If you are investing your life savings, borrowing other people’s money, and putting your family’s stability at risk, it is your responsibility as a startup small business owner to not take stupid risks.
Of course there are unavoidable risks involved in a new business venture. These are calculated risks. The business planning process may not guarantee success but it certainly decreases the chances of failure.
Your business plan also provides all of the stakeholders in your business, including partners, financiers and employees, with a succinct and unambiguous reference of your intentions and strategies.
Until next time!