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“Writing a good business plan can’t guarantee success, but it can go a long way towards reducing the odds of failure”. Elucidate the importance of a business plan in this context. 

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The business plan is valuable to the entrepreneur, potential investors, venture capitalists, banks, financial institutions, new personnel's suppliers, customers, advisors and others who are trying to familiarize themselves with the venture, its goals, and objectives. 

The business plan – 

(a) helps in determining the viability of the venture in a designated market 

(b) helps in providing guidance to the entrepreneur in organizing his/her planning activities as such: 

(i) identifying the resources required 

(ii) enabling obtaining of licenses if required etc. 

(iii) working out with legal requirements as desired by the government. 

(c) helps in satisfying the concerns, queries, and issues of each group of people interested in the venture. 

(d) provides room for self-assessment and self-evaluation, requiring entrepreneur to think through various scenarios and plan ways to avoid obstacles. 

(e) though not desirable, at times, business plan helps to realize the obstacles which cannot be avoided or overcome, suggesting to terminate the venture while still on paper without investing further time and money. 

(f) as the investors/lenders focus on the four Cs of credit : character, cash flow, collateral and equity contribution, it is the business plan which reflects the entrepreneur's credit history, the ability to meet debt and interest payments, and the amount of personal equity invested thus serving as an important tool in funds procurement.

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