The conventional wisdom has always been that you need a business plan before you’ve made a single sale, but is that really necessary for most small businesses these days?The Wall Street Journal takes a look at this question (and in good Magic 8-Ball fashion, come up with “the answer varies”), as well as five common misconceptions that most entrepreneurs have about business plans, such as:

Business plans aren’t necessary unless you’re planning to raise capital from banks or VCs.

Even if you never take a dime of “other people’s money,” you need to make sure that you don’t throw your own hard-earned savings down the drain. A good business plan can help you figure out how much capital you need to launch your business and how much revenue, profit and cash flow your business is likely to generate in the future.

Anyone thinking of starting a new business should check this one out.

Source: Wall Street Journal