What is the purpose of a business plan?

The purpose of a business plan primarily lies in outlining a company's mission and strategy. A well-crafted business plan serves as a comprehensive blueprint that defines the organization's objectives, strategies for achieving them, and the vision that guides its operations. It addresses crucial components such as the target market, funding requirements, and potential challenges, offering a clear overall direction for the business.

In contrast, evaluating employee performance, assessing competitive advantages, and developing recruitment strategies are specific functions or activities that may be informed by or included in broader strategic planning but do not encompass the fundamental purpose of a business plan. The business plan's focus is to serve as a tool not only for guiding the company's growth and direction but also for communicating that vision to stakeholders, potential investors, and partners.