Writing a business plan is a seminal moment in the life of a new venture. Doing so entails committing to paper a vision of the factors that will affect the success or failure of the enterprise. Creating a business plan will help you achieve your entrepreneurial goals. A clear and compelling business plan is necessary to build a successful enterprise that delivers profits and satisfaction to the owner(s).
Most business plans are produced for a specific reason and the most common by far is to raise finance. However a well thought out and well written business plan is essential to every company not just those seeking financial assistance. Your business plan should be kept on hand and referred to consistently as an indispensable guide and your blue print to success.
The best person to write a business plan is you! You can get help writing a business plan but you want to be sure that you get everything out of the business that you want.
So here are some basic tips and or hard questions that you need to answer for a winning business plan.
Include the executive summary
Most entrepreneurs are in the habit of excluding this part of the business plan but it’s the most important part/section as it provides the readers and potential investors/financiers with brief yet dynamic key components of a business plan. The executive summary should pinpoint what your business intend to do, who the management team is today, basic concepts, basic financial points and the capabilities that will enable you to achieve your business objectives. Unless it captures the interest of readers and potential investors/financiers and appears convincing; they will not bother to read further. To make sure it’s clear and comprehensive; make it the last thing to write about in your business plan and it should not be more than two pages in length.
In this section provide a detailed description and history of your business. State what the business is about, what you are trying to achieve (vision), and how you will achieve it (strategy).
- What is the name of the business and where is it located?
- What is the type of your business? Will it be forming or it exists? If it exists what stage is it in?
The product or service
This section describes what your product or service is, what need it satisfies, how it is positioned, its unique selling point (benefit) and the core target consumer.
- How does your product work or how is the service used?
- How will your product benefit the consumer?
- What is your pricing strategy?
- Are there vendors involved, if yes how do they fit in?
Analyze your potential markets and competition
Describe your market, the forces at play on the market and within the market, and the available opportunity for your product and service. Discuss your key competitors in regard to product or service, price, promotion, location, management and financial position.
- Who will want your product or service (market segmentation)?
- What are the current trends and developments in your industry?
- What are the barriers to entry or exit (SWOT analysis)
The marketing plan/strategy
Describe how you are going to create the demand for your products and services. This should include details of marketing and sales activities as well as your expenditure and return on marketing investments
- How will the service be marketed?
- How will the product reach its intended market?
- How will you differentiate yourself from the market?
The management team
These are the people who are responsible for leading the business to reach its goals.
- How will the business be organized and what is it ownership structure?
- Who are key managers, what are their key responsibilities, what unique skills do they bring to the business and how are they going to be compensated?
In this section describe how your business operates, how you make your products and provide your services, details of your premises as well as a description of your key business processes
- What will you do in-house and what will you purchase?
- How will you use operations to compete? (Cost, Quality, Timeliness and flexibility)
- Will your employees be full-time or part-time and what skills must they have?
The financial needs and performance
In this section provide details of your business past, present and projected performance in terms of startup capital, profit & loss, cash flow and balance sheet. This section also includes key ratios and sensitivity analysis.
- If you are not accounting literate consult an accountant.
- Use standard industry forms and formats.
This is where you should provide all the documentation that supports the body of the business plan. In this section include financial projections, curriculum vitae’s of key management, market research data, letters of interests from potential customers and technical product information.
In conclusion; you must demonstrate in the business plan that you take ownership of the plan and that you accept responsibility for the delivery of the plan and the proposed outcomes. Don’t try and hide anything, keep the details and facts in the business plan, it is better to show that you acknowledge any negative facts and propose a solution to overcome them rather than to try and hide them. Stick to what is attainable, it is good to be ambitious and optimistic but remain realistic at the same time. Explain things in simple terms so your business plan is clear and easy to read. Finally ensure your plan is well presented