Business plan is a written description of your business’s future. That’s all there is to it–a document that desribes what you plan to do and how you plan to do it. If you jot down a paragraph on the back of an envelope describing your business strategy, you’ve written a plan, or at least the germ of a plan.
Business plans can help perform a number of tasks for those who write and read them. They’re used by investment-seeking entrepreneurs to convey their vision to potential investors. They may also be used by firms that are trying to attract key employees, prospect for new business, deal with suppliers or simply to understand how to manage their companies better.
So what’s included in a business plan, and how do you put one together? Simply stated, a business plan conveys your business goals, the strategies you’ll use to meet them, potential problems that may confront your business and ways to solve them, the organizational structure of your business (including titles and responsibilities), and finally, the amount of capital required to finance your venture and keep it going until it breaks even.
Planning for Success
You’ve no doubt heard the expression, “Failing to plan is planning to fail.”
Many entrepreneurs write a business plan only when they need to secure start-up financing. However, your plan is far more than a document for banks and investors to read; it’s an invaluable roadmap for launching and growing your business.
In order to put your business concept on paper, you need to think through and research the many factors that are needed to make sure your business is a success. With a plan, not only can you spot potential weaknesses, opportunities, and threats, your plan can help you make informed decisions about your venture before you commit yourself legally or financially.
Here, I’ve summarized the key sections that you’ll find in a business plan.
The Seven Key Sections of a Business Plan
1. Executive summary
Your executive summary should be 1-2 pages long, and provide an overview of your business concept, key objectives of your business and your plan, ownership structure, management team, your product or service offering, target market(s), competitive advantages, marketing strategy, and a summary of your financial projections. Your executive summary should be written last, after you’ve written the rest of the plan; each paragraph should be a summary of the more detailed, related section of the plan.
2. Business Overview
In your overview, include details regarding your business’s history, vision and/or mission, objectives, and your ownership structure.
3. Products and Services
Expand upon your products and services, including features and benefits, competitive advantages, and, if marketing a product, how and where your products will be produced.
4. Industry overview
The industry overview is your opportunity to demonstrate the viability of your business by discussing the size and growth of your industry, the key markets within your industry, how your customers will buy your products or services, and which markets you’ll be targeting.
5. Marketing Strategy
Here you describe your target market segments, your competition, how you’ll differentiate your products or services, and your products’ or services’ unique selling proposition (USP).
• Discuss product or service pricing and promotion, including how your promotional programs will appeal to each of your target market segments.
• Provide a plan of traditional and guerrilla marketing tactics, such as tradeshows, press-magnet events, social media marketing (e.g. Facebook, Twitter, etc.), networking, and print, media, or online advertising. Include the cost associated with each tactic.
• Describe how your products or services will be sold (e.g. storefront, online, wholesalers), and your target markets’ buying cycle.
6. Operations Plan
Provide a profile of your management team, your human resources plan, your business location(s) and facilities, your production plan (if selling a product), and an overview of day-to-day operations.
7. Financial plan
Some believe this is the most important part of a plan—so much so, it’s worth dedicating up to 80% of your time to writing this section. You’ll need to show three years’ worth of projected financial statements, including income statements, pro-forma balance sheets, and monthly cash flow and annual cash flow statements. Summarize each statement into a few easy-to-understand sentences and put these in a cover page for the statements. Be sure to document all of the assumptions you used in forecasting your revenues and expenses.
Business Plan Guides
Hopefully this summery can help
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