Any business can be created and doomed in a day without a proper business plan. This is the real importance of a business plan. A business plan is not just a plan of your business in your head, but it is much more than that and this is the reason we see business consultants preparing this professional document for firms.
What is a Business Plan?
A business plan is a roadmap guiding you step by step to build a successful business. It is a detailed document that helps in understanding how you will structure, run, analyse, implement and eventually grow your business. It covers the steps for the firm from marketing, financial, and operational standpoints.
Planning a business demands a decent amount of research, exploration, thoughtfulness and vision. A business plan is a blueprint of how you expect your business to work and it also helps you attract investors & partners. In such a case your business plan becomes your tool to convince people working with you or investing in your company.
Basics of a Business Plan.
A business plan is mandatory if you really want to last very long. A good business plan can help you boost your business as expected and logically predict outcomes without putting too much money into them and, ultimately, losing in the end.
A good business plan doesn’t just look like a fairy tale, instead along with the projected costs it should also mention the possible pitfalls of each decision a company makes. Although, you might not be the only one in your industry but be specific and identical. Your business plan should precisely focus on how the business intends to achieve its goals. The document must also include how your company is distinguishable from its potential competitors.
Elements of a Business Plan.
The length of a business plan is not defined however keeping it short and to the point is always recommendable. In any case if there are crucial elements taking up a lot of space, consider putting a reference to them in the main business plan and included as appendices.
Mentioned below are some key elements of a business plan. As mentioned above, although the elements remain same across all business plans, keeping them unique according to your business is important.
- Executive summary: As the section name implies, this section outlines the company and includes the mission and vision of the company. This also includes any information about the company’s leadership, employees, operations, and location.
- Products and services: This section outlines the products and services the company will offer, and may also include pricing, product lifespan, and benefits to the consumer. Along with this the section may include production and manufacturing processes, any patents the company may have, as well as proprietary technology and any information about research and development (R&D).
- Market analysis: This section covers the information and research you have done of the industry as well as its target market. It will outline your competitors, its influence in the industry, along with its strengths and weaknesses. It should also consist of the expected consumer demand for what the business is selling and how hectic it may be to grab market share from incumbents.
- Marketing strategy: This is a very important section wherein the marketing thoughts should be clearly penned down. This section describes how the company will attract, retain and intend to reach the consumer. A clear distribution channel must be outlined. It should also clearly mention the advertising and marketing campaign plans and through what types of media those campaigns will run.
- Financial planning: This section is of much interest to founders, investors and even the one’s working along. This section should consist of the financial planning and future projections. In case you already run a business, financial statements, balance sheets, and other financial information may be included. However, new or budding businesses will instead include targets and estimates for the first few years of the business and any potential investments. If investment is your prior demand I would suggest looking for small business consulting services around you to plan this section brightly.
- Budget: To save yourself from cash crunch in the future any company will need to have a budget in place. This section includes costs related to staffing, development, manufacturing, marketing, and any other expenses related to the business. This basically covers all your expenses as a company.
With all these steps, one thing to keep in mind is to highlight any interesting aspects of the business in order to attract financing. Remember, all large scale business essentially began only as a business plan.
With the mentioned elements anyone can write a good enough business plan and secure their business. But, it is a good idea to write your business plan yourself only if you are confident enough to do justice with it or I would recommend you to search for business consultancy services in your location to get this done professionally.
Also, keep in mind that a business plan needs modification over time. The business plan should be reviewed time to time as the business grows and evolves. A good frequency would be to review the business plan annually as it allows an entrepreneur to update it when taking markets into consideration. Even for this I would recommend hiring a small business consultant at first or maybe an independent business consultant who can help you in analysing how good you are sticking to the plan and how well the plan is working. However, never hesitate in modifying the plan if required for betterment.