Developing a well-crafted business plan is crucial to the launch of any business. It sets up goals and realistic expectations. Its your road map to success with signposts that reveal your strengths and weaknesses. It also helps keep surprises to a minimum. And it ensures that your business moves steadily and reliably toward certain specific goals. The right business plan can make all the difference in getting the funding you need, convincing loan officers, suppliers and your management team that youve thought things through, and that youre committed to your enterprise, whatever it may be.
Dont Put the Cart Before the Horse
Many eager entrepreneurs start their business before they finish their business plan. Bad Idea. They say they dont have the time for a formal business plan, or that the market is simply changing too fast. They need the flexibility to react. Think of your business plan like a road tripwith your banker and management team all packed in the same car. Would you rather plan your route ahead of time with a map? Or start driving and wrestle with the map while you drive? So what does a good business plan consist of?
The Executive Summary
This should appear first and summarize the important elements of your entire business plan. It should include an overview of the industry you plan to compete in, brief profiles of the major companies in this industry, their estimated sales, where the industry is headed, and any trends that may affect the industry now and in the immediate future. Youll also need to introduce the products or services your business will be selling, your USP (Unique Selling Proposition) and any barriers youll need to overcome to break into this industry. Next, comes your competition, their market share, and how you plan to protect your product or process (i.e. patents, copyrights, trademarks, franchise rights that you either hold or plan to acquire) to ensure you keep market share.
Analyze the Market
Heres where youll go into depth about the primary target market for your product or service. This includes location and demographics and how your product or service will meet the needs of your market segment.
A Realistic Look at Your Competition
This will detail the competition for your product or service. Youll present an analysis of any and all advantages your competitors have over you, and exactly how you plan to address and overcome them.
Your Organizations Structure
How will you structure your organization? What are your human resource needs? Youll need to specify who will manage your business, and describe what each person will do.
Facilities, Equipment, Supplies
This is where youll cover your building/office sites, equipment facilities and equipment. Youll want to describe your manufacturing and/or assembly process, as well as any environmental requirements mandated by local, state federal laws. Youll also need to include the type and number of initial employees required to launch your business. And dont forget to detail any inventory requirements and list of suppliers you plan to use.
Financing Where Will You Get it?
How and where will you secure financing? Youll need to present details here that will pass the scrutiny of unforgiving funding experts. You might want to consult an accountant and tax specialist to help you with this section.
Marketing, Advertising, Promotion
What is your sales strategy? How will you price your product or service? Youll need to reveal your plans for advertising and promotion. Initial and ongoing. What media will you use to showcase the benefits of your product or service?In conclusion, it might be a good idea to start with the detailed sections first, then write the Executive Summary. Finally, try to include as many facts as you can and be as detailed as possible.