Don’t think of a business plan as only being useful for securing the money you need to get your idea off the ground, either. It’s a great way to convince both suppliers and customers to support your fledgling company. Plus, the research conducted for your plan will also help with ensuring your business takes the right steps during those vital early stages.
Due to all of the benefits on the table, it makes sense to dish up a high-quality business plan. So how can you achieve this goal? Well, with the following guide, you will learn some useful pointers in writing a business plan which sets you up for success.
Make sure you have all the right details
Unlike what some candidates on the TV show The Apprentice believe, you have to use a lot more than a couple of pages to produce an effective business plan. It needs to incorporate various details and follow the right structure. If it fails to do this, investors are unlikely to take much interest in your business idea.
When putting together a business plan, ensure it includes the following sections:
- Executive summary: This will provide a brief overview of your planned company, including the concept, financial requirements, and current business position. It makes sense to produce this after completing the rest of your business plan.
- Business description: Detail your company’s products and services, history, ownership structure, etc. It should also concentrate on the type of customer market you intend to target, as well as the products and services you plan to market.
- Market analysis: Look at your competitors and receive feedback from your target audience. Competitor analysis helps with understanding the offerings and current positioning of your rivals, while a SWOT analysis can assist with identifying your company’s own strengths, weaknesses, opportunities, and threats.
- Management and operations: This will describe how your business plans to function. It will detail how your business is expected to operate on a day-to-day basis while also breaking down the responsibilities of each division in the company.
- Marketing and sales: The strategy you have for promoting your business and attracting/retaining customers. This will include the marketing strategies you intend to use and their cost of implementation, as well as your plan to upsell and retain customers.
- Financial forecasts: Measurably show your company’s objectives by looking at costs, why you need financing, sales forecasts, etc. This is generally split into three different sections: income, cash flow, and balance sheet. The income details the company’s potential to generate money, cash flow shows how much money is required to meet certain obligations, and the balance sheet supplies a general summary of your financial information.
- Risk management: Take into account the risks your business could face when it’s up and running. This section identifies the risks your business is liable to face, as well as strategies to manage these risks should they occur.
- Appendix: This includes copies of important supporting documents, like contracts, market research results, and credit history information.
Just remember: when writing a business plan, there is no set way of completing this task. Most will follow a traditional path, but don’t be too dissuaded if you want to go with a more creative document if you feel it has a greater chance of hitting the mark with the intended audience.
A professional approach
Your business plan must be crafted professionally. This plan is a representation of your company. If it’s full of mistakes and appears amateurish, those reading it will feel the same way about your business.
When it comes to writing a professional plan, the first step is to make sure it doesn’t contain any spelling mistakes. If you’re not going to hire an editor to overlook your document, it also makes sense to run it through a program like Grammarly to catch out any basic errors.
Another top tip is to avoid waffle. Only include what is needed; there’s no word count you need to meet with a business plan. Focus on what the reader needs to know and remove any unnecessary details.
Be a realist
There’s no point in setting unrealistic expectations. You always need to factor in the challenges your business is going to face. If you have a strong idea, it will simply stand on its own merit – and you will also show to investors that you’re taking into account all angles and not overlooking the hurdles your company will inevitably come across.
It’s true: a business plan is a text-heavy document. Yet this doesn’t mean you cannot utilise the power of visuals at appropriate times throughout the plan. For example, if you have concept art for a product you plan to manufacture, include a picture as a visual aid. When putting together your financial forecasts, use graphs and charts to bring your figures to life.
However, keep in mind that your business plan isn’t a picture book. While it’s nice to break up the text now and then, always try and avoid overdoing it when placing images throughout the document.
Image by Brooke Cagle