Many entrepreneurs write a business plan only when they need to secure start-up financing. However, as you write it you will realise your plan is far more than a document for banks and investors to read. It makes you thing about what you are actually going to do and write it down. It is 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.
What should your plan contain?
1. Executive summary
Your executive summary should be 1–2 pages long.
It provides an overview of your business:
- concept,
- key objectives of your business and your plan,
- ownership structure,
2. Introduction
Details here should be about background - country and business history, vision and/or mission, objectives, and ownership structure.
3. Situation overview
The situation overview is your opportunity to demonstrate the viability of the business you are promoting by informing the reader on:
- the political/legal/taxation regime,
- economic situation
- social
- technological
Describe in greater detail the:
- size and growth of market sector,
- key markets within the sector,
- how customers will access your products or services, and
- which markets you will be targeting.
4. Products and Services
Expand upon your products and services. Include:
- features and benefits,
- competitive advantages,
- how and where your products will be produced.
5. Marketing Strategy
Describe
- the target market segments,
- your competition,
- how you will differentiate your products or services,
- the product or service pricing and promotion, including how your promotional programs will appeal to each of your target market segments,
- a plan of marketing tactics,
- 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.
List the::
- strengths
- weaknesses
of the business and how you intend to use the strengths and mitigate the weaknesses.
List also the:
- opportunities and
- threats
to the business and describe how you are going to use the opportunities and convert the threats to further opportunities.
7. Financial plan
This is the most important part of a plan and it’s worth dedicating most of your time to writing this section.
You'll need to show
- five 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 tables.
Document all of the assumptions you use in forecasting your revenues and expenses.
8. Conclusion
Briefly recap what you have said focussing on essential items of the plan.
8. Appendices
Include here items that give extra detail:
- CVs
- Market research
- Cost build ups
- References
