Why do you need a business plan? What’s the purpose of a business plan?
The key to your business success is knowing what your goals are and documenting a business plan. Mostly, it is your road map to guide the launch and growth of your business. Your business plan is your most important document for your business besides the policies and procedures or standard operation procedures. You will need a business plan if you want financing from investors or lenders. It persuades partners or key employees to join your company.
As you write your business plan, carefully think through every step of starting your business, so you can set your goals towards success. As you write your business plan you will note any weaknesses in your business idea, discover opportunities, and develop strategies for deaing with challenges as they arise.
Keep your business plan clear and concise to ensure the reader can understand it. Avoid using too much vocational jargon or terminology. Document any research you include and show the sources for the information.
The contents for a business plan are typically as follows:
The Executive Summary should be 1 or 2 pages and include a brief explanation of the overview of your business, a description of your products and/or services, goals for your business, target market, your competition and what make your business different from your competition, your management team and previous experience, and financial outlook. The Executive Summary is the most important section of your business plan.
In this section, you highlight your company’s mission statement, vision, goals, target market (briefly describe), industry and what makes your business competitive, and legal structure (sole proprietorship, partnership or corporation).
Products and Services:
Explain what you sell, what problem(s) does it solve for your customers or how does it benefit to your customers, how does it compare to your competition, and how much you will charge. Information such as technical specifications, drawings, photos, patent documents, suppliers, manufacturers and products should be included.
In this section, you provide details about your industry, competitors, your target market and how you will market your products and/or services to your customers.
Explain the total size of your industry, trends in the industry, size of your target market, and trends in your target market.
Research by gathering information from going online or driving around town to clarify who your competitors are, and interviewing and/or surveying people who fit your target market. You should also research trade organizations, journals, magazines, and newspapers for census data and demographics.
Note any costs for startup, production, marketing and branding, recruiting employees, technology or patents requirements, tariffs and quotas, and unionization in your industry.
Also note changes in government regulations, technology, economy, and your industry.
Products and Services:
Describe your products and services, special features and benefits for the customer and how you will promote.
Who is your target customer? (including age, male or female, occupation, income, marital status, population statistics, interests)
Who are your key competitors?
Pricing of products and services.
What is your promotional budget?
Sales forecast for the next 3 months, 6 months and 12 months
Explain the daily operation of your business including location, rent, utilities, hours of operation, equipment, inventory, suppliers, payment and credit policies, staffing and processing. This is where you include information on any required licenses and/or permits, trademarks, copyrights or patents, insurance coverage, bonding requirements, environmental, health or workplace regulations affecting your business, and special regulations affecting your industry.
Staffing, Management and Organization:
Include biographies about your staff, qualifications, job duties, and information about advisors (lawyer, accountant, banker/financial advisor, board of directors, insurance agent, consultants, and mentors). This section should include a company organization chart.
Budgeting and Finance:
Provide details on expenses involved in opening for business and how much capital you need, estimating startup expenses as accurately as you possibly can.
A balance sheet will be required to be included and your personal financial statement.
Including your financial plan is very important. It should include profit and loss projections for 12 months, cash flow and a projected balance sheet, a ‘break even” calculation, and use of capital if you want to receive funds from lenders and investors.
Other options that you may include are a 3-year profit and loss statement and a 3-year cash flow statement
In this section, you provide agreements (leases, contracts, purchase orders, letters of intent), trademarks, licenses, patents, resumes of owners and employees, advertising and marketing materials, information on public relations, blueprints or plans, equipment list, market research studies, and a list of assets that can be used as collateral.
Preparing a business plan is one of the most important tasks in starting up a business. At My Essential Office Assistant, we work collaboratively with you to write your business plan. For more information on our business plan writing services, contact us for a 1-hour consultation.