Are you thinking of starting a new business? Then you must have come across the term ‘Business Plan’ and you don’t know how to write a business plan. Chalking out the business plan remains the most important task to achieve success in the proposed business.
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How to write a Business Plan
Business planning is about writing a certain result oriented organized and methodical script. You are required to design your plan to obtain your purpose. It is a plan which considers the available resources, identifies the opportunities and problems, and manages those resources to get optimum growth and success. A business plan is not the thing required only for starting a business or for getting loans as perceived by most people, but it also helps to find out the shortcomings and run the business smoothly.
Although business plans vary from each other depending on nature, products, and local factors, the general outline is the same that includes the main components like Executive Summary, Description of the Company, Description of Products or Services, Market Analysis, forecasts, profit, loss, and future planning, Business Strategy and the method of Implementation, information of Management staff and sustainable Financial Plan.
Here, you must ensure that your plan should revolve around sound cash flow strategy and its strict implementation before writing down your business plan. You should not mix up profits with cash. Again implementation of your strategy plays a vital role in the success of any business. Assigning the responsibilities in a certain time frame and following up those plans can bring in desired results.
Need for Business plan
A business plan is like a road map. Here, you set your targets, identify the areas on which, more concentration is required, talk about the important measures, to provide the business plan for ultimate cash flow and business growth.
If you are intended to seek loans to fund your business then most of the financial institutions will ask you for a sound, feasible business plan. As a business plan is a clear refection of your future activities, it plays a very important role in getting your loans.
If you’re seeking investments in business then you require a business plan investment. The potential investors invest in the ideas, the people, their history, the technology the entrepreneur is using, the market analysis, and other local factors. The business plan serves the purpose to define the ideas and all these related factors and explain the concept of business to investors. While working with your partners you require such a business plan to define agreements between partners and convey the future vision.
Perhaps, the most important need for a business plan is for running the business smoothly. It also serves as one of the most useful tools for communication with your management team. While the daily routine business activities can be quite distracting full of surfacing problems, their solutions, opportunities, and commitments, it helps in keeping the business on the right track by reminding our short term and long term goals. A business plan is required to sell a business or to set a value on a business for tax.
It is high time to realize that this plan is not meant just for start-ups, loans, or investment. Moreover, business plans are much easier to develop. You simply plan the steps and stages, identify preferences, check the resources, and try to reallocate them to get maximum output and manage the cash flow.
Before writing down a plan, let’s understand what is a Good Plan
1. Try to keep your business plan simple, specific, realistic, and complete to implement in a much effective way to achieve your targets. While simplicity enhances the communication process, specific writing can help you to lay stress on particular areas. The realistic approach can result in a better success rate and it should conclude all necessary components.
2. The value of any good plan is measured by its contents and not by its length. A sound plan is broken up into meaningful paragraphs using readable bullet points, supported by useful illustrations of products, and business charts and graphs to illustrate important projections.
3. A good business plan sets the concrete goals, assigns tasks to different departments, and sets milestones and deadlines for tracking implementation. For every part of the business strategy, there should be an implementation of more than 10 parts.
4. Regular alterations and changes should be made in a good business plan according to the business condition. It should be always practical.
Types of Business Plans
According to the specific situation and personal need, these plans are known as start-up plans (the most common type of business plans), investment plans (designed to attract investment), internal plans, or operational plan (as a guiding tool in the course of business for your management team), Growth plan (designed to show your future expansion), etc.
How to Write A Business Plan
There are conventional components of a standard business plan. Although the order doesn’t carry any great importance, the conclusion of these main constituents can make your business plan appealing and acceptable.
1. Executive Summary – It is the concise summary of your business and though it appears at the top. Try to write it at last when you finished scribing other topics. It’s just a page or two of highlights.
2. Company Description – This contains the detailed pen picture of Legal establishment, history; start-up plans the information about your staff, etc.
3. Product or Service – It is the description of the product you are selling. You should lay stress on customer benefits.
4. Market Analysis – Description of your market trends, the needs of the market, your target sector of the market, the location of such a targeted area, how to reach them, etc. All you have to do is to conduct a comprehensive market survey to conclude the analysis.
5. Strategy and Implementation – Be specific. Include management responsibilities with deadlines and specific budgets. You have to make sure that all these activities carrying out tasks are tracked regularly for results.
6. Web Plan Summary – You should include a business plan summary such as business development costs, manufacturing, and operational costs, sales and marketing strategies, etc..
7. Management Team – If you haven’t handed over your plan to the management team then this is the time to hand over your business plan to them.
8. Financial Analysis – Make sure you have prepared financial analysis correctly such as operations cost, profit, loss, cash flow, etc
Now, you know how to write a business plan based on these guidelines. Remember, nobody is perfect but a good Business plan and perfect implementations can make fortunes!