How to Write a Business Plan Properly? is the important point to know when starting a business. A strong business plan can be a strong foundation for your business.
What is a Business Plan?
A business plan is a formal written document containing business goals, the methods on how these goals can be attained, and the time frame within which these goals need to be achieved. It also describes the nature of the business, background information on the organization, the organization’s financial projections, and the strategies it intends to implement to achieve the stated targets. In its entirety, this document serves as a road map that provides direction to the business.– wikipedia
Business Plan is a written description of your business’s future. It tells what you plan to do and how your business plans to do it. It describes how you star here, today with certain abilities and resources. And how you go there in the future, at which time your business will have different and increased resources, assets and abilities as well as greater profitability. Business Plan simply shows how you will get from here to there in the future. So it is very important to know, How to Write a Business Plan Properly.
A Business Plan is a road map for your business progression. Because it provides directions for your business future and helps you to avoid bumps or misdirection on the road. So, a Business plane is a big investment for your future. Also, if you need to get a bank loan for starting your business, bankers will ask for a proper business plan too.
Business plan help to make a sense about your business for your lenders, investors or other stakeholders. So your business plan should be a blueprint for a successful business.
What are the benefits of having a Business plan?
1. A business plan is a road map for your business progression.
2. Portraying a comprehensive overview of your business
3. Sharpening focus to implement your strategies
4. Aligning priorities appropriately
5. Have safeguard in place to manage changes
6. Coordinating strategic alignment
What are the components of the Business plan?
1. Overview or Executive summary – A snapshot of your business
2. Business description – It should be given basic understand about What is your company has done and the basic structure of your business.
3. Business environment analysis
4. Marketing analysis and marketing plan – Research on your market and competitors
5. Industry plan
6. Competitive analysis
7. Marketing and sales – All details about your target markets, how you will market your business and sales strategy. Research on your market and competitors
8. Organization and management
9. Business and management structure
10. Service or Product – Details about your product or services (Primary products and other products) you are offering, Their results and impacts for customers.
11. Production and operation plan – Your production process
12. Goals – Your short term and long term goals about sales, Revenue, and developments.
13. Team and management plan
14. Funding requests and Financial projections – How much money you will need for next years
15. Appendix – Optional section that includes resumes and permits
Those are the important components of the business plan. so it is very important to add the above point to your business plan. Then, let see How to Write a Business Plan Properly?
How to Write a Business Plan Properly – Step by Step Guide
1. Do research
To write a proper Business plan it is your responsibility to know everything about your business and your industry that you are entering. To know more about your business and your market you need to do research first. It will help you to know and read everything about your business, industry, and audience. Those details will help and make easy for you to write your business plan properly.
“Research and analyze your products, your market, and your objectives expertise.”– William Pirraglia
To write the perfect plan, you must know your company, your product, your competitors and the market intimately. So, consider spending twice as much time researching, evaluating and thinking as you spend writing the business plan. Also, research how it looks like other business’ business plans.
2. Create your Executive Summary
Executive Summary is the first chapter of your business plan. This summarizes the key elements of the entire business plan and it is the very first thing that people will read in your business plan. This section explains what your business does, where your business currently stands, and where you want to take your business in five to ten years.
What points to include in your Executive Summary?
- Mission statement – Explain what your business is? Why it exists and the goals of your business.
- Company information – Date of commencement, Names of founders and their roles, number of employees, locations, owners
- Highlights – Unique characteristics of your company, Financial market highlights or key milestones of the business.
- Products and Services – What you sell, and to whom sell it, Plans for a product offering
- Financial information – Capital funding, investor activity, banks or lenders information.
- Future plans – Where your business is in the future, and how it’s getting there
Executive Summary must be in one or two pages and simple. Always try to keep it short and sweet
02. Add your Business/Industry overview
This step may sound similar to the above step, However, the company overview is a top-level look into the structure of your business and what it does. Also, you can add industry trends, major players in the industry, and estimated industry sales. This section will also include a summary of your business’s place within the industry.
What points to include in your Business/Industry overview?
- What does your business do? – Give readers and investors a general sense of your business. Its nature of the business and its activities.
- Industry and marketplace of your business – Explain the nature of the industry and marketplace that your business. Explanation of your marketplace.
- The legal structure of your business – Describe the legal structure of your business and what kind of business entity your company is and provide an overview of your ownership structure.
- The company’s business structure business strengths and advantages
- Company history
- Company vision for the future and relevant strategies
In this section, you need to perform an in-depth analysis of your business industry, market, and competitors. This allows readers, investors to come away feeling confident that you and your business have a solid understanding of the dynamics of your market, industry, and competitors. For proofed above, you need to include the following sections into the Market analysis.
- Industry description
Describe how big it is, how it is grown in the past, what are the trends and characteristics, how is the predictions of the market will grow in the future? Important competitors in your market and their shares.
- Target market overview – What is your target audience?
- Target market characteristics, size, and growth
Who are the customers in your target market, and what are their needs? Who are the competitors in your target market, where is your target market located, what is the key demographic you are serving?
- Target market size and growth
How big your target market is? How many, how often, and at what time of the year your target market makes purchases in the overall industry. The projected growth of your target market.
- Your market share potential
How much market share do you expect to gain in your targeted geographic area?
- Market pricing
What is the best estimate for pricing your products, how you should distribute your product, and how you can get ahead with promotional strategies?
Any kind of barriers to market entry such as changing, regulation, technology, high investment outlays, or lack of personnel in the area.
- Competitor research
Identify your top competitors in the market and look at their market share, strengths, and weaknesses, any barriers they present, partnerships and so on. How is your company different from your competitors?
04.Define your business’s organization
That section defining your business’s organization and management structure. It explains who does what in your business, what are their background, and what their past experiences bring to the team.
- Organizational structure
Should include an organizational chart showing how your business is structured. This illustrates who is managing what aspect of your business.
- Ownership structure
Explain how your company is legally structured, who owns what, how much they own.
- Background of owners and board of directors
Explain the background of your team, managers, partners, and board of directors. That proves you have surrounded yourself with individuals who can and will make your business a success.
- Hiring needs
If your team is not big right now, you will need to expand your team in the feature for achieves your goals. Foe expands your team you need to hire people. So list out it.
05.Product and services
In this section, you need to position the products or services your business provides. You need to describe your services or products and who it’s intended for, what need does it specifically fulfill?
In this section should contain
- A general description of your product or services
You need to include the details of your products here. Specify how your product serves the needs of your customers and how it is different than your competitors.
- Current status of your products
Where is your offering currently stands, is it in the idea stage or final product stage to go to market?
- Product development research and goals
- Intellectual property
- Sourcing and fulfillment
Wherefrom the materials coming from? How you received them, how often you need to fulfillment
06.Explain marketing and sales plan
From this section, you explain how to market and sell your products or services? You should explain how will you create customers and get interested in your business and your products?
In the marketing plan, you might look like:
- should cover how you are positioning your business and products. The way you positioning your brand determines how customers find and interact with you. This is what makes you stand out against your competitor in a branding sense.
- you will reach your customers? This involves any plans you have for packaging your products, advertising, and dealing with public relations.
In the sales plan, you might look like:
- will you sell your products? Go you need a sales force? If yes, how big does your sales team need to be? Who will train them?
- Selling strategy
- an overview of how you will dell your product? Describe what is your sales funnel that you are using?
07. Details your financial plan and projections
With this part, you need to explain your financial plan and projection. If you write a business plan for your existing business, you can use financial data from past performances and financial statements. But if you haven’t previous financial data from your company, you need to include financial projections which determine by research and analysis on the industry and your top competitors.
You should need to include below essential documents to this section,
- Statements of projected income
- Cash flows forecasts
- Balance Statements
- Capital expenditure budgets
Also, you need to include the details of any funding needs in your business has or will have in the future. For that you should including the below requests:
- The funding amount you need right now
- Any funding you will need in the future
- The purpose and impact of the funds
08. Add an appendix
That section includes the supporting information which you didn’t include thus far in your documents. If you have any additional data points, charts, footnotes, legal documents, and product pictures or further explanations that are essential to creating a complete business plan.
7 Rules for writing a Business plan properly
1. Keep it short and sweet – the Business plan should be short and sweet. Try to keep it 30 to 50 Pages.
2. Use simple language
3.Know your Audience well
4. Don’t be intimidated
5.Communicate the company’s purpose and vision
6.Think efficient and concise
7. Get support from your team
Your business plan is the essential foundation of your business. Learning how to write a business plan properly can be the most important thing when you starting up your business. A business plan doesn’t write by itself. You need to spend some time and effort into writing a business plan properly.
I hope the above step by step guide for How to write a business plan properly will help you to write a proper business plan. And if you have any problem or more suggestions on how to write a business plan properly? please share with us in the comments section below.
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