10 Steps To Write A Business Plan
- April 3, 2022
- SME Businesses
A comprehensive, well thought-out business plan is essential to the success of entrepreneurs and corporate managers. Without a plan, many investors will not even grant you an interview. A strong, detailed plan provides a clear road map for the future, forces you to think through the validity of a business idea and give you greater understanding of your business’s financials and the competition. According to recent survey, about 70% of successful business owners recommend writing a business plan before you start a business because when done right, business plans can result in extremely huge payoffs.
In this article is a step-by-step guide, to help you learn how to write a well-written professional business plan that can help you successfully start your own business, start a funding and grow. So read on;
- Create an executive summary
An executive summary helps you lay out all the vital information about your business within a short space. It is typically just an overview of your business. The executive summary appears first in the plan but you can write it last so that you can condense essentials ideas from the other sections.
- Compose your company description
Your company description should contain three elements. The first one is a mission statement. This is your business’s reason for existing. The second one is your company’s history. Here talk about the foundation date, major milestones, location, among others. Then finally the objectives of the business. These should be clearly defined and with clear objectives. These three elements will help give context to the bigger picture in your business plan to let investors know the purpose behind your company so the goals make sense as well.
- Summarize the market research and analysis
Here you will need a good understanding of your industry for you to outline your ideal potential customer as well as the actual and potential size of your market. Talk about the location, income, age, gender, education, profession and hobbies of your target markets. Also look for trends and themes.
- Conduct competitive analysis
The first step in conducting a competitive analysis is identifying with other companies that currently sell in the market you’re looking to enter. Take some time to think about what sets you apart as well as checking things like where they invest in advertising, the kind of coverage they get, the quality of their customer service, their sales and pricing strategies among others. Then create a table listing your competitors and include it in your plan.
- Describe your product line or service
Here talk about the benefits, the production process as well as the life cycle of your products or services. Describe some the unique features, translate the features into benefits and the emotional and practical benefits you offer to your customers. You could also talk about how what your business offers is better than what your competitors offer.
- Develop a sales and marketing strategy
In this section of the plan talk about your strengths and what differentiates you from your competitors. Explain topics like value proposition, ideal target markets and existing customer segments. You could also further describe the customer retention strategies, your growth tactics to expand the business, advertisement and promotion channels, among other issues.
- Compile your business financials
Every business needs a budget and a financial plan even for the startups, whose business’s might not yet have financial data, financial statements or comprehensive reporting. For those who have been around for a while and need investors, you need to include items like your income statements, balance sheets, cash flow statements and profit and loss statements. Ensure you provide at least three years’ worth of reporting and that the figures are as accurate as possible.
- Describe your organization and management
Every good business needs an equally good team. Here identify your team members and explain their benefits to your business. Also highlight their expertise and qualifications, the roles you still need to hire to grow your company as well as cost of hiring experts to assist operations.
- Explain your funding request
Here you can provide a range of numbers if you don’t want to mention the exact amount. Try to be as realistic as possible when outlining the amount of money you need especially for a small business. New businesses can raise capital by selling equity since they don’t have a track record of generating profits. They could also opt to borrow money but they will have to repay creditors both the principal and the interest on debt.
- Compile an appendix
A well-organized appendix will provide your readers with everything they need to supplement to the information in your plan. You could talk about the industry associations and memberships, key customer contracts and purchase orders, patents and intellectual properties as well as state and federal identifications numbers or codes.