An Effective Overview to Creating a Business plan
Are you planning to start a business? Do you have trouble writing your
business plan? A
business plan acts as the foundation of your business by providing guidance and management as you start your business. It will show you how to grow, structure, and run your business with the aim of generating maximum profits. In addition to this, it will help you keep your plan and life on track just in case you go through a mishap while starting the business and get discouraged. It could also help you get startup funding from investors, as it clearly shows your determination and confidence in the business. This read will help you
format a
business plan.
Two Approaches to Business planning
There is no defined
business plan format. You just have to make sure that it captures your needs and goals. There are two known
business plan formats. They are:
- Traditional startup
This is the most common
format. Some people consider it standard. It includes detailed explanations of each section in the plan. This means that it will probably take a lot of time and space to draft it. Investors and lenders mostly request this
format.
- Lean startup
This
format strictly summarizes the important parts of the
business plan. This means that it does not need to the planner to spend a lot of time drafting it.
Format for a Business plan
It will take the following
format.
- Executive summary- Describe your company generally. This includes the mission statement, the service or product that you seek to offer your clients, basic info about your employees and staff, its location, and even financial informat
- Description of the company- You should describe your company and the solution it seeks to solve for your clients. As you do this, make sure that you list and describe your consumers with respect to persons or companies that you are willing to cater to. Make sure you outline and boast about your strengths.
- Market analysis- This area will help you have a better understanding of the market you seek to join. You will need to outline your competitors and their business strategies and products. Use this to outline some of the things you seek to approach differently.
- Management and organization- this area deals with the structure of your company. Make sure you provide a detailed description of your legal and organizational structure. Provide details of the people in-charge, their experience, and their input to the business.
- Product or service line- This area will require you to offer extensive detail on the service or product that you plan to offer your clients. This includes information on your intellectual property rights, among other things.
- Sales and marketing- Provide detailed information on how you are planning to attract and maintain your customer base.
- Funding- Just in case, the business plan seeks to invite investors, this area will help you to achieve that. Use this area to outline your requirements. It is advisable that you outline your funding needs for a period of five years minimum. Specify the reason behind your need for funds, inclusive of your debt payment strategy.
- Financial projections- This area will help you convince your investors that your business plan and approach is stable. Make sure you include the following documents: cash flow statements, balance sheets, income statements, capital expenditure budgets, and an explanation on your projections.
- Appendix- This area of the plan helps you to provide supporting materials and documents such as contracts, permits, legal documents, patents, permits, licenses, reference letters, pictures of the product, and even resumes.