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Creating your own business plan

By Staff

A business plan defines your business strategy. It is an important document because it is like a map, showing the path your business will take in the future. It needs to tell exactly what type of business you have and how you plan to run it. All business plans are unique to a particular type of business, but they all must contain certain consistent objectives. Without a good business as a guide to future success, your business will go by the wayside quicker than you can blink.

 Why you need a business plan

A business plan serves two purposes. (1) It is your guide to running your business and (2) It is extremely important and required should you try to get addition funding for your business. It provides a clear picture of which direction your business is headed to both you and potential lenders and offers a strategy for marketing your business. In addition your business clearly defines:

1. Established goals and strategy to achieve them.

2. Any obstacles and solutions for overcoming them.

3. Both the legal and organizational structure of the business.

4. Financial need and offers future financial projections.

How Long Should Your Business Plan Be?

So how long does any good business plan need to be? Well it all depends on how you will use it. For instance, if you are looking for funding, you will need to create a more extensive business plan that you would if it were created for your personal use as a business map. Lenders are sticklers for information. They will want a great deal of detail in the business plan before they agree to give you money. It depends entirely on its intended use.

The Uniqueness of Your Business Plan

Your business plan is unique to your business alone. No two-business plans are the same, they vary based on the type of business. The main focus of any business plan is to make sure that it presents an accurate picture of your business, now and in the future. Search the Internet for sites that offer business plan templates to save a lot of time and effort. Be sure to find a template that most closely resembles your type of business then modify it to your needs.

Drafting Your Business Plan

Three major areas are always covered in any good business plan. They are the business, the Market and the Finances.

  1.      The Business

When evaluating your business, you need to address and document in your business plan various aspects such as the legal structure i.e. sole proprietorship, partnership, or corporation. You need to make sure that you have chosen a good name for your business and list all the people who will be staffing it. Statements of unique positioning for your business, existing market conditions and what steps you intend to take to grow your business will be included as well. Equally and probably the most important element will be defining your product or service and how you manage to produce it and deliver it.

 2.      The Market

As with anything else, you have to know your audience. In this case your who your customers will be and what service or need are your fulfilling for them. You need to lay out in detail just how you intend to motivate your customers to use your service or buy your product. Also important is defining what medium you intend to use to attract customers. Knowing your competition is extremely important in any circumstance, but it too is an important element that needs to be included in your business plan. You unique position strategy to win market share and what percentage of market share you intent to target should be discussed in detail. Include any backup documents to support these claims. 

3.      Finances

Finally it comes down to money. A detailed financial plan both currently and for future financial projections must be included in your business plan. The cost of starting a business and how the money will be used are of key interest to lenders. Lenders will also be curious to see a timetable on your businesses projected profitability plan, which should include projections for at least 5 years out.

 Business Plan Elements

 The following elements are considered key to any business plan and must be included. Expand on certain details wherever possible to provide as clear a picture as possible.

          Executive Summary – Summarize important points in this section. Keep it to 3 pages or less. This part of the business plan will be of particular interest to investors and lenders. It will help them decide if your business is a worthwhile investment. Include your business Mission statement defining exactly what type of business it is, what activities it performs and why it is unique to compared to your competitors. List all business goals and objectives of your business. Quantify them and include a timeline for achieving them. Make sure they are realistic and attainable. If your can’t measure your plan your business will certainly be destined to fail.

          Company Summary – Summarizes the details of your business including how you will handle customers, business goals, the structure of your business, start up costs and the location of your business.

          Products and Services – This section discusses what you have to offer by way of products or services. It will focus on why your offerings are of interest to customers and what benefits they will gain. You will also show any competition to your business here and how you rank compared to them.

          Market Analysis – An in-depth analysis of current market conditions for your business to compete in is detailed here and the strength of your business in it. It describes the 5-W’s, who, what where, when and why of your market. and your strengths therein.

Marketing and Sales Strategies – Your detailed plan of how you intend to compete in a competitive market and win market share.

Sales forecasts and marketing  - Defines how you intend to attract customers.

Operations and Management – Listing of all management personnel and operational structure of your business. List all strengths, weaknesses, opportunities, and potential threats to your business through in-depth analysis of your business operations.

Financial Plan - Provide a detailed analysis of your businesses cash flow, P & L statement, break even analysis and all necessary financial indicators. This offers a complete look at the financial health of the business. All incoming and outgoing cash flow should be included. It gives a good assessment of how much money is available to meet you obligations.

 Follow the easy steps discussed here, and you will be well on your way to creating a solid, sound business plan.


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