How to Write a Business Plan – Components & Checklist
Are you planning to start a business? or
Do you want to grow your existing business??
The entrepreneur should accept the truth that above two scenarios requires lot of trail and errors methods to taste the success. A Business plan is a perfect match to the success of your business.
What is a Business Plan?
In simple terms, a business plan is a documentation form of what you do and how you do. It is like a roadmap to success. Drafting a business plan helps you have a clear idea about finances and competitions around your business.
Why do you need to have a Business Plan?
Usually, a business plan is sketched for 3-5 years to take control over your business. A key element is “Keep it up-to-date” to stay along with market and competitors.
A strong and well-outlined business plan can impress your investors to bring finances more than expected. It prioritizes your goals, strategies, defines objectives and finally gives a specific direction to your business.
It highlights obstacles, attracts partners & employees, efficient use of available resources and improves your marketing efforts.
Now, the next trigger question comes to your mind “How to write a Business Plan?”
A business plan is a valuable resource that helps you to identify your potential problems and plan ahead, either to raise money for your business or to build a better strategy. The components of Business plan that are essential while writing is as follow:
A summary always tells the reader what he reads in the document/book. Like-wise an executive summary outlines the business plan in the title page. It is a crucial component lending you a chance to impress your reader right in the initial stage itself. Give a rundown of concepts of business plan in this section.
A best way to begin with this part of business plan is, to tell the reader all about business. Begin with a short picture of the industry. Write it as tale and let the readers connect with it. Cover about your
- Business model
- Location of business
- Legal structure
- About the product/service
- Product description
- The present and future possibilities of market
- Provide reliable data, observations and sources of information
Apart from these points, give them a peak of how well your business is organized. Avoid making a lengthy description, try to replicate all your essentials as short as possible, so that the investor can get an idea about his investments.
Market Analysis helps the entrepreneurs to study market of your industry. While conducting market analysis make sure you cover market in terms of
- Evolving trends
- Sales potential
- Profiles of your ideal customers
It enables the entrepreneurs to position the business to obtain its share of sales in the market. Establishment of pricing, improving strategies and distribution helps the business to be positioned and acquire the target market.
Competitive analysis helps to track the strengths and weakness of present and potential rivals/competitors of his business. Entrepreneur can create a marketing strategy for product/service by considering product, price, promotion, distribution and advertising. This component of business plan paves a way for the betterment of the product.
Organization and Management
Give a brief of your organizational structure and showcase your best of the best employees in this component. Profiles of team members featuring their qualifications and expertise of areas can be a value-added point. These can be plenty of indications for the investors to get an idea of your competent team.
Sales Strategies and Timelines
Every business has its own market for its product. Gaining customers in turn gives sales to a business. Explain price and promotional strategies in this part of business plan. Give a detail list of your advertising platforms and how your strategies effects to summon the customers to have profits.
Mention benchmarks, goals and progress in the form of timelines. This chart of timelines can help you see growth and expansion of your business.
If you need funding, then quote a realistic amount in this component of the business plan. Tell the best and worst scenarios as a tale for betterment. Mention all your past and present funders of your business in timeliness to give your future funders an exact idea.
In this component of your business plan, summarize all your financial statements like – Income Statement, Cash-flow Statement, Balance Sheet. List out the cost of margin, gross profit margin, equities, long-term liabilities, net profits, basically your revenue information should be occupied in this component.
Although a business plan varies from one organization to another, the above are few but crucial components. A sound-proof business plan can help you to get more funds, sales, leads and better way of marketing.
Apart from the components, we present you a checklist of business plan elements for your ability to write a better business plan for your business.
- Mission and Vision statements
- Description of the organization
- Description of the product
- About the staffs, shareholders, partners, permits
- SWOT analysis
- Competitor Analysis
- Market Analysis
- Cash flows
Once you start this process you will find yourself looking forward to analyse, review and update your plan.