A business plan is a written description of your business’s future, an essential roadmap for the business success. You start here, today, with certain resources and abilities and you want to get to a there, a point in the future at which time your business will have a different set of resources and abilities as well as greater profitability and increased assets. Your plan shows how you will get from here to there. This living document generally projects 3-5 years ahead and outlines the route a company intends to take to grow revenues.
The exact structure of a business plan may vary but should include the following components:
Your executive summary is a snapshot of your business plan as a whole and touches on your company profile and goals. For an established business, the Executive Summary should include the Mission Statement, company information, growth highlights, products/services, financial information and summarize plans for the future. For startup or new business, the Executive Summary should include the experience and background as well as the decisions that led to start this particular enterprise.
Your Business description provides information on what you do, what differentiates your business from others, and the markets your business serve.
Before launching your business, it is essential for you to research your business industry, market and competitors.
Organization & Management
Every business structured differently. Find out the best organization and management structure for your business.
Service or Product Line
The business plan should include information about the specific benefits of your product or service – from your customers’ perspective. It should also talk about your product or service’s ability to meet consumer needs, any advantages your product has over that of the competition, and the current development stage your product is in (e.g., idea, prototype).
Marketing & Sales
Marketing is the process of creating customers, and customers are the lifeblood of your business. In this section, the first thing is to define your marketing strategy. There is no single way to approach a marketing strategy. The strategy should be part of an ongoing business-evaluation process and unique to your company. However, there are common steps that will help with the thinking through the direction and tactics that will drive sales and sustain customer loyalty. An overall marketing strategy should include a market penetration strategy, a growth strategy, channels of distribution strategy and communication strategy.
After developing a comprehensive marketing strategy, the next step is defining the sales strategy. This covers the actual product sale plan. The overall sales strategy should include a sales force strategy and sales activity.
In case there is a need for funding for the business, the funding request should include the current funding requirement, any future funding requirements over the next five years, the intention of the funding usage and the strategic financial situational plans for the future.
The next step after analyzing the market is developing the Financial Projections sections that include Historical Financial Data and Prospective Financial Data. For an established business, the historical data related to the company’s performance is required. Most creditors request data for the last three to five years, depending on the length of time you have been in business. The historical financial data to include are your company’s income statements, balance sheets, and cash flow statements.
All businesses, whether startup or growing, will be required to supply prospective financial data. Most of the time, creditors will want to see what you expect your company to be able to do within the next five years. Each year’s documents should include Pro-forma statements that forecasted income statements, balance sheets, cash flow statements, and capital expenditure budgets.
An appendix is optional, but a useful place to include information such as resumes, permits and leases.
How to Make the Business Plan Stand Out?
In order to make the business plan stand out the business plan should be clear about what the business have to offer, avoiding becoming a jack-of-all trades and master of none and the identification of the business niche.