Creating a Business Plan that Means Business
How important is a business plan? What should it include? Here’s a brief overview of the how and why of business plans, and what you’ll need to get started as you face the complex and challenging task of launching a new business.
Developing a well-crafted business plan is crucial to the launch of any business. It sets up goals and realistic expectations. It’s your road map to success with signposts that reveal your strengths and weaknesses. It also helps keep surprises to a minimum. And it ensures that your business moves steadily and reliably toward certain specific goals. The right business plan can make all the difference in getting the funding you need, convincing loan officers, suppliers and your management team that you’ve thought things through, and that you’re committed to your enterprise, whatever it may be.
Don’t Put the Cart Before the Horse
Many eager entrepreneurs start their business before they finish their business plan. Bad Idea. They say they don’t have the time for a formal business plan, or that the market is simply changing too fast. They need the flexibility to react. Think of your business plan like a road trip—with your banker and management team all packed in the same car. Would you rather plan your route ahead of time with a map? Or start driving and wrestle with the map while you drive? So what does a good business plan consist of?
The Executive Summary
This should appear first and summarize the important elements of your entire business plan. It should include an overview of the industry you plan to compete in, brief profiles of the major companies in this industry, their estimated sales, where the industry is headed, and any trends that may affect the industry now and in the immediate future. You’ll also need to introduce the products or services your business will be selling, your USP (Unique Selling Proposition) and any barriers you’ll need to overcome to break into this industry. Next, comes your competition, their market share, and how you plan to protect your product or process (i.e. patents, copyrights, trademarks, franchise rights that you either hold or plan to acquire) to ensure you keep market share.
Analyze the Market
Here’s where you’ll go into depth about the primary target market for your product or service. This includes location and demographics and how your product or service will meet the needs of your market segment.
A Realistic Look at Your Competition
This will detail the competition for your product or service. You’ll present an analysis of any and all advantages your competitors have over you, and exactly how you plan to address and overcome them.
Your Organization’s Structure
How will you structure your organization? What are your human resource needs? You’ll need to specify who will manage your business, and describe what each person will do.
Facilities, Equipment, Supplies
This is where you’ll cover your building/office sites, equipment facilities and equipment. You’ll want to describe your manufacturing and/or assembly process, as well as any environmental requirements mandated by local, state federal laws. You’ll also need to include the type and number of initial employees required to launch your business. And don’t forget to detail any inventory requirements and list of suppliers you plan to use.
Financing…Where Will You Get it?
How and where will you secure financing? You’ll need to present details here that will pass the scrutiny of unforgiving funding experts. You might want to consult an accountant and tax specialist to help you with this section.
Marketing, Advertising, Promotion
What is your sales strategy? How will you price your product or service? You’ll need to reveal your plans for advertising and promotion. Initial and ongoing. What media will you use to showcase the benefits of your product or service?In conclusion, it might be a good idea to start with the detailed sections first, then write the Executive Summary. Finally, try to include as many facts as you can and be as detailed as possible.
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ABOUT THE AUTHOR
Alex Kecskes is a former ad agency Copy Chief who has created effective copy and concepts for a wide range of ad agencies, Fortune 500 companies and startups. As owner of ak creativeworks, Alex provides brand names, as well as strategic copy for brochures, mailers, multimedia, articles, newsletters, PR and web content. He has published articles in a variety of publications about health, business and technology--this includes copy for over 130 different products and services. He has won such national awards as the Andy, Belding and One Show. For more information and samples, please visit: http://www.akcreativeworks.com