The basic foothold of the business lies in its business plan. A good business plan provides strategic planning helps you in the smooth running of the business as well as bring new investors or business partners for your business. Writing a business plan is not that difficult either. It doesn’t require any big degrees to put your pen down for a business plan. This guide will explain to you to write a successful business plan by following very easy and effective steps.
Selection of a business plan format
There are no specific ways of writing a business plan. When this very question of how to write a business plan strikes your mind, remember that it is important that the plan necessitates your demands.
Business plans generally categorized under two headings: one is traditional while the other is lean startups.
Traditional business plans are comprehensive and illustrative. This kind is preferred most by the investors and lenders. The detailed explanation helps them to understand your business goals and strategies. Though it takes more time to write, no doubt, it will always have an everlasting impact.
Lean startups, on the other hand, are less common. Lean startups use a standard structure, but its centre of interest lies in the most important particulars of your business. Thus these are very fast to write and generally completes in an hour or so. This type of business plan doesn’t encourage the investors to invest and they may ask for more information.
The ‘seven sections’ describes how to write a business plan
Whether your business is a startup one or an established one, a business plan should cover six essentials to grab the opportunity you are searching for. The ‘seven sections’ will show you, how to write a business plan as well as explain, how your business idea will figure out and help in the growth of the business. Detailed analyses of these sections are described in this guide.
Executive summary, in brief, is the introduction of your company. This generally includes details about your company and the success story behind this. Let’s see what the things you should write are in a winning executive summary.
First, while writing an executive summary don’t forget to include your mission statement.
Second, it is important to mention the product or services that you are providing to the market and how it has become a solution to a problem.
Third, the specifications of the target market are required. So, you should briefly describe your target market. By target market, we mean the potential customers. For example, if you are a seller of some everyday commodities, people irrespective of any distinction will become your target market. On the other hand, if you are a service provider, your target market will comprise of those customers who are in need of your service. Thus, it is important to mark these specifications and mention them in your summary.
Fourth, your executive summary should have a mention of competition in the market. Why your business is the best for your target market? Are there any other alternatives in the market?
Fifth, to write a good executive summary, it is important to add information about the location and your team; the leaders and the employees who are working for you.
Last but not the least, you should highlight your financial data and growth plans if you are planning to get an investor for your company.
This section provides detailed information about your company. Here, you have to mention the solution that your business is providing in an illustrative approach. It is necessary to be specific here. List your consumers or businesses whom you are planning to serve.
Along with that mention the advantages of your business over others in the market and why your business will be successful in the near future.
In the previous section, Business Description, you mentioned about your strengths and advantages over other competitors. In this section, you have to focus on market research. What does market research show? Market research shows what is trending in the market. For this reason, you should have knowledge of your product or service in-depth and also know the target market.
Company and management summary
In the executive summary, you will have to introduce your leadership team and the employees. In this section, you will have to explain the structure of the company and the leaders who will run it. It is that section where you have to mention how you are planning to work and who is in charge of the different areas. Not only that, but it is also good to mention the unique experience and expertise of the in-charge in the different sectors. Some businesses also include the resumes of the key members of the business to gain confidence among the investors and customers.
The next thing that you need to write here is the description of the legal functions of your business. While writing this you should mention about the registration of your business. Are you the sole proper proprietor or having partners? Is your business registered under the Registrar of Companies or you are intending to do so. If it is registered already, mention whether it is a private limited company or LLC or LLP.
Design & Development Plan
The design and development plan of the business plan focuses solely on the product or service you are providing. In this section, you have to write the lifecycle of the product or service. This section is important for the investors because in this section you have to describe your product or service in detail. You have to mention its longevity and the materials used in case you are dealing with products. Explain how your products or services will be beneficial for your customers.
It is important to mention about copyright issues and patents here. Also, it is praiseworthy to write and explain the research and development of the service or products your business is providing.
Financial plans are perhaps the most important thing when we discuss the topic of how to write a business plan.
This section of the business plan is mainly for investors. Highlight your financial projections to your readers.
Income statements, balance sheets, cash flow statements of the last three to five years should be included if you have an already established business. Mark your long- sight visualization on financial decisions, at least for the next 5 years. Analyze on the prospective income and expenditure and make sure to elucidate them clearly in your future projections. The funding requests depend a lot on this. This is the place where you can use graphs and charts to explain your thoughts in the most effective way.
The last thing to be included in the business plan is the appendix. Generally, all supporting documents like resumes, legal papers, contracts, licenses, letter of recommendation, permits are included in this section.
A business plan is a strong foundation for your business
It is not necessary that all businesses make a business plan for investors. When you make a business plan you can have a crystal clear idea about your business strategies and financial planning. A business plan not only helps in future planning of your business but also helps you find the loopholes that need to be fixed. Whether you have already written a business plan or you are learning how to write a business plan, this guide will provide all the required information that may help you in the future.