Entrepreneurs recently have very great ideas for businesses, but having an idea is one thing while turning it from the incubation period into the processed stage and powering it to success is another different thing entirely. However, this content would help you turn that idea into an achievement by teaching you how to write a business plan.
WHAT IS A BUSINESS PLAN?
A business plan is a written document containing the business’s goals, describing the business’s nature, the sales and marketing strategy, the method for attaining those goals and the time frame for achievement. In other words, a business plan is a compulsory note for every business. A business without a plan is like a traveller without a road map or an individual without a goal. A business plan is the road map of every business. It gives firms direction on what to do and how to do it, and how things are done would be done.
As a beginner, having a well-written business plan is essential as it serves as a guide for you and other stakeholders while you grow your business. It is a necessary part of your business greatness. To help you produce a smart and outstanding business plan, we have written this to guide you through it. In this guide, you will learn how to write a business plan step by step
The need for a well-written business plan can never be overemphasised because irrespective of the nature of the business, it gives:
1) a clear business plan from the first day, you focus on the crucial goals for the establishment’s development, providing a clear guideline for its activities.
2) For a start-up company, the whole process of starting a business would have caused lots of stress. However, a business plan gave you an edge to be ahead and prepared to know what is expected of you fully well. As such, it would reduce the impact of the stress on both the individual and the company.
3) It helps you keep track of how focused you have been and what you have achieved. With time, it can be looked back on to make references as time goes on.
However, a business plan’s primary aim is to provide investors and finance to help your fledged business. The sales aim is to attract and keep the deep pocket investors to provide the financial aid you need to get your business up and running.
Having grabbed the idea that a business plan is as crucial as the business’s finance, this content will teach you elaborately the secret on how to produce an excellent business plan.
6 EASY STEPS THAT PRODUCE AN OUTSTANDING BUSINESS PLAN (How to write a business plan).
Step 1: EXECUTIVE SUMMARY
This is the first part to critically think about before writing a business plan. Just as the name sounds, it is a summary of every aspect of the business plan. It answers the questions of what, where and why. This means that any information written would correctly answer those questions. Write it to stand on its own and be regarded as an essential part of a plan. Because, at a point, some investors might only ask for your executive summary and use it to decide whether to work with your company.
To efficiently develop one, follow these steps ;
Mission and Vision: Only precise words and paragraphs should explain your business goal and what you choose to achieve. Remember, this is the first part they read, so it should be crafty and briefly written to make them interested and keep them reading.
Company History: state when you formed the business, the name of founders and roles, the number of the employees and the location of the company.
Highlights: if it is a start-up business plan, you should just give information on your experience from your past endeavours.
On the other hand, the traditional business should include examples of any growth you have seen since its conception. It is evidence supporting what you have done and the success rate of what you will do.
Products and Services: in a sentence, you summarise what you plan to offer and who your targeted audience is.
Financial information: this is an important area. Ensure you include financial goals at the end of the executive summary with details about your past economic achievements with investors and banks (if any).
Lastly, kindly state where you plan to see the company with their investments in years to come.
All these should be kept precise, relevant and written assertively to determine its future.
STEP 2: COMPANY DESCRIPTION
This step is a bit similar to the executive summary. It is an echelon look into the structure of your business and what you do. It is a description of the most critical points about your company. It gives an essential background of the business, and it tells more about what the company does, your targeted audience, how you will be able to serve them and the legal structure concerning your services to them.
Here are the guidelines on what to write;
In straight and catchy words, the company explains its input and what you want to achieve with what they have been doing.
Your target market; state who your target market is, how you plan to reach out to them and how best your product will be useful to them.
This part should be brief and captivating as it will keep the investor moving to the next point.
Here you will explain in detail the structure of your company. You should start by describing the management hierarchy, i.e. who is in the company, the company’s ownership, and at what percentage, how it should be structured legally, How the company operates, and who the key decision-makers are.
Everyone’s background is and what their experience would bring to them about the company’s success.
As a beginner, if your team isn’t big enough and you would probably need to expand in the future, it is vital to list out those key positions you would want to hire to achieve your goal. These details are essential to investors as they will want to know who’s behind the company and convert a good idea into a great business.
STEP 4: PRODUCT AND SERVICES
Here you tell them the specialty of your company. The kind of product/services they offer, Who they offer the services to, and how they plan to increase the audience’s number.
YOUR BUSINESS PLAN MUST INCLUDE a description of the products and services you offer. This is true even if you have an established business because the readers may not be familiar with your offerings.
IF YOUR PRODUCT IS NEWto the marketplace, you must include a very detailed description and, if appropriate, support the report with even more detailed aspects included in an appendix. YOUR BUSINESS PLAN MUST INCLUDE DIFFERENTIATING ASPECTS of your product(s) or services (so as not to sound like “me too”). They may include price, service, support, training, delivery, or other aspects.
CONSIDER PERSPECTIVE, AND FROM WHICH VIEW, or views, it is essential to describe your offerings. For example, you may operate some high-speed drive-thru service. It may be necessary to describe the operating procedures lending to high-speed; it may be necessary to tell the associated convenience from your customers’ perspective. From the lender or investor’s perspectives, it may be essential to say both. Looking for
You should be able to strategically devour to the best of your knowledge in simpler terms about your company’s services or product. While keeping it short, you should also chip in your company’s status if it is in the idea stage or have products or services ready to market. If your product is still in the ideation stage, explain how you plan to drive it to the final step.
STEP 5: MARKETING
Marketing is the soul of every business. So you should concentrate very well on the marketing strategies which you would use. You must be clear and concise while stating how the plan would go.
Your plan’s market analysis section provides evidence that your company can exploit a niche in the market. This analysis provides the foundation on which your marketing and sales plan will rest. An in-depth analysis of your industry, market and competitors is highly needed here. This analysis gives the investors the confidence that the company has a solid understanding of marketing, and it’s a strategy, and you can offer better services.
The market analysis has three core component, and they are:
1) an industry analysis, which assesses the general industry environment in which you compete.
2 )a target market analysis that identifies and quantifies the customers you will be targeting for sales.
3) a competitive analysis, which identifies your competitors and analyses their strengths and weaknesses.
The precise way in which you choose to organise this information is up to you. As long as you include all the necessary facts, several outline forms can work well. Just keep the purpose of your plan in mind, and highlight or expand the sections that have the most powerful application to what you’re trying to accomplish.
It’s also important to realise that you should be doing a lot of research and learning an enormous amount about its marketing environment as you go about planning a business startup or expansion. Your business plan is not intended to include everything you’ve learned. It will just summarise the highlights in a way that shows the reader that you understand your industry, market and individual business.
To achieve this, you will have to;
write the best opportunities in your market
State who your competitors are
What their strength and weakness is
What is the leading market, product and services? What you are so doing to improve the top products or services
At this point, you are to write why you are better than every other brand as to why he should choose you over them.
STEP 6: FINANCIAL PLAN
Each section of a business plan has its own set of required pertinent information, and the financial section is no different.
The most crucial step after the idea has been made. It means that you have to be analytical while setting up the budget. You will have to detail your financial plan with projections and revenue forecast for the first 12 months and annual projections for the remaining 3 – 5. And would help give your investors the mindset that you are set out for business.
“There are two parts to the financial component of a business plan: historical data and prospective data,” according to Spaziano. “If you’re a startup, you obviously won’t have any previous financial information for the company, so many lenders will want to see your personal financial information instead of, or in addition to, your business financials.”
Historical data includes items like your balance sheet, cash flow statement, tax returns, and capital. In contrast, prospective data includes details like a projected income statement that will help lenders and investors understand how you will invest their money.
Finances are the backbone of a business, so when writing the financial section of your business plan, be thorough.
A financial business plan is created by gathering all the business components and expressing them in numbers – both revenue and startup expenses. Your business is selling a product or service at a specific price point, and the goal is to prove that your business is viable. The financial plan is where you translate ideas into numbers.
“You are explaining where you plan on getting cash, what you will spend that cash on to start the company and what the operating cash flows of the company will be in the first few years. Make sure to show how lenders and investors will receive a return on their investment.
Ensure that your projections match the numbers you put together for the funding request portion of the plan. At best, any inconsistencies here could delay consideration of your application, and at worst, could be a signal that you’re not as on top of things as you should be, disqualifying you altogether.”
A business plan has been recorded as the easiest route for a successful business. This use of this will make business more comfortable and more successful. Since some steps need more attention than others, all of the steps are very important and are a determinant factor to the business’s future and should be treated seriously.
Writing a business plan isn’t as hard as people take it to be, and with these steps, you would arrive at a beautiful future map of your business. You can also get come business plan template here.
With our expertise, you'll no longer hit a brick wall when it comes to growing your business. Now, we can easily assist you to get your desired audience and sales. Choose any of our offered solutions to enjoy amazing results!