When starting your own business, one of the things you need to do, especially when searching for capital investment, is to prepare a business plan.
This document basically spells out in black and white what your business will do, what its aims are, projected financial outlook, its structure, etc. Its purpose is to reassure any potential investor, both financial and otherwise, of the overall soundness of the new business, both in concept and cashflow.
But what things do you need to include in a comprehensive business plan? This article will take you through the important points to cover and hopefully provide you with an overview of what is needed to make your business plan a thoroughly professional presentation.
Before you begin drawing up your business plan, first you need to do intensive research about the industry you wish to operate in. It’s history, the state of the current marketplace, your competitors, etc. Once that is done, you’re hopefully ready to lay out on the page your business plan, so let’s go…
1. Executive Summary
This is the first thing any investor will read but usually the last to be written. It is essentially a snapshot of your business; what it is, how it will operate, what its goals are, how it plans to create a return on investment, etc. It should be both concise and compelling, provoking the interest of the reader so that they will wish to invest in this latest venture.
2. Business Concept
What gap in the market does your business solve? What are the key demographics you’re aiming for? How will your business fit into the current marketplace? This section should spell all this out clearly.
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3. Market Analysis
This section should provide the reader with a landscape view of your competitors, how you differentiate yourself from them, and how you plan to gain a commercial advantage with your own product and/or service.
4. Management Structure
Any investor naturally wants to know the team that will utilize their investment in the marketplace. Here you introduce the investor to that team; who does what, how they will operate, their strengths and talents.
5. Service And/Or Product Line
What is it you’ll be selling? What’s the advantages it will bring to customers? This section is where you match up your commercial product with customers needs.
6. Marketing Strategy
So you’ve told the investor what your product is and how it will serve a purpose in the marketplace. But the marketplace is all about visibility so how are you going to market it? Advertising, pricing, branding is what is laid out here.
7. Financial Requirements
Here’s where the rubber really hits the road. You have to spell out in very compelling terms why exactly a potential investor should part with good money to bring your vision to life. What’s in it for them, to be blunt?
You need to be very precise in this section, detailing financial projections, sales and income analysis, balance sheets, and cashflow outlays over the next five years at least.
8. Appendix
This is where the investor will be able to sift through corresponding and corroborating documents that back up your overall business plan. Make sure you have all such documents in order and easy to read.
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9. Additional Steps
Once you’ve compiled your business plan, go through it and check everything is accurate and up-to-date. Is it written in a manner that is both concise and compelling? Also, continually update it as new and relevant information presents itself.
10. Be Flexible
The marketplace is forever changing and as a result, you must be equally prepared to change your business plan if needed to accommodate shifting tides of market forces.
A business plan is more than just a dry analysis of facts and figures, it should tell a gripping narrative filled with ideas, innovation, and potential. Draw the reader into your dream and in turn they could provide the capital for you to realize it! Be bold, be brave, but above all, be yourself… good luck!
