Business Article - Business Plan Structures from Business Route
While your business is by no means required to possess a business plan, there are so many great benefits to having one in place that every business should absolutely have one. Business plans should never be restricted only to start up businesses, or to new product or service launches, because there are many other important reasons to have a solid business plan in place. Are you wondering why your individual company should have a business plan, or how much of a business plan needs to be in place?
Documenting a business plan is an easy but extremely useful process that can allow you to focus your owners and management directly on many facets of the business, including the business concept, the business strategies and any operating plans that need to be in place. Developing a business plan requires decision-making and consensus that may be neglected otherwise. Developing a business plan also forces business owners and managers to resolve issues and to make decisions based on financial projections that are made during the researching and business planning process.
Well documented business plans can make it easier than you ever imagined to communicate all of the most important facets of your business and marketing strategy to anyone who needs to know this information, including the owners of the company, management and in some cases other employees within the computer. Regardless of whether your company has been in business for many years or is just getting started, it is still a good idea to formulate a solid business plan. Now is the best time to start planning your business plan if you have not already done so. Business plans are also great for exiting a business, as they will allow for an accurate valuation to be placed on the business.
The following is meant to serve as a suggested guideline for a basic layout for a variety of different effective business plan developments. This is meant to serve as a consolidation of all of the best practices relating to business plan formation, and all of this information has been drawn from years of experience with management, entrepreneurship and business in general.
Your Cover Page –
Your cover page should include a title, a date, the purpose of your business plan, the name of whoever prepared the business plan, a brief confidentiality statement, a description of who the business plan is being issued for, and a document control number. The cover page is an important part of formulating your business plan but can be left until last if you choose to do so.
Purpose –
The purpose of your plan is meant to serve as the objectives of your plan. You should briefly touch on a number of different topics, but should mainly focus on the objectives for the business plan. Is your business looking to impress customers, to locate potential key executives or to attract financing or strategic partnering? Is your business plan meant to document strategies and action plans for the company, or to set a financial timetable and financial objectives?
Business Plan Contents –
The first part of your business plan content should be the executive summary. Your executive summary should be two pages maximum, and should be written last in the business plan writing process. The executive summary part of your business plan can actually be used as a stand-alone document in some cases. The executive summary should include your business concept, your business objectives, your current market opportunity status, any expected results and key risks or success factors, and specific information relating to your financial situation and financial needs.
The next section of your business plan content should involve the business opportunity and business concept information. You should focus on what needs need to be addressed, how your personal approach will be different, and why you believe that your business is going to succeed. You should also include market feedback, market need and current market solutions information if available.
The third part of your business plan contents is the mission statement. You want to attract interest in your business plan and your business by convincing other people to join your cause. You should include objectives that are clear and attractive and which explain who you want to be and what you want your business to be, along with a statement of your personal and business priorities and values, and information relating to timetables and milestones. This is a great section for convincing investors and lenders to sign on with your company, and for luring in new key executive employees and potential candidates for management positions.
The fourth section of your business plan's contents should be a in depth market analysis. Make sure to provide information that is both pertinent and relevant in order to best demonstrate the amount of competence and knowledge that you possess in this specific industry. The market analysis section of your business plan should include information pertaining to the market overall and any changes that it has recently experienced, including information on market segments, target customers and target markets, and specific needs and characteristics for different buyer types. This section of your business plan should also touch on the process of buying and selling in your specific industry.
The fifth section of the contents of your business plan should involve information relating to your competition. You should demonstrate an awareness of any competitors within your industry, as well as your own personal ability to successfully compete with these competitors.
The sixth section of your business plan should be your strategic plan, which will allow you to describe the point at which you are beginning your business, what direction you plan to go into, and how exactly you plan to get there with as much detail as you can muster. You should include company background and history, resources, strengths and weaknesses and how they apply to your competition, a strategy for leveraging your company's strengths and for reducing its weaknesses, and an action plan detailing a step-by-step process for implementing said strategy.
Other sections that you should consider including in your business plan include, but are not limited to the following; Information on your management team, organizational plan and staffing structure, information on the products and services that are being offered based on whatever familiarity of the industry your intended reader has, and a marketing and sales plan. The marketing and sales plan is an area that is often neglected by the owner or manager of a company, but it is a very important part because it proves that you do have a plan for marketing and selling that is both effective and affordable at the same time. This may include sales tactics, a marketing strategy, strategies for positioning and presentation, advertising, promotions and incentives, publicity information and website marketing just to name a few. You may also want to include an operations plan in your business plan, which will detail all of the important issues and factors that may affect the perceptions of your customers, as well as whatever costs are related to operations and the investment of capital into the company. This many include details on what facilities and staff are required, or what processes are in place for the delivery of product.
Finally, you will want to include a section in your business plan that speaks to efforts at risk analysis, by focusing on what could possibly go wrong, and how your business will tackle those potential issues. This includes business risks and market factors and how they will be addressed.
The last part of your business plan should be your financial plan. You should convert everything you have already written into numbers for various points in time, such as next year, and for the next three to five years. You should include facts and figures here, especially when it comes to starting balance sheets, profit and loss projections, a projection of the balance sheet, a value of equity ratio and analysis, financial needs and potential sources for funds.
Some business plans include appendices, which are essentially additional personalization in the form of a variety of extra information additions, such as information on key executives, marketing literature, plans for a facility, customer testimonials and press releases. This information is not necessary by any means, but is often quite appreciated depending on what type of reader you are currently catering to.
Following the basic guidelines set forth by this plan should make formulating a solid business plan a much easier task than trying to do so without. A business plan should be a solid document with plenty of market research and pertinent information to back up claims. A business plan can both serve as a way to sell your business to investors by proving its worth, and a way to create a road map for your business so that you may guide it to success. No matter what type of business you own, or what you are trying to accomplish, a business plan can be an invaluable tool.