The business plan is not just a document that should be written to secure a start-up loan. Instead, the plan is an important strategic tool that entrepreneurs should use when and growing their business. Whenever we fail to plan, it is the moment that we are planning to fail. It, however, does not necessarily mean that writing the business plan should be a complicated task.
A quality business plan should incorporate all the factors that will make your business ideas succeed. The plan should focus on both the short and long-term objectives of the business while also spotting the opportunities, potential weaknesses, and threats. With a good business plan, you will be able to make conscious decisions concerning your business before committing yourself financially and legally. Below is a guide of the critical sections that should be incorporated into every business plan.
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The executive summary follows the title page and should have an average length of 1-2 pages. This section should be as straightforward as possible, explaining to the reader the following aspects:
-An overview of the main concepts of your business
-The key objectives of the business
-The key objectives of your plan
-The ownership structure
-Your management team
-The product(s) and service(s) you will be offering
-Your target market and audience
-Your market strategy
-How you intend to gain competitive advantages in the market
-A summary of your financial projections
This summary should come after the other parts of the plan have been written. Let each paragraph summarize the details of what you have written in the other sections of the plan. It is a relevant section as it clearly states what you want. The statement is supposed to be short and business-oriented.
The business overview starts with a summarized description of your business. This section should have details concerning the history, mission, vision, core values, objectives, and ownership structure of the business. When describing your business, discuss its current outlook while writing down its potential possibilities.
Expound on all the products and services that you intend to sell to your customers. While describing these two things, be sure to include their features, their competitive advantage, their benefits, and if it a product, explain how the products are going to be produced. This section is more than listing what the business will provide. If you want the plan to be used in acquiring capital or find business partners, the products and services section should portray the values and benefits that the business will be offering to its audience.
If your products are physical and software, include both. Let this section be evident as you emphasize the value you will add to your audience by providing the services or/and products. The product should be something tangible that when put on the market, it will acquire the attention or/and consumption of the customers. A service, on the other hand, is an intangible item that comes from the output of one/more individuals while meeting their needs.
This section refers to the overall analysis of the economic goals and market status of your industry. Such an analysis will allow your business to present your records in a manner that will lure buyers to your side. The section also helps you to get clients for trade and investment purposes. That is why this section is significant in your business plan. It should show how viable your business will be in its specific industry. Here, you are to discuss the size of the business and the potential growth of the industry. Let the reader come to terms with the markets in your industry and the possibility of customers purchasing your services or/and products. Explain your target markets. While going through this section, let the reader come to terms with an insight into the industry of your business. Only give well-researched info that will show that you understand your industry.
This strategy should describe your customers. Let the reader know the people who will be interested in your products and services. Describe the ways you will use to reach this audience about the services and goods that you are offering. This segment should also explain the competitive analysis of the business. Additionally, you are supposed to let your reader know the targeted market segments that you intend to employ. Explain how you intend to gain a competitive advantage over other businesses. Also, say how you will be able to differentiate your services and product. Other things to add in this section include:
-Explain the price and ways of promoting your products and services. Include the promotional programs that you plan to employ
-Give a plan for your marketing tactics. For instance, you can mention if you intend to use media advertisement tools like Twitter and Facebook, tradeshows. If you are planning to use networking, press-magnet events, online advertisement, or print advertisements, remember to mention them. Be sure to include the cost that you are likely to spend on each of these tactics.
-Describe how the services and products of your business will be sold. State, whether you will have them, sold online, storefront, retail, or wholesale. Also, describe the target buying cycle of your market.
This plan is included to define the actions that you will employ to support the plans and strategic objectives of your management. This section should, therefore, give an in-depth understanding of your management team and the human resources plan of your business. Also, include the facilities and location(s) of the business without forgetting to mention the daily operations of your business and the production plan of your products.
This part is the most critical part of your business plan. Here, you should show the anticipated financial statements of the business. These include balance sheets, cash flows, and income statements. The statements should be in summary form and use them to forecast your expenses and revenues.