Whether you’re starting a new company or looking to grow an existing one, you need a solid business plan. It’s a step that’s often overlooked, or done quickly, in an effort to get started on what appear to be more important tasks. However, a business plan is the foundation on which you will build (or grow) your organization.
What makes a business plan so critical is that it puts into writing many key factors that are necessary to consider for profitable growth – no matter what stage the business is in. We’ve outlined our 8-business plan must-haves below.
The purpose of a business plan is to outline the goals of an organization, and how those goals will be achieved. Sharing the overall concept for your company and its products and/or services is therefore a great place to start. You can also include an overview of the organizational structure, and your business’s short-term and long-term goals.
The Value Proposition
What makes your company unique is what’s going to help it stand out in your desired market. Therefore a business plan needs to include what differentiates your organization from the competition. Spend some time actually putting into words what makes your products and/or services, operations, or ideas different from any other company that exists today.
The Market Analysis
In order to be successful, a business needs to have a good understanding of the market it’s planning to enter. While the market analysis portion of a business plan takes plenty of research (and time), the information that’s discovered will be invaluable to your company. The more in-depth your understanding of the business landscape, including your target market, competition, and overall industry, the better you’ll be at reaching your audience and establishing a strong market share.
The Business Model
With your idea established and a solid understanding of the market opportunity, it’s time to focus on the specifics. Your business model should include the operational details of your organization, your revenue streams, and any costs of doing business. If you have key suppliers or partners, include them here. Take your time working through the particulars, and clearly indicate if any assumptions have been made.
The Financial Projections
What makes a good idea a good business? Money. A financial analysis is one of the critical pieces of a business plan – but also one of the most challenging to put together, depending on how comfortable you are with numbers, and whether or not you have a company history to build on. If you don’t have the luxury of working with previous financial data, it’s still possible to project a budget based on anticipated growth. However, you’ll want to include feedback from financial professionals to back up your projections.
The Marketing Plan
You’ve got a fabulous business idea. You know your market. You’ve perfected your business model, and forecasted financial statements. Now, how are you going to actually reach your customers? With so many marketing avenues available today – both on and offline – you’ll want to determine the best way to capture the interest of your target market and turn that into profits. Put your strategy into writing, beginning with a launch and continuing through the first 6-12 months. Don’t forget to include metrics that will indicate whether or not your efforts are successful.
Overall, a good business plan helps to align management toward a set of common goals, and determines how to realistically measure those goals. It’s a good opportunity to assess any potential problems as they come up, and adjust your strategy accordingly before it impacts your bottom line. However, it also can take plenty of time, research, and expertise to write.
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