A business plan is a formal statement of business goals, why they are achievable and plans for reaching them. As an entrepreneur you are required to produce a business plan which you will execute to transform your business idea into a successful and profitable business that will ultimately achieve the set goals. A clear and convincing business plan provides you with a guide for building a
successful enterprise focused on achieving your personal and financial goals. It can also help persuade investors, including banks, to invest in what you are creating. This document will provide full details of what is required.
The Importance of Passion
A good business idea requires an entrepreneur that cares about it. If you are not interested in your own business idea, then it is unlikely that you can make someone else to be interested in it. A key criterion for deciding which idea to take forward is that you find it interesting.
Writing a business plan requires both creative and rational thinking. You need to originate an idea (which you have done), but then you need to produce a rational argument about why your idea is a good idea. For a proposed new business that does not have a financial track record, when it comes to the financials of your business idea, you are essentially going to have to predict what might happen. You will have to make assumptions about future revenue streams and costs. Be clear in your financials what is based on assumptions, and what you can base on evidence. The more evidence you can find to lend credibility to your assumptions, the better.
Presentation and grammar could keep readers interested in your business plan, so you need to take note of these. You can add a brand logo to the header of every page for branding purposes and professionalism. You can use appendices if you wish to include any visuals e.g. sample web pages or diagrams of your product.
Business Plan at A glance
A business plan is not meant to be an exact prediction of everything your business does now and will do in the future. Think of it like the plays that football teams practice. There are roles and responsibilities for each member of the team, but you cannot predict exactly how people will play in a match.
A business plan should be used as a guide to help you run the company. It helps you consider the most important aspects of your business in a comprehensive way. Everything we have done since Week 1 can be integrated into your business plan. You start to understand why this training was so important to the complete development of your idea.
It is long and time-consuming, but do not let other people write the business plan for you. Only the founding team of the company should be responsible for drafting and updating this document. Each question you will have is an opportunity to decide together what exactly it is that your business will do. Expect to have many questions while writing the plan. That is a normal part of the process, and a great chance to speak with friends, advisors, and your Mentors.
Generally speaking there are seven parts to a business plan:
- Business Description
- Market Analysis
- Competitor Assessment
- Marketing Plan
- Operating Plan
- Financial Plan
Go through the following questions and answer them to the best of your ability. Pay close attention to places where you are not confident in the answer. Those are the topics that you need to discuss with friends, advisors, and potential customers.
Why does your business exist?
What are the customer problems that you are trying to solve?
What motivates you to solve these problems?
What is unique about your solution?
Who owns the business?
How is the business structured legally?
Who is your primary customer – individuals or businesses?
Why do your customers want to buy your product or service?
Is the user of your product or service the one who pays for it?
How large is your market geographically?
How large is your market financially?
Are there government regulations that will affect your business?
Who creates similar products or services in the same area?
Who solves similar problems in the same area?
How much do these products or services cost for a basic version? A luxury version?
How are these products or services advertised to the customers?
How do you describe the best features of your product or service?
How do you describe the biggest benefits of using your product or service?
What would you like to charge for your product or service?
What is the minimum you can charge for your product or service and make a profit?
Will there be intermediate steps like a wholesale or retail partner?
Who owns the company?
In which form is the business incorporated?
Who manages the day-to-day operations of the company?
How many employees do you have? How will you expand in the future?
How many contractors do you have? How will you expand in the future?
What sort of facilities and equipment do you need?
Do you need to consider intellectual property, such as proprietary technology?
On a quarterly basis, how much income are you predicting over the next two years?
On a quarterly basis, how does your cash flow look over the next year?
How much does it cost to produce your product or service?
What are your largest costs this year? Next year?
When will your company be able to sustain itself financially?
About the Author:
Andrew Habel Odongo is a result oriented professional with unwavering online presence. He is a subject matter expert in matters Entrepreneurship, Self development, Transformative Leadership and Management. He is a motivational speaker, lecturer and researcher. All these achievements have been achieved courtesy of his resilient utilization of technology and online presence. He is an award winning entrepreneur having won the Tony Elumelu Entrepreneurship program award of the year 2016. He founded Uwezo Accelerated and Tech Hub which is an Entrepreneurship and talent Incubator and Support Innovations for Peace and Education- NGO and does a lot of varied sector research and content writing. He is an online independent research, Subject matter expert, higher education programs assessor, moderator and lecturer. His mantra is Don’t dream it, Be it. He speaks loudly on many issues about self development, inspiration and positive living, entrepreneurship, transformative leadership and management on his blog https://www.andrewhabel.blogspot.com