A business plan is critical to the success of a business. Many new business owners do not understand the purpose and importance of a business plan. Often, a business plan is required by lenders and investors before they decide whether or not to lend you money. They want to see a solid business plan that outlines your company’s goals and the strategies you intend to use to make your business profitable. You need a carefully crafted business plan to convince those with money to lend that your business is worth investing in. By providing an impressive business plan your chances of obtaining business loans are increased.
A business plan is not just for obtaining needed financing for your business, but also provides a blueprint to follow as you operate your business. It can help you stay on the right track until you reach your goal. You can review and revise the plan when necessary, allowing you to keep the strategies that work, abandon those that don’t, and change your objectives as your business progresses.
Writing a business plan is not difficult once you have the right information at your disposal.
Start with a persuasive executive summary. Your executive summary should include brief information on your company, your objectives, information on your product or service, your market and projected growth, key personnel in your company, and why you expect your business to become successful. The executive summary is mainly an overview of your business plan, but must be presented in a way that impresses investors and encourages them to continue reading. Make your executive summary one or two pages long.
Next is your company overview and here is where you provide information about your company, why and when it was started, its business model, mission, and strategy. You should also include information about its location.
The product and service section of your plan is where you talk about what product or service you are offering, and should discuss what benefits your product or service offers to potential customers. You can also include information on how and where your product will be manufactured.
In the marketing segment of your business plan, you should provide analysis of your market. Discuss your customer’s needs, the methods you intend to use to reach your customers, advertising methods you plan to use to market your product or service, and the amount of money you plan to spend on your marketing. Also describe your competition, and discuss the advantage your business has over the competition. You should use this section of your business plan to emphasize how your business is better than the competition.
The financial section is should include accurate financial details to be used by potential investors. These should include information such as cash flow statements and income statements for each year you’ve been in business.
The management segment of the business plan introduces your management team, their experiences and their responsibilities. Investors will be impressed to know that your management team is knowledgeable about the market and product, and has can successfully operate your business.