If you intend to start a business, this is an important document that you need to prepare. You will be required to organize your information logically to make it easy for readers to understand your content. Some new entrepreneurs think that the business plan is unnecessary. There are numerous benefits that your business can get by preparing this document, as explained in the section below:
1. Bigger picture.
By having a business plan, you will get a clearer picture of various aspects of your business. It helps entrepreneurs to develop effective strategies and tactics that your enterprise can utilize to grow.
2. Creating an identity.
A business plan requires business people to define their target markets and reveal the products and services that their enterprise will provide to meet their customers' needs.
3. Setting priorities.
There are many activities that a business owner is required to carry out. The activities cannot be completed at once. When you write a business plan, you will outline some of the tasks that should be prioritized to enable the enterprise to achieve its objectives in the long run. Allocate resources according to the importance of the activities you identified.
4. Helps in managing change.
A business plan involves outlining how you will carry out different tasks in your enterprise and tracking any developments at every stage of its growth. It will help you to make adjustments needed to achieve the goals of your business.
5. It Facilitates Financing.
You require funds for carrying out the operations of your venture. Writing a business plan helps you acquire loans, grants, and other credit forms from different financial institutions. Even when you are applying for grants from government agencies, you will be required to attach your business plan. Other components of a business plan include tax returns, banking statements, and payroll information. The documents will also make it easy for you to get credit from financial institutions.
When you are seeking contracts for your business, you will be required to outline your forecasts. Presenting a business plan will help other enterprises to have a deeper understanding of the business missions and objectives both in the short and long run. The business plan also helps reveal the leadership team as it plays a significant role in a venture's success. If you have business executives with an excellent track record, investors will have confidence in your enterprise.
7. Helps your business to stick to its strategies.
There are many routine activities that a business undertakes daily to help achieve its objectives, and one may lose focus on priorities. A business plan serves as a reminder of practical strategies that can help in achieving growth.
8. It Facilitates delegation of duties.
When different stakeholders in an organization are aware of what is expected of them to achieve the business goals, they are likely to be more productive. A business plan helps in delegating the crucial tasks of an enterprise to individuals.
Different Ways of Writing a Business Plan
It is a modern technique and is effective as it has features such as images and graphs that help grab the readers' attention. The content is usually presented using bullet points.
The components of a business plan written in this form are the same as in slideshows. The only difference is that the content comprises of paragraphs. It is the most common form of a business plan, and most financial institutions are likely to request it.
• Business plan software.
The difference between this and the paper business plans is that the software provides stylish templates that help make the work more presentable to investors. Some of the templates will help you create custom charts for your business and a table of content.
Insights for Writing a Perfect Plan
a) Consider your audience.
Make sure that you write a business plan according to the intended readers, including banks or investors. If you are presenting the document to a financial institution, do extensive research on its operations. Take note of some of the areas that the firm has invested in before and focus on outlining your business's uniqueness.
b) Provide a solution.
Every business plan should help to solve a particular problem. It should explain the cost of achieving that objective and how much you will charge for providing solutions to such issues. Explain the workforce and other resources that the enterprises possess that will make it easy to achieve your objective.
c) Include industry statistics.
Investors would want you to present factual and convincing information in your business plan. One way to achieve that is to include industry statistics from credible sources that will support your assumptions and projections.
The Main Sections of a Business Plan
i. Executive summary.
The section provides an overview of the whole business plan. Review the summary after writing the other parts of your document to ensure no disparities in the main body's content. It should be as short as a possible, and concise language should be used.
ii. Business description.
The content of this section should help investors to understand your enterprise. Provide a brief history of the business and explain some of the problems that you intend to solve. You should describe the form of your enterprise. For example, disclose whether it is a sole proprietorship, a joint venture, or a limited liability company.
iii. Products and services.
In this section, explain how you plan to provide different products and services in your business. Only use concise language when completing this part of your business plan.
iv. Marketing plan.
You will need to carry out extensive research to identify effective marketing strategies you will use in your business. Take advantage of this section to display your knowledge in the market.
v. Design and development.
Most investors pay attention to what you have to say in this part of the business plan. Explain your sales strategy and your plan to reach out to the target your target customers. The investors would want to know how you will overcome different business barriers and how you intend to carry out various operations in your venture.
vi. Financial plan.
It is recommendable to hire an accountant to help you write a sound financial plan to convince your financiers. It includes things such as your projections for revenue and expected cash flows.