So, you have a business idea but what do you do next? Easy, simply write a business plan… but what is a business plan and how do you write one?
In this post we aim to help demystify what a business plan is and how you can write one.
What is a business plan?
A business plan is a document that defines your company’s objectives and goals and how you aim to achieve them.
Why do I need a business plan?
The aim of a business plan is to create clarity on how to move your business from an idea into reality or if you are already an established business it can help you make plans for growth and expansion. By sitting down and thinking through you aims you will build yourself a checklist of tasks or steppingstone to achieving your goal.
What do I need to include in my business plan?
- Company summary- In essence, this is your company’s mission statement where you will explore your company’s core values and principles. In this section you need to explain who you are as a company, what your company does and why it will be successful.
- Products and services- Although you have outline what your company is, in this section you will expand on what services or products your company will offer. You will need details on manufacturing or purchasing of products, benefits to consumers and any technical detail relating to the products or service you are providing.
- Market research– By spending a little time focusing and analysing your competitors, you will start to see trends and gaps in the market which your business can fill. This analysis will help you develop your businesses unique selling point (USP) allowing you to stand out from the crowd. This can also be key when looking to entice investors as they want to know what makes your company unique and how well you know your industry.
- Marketing Plan– Having spent time researching and analysing your market, now is the time to focus on how you are going to reach your target audience. What platforms do they use and how are you going to stand out next to more established business.
- Financial Planning – Your financial planning gives you the opportunity to expand on the price points for your products and services. Allowing you to make projections of your estimated sales and where your break-even point is. For new businesses, this planning stage will be built from targets and estimations on how your business will grow in the first year or two. Once you have figures to work from you can start to look at the areas within your business which have been most successful and how you can expand on this.
- Budget- A budget is the nitty gritty of how much money you have to spend and what you are spending it on. By having a budget forecasted, you can see how you are spending your money and where cost can be cut. Areas you may wish to include on your budget include wages, products, software, marketing etc.
Hopefully this has helped simplify the process of creating a business plan and given you bite size chunks to work through.
Although it’s important to think about all these areas and have a plan, it’s also important to put these plans into action. Don’t become lost in the planning but use it as a platform to help catapult your idea from paper into reality.