Writing a business plan is a vital requirement for any entrepreneur or business seeking to increase their chances of survival. When you write your business plan, remember to be clear, realistic and concise and remember that business plans are dynamic documents, so you should always be prepared to adjust your plan as your business develops.
Back to Basics Writing a Business Plan
Do Thorough Market Research
An entrepreneur should undertake market research and ensure that the plan includes reference to the market size, its predicted growth path and how they will gain access to this market. A plan for a restaurant, for example, would consider the local population, what type of food they will offer and predictions about whether it is likely to grow or decline.
Understand the Competition
An important part of understanding any business environment is understanding the competition, both its nature and the basis for competition within the industry. Is it a particularly competitive environment, or one that lacks competition? Including a thorough understanding of the basis on which you intend to compete is vital to determine if you can effectively compete with the existing players.
Focus on the Opportunity
If you are seeking investment in your business, it is important to clearly describe the investment opportunity. Why would the investor be better off investing in your business rather than leaving money in a bank account, shares, or investing with another business? Why will people part want to spend their hard earned money to buy your product?
Ensure Key Areas are Covered
Undertake research on what a good business plan should contain. Also, keep in mind the readers’ various preferences for viewing data. For example, while many plans are predominantly text, the plan should include some simple colour charts and spreadsheets.
Sum it Up
The numbers will be subject to particular scrutiny, so costs should be documented in full and sales predictions should be both conservative and realistic. While costs are more certain and predictable, a crucial factor in the success or failure of the business will be the level of sales. If you are not particularly comfortable with numbers, have someone assist you in preparing a simple cash flow and break-even chart. This will help the reader understand how many sales you must make to cover your costs, and also how much financing you must raise to start up successfully.
Put the Plan in Place
Finally, a plan should always be viewed as an important document that contains specifics regarding dates, deadlines and specific responsibilities. It should be constantly reviewed and updated, as well as being used in regular discussions in regards to the direction of the company. A winning business plan will always help to ensure that the business is fully focused on what is required to achieve the company’s goals.