When you start out your business and are struggling for finances, you will typically want to go to a bank. People who go to the bank to get their business financed will often hear one answer in return; they need to look at your business plan. What are business plans and why are they so important? A business plan simply put is a plan that outlines the business related activities that you want to go about and all the details of how you intend to go about it. This is why banks take a look at the business plan before backing a startup.
A business plan is your business idea and its practical aspects listed out. It is as important for the person who is making it as well as for its employees and other investors such as banks. It gives you a structure to work towards. Despite the importance of a business plan how do you make it? What are things that you take into account etc? This article will highlight the step by step ways to devise a successful business plan.
Here is a low down on the step by step guide to make your business plan.
1. Think About Your Business Idea
The first thing you will need to develop a business plan is a business idea to work towards. Before you can make a business plan you will need to think about your business idea, is it worth it? Do you think your idea can benefit you? And the most important question is it workable? Making a business plan is not an easy task and definitely not one that you would want to do if you are unsure of your business proposition, the first step to making a business plan is actually thinking about the business idea.
2. Determine Your Goals and Benchmarks
Again, you will need to put this in your business plan and instead of being rushed for time once you have started to make it. Think about the goals you want your business to achieve and the benchmarks you expect it to set. These are important to determine beforehand. What you want your business to achieve will outline the way your business plan is made. Being able to set benchmarks is another thing that you need to keep in your mind before hand to help in the making of the business plan.
3. Begin with a Pitch
First things first, when you start your business plan you need to start with a brief pitch. Simply put, the first few things on your business plan should be about the strategy (in brief) that your business will employ to function and the basic concept of what your business actually is. This needs to be kept simple yet effective. Your pitch determines the mood of the company and the people’s impression of the company.
4. Emphasize the Need
There are many business in the market, unless your business idea is a significantly unique one chances are that there are ot6hers like your business already in the market. Hence to motivate your staff, investors and to highlight to yourself, you need to emphasize the need for the business. Outline how and why your business deserves to enter the market and if and why will it be able to do something that other established companies in the business cannot do.
5. Do a Competitive Analysis
Once you have outlined your business plan, highlighted why you business idea needs to be made into a business and outlined your strategies to success, you need to do a true competitive analysis of your business. Use techniques such as Boston Group techniques, SWAT analysis and others to identify the competitiveness of your business. One of the most effective tests in this regard is the SWAT analysis. It will highlight the threats that your business faces, its weaknesses and lets you think on how you can improve and make the most of it.
6. Have a Sales forecast Made
No business no matter the administrative ability running it can survive if it is unable to take care of its finances. One of the easiest ways of doing so is creating a sales forecast for your business plan. A sales forecast will not need to be perfectly accurate however it should ensure that it is relevant to the current market. The best way to make a sales forecast is to use the data available online to check for the amount of sales that are made in your business category and realistically setting a sales forecast offs it.
7. Outline Your Business Structure
This is important, if you want to have a smooth running business you will need to employ other workers beside yourself. If your business is such that it makes use of number employees it is best to have a structure of its management drawn up. With so many people working in your business, you will have some people doing different jobs to others. This can lead to confusion and conflicts of authority. If you plan and lay down a business structure in your business, the hierarchy will be clearly defined and the flow of information and orders will go on smooth.
8. Keep Your Executive Summary Short and Sweet
This is the part of your business plan that is often finished last but will appear at the very front of your business plan. An executive summary is the crest of all that has been discussed in the business plan. It is basically an overview of what has been discussed in the business plan and will dictate the interest of the investor.
A successful business plan is nothing out of the ordinary. Most business that run successfully are a result of considerable effort being put into its business plan. For a business to get the requisite finance that it needs it needs a well drafted, impressive business plan. For the owners it can often act as a map to work with to achieve business goals.