Thursday, 5 April 2018

How to: Create a Business Plan

You may of heard business owners talking about a business plan, and the importance of creating one prior to starting your business.  A business plan is a formal statement of business goals, reasons they are attainable, and plans for reaching them. It may also contain background information about the organization or team attempting to reach these goals.

In a more simple term, a business plan is a road map or guide of your business goals and how you plan to achieve them.

Why is a business plan important?

A business plan is essential for the success of your business, it will provide direction and keep you on track. It also comes in handy if you require financial help to obtain your business goals, as this is presented to the bank at time of loan application. Investors will often ask to see a business plan also.

How do you create a business plan?

A business plan is broken up into a few sections. But prior to starting the business plan, you want to jot down a few simple tips

  • Decisions: Your business plan will require you to make some decisions in regards to the direction of your business, structure and marketing strategies. So its best to have some ideas of how you will arrange this before hand. This may mean doing your homework.
  • Who is the plan for:  Will you be using your business plan as a simple guide for you to follow, will this be presented to a bank or investor.  If third parties are involved, you will need to cater to their needs within your business plan also.
  • Take your time:  Don't expect to start and finish your business plan in one day, this is a detailed document that requires time and attention, a business plan will very easily become one of your most valued assets within your business, as you've got a guide to follow, and a way of ensuring you are staying on track. So take your time, and include all the relevant information.
  • Ask for help: Sometimes it can be difficult to answer all the questions. This is where asking for help comes in, do you have a business mentor, Family member or friend who can assist you with the writing of your business plan. If you are not confident at all in creating the structure of the plan alone, there are many companies that offer at home guides and tools to create a business plan using a template.
  • Figures: Now we can all sit there and make up figures in relation to our business, but is it really beneficial? Well not at all. You need to determine the realistic expenses of your business, and clearly state if these are actual figures or estimations.
  • Review: Always review your work, business plans are used to gain confidence from outside parties that you're business is viable. Mistakes or errors will only deter them from seeing your potential as a professional business.

What to Include in a business Plan?

Your business plan requirements will vary depending on the type of business, however below are a list of things that could be included within your business plan:

  1. Title Page:  General Information on your business
  2. Business Summary: A short overview of whats to be included within the business plan
  3. Management/ Operations Plan:  Covers details like structure, registrations, premises, products/services.
  4. Target Market:  Where you will provide the information in regards to your knowledge about your target market, here you can touch base on some marketing techniques and strategies.
  5. Predictions: Your future predictions, goals, and milestones.
  6. Financial Plan: How you will finance your business, outgoing costs or expenses, projections.
  7. Documentation: Any documentation to support your business plan.

Once your business plan is complete, you can put it away. But not too far from reach because you should regularly check that you are on track, adjust any changes accordingly and generally use this document to track your progress in comparison to your initial predictions.

Business plans do change quite frequently, and your initial plan is just used as a guide to get started.

Related topics:

-Haven't found your niche yet? Visit our "how to find your niche" blog 

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