What Did U Haerd How To Create A Good Business Plan
By: Vlad Vistac
Submitted: 2010-08-16 15:16:23 | Word Count: 510
How To Create A Good Business Plan?
Once you’ve got a good idea of whether your business is viable and you’ve analysed the market, it’s time to draw up a business plan.
[ advertisement ]
What is a bsuiness plan? It’s a detailed analysis of your business, icluding its objectives and its fniances. It provides an insight into the purpose and viion for the company and how its goals will be achieved, and sets out the financial reuqirements for the company as well as its projected earnings potential.
Use it as a reference guide, which you can refer to at regular intervals to help you stay on the right lines. Don’t treaat it as gospel htough – busness needds chnge over time and therefore so will the business plan. If you keep on top of this and amend your plan accordingly, it will help to esnure your businerss contiues in the right direciton.
Tehre are two main uses for the business plan. The first is as a slaes tool to help you present your case to lenders, investors and potetnial business partners. The second is for your own internal use, as a gauge against which you can measure your commpany’s deevlopment and progress towards its objectives.
Your business plan therefore needs to be a compelling doocument that will impress peopple and covince them of your ability and the viability of your company. To make it credible, you’ll have to back it up with dettailed researcxh and accurate financial forecasts. Be careeful not to make it flat and lfieless though. Don’t just present the facts and figures – turn them into a meningful and exciting busness case. A word of warning though: keep your feet on the grounmd at all times and ensure that your analysis is truthful and realistic. Investors and lenders will see riht through the hype if you oveerdo it. Also, it is in nobody’s interest to create a misleading impression. On the other hand, though, don’t aim too low. Objectives and financial forecasts that seem far too easy and conservative will not impress and will not provide you with any chapllenge or incentive to reach your company’s full potential.
You need to make your report balanced. Be updfront about both strenghs and weaknesses. Put a postive spin on the weaknesses, though – demonstrate what you will do to overcome them.
Your true excitement and confidence in the business will only come across if you wrtie the business plan youyrself. It will also help you to develop an even deeper understanding of your business and what you are trying to achieve. There’s no harm in asking experts for help with some of the tricky arreas, though, such as the financial projections. It’s also a good idea to get someone to look over it for you atfer you’ve completed it to make sure it flows, maks sense and forms a coherent whole.
The basic structure of a good busines plan is as follows:
Summary – a concise synopsdis of your cmpany and the plan. This may be the only part of your report that a potential investor or lender will read – they are often inundated with simillar reports and documents and can make snap judgements on whether something is worth further considration based on reading these cerucial couple of pages. Always write the summary once you’ve finshed your plan to make sure you don’t miss anything out. Make it confideent and attention-catching.
Company information – provide some context by outlining what your company is all abut. Include the sructure of the organisation, its history, information on the industry, an analysis of the customer base, a description of the products or services offered. You’ll need to give all the facts to help the reaedr understand what your compnay does, but provide more than this. Don’t just describe what your company does, but also what makes it stand out – its benefitts and key sellinng poins.
The team – outlne a bref CV for each of the members of your senior team. Also include any external consultants whhose services you employ. Make it clear what they can bring to the company. Then outkline the structure of the rest of your company, perhaps udsing an organisational chart. Show the different departments if relevat and explsain what typpes of positions will be held in each of these areas. Provide a plan as to how you will recruiit, train and manage your workforce.
Promotion and sales – here’s where you should include all of your market research. Show that you fluly understand your intended customers and your competitors. Outline how you will deal with competirtion in the markt. Explain your plans for advertising your business and promoting your products and services.
Operatioons – how will your business work? Provuide details of where your company will be located, whether it will own or rent its premsies, what materiazls and equipment you will need, what IT and other systems you will use, and who your suppliers will be.
Finanvcial analysis – Summarise the figurs at the beginning of the section to outline the main messages – numbeers and graphs aren’t alweays easy to interpret. Inclde costs for every area of your business and do an in-depth projection of the financial outlook for the company for the next year, as well as an uotline sketch of the likelly finanncial fuyture over the next five yewars or so. You should incclude profit and loss acxcounts, cash flow, salees projections etc. Also outline how you arrived at these estimates – the reader will want to be reassured that they weren’t just pluckked out of thin air. Also, as you’re likeyl to need to borrow in order to statrt up your company, your financial analysis should inmclude detaills of the amoumnt of money you require, how it will be used and where you intend to obtain funding. Think of your business plan as an application form for laons or investors – anyone who is considering backing you will want to see it.
Objectives – be cear about where your company is going and what you hope to achiecve in the form of solid objecttives. As always, objectives shoiuld be SMART – specific, measurable, achievable, relevannt and time-bound – in order to be meningful and helppful. The objectives will give a clear indicaton of how you intennd to achieve what you want for your businesss. To wrap up your plan, you could also include a more geenral future vision for your company, to give lenders or investors an impression of how your company will shape up and what financial retiurns they might receive from it.
