A lot of entrepreneurs hear the term business plan and get nervous. They think that it’s going to take weeks to prepare and require the destruction of a few trees.
Let’s be clear right from the start. If you’re setting up a business and you don’t need any outside funding, then you don’t have to have a business plan. But, that’s not to say you shouldn’t have one. Documenting your thoughts, identifying the market and doing your sums will stand your business in good stead for long term survival and will keep you on track to achieve your goals.
What’s a business plan?
Business plans are really a statement of what you’re going to do in your business and how you’re going to get it done. But really what goes into a business plan depends very much on what you’re trying to achieve as a business.
For example, if you’re looking to raise funding then the content will be completely different to a business plan used purely for internal consumption.
Which brings us neatly to the top 10 things you need to think about when writing a business plan:
Know your audience
The starting point for any business plan should be the perspective of the audience. Is it to secure funding, or to communicate the future plans for the company? You should tailor your plan to the audience’s specific requirements. Potential investors will be looking for a clear understanding of the proposed return on investment and the time taken to get their investment back.
Who are your customers?
You will need to ensure your plan identifies who your customers will be including the size fo the market and the expected growth over the life of the business plan.
Not only is it important that you know who your competition are, you’ll need to think about how you’re going to deal with their challenges.
The ‘Mini Skirt’
Whilst your plan should be short enough to arouse interest, it needs to be long enough to cover the essentials. The plan should reflect a sense of professionalism, with no spelling mistakes, realistic assumptions, credible projections and accurate content.
How does it look?
Think about the format of your plan – is it going to be a written document or a PowerPoint presentation?
Show me the money
If you’re looking for investment for your business you need to talk about what the investment is that you’re offering. For example 20% of the business and then lay out for the investor why they should invest with you. You should cover how much money you’ll need, what it’s going to be spent on and how you’re going to make money.
“It ain’t over when the Fat Lady sings”
The plan does not finish when you’ve secured your funding or launched your business. You should regularly follow up the plan to see where you are against your milestones and address as necessary.
So, what tell us about your experiences in writing a business plan. Did it help you get your business off the ground?