Every company needs a strategy. But how do you go about getting your plans down in a written form?
If you’re serious about launching your own enterprise, you’ll need to have a solid business plan in place.
Why do you need a business plan?
A business plan helps you clarify your thoughts, identify potential flaws and can be used to seek feedback. On top of that, it demonstrates your commitment to investors and financial advisors. A business plan also serves as a strategic guide, keeping you focused as your business evolves.
1. The executive summary
The executive summary is the most crucial element in a business plan. In fact, it can often be the only part of your entire business plan that potential investors and lenders will read. It is essentially where you summarise your company’s objective and mission. Invest plenty of time, effort and strategic thinking and effort in setting your business apart.
2. Company description
When drafting your company description, include as much information you think you need to thoroughly explain what you do and why you do it.
The goal of this section is to define the scope and intent of your business. To do so, answer the following questions as clearly and concisely as possible:
- What business are we in?
- What does our business do?
- What is our unique selling point?
Have a look at how your strongest competitors have written their company descriptions; is there inspiration you can borrow from them to tweak your company description and make your business stand out even more than it already does?
3. SWOT analysis
A SWOT analysis (strengths, weaknesses, opportunities, threats) is one of the most effective and strategic business decision-making tools available to business owners.
The main objective of a SWOT analysis is to help business owners develop greater awareness of all the factors involved in making business decisions.
As part of your SWOT analysis, define your unique selling point (USP).
4. Competitive analysis
A competitive analysis involves gathering information about your key competitors and using the insights to identify their strengths and weaknesses. Once obtained, this information can then be used to develop strategies to improve your own business and gain a strategic advantage over your competition.
5. Organisation and management
Create a detailed overview of your team members and the other key personnel who will be essential to the success of your business. List all the defined roles and responsibilities, and where possible, note the hierarchy or team structure.
6. Define your products and services
Regardless of your industry, the products and services you provide will define the success (or otherwise) of your business. So it’s critical that you invest time into testing and refining your products or services before launching into marketing, sales, or funding details.
7. Identify your target clients
Determine whether your clients are individuals or corporations. If they’re businesses, who are you going to target within those enterprises? Is it possible that it’s the salesperson or the CEO?
Decide if you’ll have repeat customers or one-time purchasers.
8. Identify the opportunities
Businesses that are successful think large. The exciting thing is you don’t have to stay small-scale if you’re just getting started. As your company expands, make a list of potential possibilities and opportunities that you take advantage of to help your business grow and succeed.
9. Create a financial plan
Financial health is the key to business longevity; after all, it is very hard to sustain a business long-term without access to a healthy cashflow. A well-considered and strategic financial plan. As such, critical financial information should be included in your business plan. This typically covers the total cost of starting your business, including:
- The cost of making or purchasing your products;
- Labour and manufacturing costs, including raw materials;
- Employee expenses, particularly in service industries;
- Costs of distribution and marketing; and
- Overheads, both fixed and variable.
Financial plans are not a “one size fits all” proposition. Rather, they are most-effective when they are customised to individual businesses. The specifics of the financial plan you create for your business will depend on your business goals and your business forecasting.
10. Include a marketing strategy overview
Marketing is a multifaceted, always on activity that includes both digital channels such as social media marketing and email marketing, and traditional channels such as print advertising and word of mouth marketing, such as referrals.
Consider the “five marketing ‘Ps’” (product, price, promotion, place, and people) when writing the marketing section of your business plan:
11. Make a business plan based on your strengths
Keep your strengths as well as any areas for growth in mind when you construct your business strategy. This will assist you in developing a strategy that maximises your strengths while being realistic. This is more likely to persuade investors that you’re serious about your business.
Your business plan acts as a guide for your company, but it isn’t set in stone. At least once a year, review it and make any required modifications.
Above all, continue to seek input from your advisers, both formal and informal. You’ll be able to design the ideal company plan with their assistance.
Having a solid business plan in place is just the beginning of your new small business adventure. You’ve worked hard to make your business dream become a reality so it makes sense that you would do anything to protect it and keep it safe from any unwanted challenges- that’s where business insurance comes into the equation.
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