A quick checklist of all that you’ll need in your business plan
Everyone knows that coming up with a good business idea is only half the battle – you need a good business plan to go along with it. Failure to produce one can result in a loss of direction, and a complete lack of focus in your business from day one. You need to know where you’re aiming to take your business, or it’s going to end up completely aimless.
Just so we’re clear, a business plan is considered a written statement of what your business is going to provide, what you want to achieve with the business, and how it’s going to get there. Oftentimes business plans are used in support of a pitch for funding, as such they need to be concise yet provide potential investors with all the information they need.
Do your research. Many a businessman or woman has thought they’ve came up with an idea that’s a surefire hit, only to find out that someone else has beat them to it. A new spin on the right idea can work under certain circumstances, but whatever you do don’t pass of the idea as your own no matter how good your intentions – you’ll lose instant credibility.
You only get one chance to make a good first impression, so remember that the summary section of your business plan should be short, snappy yet interesting to potential readers. It should explain the basics of your business and where you see it going, however it’s usually a good idea to write this last, as you don’t want to write anything you may contradict later.
Next up, you’ll want to include a concise background of yourself and the key skills/experience you bring to the table. Think of it as if you’re applying for a job and you’ve only got one chance to promote yourself. Stay truthful (it’ll quickly become apparent if you lie), but feel free to toot your own horn if you deserve to. Also, include a CV of anyone else included within the business.
Now it’s time for you to describe accurately what you’re going to sell. Remember that anyone reading over the plan might not be as familiar with the market as you, so explain everything in thorough detail. Be sure to include any statistics or proof which show that there is a gap in the market for your offerings as well.
Accurately describe the market for your product or service, as well as your typical customers. Include information regarding said target customers’ income levels, factors under which they’d buy your product or service, and whether you’ve already made any sales. Thoroughly describe the number of customers you think will be interested in the product within your target area. Even though they won’t buy your product right away, if you consider them eventual targets then make a note of them.
Next up make a list of your direct competitors, and how you plan to compete with them. Acknowledgement of the competition is one thing, but you’ll need to state what makes your offering different from theirs and why people will use you ahead of them.
You have to make a note of how you’re going to get your product or service to people. If you’re operating something as simple as a shop this is pretty straight forward, but how are you going to deal with online, or international sales? Similarly, where are you getting your stock from?
How are you going to receive payment from customers? Again, this is fairly simple if you’re selling goods over the counter, but do you have systems in place to take care of credit card transactions or online orders?
This is a very important part of any business plan – basically, you’ll have to list expected business costs (including wages, rent, stock purchase and electricity prices for your business) then weigh it up against a realistic sales figure. Many businesses don’t turn a profit overnight and that’s all well and good – just be sure to be honest about it. Many investors are interested in long term gains than those over the short term, as long as they feel they’re onto a winner.
Finally, it’s important to be transparent about your own financial situation. Make a list of all your personal outgoings, and put a survival plan in place for if you don’t quite meet sales targets. Not only does this make sense in terms of a business plan, it makes sense from a personal standpoint – you need to know what you’re going to do in case of an emergency.
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This Business Plan Pack from the Prince’s Trust has already proved a hit with many start-up businesses, and we recommend having a look over it.