How to write a business plan
A business plan is not merely a document required by your bank or investors when applying for finance. It is a research-intensive roadmap that can mean the difference between success and failure.
In following the step-by-step approach to creating the plan, aspirant entrepreneurs must get to grips with and take a realistic view of the market opportunities and driver, the pitfalls and challenges and the costs involved in starting your business.
Experts caution against hiring a third-party business consultant to draw up a plan on your behalf – taking this shortcut approach can doom the enterprise to failure from the start in that the entrepreneur does not develop a thorough understanding of the opportunities and challenges integral to the business.
The same can be said of sample business plans; however there are merits to starting with a template of sorts – so long as the business owner conducts their own research.
Why is writing the plan yourself so important
Once you have an idea, you need to do research in order to gather the information you need to prepare the business plan. It cannot be stressed enough how important it is to write your own business plan. The reason for this is that the plan is your road map of how you will conduct your business from start-up to a successful operation.
Do thorough research
Begin the research process by writing an overview of the business you intend starting. Begin the field research once you have a good grasp of the go-kart fundamentals. You will need answers to the hard-to-find information, such as the cost of machinery, maintenance, fuel, spare parts, and rental for the premises and so on.
Research must include other key businesses, to the customers you are trying to attract, and what your product will be. Consolidate this information in your business plan.
Your research is in fact a SWOT analysis of your business (strengths, weaknesses, opportunities and threats). Do all the basic financial research – understand VAT and tax requirements and decide if you will trade as a sole trader, partnership or company? Look into insurance cover, especially public liability cover, disclaimers and theft and fire cover.
Work out what unique selling point will truly make your business stand out. It could be anything – but it must be unique to you. This is what your customers will come back time and time again.
What you need to know before you begin writing your business plan
Everything you need to know on how to prepare an investor-ready business plan that will get your new venture off the ground.
Research & preparation for your plan
What you need to know about creating a business plan for your small business. Learn how to determine and describe your objectives, strategies, market, and financial forecasts.
Writing your plan: The contents of the business plan
There are ten basic elements that must be covered when writing a business plan. They include an overview, executive summary; general company description; the opportunity; industry and market; your strategy; the team; a marketing plan; operational plan; financial plan and an appendix.
Sample Business Plans
Learn from the experts. We provide examples of well constructed business plans that will help you to format your own, based on the requirements of your small business.
SME Mentoring & Support Services Directory
Putting you in touch with companies and organisations that can help you and your business grow. Including online, professional and free mentorship services
When drafting a business plan. Should all the information prescribed by business plan templates be included?
The key to deciding between using information as prescribed in a business plan template or writing your own depends on the complexity of the venture and the purpose of the plan.
Decide exactly what you need in the business plan
The first rule for drafting a successful business plan is deciding exactly what your business plans on doing. This could be a service or a product – whatever it is; it is the cornerstone of your enterprise and needs to be well defined. What need is it satisfying? Is it just a road map, a business model, or is it aimed at raising money to start the business? If you are starting something simple that does not contain many variables, you can get by with a standard plan outline and perhaps use a template quite successfully.
Choose a plan
There are two kinds of plans – informal business plan and a formal plan.
- An informal plan is a road map of the business and acts as a guide to the day-to-day operations, marketing and expansion plans for the business.
- A formal business plan on the other hand is a detailed document, prepared for the primary purpose of securing funding for the business.
Partnerships
If you have partners, factors such as how the partnership will work, payment terms, contract length, timing of payments and so on must be included.
Budgets are crucial
The budget process is a key part of running a business successfully and achieving a strategy. It gives business owners a current assessment of the business as well as a roadmap for the future. It is essential to have an up to date business plan in order to secure financing, ranging from an overdraft facility or bank loan to venture capital funding. The business budget is a living document that should be continuously updated and revised.
Appealing to investors
The financials can enhance or harm your business plan’s chances in the capital-raising process. By doing the research to develop realistic assumptions, based on actual results of your or other companies, the financials can bolster your firm’s chances of winning investors.