Writing business plan is essential for an entrepreneur interested in the expansion of business and getting beyond his immediate reach. It is primarily impossible for any business to thrive in this dispensation without paying massive attention to how business should be approached and run. Meanwhile, with current development in this age, many business experts with trackable records have essentially given credence to the importance of business plans.
What is a business plan?
It is a document written or coined to give extensive details on how business organisations (mostly startups) should operate towards achieving their desired goals. This document is the pattern or the road map for a business built financially, structurally and operationally. It is also the tool used in enhancing the efficiency of all business allocation in different sectors. A business plan can also be a source of attraction both internally. For instance, a good business plan can be used to invite investors.
By extension, you cannot talk about work ethics in any establishment – especially in startups, without emphasising the essence of the business plan. It is also an action book that catalyses the workflow. The business plan also gives better initiative to all employees on how work should be balanced and stabilised.
A good business plan should be updated periodically to meet its timeliness and essentialities. Its role is irreplaceable for any ambitious and visionary organisation. This piece will deep-dive into why you need a business plan, and it will also show you a sample of a good business plan.
Why do you need one for your company?
As mentioned earlier, the importance of a business plan cannot be undermined in your endeavours. As an entrepreneur interested in making their business grow beyond its immediate horizon, you must understand why you need to have feasible and concrete plans for your business. Below are the reasons you need it for the survival of your company.
Business plans show how serious you are:
If you want to be taken seriously as a business owner, the first you need to take is to draft a consequential business plan for your enterprise. Taking a drastic step in designing a detailed one does not only make your business formal but also gives a profound impression to your potential partners, investors, competitors and your employees that you are on a mission to build a vast business empire.
Understanding your customer:
There is no business operation without some targeted customer. Regardless of what your products are and how quality they can be, you need to understand your customers. A good business plan enlightens you on how to take a swing on your desired customers and how to relate with them. Setting up your business, especially at the beginning, may be stressful a little bit, but if you have solid customer relations and you enlist how to get more of them in your business plan, you are way ahead in the game.
Attracting investors:
Financing a startup can be tasking. To solve a financial crisis your business may be combating; you need to have solid investors for your business. Meanwhile, if you want to get the right investors for your business needs, you must have one that explains everything about your enterprise. Your business plan must be able to give straight answers to questions about your products, your financial goals, your expenses and your assumed income, either yearly or monthly.
Understanding your competition:
Having business plans helps you accurately analyse your competitors and how to beat them. Failure to have one that explicitly understands how your competition navigates, you know what to avoid or what to embrace in the market.
To know the opportunities to explore:
Business plan gives insight into which business opportunities to study the expansion points. Expansion in businesses can be tempting as you tend to get many prospects coming to you to explore. Regardless of the opportunities proposed to you, playing by your business plans will guide you on which one to explore.
To build your revenue structure:
The sole aim of every business is to make money. A business plan is a vital tool that explores how you make money from your business. Business plans measure up the pros and cons of how your business should be structured to balance your revenue collection and remain profitable.
To judge your progress and place you for refocus:
The concept of retreats and yearly reviews originate from the influence of business plans. Business plans make you evaluate your business growth, downside and how to make some needed corrections.
It portrays you as a master in your field:
Have you ever wondered why successful business owners sound authoritative while talking about their products? That is one of the good things business plans can do. Having a solid business plan can maximise your expertise; it also makes your business look coordinated and visionary.
Sample of a good business plan: What it should contain
A good business plan must contain some key elements imperative to your business growth. All these elements are needed to maintain your professionalism and your business outlook. In no particular order, below are the expected main contents of a good business plan.
- Mission statement or executive summary: The mission statement is always the introductory part of a good business plan. It also includes your products and services and organisation. You may also input your financial projection in the executive summary, provided you add financing plans.
- Management and organisation structure: your plan must include your company’s hierarchy. Elucidate the leadership structure and the employee’s position.
- Analysis of market: you have to present your understanding of your market analysis in your plan.
- Description of your business: you need to give a new description of your business and the company’s approach to be reckoned with.
- Sales and product: lists: enlist your sales and marketing plans in your business plans.