Writing a business plan is one of the most important tasks when starting up a new business. It should continue to be one of the most important aspects used to guide your business, making it a dynamic document that should be reviewed regularly to help with monitoring and measuring the performance of your business.
It is also the best way of collating ideas, setting targets i.e. SMART GOALS, planning for the future of the business and acts as a blueprint to allow you to see that the business idea is realistic and workable.
The business plan is also an essential tool to combine such elements as Finance, Marketing, Sales Funnel, Value Proposition, Key Resources, Key Objectives/Activities and understanding your Customer Segment.
The benefits:
The business plan is for the owner(s) and key operator(s) of the company, it will help you:
• Bring together ideas and research into a structured easy guiding format.
• Decide whether or when the business will be commercially viable and at what rate to expect growth.
• Clarify the purpose of the business, allowing you to communicate this effectively.
• Predict its growth and mind map pitfalls enabling the business to be able to address them before they threaten company’s success.
• Set targets and objectives, including sales and financial targets, so that the business performance can be continually monitored and adapted.
From the above elements covered you will have the makings of an outline business strategy, this becomes particularly advantageous when you get to pull together he marketing strategy.
Plan for failure, don’t fail to plan!
Even better yet…plan for success!
We have all seen it before in Dragons Den (UK) or Shark Tank (US) and similarly in the Apprentice series on TV, the business plan is the crux of it all and can be torn apart very easily if there is no real effort or understanding within the plan. If the plan can be picked apart then so could you business venture too!
The plan should be easy to read, comprehensive yet very concise, and without contradictions or complete assumptions, for example:
• Figures included in the plan for overheads should be calculated.
• The pricing point of the product or service must be accurate and well researched.
• Overheads that appear in the plan needs to be reflected the same within the financial forecasts otherwise business plan loses credibility and will not be effective when actioned.
Quantitative data is evidence shown within the plan to back up any claims that are made (for example, the market research results that led to the projected sales forecasts).
The plan will also need to show the progress of sales (personally I suggest a conservative cost neutral projection for a period of time, then a medium term and medium return, then a target, the going is good revenue projection). It is also to consider how the small, mid and large returns will impact the finances needed to support the business, its owners and any borrowing requirements they may have.
Although it may seem challenging I cannot stress enough how important this plan is. EVERYTHING you do in your business will derive in some way from this plan.
Remember: NO PLAN, NO MARKETING, NO SALES – NO CUSTOMERS = NO BUSINESS