A business plan is essential if you are going to be looking for finance of any kind. This can apply to start-ups and also to established businesses. The cornerstone of your business is the business plan. The idea of a business plan is to be able to present your company to investors in a way that they will understand how your business is going to be run.
To be effective the plan needs to cover every aspect of your business operations. Here we list the 7 essential elements that your plan needs to contain.
#1 Executive Statement
The executive statement is needed to introduce your business to potential investors. You will need to focus on who you are, what you want, and how you intend to pay back any investors. This should read as a short introduction for your investors to the main plan. It should offer the readers a snapshot of your company as it is now and what you need to progress further.
It is better to complete this part of your plan after all the other aspects have been completed. In doing this you will have a far better knowledge of what you want from your investors and will be able to write a better resume of your plan.
#2 Your Business Model
This is where you will be discussing the workings of your business. You need to tell your investors what type of business you are i.e., retail, direct sales, or in the service industry. You will need to give your investor a very comprehensive description of the business goals, products, services, and your target customer base.
#3 Market Strategy
Here is where you tell your investors about the market you are covering with your business. Discuss your target market and the demographics including the pain points. Also, you need to be able to demonstrate to your investors how your product or service will resolve a need in the market.
If you cannot resolve a need in the market, then you are not going to gain any interested backers. Many internet marketers miss this point completely when they should be treating it as most important.
#4 Your Marketing Plan
In this section, you need to specify how you are going to reach the market you are targeting along with how you are going to build your brand in the eyes of the prospective customers. Your marketing and promotional strategies should be described here with attention being paid to the price plans you have in mind. You will need to have a strategy for your expansion in order to grow your customer base.
Let your prospective investors know the unique selling point of your company. You need to explain how you are going to get your company and its products or services in front of your target audience. Make sure you have researched competitors so you can explain how you are going to compete with them on an equal or better footing.
#5 What are Your Products/Services
Go into further detail on the products or services you are going to be selling and how they are going to solve a current market problem. This is generally of less concern to your investors, but you may find someone asking for that information. Once this section is in your business plan it will save you trying to explain the answers you give.
#6 Day-to-Day Business Plan
How are you going to run your company on a day-to-day basis? How is the organizational structure of the company laid out? Who are the team that are going to be responsible for the daily running of the company? Where is your company going to be based and how many employees do you envisage having? Also, mention who is going to be responsible for any HR component of your business and whether it is in-house.
#7 Financial Details
This is without question the most important part of your overall business plan. When you are a start-up, this describes how much investment you are likely to need, how you intend to use the money, and what sort of return the investor can expect.
If you are already a going concern then you will need to submit your past financial performance in this part of your business plan.
Any investors you attract will need to know that they are dealing with people who are financially responsible. They are also looking at what return they can expect and if there are any great risks in the deal.
While you may be looking at setting up a one-man business without the need for any investment you will still need a business plan.
To not bother with the planning stage means you are most probably staring into the eyes of failure.
By not planning you are planning to fail