Business plan; Most people who want to venture into entrepreneurship always ask themselves this question, do I need a business plan when starting a business?
One of the biggest mistake that most entrepreneurs/ business people do when they want to prepare a business plan is to hire an outsider to prepare a business plan for them. I did that once. The problem is, and I reckon that’s what others might have faced, the person I hired had no clue of my business operations.
Coming to think of it, nothing was requested from me on how I run the business, my ideas or my vision. So what did I get? a business plan that did not resonate with my business.To stand out of the pack and ensure you have created an amazing business plan.
3 Things that makes an amazing business plan you should focus on.
- Be clear about what you have to offer; The product or service offered should be very clear without much thinking. A good business plan is the one that not only mention the product/services but also the description and how that product and service operates
- Show Uniqueness of your business/idea; Its important for other people especially the financiers to see why your idea or business is different from other similar business and why they should put their money or investments in your business. People are not interested on information they can get over the internet but information that in unique and convince then to invest in your business.
- Show return on investment; Business Plans must contain the financial part of the business where income projections can be articulated in both worst and best scenarios. Bottom line every investor is interested to see how they can get the value for every amount they have spent. so even on the worst case scenarios investors are more interested to see a small profit or breaking even. There is no point for someone to invest when all they can see are losses.
Steps in creating an amazing business plan
- The executive summary – This is where you will give a snapshot of your business plan as a whole. The summary should tell the reader what you want. You should clearly state what you are asking for in the summary.
- Business Description – Here, you will discuss the concept and scope of the firm. The concept in this context describes the industry in which the business will operate the structure of the startup and success strategies. When discussing the industry, you should look at the present outlook of the industry as well as the future possibilities. Discuss any new products in the market and the effect they might have on your business.
- Market strategies – Market strategies will be as a result of the market analysis. This is where you will do research on the industry and your competitors. This will help you to understand the market and establish your target thus increasing sales. The plan should include strategies and approaches to implement these strategies.
- Competitive analysis – The reason for this is to calculate the weaknesses and strengths of your competitors. Here you will state the strategies that will help create barriers to prevent competition. Other strategies on how to exploit your competitor’s weaknesses will be discussed here.
- Design and development plan – The reason for this section is to provide consumers and investors with the product design. The plan should also indicate the products and services to offer to the market and their respective advantages. The details of the products and services should also come along with the target market of the business.
- Organization and management – A good plan must show the management structure of the enterprise and its suitability in meeting the deliverable of the firm. This will discuss how the business operates on a continuing basis. The organization plan will highlight the logistics of the business such as the responsibilities of the management and the duties allocated to each team.
- Financial factors – Financial forecasting is also necessary for showing the audience how the business will raise capital as well as a projection of its financial statements. This will appear at the back although this does not mean it is less important.
Things that you should avoid.
- Don’t have an incomplete plan -Your business plan should cover all the above parts this article has discussed.
- Don’t write a vague business plan – Your business plan should not be like a novel or a poem. If a person with a basic education cannot understand it, then you need to rewrite it because it is vague.
Just in case you want to write a vague business plan to protect maybe your formulas or strategies then you should state that in the business plan summary.
- Don’t write a too detailed -This especially affects the technology-based startups. Do not focus too much on the technical details!
- Don’t have a business plan with a sloppy presentation – Once you have written your business plan, ensure that it is presentable to investors. Do not have inconsistent margins, missing pages, or unlabeled diagrams on your business plan.
One to avoid this is having someone to proof read your business plan before handing it over to an investor or venture capitalist.
- Don’t have a poorly written business plan – Although investors are not investing in grammar Nazis, make sure that your business plan is in good grammar, no spelling mistakes, and good style.
- Don’t include unrealistic assumptions – Although a business plan is based on assumptions, you should make sure that you include the rational and realistic ones.
The most important assumption should be the business would succeed. Don’t have too many assumptions in your business plan that they bury the facts.
