No one knows what the future holds, but the best we can do is to plan for our future. This also applies to your business. I can tell you from personal experience that many uncertainties await you as a new business owner as you rush into establishing a new business or a start-up company.
It is a very dangerous game to venture into a business without first having the right business plan as a guide map to deal with uncertainties. The business world can sometimes be like an unpredictable journey. One of the uncertainties is how to find a strong target customer base and those who will buy your product or service. From here, you ponder what the purpose of your business is and how you will convince investors to finance your business.
4 Tips for Writing a Good Business Plan
I usually advise new or old business owners, as well as start-ups, to write the different sections first and then treat each section one after the other until they reach the summary. Try to keep each section to a simple couple of pages. Remember, you are not writing a textbook for students to use in schools, but rather, your business plan is meant for you and your business partners. So here are 4 tips I use to write a good business plan. They have always worked for me, and I believe they will work for you as well:
1. Market survey
NerdWallet suggests that this is the first part of writing a successful business plan. Researching the market, industry, and your competitors is important because it assists you in understanding who to target with your product. I will suggest that you gather information and analysis that will create opportunities for you to produce a brand that is different from that of your competitors in terms of taste, packaging, quality, and quantity.
2. Company Description
This is the part that most investors or potential shareholders will be interested in. In this session, you should, to the best of your ability, explain what your business is all about. What do you do, and how do you want to do it?
It is funny sometimes as to the kind of answers I get when I ask new entrepreneurs who wish to establish a business to describe their business. The kind of replies I get most times indicate that they just can’t seem to give comprehensive details about their vision and mission.
As a business owner, you should have a good description of the business that entails key points such as a registered business name, office address, proposed initial number of employees, and proper business structure, such as sole proprietorship, limited liability company, or corporation. Finally, you should know those who own ownership stakes, like investors and shareholders.
3. Outline Your Business Goals
Your business goals are what your targets are and what you aim to accomplish. You need to know what you will be working toward, and there should be a set timeline for each goal. These timelines could be set in the short term or long term.
Please do not list goals that will make you look stupid in front of investors. This is the part where you list those targets that investors know can be achieved. Investors want to know why they should invest in you rather than your competitors. Funds are valuable to all investors, and they expect you to set goals that will guarantee a return on investment.
Also, after you set these goals, you should state how you plan to achieve each of your goals or targets. It’s good when you set goals for your business, but it is even better when you have the zeal and plans to achieve these goals.
4. Business Plan Elements
In your business plan document, there are major sections that make it professional. Now I want you to know that the number of sections and pages in your business plan might not be the same as that of your fellow entrepreneurs. Business plans usually vary, depending on the industry or niche you go into, but all standard business plans include these elements:
- Executive summary: This is a simple or broad description of the services you offer and your financial plans.
- Description of business: This element states your company name, address, key players in your business, and the kind of business structure you operate under.
- Competitive analysis: Explain who your competitors are and what they do, as well as what sets you apart from your competition.
- Description of organizational management: Who are the key major players in the business with you? This includes the investors and shareholders that hold major or minor components or parts of the business, no matter how small or large their shares are.
- Description of services: This element includes details of how your service works, proposed pricing, sales strategy, and distribution strategy.
- Marketing plan: Explain how you plan to encourage both old and new customers to patronize you.
- Sales strategy: How do you plan to sell your product or render your services? Will it be online through the internet, will you be selling only to walk-in customers, or do you plan to do both to earn a decent profit for investors?
- Financial projections: Businesses run on loans, so explain how your business will make enough profit to repay the loan.
Frequently Asked Questions
Should I consider an exit plan when writing my business plan?
Yes. You should have a second plan, an exit strategy, or a predetermined alternative to what you are currently into, as this will prevent total loss in the future, should you not get what you want.
How does a business plan help my business to be successful?
A business plan gives you a guide map as to where your business is coming from and where your business is going, as well as how, during difficulties, you can sustain it.
