The business plan is more than a document that explains a business. It is the most important tool for building and consolidating strategies. It makes no sense to start a business without knowing its purpose, when it will make profits, reach customer, or work.
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A business plan can have different structures, but in general, the following sections are fundamental:
- Executive summary.
- Description of the company.
- Market analysis.
- Organization and management.
- Products and services.
- Sales and marketing.
- Financing and financial projections.
What is an executive summary?
The executive summary is the general summary of what the company is or will be, and it should summarize the other sections of the report. This section should be helpful for a person who wants all aspects of the company presented concisely. This section of the information should:
- Clearly describe what the company does.
- Present the mission and vision.
- List the owners or stakeholders.
- Detail the human resource needs of the company as envisioned.
- List the location of the company.
- Explain the financial aspects.
- Mention the amount of money needed to maintain and grow the business.
How is the business description done?
This section is an essential part of the business plan. If an investor or a financial institution is impressed by this section, they will be more inclined to explore the rest of the report. This part aims to create interest in the person reading it.
The description should explain to the reader what the company does or will do; it is essential to take this opportunity to explain what differentiates the company from others. Also, take care of the basic rules of writing to be pleasant and easy to read: simplicity, clarity, not overloaded with terms, and not a lot of repetition. You can hire a paper writer to help you prepare the text. This way, you will save time and be sure of the quality. Some additional aspects that can be included are:
Detail the business’s ownership structure (owner, company, etc.).
Describe the customers you target and why the offering is ideal for the customer demographic described.
Explain to the reader where you will establish operations and the company’s mission statement.
What needs to be done in the market analysis section?
It is essential to understand the market in which the company will operate, so study the market and then write down the following points:
- Size of the market.
- Target demographic group within the overall market.
- List of competitors and market share.
- Analysis of the competitor’s strategy and the success or failure of the process.
- If you thoroughly research this section, you will be prepared to better compete with others in the marketplace.
How to describe the organization and management structure?
Here we describe the company’s organizational structure at the legal level and, that is, the legal structure under which it will be created. The most common types of companies are:
- Sole proprietorship.
- Simplified corporation.
- Public limited company.
- Limited company.
Instead of simply indicating the chosen business structure, you must explain why you believe it is the best option for the company.
Another point to consider in this section is the organization chart of the key members, so you should list the people who occupy the highest levels of management and detail their profiles.
This section should inform the reader in detail about:
- The legal structure of the company.
- The reasons for choosing the organizational structure.
- How the company’s structure may change in the future if necessary.
- The organizational chart of the company.
- Description of the people in critical positions.
- Description of the positions that have not yet been filled.
A products and services section.
This section describes the product or service that the company will sell. Most entrepreneurs find this section easy to write. It will detail what differentiates the product or service from the rest of the competition. The introduction to this topic was already laid out in the market analysis section, and it should report at a minimum:
- What is the product or service you will sell and all the details about it.
- The life cycle of the product or service.
- A comparison of the product or service with competitors.
- Patent or copyright plans, if any.
- What should be explained about the company’s sales and marketing?
No matter how good the product or service is, people need to know it exists. It would help if you had a marketing and sales plan to capture the attention of potential customers. All the effort invested in developing the product will be useless if the marketing and sales aspect of the business plan is ignored.
Sales and marketing.
Explain the marketing strategy in detail and list the different media you plan to use. This section should convince the reader that you have a good marketing and sales plan to grow your business. In general, it should include:
- The marketing strategy.
- The marketing channels.
- The mode of sale.
- The details of how profit margins will be calculated and managed.
How to write about financing and financial projections?
This business plan section is vital for approaching investors and financial institutions. A potential investor will judge the pros and cons of investing in the business based on the financial planning, and they will need to know to what extent their money will be safe. The details required in the financing section are:
- How much money does the business need?
- How the company plans to finance the business?
- How will the funds be spent?
- Loan repayment plan.
- Details on whether the financing will be through debt or equity.
- This section should demonstrate to potential investors and third parties how much money is needed.
Financial projections tell the reader how you plan to budget and manage the company’s finances. It may be tempting to overestimate the company’s revenues, but you should be as realistic as possible; the financial projection should detail:
- Projected expenses.
- Cost of goods sold.
- Projected revenues.
- Break-even point.
- Exit strategy for the business.
Some general tips that may help write the business plan are as follows:
Research: Taking the time to do thorough research, the information you gather will make the business plan look good and help to better plan and manage the business.
Keep it updated: Creating a business plan is not a one-time activity; you should keep the business plan updated periodically as the company grows. It is essential to update information on market research, financial details, and products or services.
Do not make the report too long: It is necessary to read it repeatedly to eliminate unnecessary text sections. It should be detailed but not too cumbersome to read.
A great business plan will communicate the objectives and convince readers that the idea and plan are sound.
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