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Your business plan is an essentially part of your small business success strategy. It is a vital document that lays out all of your professional goals and the means by which you intend to achieve them. It is what brings your business out of the concept phase and turns it into an actionable reality.
It is very important that you write a business plan for your own small business. With it, you can focus your ideas into realistic techniques and goals, with a proper plan, and achievable but not too unchallenging goals. It is what will keep you on track and motivated throughout the growth of your business. Furthermore, business plans are commonly required by investors, banks, the government, and other lending institutions from whom you will be requesting financing to help to get things off the ground.
There are certain steps that you will need to take in order to prepare to write your business plan. These are:
Identification and narrowing down of all of your business objectives
Thoroughly researching all of the different points within the business plan
Write out a rough first draft of the business plan
Go over the rough draft and divide it into key sections
Apply realistic financial projections to the plan
Obtain feedback regarding all of the elements of the business plan.
The elements of your business plan should consist of the following:
Vision answer the question why am I creating this company?
Mission answer the question what benefits will my products or services provide to my customers?
Goals answer the question what are the short-term and long-term goals of the company?
Introduction to your business examine and discuss the following points:
- An overview of the industry of your business, your business history, and its operations strategy.
- An introduction of the key people in your team.
- Your current market, including its size, the opportunities you have, the challenges you face, and the growth pattern.
- Competition and alliances, including strengths and weaknesses, and strategies.
- Target market.
- Identification of your clients in terms of their needs, demographics, and purchasing habits.
- Your products and services as well as their revenue streams.
- The image, experience, or lifestyle you're selling
- Placement
- Where your product or service will be available for purchase
- Pricing
- Your promotional strategy
Operations including its functioning involving the following points:
What the business will accomplish everyday.
Current and future projects in the works.
Successes and challenges faced so far.
Overall strengths and weaknesses of the business
Internal operations issues
The Team including the people who will be working together in your business, covering the following points:
Who is responsible for what?
Is there the right number of people in your business for getting the job done?
Strengths and weaknesses
Internal successes and challenges
STEP also known as the external analysis. This includes:
What trends are affecting your business in the following areas: social, technological, economical, political.
Opportunities what is available to your business regarding the following points:
The size of your prospective market
How much growth opportunity your business has
Your market niche
Changes in operations
The structure that would be required in order to allow for growth
Concise statements of opportunities for your business
Plan of action and strategy including:
What does your business require for achieving its long-term goals?
What challenges does your business face before reaching its long-term goals?
What actions will you take in order to achieve your business goals?
Why have those actions been chosen? How do they complement your vision?
Assumptions examine these points:
List all of the assumptions that have been made within the writing of your business plan.
List soft assumptions that is, those that have been made but which are not quantifiable.
List hard assumptions those that are quantifiable.
Financial projections including:
Cash flow statements from the past two years through until the next two years.
Income statements from the past two years through until the next two years.
Balance sheet from the past two years through until the next two years.
Create each of these statements with a high, medium, and low sales estimate.
Executive summary this section should be written as following:
A summary of your business plan
This sections size should consist of approximately 10 to 15 percent of your entire business plan.
This section should always appear at the end of the document
Key points should be highlighted
Consider this section the most important of the entire document.
As you can see, a business plan requires a great deal of work and planning, however, it is likely to be the most important document that you will create throughout the entire life of your business. Therefore, it is well worth doing, and doing well.
Robert Moment is an innovative small business coach and author of Invisible Profits: The Power of Exceptional Customer Service. Robert specializes in teaching small business owners how to actionable small business marketing ideas and strategies that generate profitable results. Visit http://www.smallbusinessmarketingideasstrategies.com and sign-up for the FREE Small Business Marketing 5 day e-course.
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