The main purpose of writing a business plan is to articulate an approach to start a business, It is as important as a strategy of the business. Complicating a business plan reduces the chance of you reaching the milestones. In this step-by-step guide, I’ll show you how to quickly and easily write a business plan that will get the faster results you want. You don’t have to have a Master’s degree to write a great business plan. The below steps will show you how you can get to your Plan without any of the complexity or frustration.
A business plan helps you in:
– find out where you are now & where you want to go in your business
– Identify resources to start and run your business
– Gain insight into and understanding of your industry, market, and more
– Build clarity and focus on what has to be done.
– Calculate Business setup costs and what you have to charge to establish a profitable business
– refine in on your offer, how it’s different from your competitors, and how it benefits your potential client/customer
– Obtain financing
– Decide if you have to contract outside help or hire
1 Executive Summary
The executive summary is an overview of your ideas and business plans. It is ideally only a few pages (1 to 2 Pages). It introduces your business to the readers and layouts what you are looking for from them. While it is the first thing in the plan I recommend you to write it at the last of the plan you may ask me why? Because once you know the overall picture of your business you will be prepared to write the summary more relevantly. It’s a standalone document that contains details of your business plan. As an executive summary is an important document make sure you prepare as clear and precisely as possible. Because your executive summary is such a critical document of your business plan it must bring sparks interest and makes your investors feel eager to hear more from your business.
2 The problem and solution
Start this section by describing and defining the problem that you want to solve in the market and what are your competitive advantages you have over others in solving this problem. The primary point for your prospective customers is that the extent of difficulty with that of the problem that you want to solve in the market, Maybe it is very expensive or the complexity involved in it. For a business its geographical location makes the customers reach a reasonable distance.
Defining the Problem that you want to solve in the market is the critical element of your business plan and the success of the business you want to start. If your business plan cannot point out the problem that your potential customer has, then you may not have a viable business concept.
B. The Solution
Once you have described the Problem to your potential customers the next step is of a good business plan is to describe your solution. Your Solution is the Product or the service that you want to offer to your potential customers. Also, describe the product or the service and how exactly your product solves the existing problem.
To justify that you are solving the real problem in the market is to get out of your room and talk to the potential customers, and explain to the potential customers how your product or service is solving the problem.
Resonating with the real incidence and how your product or service helped them out to overcome the problem they are having.
3 The Target market
Now that you have a detailed study of the problem and the solution now it’s time to focus on the right group of people to whom you wanted to sell your product or services. Depending on the type of your startup idea you must go into more details as to how your product will help them in solving their problem No matter what, you must know who are your customers are and have an estimate of the class of similar people. If you don’t find enough customers for your product or service, that could be a warning sign for you to enter into business.
Before you set your Target market, Market analysis, and market research helps you to find exactly what your target market is. Before you set your target market you must ask yourself the below questions.
a. How big is your market segment?
b. What is your Total Available Market?
c. What is your segmented addressable Market?
d. What is your tentative share of the market?
Once all the above research is done now it is time to discuss the trend for this type of product or service in the market. What is the trend line (Upwards or downwards) Talk about the tastes and preferences of the markets
4 Ideal customer
Once defining the target market is ready and now you have got to specialize in your ideal customer for every segment and it's to use your “buyer persona” or “user persona.”
You may have done additional work on top of the market segmentation, having a solid buyer persona is an especially great tool to assist you to identify the marketing and sales tactics you’ll use to draw in these ideal customers.
Good customers appreciate your offerings, buy your products and services offered and pay your bills timely courtesy. And what often brings them back may be a better offer. They will never become loyal patrons because they're easily drawn to special deals quite long-term business relationships.
This segment of the plan is More of what are the competitive advantage you have when compared with pears in the market. Most business plans use the competitive matrix to compare them with their peers. The most important thing is to explain how advanced your solution works for the problem than your competitors then we show how your plan is different from the others. Most of the business plans claim that their product or services have fewer or no Competitors which is a blunder.
The simple fact is that every business has competition. Competitors always may not come in the form of “direct competition,” which is when you have a competitor offering a similar solution to your offering. Many times, you may be dealing with “indirect competition, which is when consumers try to solve their problem with a completely different kind of solution.
6 Future business plans
In this future business plan section you have to talk about the complete future plans of the company that is stepping into and here comes all your‘ VISION’ ‘MISSION’ and ‘VALUE’ Statements of the company and also the company’s perspective of the future journey of the company.
You must clearly define all your future plans for the below segments
1. Your positioning statement
3. Promotion & Distribution
6. Public relations
7. Content marketing
8. Social media & Technology
9. Strategic alliances
10. Sourcing and fulfillment
Any company will have a future plan segment but what makes your business plan outstanding is to have a feature what are your strategies and plans to activate the future set goals and the company approach in achieving them.
7 Marketing and sales plan
This section of marketing and sales plan is for the immediate strategies for marketing and sales before starting your business, it's important to outline all the details one of the most important sections of a business plan is marketing and Sales Strategies which outlines your plan for reaching and selling to your target market.
Why You Need a Sales Marketing Plan?
There are some misconceptions about why do we need to have a sales and marketing plan but regardless of the size of the company, you must have marketing and sales strategies.
The basic sales and marketing strategy is to know your market and competition which includes marketing strategies to maximize sales. You must not launch your product or service keeping in mind the profit when you want to enter and establish yourself in the market. This marketing plan also includes 5Ps in the market
1. Product - Describe the product or service offered to the customer by your home business.
2. Price - How you will price your product or service so that the price remains competitive while still make a good profit.
3. Place - indicate in which physical boundaries you are going to sell your products or services.
4. Promotion - What methods of promotion you will use for your products or services to communicate the features and benefits to your target customers.
5. People - Decide your sales strategy and the people who will provide sales and service that will be used in marketing your products or services to the potential customers.
Basically the 5 P's of marketing are included in any marketing plan. If you want to make your marketing plan a unique document, you'll have to include the information prepared in the Market Analysis for your business plan.
Your projections of how much you sell to your prospective customers over the next coming few years are your forecast figures.
This sales forecast is mainly divided into many sections where each section contains the forecast sales figures of the core products and services you are offering. Your sales forecast report will also include a corresponding row for each sales row to cover Cost of Goods Sold, also known as COGS. There are many methods to derive the sales forecast numbers Qualitative and Quantitative Methods are most commonly used to determine them which helps the users to determine the level of growth you are estimating using the current Opportunity.
8 Funds and financial planning
In your financial plan chapter often what entrepreneurs find most difficult is it doesn’t have to be as intimidating as it seems. Business financials for most start-ups are less complicated than you think, and a business degree is certainly not required to build a solid financial forecast. There are many financial tools that you can make use of to create your financial reports.
A typical financial plan will have monthly sales and revenue forecast for the first year, and then annual projections for the remaining three to five years. Three-year projections are most commonly included, but some investors will request a five-year forecast for the better understanding of the business.
Below are details of the financial statements that you must include in your business plan, and a small brief overview of what should be in each section
• Startup budget or cash flow statement.
• Startup costs worksheet.
• Projected profit and loss statement.
• Projected balance sheet.
Last but not least is your management segment in your business plan, this segment contains the most important information about the people who are responsible for the company’s management. By adding such information to your business plan you can show the Stake Holders (Investors, Shareholders, Employees, Creditors, Customers, Owners, Government, etc...) how exactly your business is structured.
The easy way to organize this section is to break it into the following points:
• Ownership Structure - This section through light on the actual legal structure of your company this statement may vary from the type of business you are operating, this section mainly outlays the percentage of shareholding of the members of the company.
• Internal Management Team – you have to give details about basic business categories of sales, marketing, administration, and production work for many small businesses and the persons administering them.
• External Management Resources – External management Resources are always looked at who can help the company for which intern decide the success or failure of the business strong external management helps the business to achieve the milestones in very little time.
• Human Resources – This section you have to provide all the information about your company’s workforce labor cost and all other details regarding the company and how you are going to utilize your workforce to achieve the set milestones and all the forecasted numbers related to Human resources.
Your conclusion lines should speak about the opportunity, highlight the key strengths and strategies of your plan, summarise your vision, and remind the reader why your business is in a position to successfully execute the plan. The business plan's conclusion should state facts and maintain a professional tone, if you are looking to raise funding with your plan, you should detail the finance required and also the possible tenure to repay it.