How To Write a Business Plan
Launching a new business is exciting. To achieve financial success, however, you need to establish a good foundation for your company. That’s what business plans are for. How can you write a great business plan?
Choose a Type of Plan
The first step is knowing how much detail you need to include in your plan. When it comes to angel investors and other sources of business capital, you often need to present in-depth financial projections and other documents. More-detailed plans list concrete numbers for cash flow, estimated operating costs, product revenue and projected first-year sales. You also need information related to the organizational structure (such as C-corporation or S-corporation) and management of your proposed business.
Choose Your Company’s Identity
A key part of any business plan is deciding what will make your company unique. Why should customers buy from you instead of competitors? Your brand’s personality includes the way it treats customers, what its main goals are and how it does business. It’s best if your company approaches its target market with unique offerings.
Do Market Research
Understanding your potential customers and the market available to you can help you decide what kind of services are worth your time and effort. Market research provides information on demographics, purchasing trends and total spending in the area.
State Your Product Offerings and Services
Write down what kind of products or services you will sell. Include specific numbers wherever possible. How much will it cost you to produce each product, and how much revenue can you obtain based on the local market?
Describe Your Target Market and Ideal Customer Relationship
You need to define who you want to reach with your products or services. Are you mainly marketing to women, parents, teens or older individuals? Which demographic is most likely to purchase your products? The answers help you know where to invest your marketing dollars.
It’s also important to decide how you will reach your customers. Do you envision most sales happening in a brick-and-mortar store, online or by visiting customers at their homes? How large will your customer service staff be?
List Your Revenue Goals
A good summary of revenue goals provides specific targets for you to shoot for. Business plans should answer the questions of how much and how to reach these financial targets.
A business plan gives your company a clear structure, attainable goals and ongoing guidance for smart decisions. It helps you measure your financial performance and make relevant changes if needed.