Business plan for your business is required when you seek funding for your business from the banks or other financial institutions or potential investors. Your potential lenders would be interested to learn more about your business model and the product and services you offer.
Even if you do not require funding for your business. It is good to have one and use it as your continuing business reference guide.
A business plan is an overview of your business life cycle from the beginning to its foreseeable future. The plan should be short, simple, specific to the points and realistic with factual information.
Writing your business plan can help you to put things into perspective and allow you to prioritize your work according to business operations needs and it also can be used as a yardstick to measure the progress of your business. Generally, a good business plan should cover the following aspects.
Capture in a sentence what is it that makes your business exciting and utterly irresistible to customers, suppliers and, most importantly, to you.
Describe how you came to conclude that this is the right business to be in right now. What are the circumstances that are coinciding to create your opportunity?
What are the specific short, medium and long-term goals and how would you measure your success?
For example, you would use a limited company for business. You plan to float your company in the stock market within 10 years. For this purpose, you would have a plan of when to re-register your private limited company to a public limited company.
Are you starting up your business alone? Or with business partners? Or get new staff? Whoever they are you must know how are these people perfect for the job?
What are you going to sell and what are the main benefits of your potential customers would prefer to buy from you than your competitors? Anyone else selling the same products and services?
Who is already out there and how will you be different? The differences are crucially important – without knowing them you will not succeed.
How are you going to communicate the benefits you offer to those you seek as customers? How will you measure the response and improve marketing effectiveness?
How will you pay for your business expenses? Using your own savings or getting a bank loan and if there are investors what can they expect in return?
Show that you’ve assessed the risks to your success and have them covered.
Your business, like anything else, has a natural Lifespan. You need to plan for your exit before you start. Will you sell? Give it to your kids? What?
Last but not least, writing business plan provide you with clear direction of how your business is going to be one day.