How to write a business plan that works.
Are you an entrepreneur? Do you want to expand your existing business? If so, you may need help coming up with the capital to support your big new project. It’s time to create a business plan.
“Writing out your business plan forces you to review everything at once: your value proposition, marketing assumptions, operations plan, financial plan and staffing plan,” Steve Robbins, a nationally recognized venture coach, writes. “You’ll end up spotting connections you otherwise would have missed.”
A business plan has two purposes: to outline your company’s roadmap to success and to demonstrate your potential to lenders. Your business plan should include:
Executive Summary. Quickly clarify your vision and clearly outline your goals. This section of the document – which should be located immediately after the title page – will help the reader decide if he or she wants to take the time to read the rest of the plan.
Business Description. Begin with a short summary of your industry. Include market trends, new products and potential opportunities. Next, detail your specific business: what products/services do you offer? A common question investors ask is what you feel is the “secret weapon” that sets your business apart – answer this in your description.
Competitive Analysis. Who are you fighting for clients and customers? What are the market gaps that these other businesses are failing to cover – and how do you propose to step in? Who has succeeded and who has failed to serve your market – and what will you do differently? The competitive analysis should answer all of these questions.
“According to theory, the performance of a company within a market is directly related to the possession of key assets and skills,” Entrepreneur Magazine explains. “Therefore, an analysis of strong performers should reveal the causes behind such a successful track record. This analysis, in conjunction with an examination of unsuccessful companies and the reasons behind their failure, should provide a good idea of just what key assets and skills are needed to be successful within a given industry and market segment.”
Customer Analysis. Who are your target customers? Include their demographics, interests and needs.
Marketing Plan. How will you reach your target customers? A marketing plan establishes how you will brand your product while identifying the promotional tactics and channels you will use to communicate
Operations & Management Plan. Describe how your business functions on a day-to-day basis. Detail the roles and responsibilities of your team. Outline the milestones you want to hit both short-term and long-term.
Financial Plan. Include your current financial information, how much external funding you need to grow your company and where that money will be invested. Show your projected revenues and profits over the next few years.
“The simple act of writing down your idea and outlining how the business will operate can be helpful to ensure that you communicate your vision and that everyone is on the same page,” Forbes columnist Patrick Hull writes. “It also helps you benchmark and check your progress as the company grows.”
If your business needs capital, your first meeting should be with a Northwest commercial lender to discuss all of your options. Visit (link to Northwest Commercial Lending page) to get started.