Whether you need financial assistance with your business venture or you're self-funding, writing a solid business plan is a very important step.
What is a business plan & why is it important?
In the simplest of definitions, a business plan explains what a business does, how it plans on making money, and why other people should care.
Business plans can help you get funding or bring on new business partners. Investors want to feel confident they’ll see a return on their investment. Your business plan is the tool you’ll use to convince people that working with you — or investing in your company — is a smart choice.
Investors aren’t your only audience. A good business plan guides you through each stage of starting and managing your business. You’ll use your business plan as a roadmap for how to structure, run, and grow your new business. It’s a way to think through the key elements of your business.
9 Basic Components to Consider
1. Executive summary
Briefly tell your reader what your company is and why it will be successful.
2. Company description
Use your company description to provide detailed information about your company. Go into detail about the problems your business solves. Be specific, and list out the consumers, organization, or businesses your company plans to serve.
3. Market analysis
You'll need a good understanding of your industry outlook and target market. Competitive research will show you what other businesses are doing and what their strengths are.
4. Organization and management
Tell your reader how your company will be structured and who will run it. Use an organizational chart to lay out who's in charge of what in your company.
5. Service or product line
Describe what you sell or what service you offer. Explain how it benefits your customers and what the product lifecycle looks like.
6. Marketing and sales
There's no single way to approach a marketing strategy. Your strategy should evolve and change to fit your unique needs.
7. Funding request
If you're asking for funding, this is where you'll outline your funding requirements. Your goal is to clearly explain how much funding you’ll need over the next five years and what you'll use it for.
8. Financial projections
Supplement your funding request with financial projections. Your goal is to convince the reader that your business is stable and will be a financial success.
9. Appendix
Use your appendix to provide supporting documents or other materials were specially requested.
For more in-depth knowledge, consider taking our free course on creating your own business plan.