5 Steps to Developing a Solid Business Plan
You have a great business idea and want to jump right in. The one thing holding you back may be lack of a clear business plan. While some would say having a business plan is an absolute must, others would argue that you can get started and be successful without one.
I think the answer lies in how confident you are in your idea and how organized you are in terms of executing it. If you already have a clear plan in your head along with the steps you need to take and the means to take them, you may not see the need to create a 20-page business plan.
On the flip side, if your idea lacks clarity and you are considering seeking out funding from others sources, it would be best if you came up with a solid business plan. The good news, is that you can sit down and create a business plan in under a day. It doesn’t have to be super extensive so long as you hit all your main points and follow stick to outlining these steps.
1. Executive Summary
The executive summary is the first part of your business plan. This is where you capture the reader’s attention be explaining the specifics of your business. What is the name? What will you be doing? What is the mission of your business and what are your goals?
Be sure to include what makes your business unique and summarize why you feel it will succeed.
2. Market Analysis
Next you want to analyze the market in order to prove that there is a need and target audience for your business. This is a great way to validate your business idea as well. If you can’t narrow down your target market or find that they aren’t interested in what you are offering, that could be a huge red flag.
Be sure to clarify who you wish to serve along with some detailed statistics that describe them, their interests, what products and services they buy, along with and their needs and wants.
3. Financial Projections
The financial projections section is where you get to have some fun with numbers. Map out the financial progress you plan to make with your business over the next 3-5 years. Include revenue goals and you might want to specify how much you’d need from an investor or a loan to bring those goals to fruition.
This is also a great place to mention various different start-up costs you’ll have so investors can know why you need money to support your business.
4. Organizational Structure
Have you ever thought about how your business will operate and be structured? Will you act as the CEO? Will you have a team or hire interns? Will you eventually need to work with accounting, sales, and marketing experts? Or will you be more of a solopreneur.
This is a great section to answer all of those questions and map out how you might expect your business to grow in the future and which roles you’ll have and need.
5. Products or Services
Finally, in step 5 you want to go into more detail about your products and services. Most people start with this step (especially if they don’t consider making a business plan) but it’s best to end here after you’ve covered your bases in the previous steps.
Discuss what makes your product or service unique and how you plan to execute it in a competitive marketplace. If you’re going to be selling products include descriptions and images along with whether you’d need to trademark anything.
A business plan can be a crucial tool to help you get organized and perform neccessary research before moving forward with your new venture. If you’re considering asking for funding or financial assistance, a solid business plan is usually a requirement.
Even so, it’s a great way to get crystal clear on your goals and intentions so you can focus in on carrying out your plans and being successful.