It’s the crucial first step on every entrepreneur’s journey. Before you can launch a new business, you have to get the business plan right – ultimately it spells the difference between success and failure for your venture. Read on to discover the best approach to creating that all-important document and give your fledgling business the best possible chance to thrive.
What does a good business plan look like?
If you’ve never been involved in launching a business before you may never have seen a business plan, much less recognise a good one. They can take many forms (spreadsheets, projections, process-maps, price lists or presentations) but the best have a number of key things in common.
They should always be fact-based rather than rooted in speculation and add-up to a coherent road-map for the development of the enterprise. This means that the perfect business plan is objective, logical and detailed. It should clearly frame why your business is a great idea and likely to succeed, not only because that could encourage lenders and investors to get on board but so that it sets the compass you will steer by once you begin.
The right introduction
A great business plan begins with a concise description of your venture, covering details such as your concept, your objectives, and your justification for starting the business. This is the most important part of your plan, and needs to be specific about things like; your products or services, the current market situation including growth potential, and your funding requirements. It needs to identify key competitors and explain how your venture will offer an edge.
This means the first page or two of your plan is the most important and should provide a thorough overview If those pages don’t grab a reader’s attention there is something missing. When there are others to convince that is doubly important.
Identify your objectives and how they will be reached
Objectives are landmarks by which you can measure your own progress. They should be accompanied by a general overview of what you will need to achieve them; who will do the work, where you will find your customers, how many you need and so on. If this seems daunting, start with the basics and slowly expand on the details. This exercise helps you focus and consider realistic options in detail. Be sure to keep those objectives SMART- that is, quantifiable and with a specified time-frame. Also consider the decisions you can take if you fall short, or exceed, those targets.
Research your market
Good research is the key to a great business plan. This means conducting a thorough investigation of the market you plan to enter, and then analysing precise metrics such as customer demographics, buying cycles, and purchasing trends. This research will reveal precisely where the best opportunities lie, and help you refine your marketing and pricing strategies. The effects of time and location should also be taken into account. For example, winter sporting activities may be a growth sector, but can you stay afloat in a flat region through the summer months? Your goal is to identify opportunities in your specific location and maintain cash flow throughout all seasons. For that you need a clear picture of your target customer and your own circumstances.
A perfect business plan not only helps to bring lenders and investors to the table, but is also an invaluable tool in the years ahead. A well thought out plan is one that has considered all the relevant details and how you should act in all possible future scenarios. The process of creating a plan should also weed out enterprise ideas that might not be destined for success, saving you time and money. A good business plan is the best foundation you can give your new venture, so don’t overlook this vital stage of the process.