Business Plan: How to Write a Business Plan

The question is why do you need a business plan?

A business plan is used primarily to secure funding. Since the content of the plan is focused on plans involving success or failure of the enterprise.

Funds targeted by such documents are grants, startup company funds, venture capital, business loans and angel investors.

The plan is used to fashion management objectives and employment standards within an organization. Other reason why your organization needs a plan is strategic planning concerning allocations of resources and management structure.

The document covers total quality management and quality control. Now you have a brief idea of the potential in writing a business plan lets look at writing the plan.

Business Plan Framework

A typical business plan has a structure for startup companies. The document has a cover page followed by a table of content.

Next are the executive summary, company’s mission statement and business description. You need to include a business environment analysis and SWOT analysis.

Other things you can add to your business plan are industrial background, what competitors are doing and a good marketing plan.

The plan is not complete without an operational plan, management structure, financials and milestones. The last page should focus on future projections.

Executive Summary

The focus of the business is usually captured in the executive summary. The purpose of the business plan dictates the focus.

An externally focused plan set targeted goals for financial institutions like banks or investors. The focus summaries profit, growth potential and future goals.

Lists of external stake holders are government agencies, international financial organization, banks and NGOs.

The summary explains your company’s vision and mission statement.

Mission Statement

A mission statement is used to communicate the purpose of the business. The mission statement is usually short and outlines the company’s mission and purpose.

It shows clearly the direction a business is going. The corporate purpose is a guide on the path and actions including decision making of the establishment.

In your mission statement formulate strategies, content and a frame work. There are three essential elements which are the key market of focus which are product or service. The third is what makes your products and services different from your competitors.

What is the purpose of a mission statement?

The mission statement highlights the agenda of the company. It clarifies what the organization wants to achieve through policies, staff engagement, products and services.

It also reflects every facet of the business like pricing, service delivery and quality. Note that a mission statement is different from vision statement.

SWOT Analysis

This is a method to evaluate the strengths, weakness, threats and opportunities of a venture. It identifies favorable and unfavorable conditions including internal and external factors.

The reason for this evaluation is to have a strategic fit.  All the comparative analysis is focused on advantage and disadvantages of company strength, weakness, opportunities and threats.

The importance of SWOT is that it helps in decision making, planning and setting objectives. It identifies external and internal factors to achieve a business objective. Categorizing these parameters is what the SWOT concept is about.

 Business Description

A business description is a short description of the industry you want to operate. Describe the present and future prospects of the company and add information products development and benefits.

Competitive Analysis

Every business has rivals so assessing the strengths and weaknesses of competitors is competitor analysis.  It is an essential component of business strategy through information gathering.

Things in a competitor analysis are key success factors in the industry and rating your competitors. Other determining factors in an analysis are scope of your industry, customer’s benefits and expectations.

The reason for having a competitive analysis is gathering superior knowledge of competitors. By creating a detailed profile your business can strategies its operations.

Marketing Analysis

A market analysis focuses on the purchase, inventory and expansion plan.  You need to identify your company’s strengths, opportunities and format a business strategy.

You need to find a competitive advantage through market analysis and market knowledge. The questions you should address are accessibility, sustainability and behavior. When you formulate a business plan add a marketing analysis.

Financial plans

A financial plan predicts variables in assets, withdrawal and future plans of the company. For it to work you need a budget that highlight specific goals on savings and expenditure.

The expenses are factored in the future plan including spending, utility bills, rent and saving plans. Things to consider in your plan are management structure, wages and effective budgeting.

The context of your business focuses on income statement, cash flow and balance sheet. In a nut shell a financial plan is a financial statement that focuses on present, past and future financial statements.

Marketing Plan

A marketing plan needs to have a solid marketing strategy to work. The plan centers on advertisement and promotions.

The marketing effort is focused at accomplishing specific goals, brand building and other marketing objectives. The plan should include future projections, historical data, strategies and methodology to achieve goals.

Other parameters are sales forecasts, budget, planning and programs. The analysis should cover strengths and weaknesses in the company’s structure.

To effectively organize achievable goals you need a marketing plan

Other things to Consider in your Business Plan

Other things to add in your business plan are operational analysis and management summary. You can include a business description and business environment analysis.
Free Business Plan Samples and Ideas