Don't Skip This Step In Your Business!
What is a business plan and why you have to have it.
It’s so unfortunate that a huge majority of business starters skip this step because it’s so important and can be a huge obstacle to getting startup loans from banks and other money lending institutions and investors. I personally do not suggest that anyone starting a business takes out a loan but I understand that some people don’t have any other options available to them. That being said, a business plan is one of the most overlooked documents by many entrepreneurs. Similar information may be in your head but it’s imperative that you put it on paper too.
What’s a business plan? It’s a formal document that spells out, in detail, your plans for your business and how you intend to make money with it. This is a living document. That means that it continues to change as your business grows. Because unless you’re opening a franchise or brick and mortar store, your business will not be the same over time compared to what you originally planned. And it shouldn’t. Your business should grow and reflect your what you’ve learned over time and your experience.
There are so many internet services and downloadable software packages available to help you write your business plan. There are some internet services that offer you an online space to work and keep your business plan for a monthly or yearly fee. When I started in business, there were no online options for me at all. I used the Business Plan Pro software which is still one of the most widely used business plan writing software available today.
Here are the most common and major sections of a business plan and a short description of each. These sections can be filled out in any order. And for me, it was easier to jump around at first because I didn’t know all of the information that it requested. Be sure that you can answer the following questions before you write your business plan. They’ll make filling out the required information much easier.
It’s an overall summation of your business plan that touches on your business goals and its profile. A good business plan creation tool will create the execurive summary for you as you fill out the rest of the document.
Here’s where you describe what you do, what markets you will service and what makes your business different from your competition.
Organization and Management
This is where you detail your business structure. Every business is different and has different needs. Describe your business organization structure in this section.
If you are looking for financial investment in your business the you would use this section to spell it out. Tell how much you want and how you plan to use it to finance your business.
Market analysis is a fancy title for researching your competition and your business industry. This should be done before you start any business at all. You have to be prepared as much as possible. And not knowing your competition can be the end of your business before you even get started.
Products or Services
In this section you talk about what your business will provide to its customers or clients. This is where you discuss how your business plans to profit.
Sales and Marketing
This is pretty straight forward. Talk about how you plan to market your product or service. This is basically your marketing strategy.
This section is important if you’ll be using this business plan to request monetary investments. This is where you show your expected financial growth thus showing any prospective investors how they can recoup their investment(s) into your business.
Whether you’re planning to start a business or have been in business for some time now, it’s still a great idea to create and keep a business plan. You should review it quarterly or yearly. It’s a good practice to review it each year at tax time. Why? Because you’d be surprised at how quickly your business can change in a year. And it can even help you to get back to basics when you’ve drastically veered off track or have decided to give up. It can remind you of why you got into business in the first place.
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