How To Build A Business Plan

Dreaming of bootstrapping a business and being your own boss?

Preparing to pitch to investors or trying to get business loan?

Hold on!! before proceeding with your ideas, let us review the secret mantra that our business tycoons have gifted us to follow before starting any business or pitching to an investor. The secret mantra is the “Business Plan”

“A good plan is a success half-done”

In this blog, we will provide you some ideas on how to build and what are the elements to be covered in building a perfect business plan for your dream business!

What is a business plan?

Business plan is a document that describes how your business endeavors and the way that your business will pass through to reach success. It is a fundamental tool that convinces your investors and partners to rely your business idea and also to act as a guiding document that can be referred during your journey.

What are the elements in a business plan?

Breaking down a business plan, below are the 7 key elements that you many need to cover while building your own business plan.

1. Executive summary
2. Business description
3. Marketing strategies
4. Competitive analysis
5. Operation plan
6. Management and Ownership plan
7. Financial factors

1.Executive summary

It is a key section which summarizes the entire business idea in a nutshell. It should convey the core details of what your business offers to this world, including the mission & vision statements, short description of your products or services and summary of your business’ opportunity in the market.

Executive summary should act as a highlight reel of your entire business plan. Specially to pitch your business idea to an investor, your executive summary should be precise and outstanding, to act as a self-convincing element.

2.Business description

A business description should explain what kind of problem does your product or service solves for a consumer. It may also include the details on pricing, product lifespan and other benefits offered to your customers.

This section should also provide a summary of your business’ position within the industry segment, along with your organizations’ expertise and your competitive advantage. It may also include the overview of the industry that your business is serving for, including the recent trends, key players in that segment.

3.Marketing strategies

Marketing strategies should detail on how your business is intended to reach your target consumer in the whole market and how it will attract them towards your business. It in turn, defines the clear market distribution channel that your business is about to sail through to reach your right customers.

This section should also detail the cost elements that could be incurred in the marketing activities that is to be carried out. Forecasting and compiling all the associated costs with the marketing channels should act as a key element in this section.

4.Competitive analysis

This section should convey a clear comparison of your business idea against the existing direct and indirect competitors in the marketplace. You should convey that you are aware of your competitors’ strengths and weaknesses and how you will stay ahead of them.

It should also explain on how you will overcome any entry barriers in the chosen marketplace. You may also need to distinguish your business idea from the competition, which is truly important in persuading funding sources.

5.Operation plan

Operation plan should give out the information on how your business will actually run.

It should be covering the following areas:

• Physical location of the business
• Facilities and equipment
• Kind of employees needed
• Inventory requirements
• Suppliers
• Any other operational details

6. Management and Ownership plan

This section should provide an outline of your business’s legal structure and management resources which includes both internal and external management resources and human resources needs. The experience or unique skills possessed by your management team which adds special value to your business can be highlighted in this section.

Details about your business ownership type – a sole proprietorship, partnership or a business with a different ownership structure need to be mentioned in this section.

Note: To specially focus for Investors, you can include the details of your Advisory board members and about their experience notes.

7.Financial factors

The last and the key element in the business plan is about mentioning the planned budgets which includes the costs related to staffing, product development, sales & marketing and any other expenses that could be incurred in running your business.

Also provide a description of your funding need, your detailed financial statements, and financial statement analysis. For a start-up, a well-studied cash flow projection and estimates is a key element as it helps to objectively evaluate a company’s potential for success. Comprehensive financial reports and analysis summary can also add more value.

As each and every organization is different from others your business plan may not be looking as same as other businesses. But understanding each core component of a business plan will help you in compiling up a perfect business plan.

Now that you’re ready to take up the journey, start your launch into the writing process, you can anytime refer back to this article to make these elements specific to your business. We wish you all the very best for your business growth.