If you are thinking of starting a business, you need to prepare a business
plan. Why? First of all, banks will never give you a loan if you do not present a good plan. Second of all, you
will learn very important aspects of the business you are thinking of starting. So do it, it's for your own good.
Below are the categories you must address.
1.
Executive Summary: This is the first part of the plan any
investor will read. So make it good, and no more than a page or two. Include your company name, address, etc.,
then give a brief description of the business and your mission. Highlight your marketing strategy, financial forecasts,
and managerial or technical experience.
2. Industry Analysis: Include the background
of the industry, current trends, growth rate, and the outlook for the future.
3. Your Business: In this section, start with
a brief history of your business and it's current situation. Then give a complete and detailed description of your
business. Include your company mission statement and competitive advantage. Describe the key factors that will
make your company successful.
4. Market Analysis: This is the most important
part of your business plan. Get ready to spend some time conducting market research, because you will have to answer
these questions:
° Who are the potential buyers for your product or services?
What is their motivation to buy?
° How many customers are in this market? What is their
buying potential?
° What do you know about the potential customer in your
target market?
° Is there a buying cycle? Is the product seasonal?
° What are your pricing strategies? What is your price
versus your competitor?
° What are your advertising strategies? Which media will
be most effective? Costs? Frequency?
° Are there external market influences? How will economic
factors affect your business?
° Who are your customers? Age? Location? Income? Attitudes?
5. Competitor Analysis: This is your chance
to act like a spy. You will have to find out as much as possible about your major competitors. What share of the
market do they have? What are their pricing strategies? Why do customers buy from them?
6. Strategic Plans: Here is where you will
define your specific plan of action. Describe what your market position and image will be. Do you want to be a
cost leader? Or will you promote customer service? Now define your strengths, weaknesses, and opportunities.
7. Management and Organization: Describe which
legal entity your business will operate under. Will it be a corporation, sole proprietorship, partnership, or an
LLC? Prepare an organizational chart with all key managers and employees. Include a description of their resumes.
8. Financial Plans: This is where you find
out if your venture will be profitable. Again you'll be doing a bit of research, nobody said this was going to
be easy. You need to know how much money it's going to take to start your business. This is very important to your
banker or investors. You will have to create a realistic budget and sales forecasts. Prepare projections for daily
operating costs. Present actual and projected balance sheets and income statements. Think about your payroll, equipment,
materials, and overhead. Finally, you must prepare a breakeven and ratio analysis.
9. The typical business plan should cover the first 3 years of your business. So don't be surprised
if your plan is over 40 pages long.
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guides you throughout the whole process. It generates tables and graphs, gives you sample plans, offers advice
and produces a professional quality plan that is sure to impress bankers and investors. And it has a 60 day money-back
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