Not having a business plan is a plan for failure.
If you want to learn how to write a business plan, you need to analyze your business idea. You need to determine the elements that will give you the best chance for being successful and make them a part of your written plan. A good solid business plan will guide you to success. The approach to writing a business plan used by the SBA (Small Business Administration) is detailed below.
You need to prepare before you begin to write your business plan. Following are four questions that you should answer before you start:
Who is your audience for your business plan? Is it for your use only, as a tool for obtaining financing, or a document to unite business partners in a common goal?
What service or product does your business provide and what needs does it fill?
- Who are the potential customers for your product or service and why will they purchase it from you?
How will you reach your potential customers?
Where will you get the financial resources to start your business?
What goes into a business plan? Consider these four elements:
Description of the business - What is the business all about and what is its structure? The more details about your new business the better.
Marketing - A marketing plan within the business plan is appropriate. Your plan should detail the way you are going to sell your product or service. You should have done market research that shows what the demand is. A matching competitor survey will give you how much supply there is. With a grasp of supply and demand you will be able to know if there is enough unfullfilled demand to support your business.
Finances - You know that your new business will not be making money immediately. It takes time for any new business to get going. That time takes money. In addition there will likely be other start up costs such as equipment, inventory, facilities and manpower. You need to plan for the initial expenses and make an estimate of how long it will take you to get to break even. That initial capital must be either borrowed or provided out of personal funds. An important part of the business plan are your projections of what money is needed for the startup and revenue past the point of break even.
Management - Have you ever managed a business before? If not, who is going to manage your new business? If you are planning on doing everything yourself, then you need to include in your plan some training. Most small businesses fail. Try to put the odds in your favor.
Finding out how to write a business plan is very important. You must plan to succeed. Having no plan is a plan for failure.