The great business plan debate- is it necessary? Is it a waste of time?
Some may say yes- times have changed and to a certain degree- I agree. What I don’t agree with is phasing them out completely. It is a great referral document for you to have on hand and if you ever look into getting bank loans or obtaining outside investors? You should have this available for reference.
I believe that the real significance of creating a business plan is not the finished product in hand or who you submit it to; rather, the value lies in the process of researching and thinking about your business in a methodical way. You do not have to complete the sections in order- but I recommend completing your executive summary last. Remember that this is a living guide that you should develop as your business grows and changes.
Below are the sections that you should include in your plan.
Explain the basics of your business: What will your product be? Who will your customers be? Who are the owners? What do you think the future holds for your business and your industry?
What business will you be in? What will you do? What is your legal form of ownership (sole proprietor?) Include your mission statement, company goals and objectives: business philosophy, your industry, target market… your company strengths and weaknesses.
Products and Services
Describe your products or services. What factors will give you competitive advantages or disadvantages? What are the pricing structures of your products or services?
Marketing & Advertising Plan
Your marketing plan details how you intend to meet your customers’ needs and communicate the benefits of your products or services to them. You want to identify your target market and their needs and wants. Research your competitions strengths and weaknesses and think of how to position your brand, products and services so that your target market sees your business as better than, or different from, the competition.
Complete a S.W.O.T analysis and include it. (Download a free template HERE.)
Outline the budget and what avenues you think will work best for getting your message across.
Explain the daily operation of the business, its location, equipment, people and processes. How and where are your products or services produced? How will you handle customer service, quality control, returns/refunds? How will you be storing your inventory? (If any), will you need to ship anything to your customers/suppliers?
Your Internal Organization
Who will run your business? Who is their backup should something happen to them? How many employees will you have? What experience will your employees need to bring to your business? How will you hire them? What benefits will you offer? What training do they need? How will you track their attendance and performance? How will you pay them?
Show your assets and liabilities held outside the business and personal net worth.
Startup Expenses Planning and Forecasting
Estimate your expenses accurately and then to plan where you will get sufficient capital. It is best to overestimate than under. Consider all your startup expenses such as: legal work, logo design, business cards, brochures and marketing material, web site design, office supplies and furniture etc.
This is what will ultimately tell you whether or not you are going to waste your time. Remember to BE REALISTIC when entering your numbers.
This section was/is the trickiest for me to explain- because it’s so important I found a handy template online- it was created by The Commonwealth Bank and it helps give you an idea of what you are looking at! Download the free template by clicking this link: Financial Plan Template by Commonwealth Bank
Also think about whether or not you plan on offering any credit to your customers- and how you will manage that.
Keep track of the information that you used to come to your business plan conclusions. There is a lot of information in one document so it’s easy to forget sources! Even a copy/paste of the links will suffice.
So there you have it! Your business plan.
Take your time and enjoy this process- you will learn a lot about your business and yourself!