You might believe that you don’t require a step-by-step manual for creating a successful company strategy. You might believe that you can write a business plan without using a template. After all, some business owners are successful even without a written business plan. Some founders create successful firms without even drafting an informal business plan thanks to excellent timing, sound business acumen, entrepreneurial passion, and a little luck.
However, the likelihood that those business owners will fail is higher.
Does having a business plan guarantee startup success? Without a doubt. The key to success or failure, however, is frequently determined by excellent planning. You should take all steps feasible to create the conditions for success to realize your entrepreneurial aspirations.
Therefore, a successful company plan aids in your success.
Detailed instructions for writing a fantastic business plan are provided here. A summary of the main ideas will be presented first. The following sections of a typical business plan will be examined:
- Executive Summary
- Overview and Objectives
- Products and Services
- Market Opportunities
- Sales and Marketing
- Competitive Analysis
Let’s first get some context on why you need a business plan.
The Primary Concepts of writing Business Plan
Business ideas often consist of fantasy. This is because many aspiring business owners view a business plan as nothing more than a tool—filled with ideas, predictions, and exaggerations—that will persuade lenders or investors that a firm makes sense.
That is a terrible error.
Because your time, money, and effort are on the line, your business plan must first persuade you that your idea is sound.
Consequently, a strong business plan ought to serve as a roadmap for a fruitful enterprise. It should elaborate on strategic plans, devise marketing and sales strategies, provide the groundwork for efficient operations, and maybe—just maybe—convince a lender or investor to support the venture.
The first step in considering whether to start a business is for many entrepreneurs to create a business plan. An aspiring founder might save time and money by figuring out whether a concept is doomed on paper before investing time and resources in it.
So, your strategy should at the very least:
Be as rational and impartial as you can. After careful consideration and study, a company proposal that first sounded promising may turn out to be unworkable due to fierce competition, a lack of capital, or a nonexistent market. (Occasionally, even the best concepts are simply too advanced for their time).
Serve as a manual during the first few months, and sometimes even years, of the company’s operations, laying out a path for executives to take. Provide an overview of marketing plans, identify management roles, detail personnel requirements, communicate the company’s mission and vision, and assess current and upcoming market competitors.
Build the framework for a funding proposal that lenders and investors may use to assess the company.
Each of the aforementioned areas is covered in depth in a strong business plan, but it should also achieve additional goals. A strong business plan is convincing beyond all else. It supports a claim. It gives you tangible, empirical proof that your business idea is sound, rational, and has a good probability of succeeding.
What does your business plan need to persuade?
Your business plan should, first and foremost, persuade you that your concept for a company is more than just a pipe dream; it has a chance of becoming a real possibility. Entrepreneurs are by nature self-assured, upbeat, and capable individuals. You’ll have a lot better understanding of your prospects of success once you’ve objectively assessed your capital requirements, goods or services, competitors, marketing strategies, and possibilities for profit.
And if you’re still not persuaded, that’s okay: Take a step back and improve your concepts and your strategies.
What is your business plan able to persuade?
- Potential funding sources. Your business plan might be quite useful if you need to convince a bank or close friends and family members to provide you with seed money. Financial records might provide insight into your past. Financial predictions outline your intended course of action.
Your business plan outlines how you will accomplish this. A strong business plan can aid lenders in understanding and quantifying the inherent risk of lending, improving your chances of getting the money you need.
- Potential investors and partners. Sharing your business strategy with friends and family might not be required (although it certainly could help).
A business plan is typically necessary for other investors, such as angel investors or venture capitalists, to evaluate your company.
- Professional personnel. Since you’re still in the startup stage, you need something to show potential employees when you need to attract talent. Your business plan can aid potential employees in understanding your goals and, more importantly, their role in aiding you in achieving those goals since, at this early stage, your company is more of an idea than a reality.
- Potential collaborations Joint ventures function similarly to corporate partnerships. A legal agreement to share the work, as well as the revenue and profit, is known as a joint venture. You’ll probably be an unknown in your market as a young company. Setting up a joint venture with an established partner could be crucial to the success of your company.
Your business plan should, above all, persuade you that proceeding makes sense.
You can come across problems or difficulties when you lay out your plan that you had not expected.
The market might not be as big as you once believed. After analyzing the competition, you may conclude that your strategy to be the least expensive provider is impractical since your profit margins won’t be high enough to pay your expenses.
Or you can recognize that while the basic concept behind your company is great, how you go about putting it into practice needs to alter. Perhaps opening a storefront for your business isn’t as cost-effective as bringing your goods directly to customers; not only will your running expenses be reduced, but you’ll also be able to charge more because you’re giving your clients more convenience.
Consider it in this way. Successful companies constantly evolve. They take lessons from their errors and adjust to and respond to changes in the economy, the market, their clients, their goods and services, etc. Successful companies recognize opportunities and obstacles and respond appropriately.
You can identify possibilities and difficulties without taking any risks by developing a business strategy. Make use of your plan to dangle your toe in the commercial pond. Before you spend a dime, it’s the ideal technique to analyze and improve your notions and ideas.
Writing a business plan is frequently viewed as a “necessary evil” necessary to obtain funding or investors. Instead, think of your strategy as a free way to investigate the viability of your possible firm and prevent expensive errors.
The top business plan programs
If you decide to spend money on your company plan, there are several excellent software options accessible. Writing a business plan is made easier by software since it streamlines the procedure and eliminates the need to start from zero. They frequently come with capabilities like step-by-step wizards, templates, financial forecasting tools, graphs and charts, integrations with third-party applications, collaboration tools, and video lessons.
We whittled down the top four choices after looking into and assessing dozens of business plan software companies to these four:
LivePlan
With more than 500 templates, a one-page pitch builder, automatic financial statements, comprehensive financial forecasting, industry benchmark data, and KPIs, LivePlan is a cloud-hosted software program that offers a variety of tools for creating business plans. Plans for a year start at $15.
Bizplan
A step-by-step builder for the business plan is available in the cloud-hosted program called Bizplan. Monthly rates for annual plans begin at $20.75.
GoSmallBiz
A cloud-based tool called GoSmallBiz provides industry-specific templates, a step-by-step wizard that makes it simple to create a thorough business plan, and video lessons. Monthly rates for plans begin at $15.
Enloop
Enloop is concerned with financial forecasts. It gives you everything you need to show that your company can be profitable and guides you through the creation of financial forecasts. Monthly rates for annual plans begin at $11.
Unique summary of your business plan
The aim and objectives of the company are summarised in the executive summary. Although it can be difficult to fit on one or two pages, a good Summary contains the following:
- A brief description of products and services
- a list of the goals
- A thorough explanation of the market
- a succinct defense of viability (including a quick look at your competition and your competitive advantage)
- Potential for growth in one picture
- A summary of the necessary funding
I realize that seems like a lot, which is why you must do it correctly. Your business plan’s Executive Summary can either make or ruin it.
A great company finds ways to satisfy its clients. If your Summary can’t succinctly explain in one or two pages how your company will address a specific problem and turn a profit, it’s extremely likely that the opportunity doesn’t exist—or that your strategy for seizing a real opportunity isn’t well thought out.
So consider it a summary of your business plan. Instead of trying to “hype” your company, concentrate on giving a busy reader a clear understanding of what you intend to achieve, how you intend to do it, and how you intend to succeed.
Your Executive Summary should primarily assist you in starting and expanding your firm as that is what a business plan should accomplish for you.
- Tighten and clarify your concept.
Consider it a formal elevator pitch (with more detail, of course). Your Summary highlights the key components of your strategy, omitting the less crucial details in favor of the most crucial ones.
Naturally, you’ll concentrate on the issues that have the biggest impact on your Summary’s likelihood of success. Go back and start over if your idea is too nebulous, general, or complex. The majority of excellent companies can be described in a few phrases rather than a few pages.
- Choose your top priorities.
Your business plan explains your strategy to the reader. What is highly valued in terms of significance? product creation? Research? Getting the ideal location? forming strategic alliances?
The rest of your plan’s writing can be influenced by your Summary.
- Make the remaining steps simple.
You can use the Summary as an outline for the rest of your plan once it is finished. Simply add extra depth to the highlights.
Then, by putting your readers first, attempt to achieve your secondary goal. Even though you might be writing a business plan only for yourself, you never know when you might decide to look for funding or recruit additional investors, so make sure your Summary satisfies their requirements as well. Set the stage for the remainder of the strategy with diligence. Let your enthusiasm for your concept and company come over.
Make readers want to turn the page and continue reading, in other words. Just make sure your steak and sizzle match by giving precise, realistic details.
Well Constructed Introduction
Road and mountain bike rentals will be available from Blue Mountain Cycle Rentals in a prime spot just next to a George Washington National Forest entrance. Our main goal is to provide Blue Mountain Cycle Rentals with the most practical and affordable rental option for the numerous tourists who come to the area every year.
Once things are going well, we’ll broaden our focus, profit from high-margin new equipment sales, and use our existing labor force to market and support those goods. We plan to establish the region’s top cycling destination within three years.
Organization and Management
Blue Mountain Cycle Rentals will be situated at 321 Mountain Drive, which offers very high visibility as well as easy access to and from the main road leading into a national park. Marty Cycle, the business’s owner, has over 20 years of expertise in the bicycle industry. He has worked as the general manager of Epic Cycling and a product manager for Acme Cycles.
Due to his considerable network in the industry, excess inventory from stores around the nation will also be sourced to purchase initial equipment inventory at great savings from OEM suppliers.
Due to the business’s partly seasonal nature, part-time personnel will be hired to help with demand spikes. Competitive pay and discounts on goods and services will be used to entice these workers.
Market Possibilities
In the past year, 460,000 people have visited the George Washington National Forest. The park anticipates an increase in visitors over the following few years, even though the outdoor tourism sector as a whole is flat.
Less cycling enthusiasts from VA, WV, NC, and MD are predicted to travel beyond the region due to the economic outlook.
The park has recently introduced camping and hotel options that should draw more tourists.
The park has made more space available for trail research and development, resulting in a bigger selection of single-track alternatives and, consequently, more visitors.
With those visitors, there is considerable market potential. About 30% of cyclists, especially those who are visiting the area for purposes other than riding, prefer to rent bicycles over transport them, according to data from an independent study.
Competitive Benefits
The bike stores in Harrisonburg, Virginia, are direct and well-established rivals. Location and cost savings will be our two main competitive advantages.
The park has made more space available for trail research and development, resulting in a bigger selection of single-track alternatives and, consequently, more visitors.
With those visitors, there is considerable market potential. About 30% of cyclists, especially those who are visiting the area for purposes other than riding, prefer to rent bicycles over transport them, according to data from an independent study.
Competitive Benefits
The bike stores in Harrisonburg, Virginia, are direct and well-established rivals. Location and cost savings will be our two main competitive advantages.
Another significant drawback of ours relates to non-park rentals. To solve that problem, we’ll open a satellite facility in Harrisonburg where fans can rent bicycles to use in town or on nearby trails.
Additionally, we’ll leverage online capabilities to better engage customers by enabling them to make reservations and payments as well as personalize profiles for sizes, preferences, and special requirements.
Monetary projections
Based on anticipated sales, Blue Mountain Cycle Rentals anticipates making a small profit by year two. We base our estimates on the following fundamental presumptions:
Initial growth will be modest as we build market awareness.
Initial equipment acquisitions typically last three to four years in service; after that time, we start investing in “new” equipment to replace broken or outdated equipment.
No more than 14 percent of sales will be spent on marketing.
The remaining earnings will be invested in extending the range of goods and services.
We anticipate revenue for the first year and a growth rate of 10% for the next two. It is anticipated that direct costs will account for 60 percent of gross sales on average, with equipment purchases accounting for 50 percent and ancillary purchases for 10 percent of total costs. In year three, net income is anticipated to reach $105,000 as operations improve and sales rise.
The list goes on.
Remember that this is merely a hypothetical illustration of how your Summary might appear. Also keep in mind that since this example focuses on the rental industry, a product description was omitted. (They’ll arrive after I do.) Make sure to include a Products and Services section in your Summary if your company will produce, sell, or offer a range of services. (In this instance, it would be superfluous to have a dedicated section because the products and services are evident.)
The bottom line is to Include some zing in your introduction, but make sure you also give the steak a fair shake.
How to write a business plan while overcoming obstacles
Even if you won’t be able to forecast everything that may affect your company, you can take preventative measures to lessen the number of potential problems. For instance, learn about the business plan procedure by reading about company plans and figuring out how others have successfully implemented their plans.
These strategies can serve as a starting point, but Rick Cottrell, the CEO, and founder of BizResults.com, suggests going even further: Speak with small business owners and other knowledgeable people.
The business owner should speak with an accountant, a banker, and individuals who work with these plans every day to find out how others have handled the situation advised Cottrell. They can interact with colleagues and others who are preparing to begin a business to obtain insights from them. They can also join startup and investment organizations. They can look for capital innovation groups in their region to gain more knowledge.
You may always hire a consultant to assist you with the process if you’ve done your study on how to build a business plan but still don’t feel confident doing it.
Cottrell continued, “It is just a tedious process that cannot be expedited. “Millions of dollars are frequently at risk, necessitating a high level of skill that must either be learned or applied in cooperation with an experienced business consultant.”
