How to create a business plan
You’ve decided to start a business. You’ve wanted to do this for a long time now. It’s a huge decision so congratulations on taking that step forward. Before you get started, you’ll want to make sure you’ve got a roadmap to lead the way. That’s where a business plan comes in.
Creating a business plan allows you to map out the ways you’ll start and build your business. It’s where you’ll think about what it really takes to be successful. This includes looking at the market you’re going into, how you’ll operate the business, and the competition you’ll face to name a few things.
Although each business and business plan is different, the key elements that go into a business plan are the same, so don’t hesitate to reach out to local resources for advice.
To give you some structure as you start to write your business plan, we’ve put together a quick overview of the key elements you’ll want to include. Here’s what you’ll need to get started:
1. Executive Summary
What kind of company are you going to open? Why will it be a success? What problems will your business solve? What are your competitive advantages? You’ll be able to answer these questions and give basic information about the leadership, growth plans, location, etc.
2. Business Description
If someone asked you what your business is and you only had thirty seconds to explain it, how would you do it? Be concise and have laser focus in this section.
3. Market Analysis
Before you dive head first into a new business, you’ll need to understand the industry and the target market. Due to the nature of this section, you’ll want to do some research into the landscape of the area, current trends in your industry and the areas where you think your business can perform better than others.
4. Competitive Analysis
Take a good look at the competitors in your area and industry. What are they doing to be successful? Why does it work? You should be able to illustrate how you’re going to differentiate yourself from them and how you’re going to stay ahead of them.
5. Service/Product Line
Describe what products you’re going to sell or what service you’re going to offer. Give examples of how your offering benefits your customers. If you have any sort of copyright or intellectual property, you should include that in this section.
6. Operations and Management Processes
Go into detail about how your company will be legally structured and who will be running the day-to-day. You can use an organizational chart to lay out who’s doing what at your business. You’ll also want to go into the operational procedures of the business. Will you need to hire employees to manage the counter? Will you need to work with distributors to distribute your product? Explaining in detail helps you fully understand all that it takes to run the business.
7. Financial Considerations
Layout a prospective outlook for the next 3-5 years. This can be a difficult section when you’re just starting out, but you do it right, you’ll be setting yourself and your business up for success.
What to include:
- Forecast Income Statements
- Balance Sheets
- Profit and Loss Statement (P&L)
- Capital Expenditure Budgets
Use this section to provide any additional documents or materials to tell your story. Any letters of reference, business licenses/permits, credit reports, and other legal documents.
As you continue to write and tweak your business plan, you’re undoubtedly going to need some additional help. There are so many valuable resources online and through local small business associations like the Chamber of Commerce or Small Business Development Center. Don’t hesitate to get out into your community and speak to other local business owners about how they got up and running.
Once you have a solid business plan in place, you’re well on your way to fulfilling your dream.