Why do you need to create a business plan?
You must understand that a business plan plays many roles in an organization, new or old. It represents who your business is today and who your business will be tomorrow, it is a detailed road map to ensure you and your business get there safely. A business plan is essential to helping you gain a deeper understanding of your market, your potential customers and your competitors, while developing a financial plan that adheres to your objectives. A professional business plan may also be necessary if you are looking to get funding and attract investors. Most importantly though, business plans focus your attention on productivity and allow you to establish benchmarks to measure your success. If you fail to plan you are planing to fail.
A business plan defines in detail the following areas of your specific business:
- Mission, Vision & Objectives of the venture
- The Company (its legal description, history and current situation/location)
- Products & Services (current and planned)
- External Business Environment (the industry status, the economy, legal/regulatory)
- Overall Market (including analysis of the competition, size, growth, demographics, etc)
- Target Market (the specific clients or customers your business has or plans on pursuing)
- Analysis of Strengths, Weaknesses, Opportunities and Threats/Risks
- Sales & Marketing Strategy (including promotion, pricing, distribution, forecasts)
- Management Team & Advisers (one of the most crucial areas for influencing funding)
- Operational Plan (including equipment needed, labor/personnel, production/service processes)
- Implementation Plan (Guides you in putting your plans into action)
- Financials & Exit/Payback Strategy (to show investors/lenders how they will get their return on investments)