Business plans: Why They Help You
Business planning is essential when you’re starting out in a commercial venture. Not only will it assist you to outline the structure and function of your business, but provides a strategic road map that puts you on the path for growth and ideally, profit. But what exactly are the key features of a good business plan? Read below for an overview into the things that every new business owner should consider when they’re at this crucial planning stage.
What’s inside?
Having a master document that collates financial specifics, management structure, marketing strategies and company aims is invaluable. Not only is this information useful when you’re initially launching, but as your business progresses, it is important to revisit to see whether key strategies are being achieved, worked towards or abandoned for operational reasons.
Aside from this, it’s wise to include a clear goal for your business to pursue. Are you purely online and wish to expand enough to justify a retail space for lease, for example? This then provides the context in which your business actions should operate. Although having a vision for your company is vital, it is necessary to then articulate the steps, ideally with accompanying timelines, that you’ll take in order to realise them.
Another important section to this document will be your executive summary. Although business plans can range from relatively brief to lengthy and detailed, both examples will still benefit from a high level summary. This will be written only after you have completed the bulk of your business plan, and is located at the beginning of the document. It will describe your company’s core deliverables and how it will realise them effectively. Also include the key points that you will expand upon in detail later on in your plan, so you do not need nitty gritty details in this section. Rather, it should signpost for the remainder of the document.
The bigger picture
Not only is a business plan focussed on the inner workings of your company, but it should consider the conditions and wider market that it will be operating within. A good place to start is by identifying the demographics that your business will target. Here you will describe the most likely clients or customers that you will attract and what steps you will take to entice and then maintain their business. Outlining how additional demographics will be reached (in the future) is also advisable.
Investment potential
Many external stakeholders will be interested in the contents of your business plan. For those seeking finances, most banks and financial institutions will require a detailed business outline in order to assess (and ideally approve) any loan application that you make to them. Likewise, any investors in a start-up and/or venture capital type capacity will also want to look at this key document. Therefore, it will be a crucial part of your investor deck so it’s worth taking the time to revise its contents for each interested party in order to showcase the most relevant information.
