The business world has a lot to offer on the economy of the globe, and as such, it must be driven in the right way to ensure this is achieved. Many documents have to be written to ensure businesses achieve their goals within a specified period. When it comes to business plans, it refers to a document that is recognized enumeration or statement of the business objectives, reasons why they have to be attained and the plans that are necessary to attain them. In other words, business plans provide a blueprint of your business, and as such, it must have the background information of the organization or the team mandated with achieving the objectives.
In most cases, business plans are used to change the perception and branding by the customer, taxpayer, or the client. If an existing business expects a major change or they are venturing into new frontiers, they must come up with an excellent business plan that spans two to five years. This is what investors are looking for with regard to the return on investments within that time. Business plans can be either internal or external.
When it is internal, it focuses on the most immediate goals that are the best catalysts to the external goals. This can be a review of the product, service, financing restructuring, factory refurbishment, new IT systems, or the restructuring of the entire corporation. When coming up with internal business plans, you must include critical factors for success.
With external business plans, the goals here must be crucial to the external stakeholders especially the financial goes. These external stakeholders may be investors or customers. When it comes to non-profit businesses, the stakeholders may include donors and clients for non-profit business services. The external stakeholders for government agencies include high-level government agencies, taxpayers, International Monetary Fund, United Nations economic agencies, World Bank and other development banks.
With business plans, the growth of businesses is guaranteed since the sole proprietor, or the organization must put into achieving whatever goals they have set out. Now with the information about what business plans are, you need to understand some steps that are essential in helping you to come up with the best business plan to achieve your goals.
These are the rules you need to adhere to when coming up with business plans.
You will write many business plans, and the most important thing is to keep it short and precise. This is because you want the audience to read without any problem. More so, no one wants to read a lengthy document. Remember that it is a tool that is essential to run and grow your business. Remember that all business plans are subject to refining as per your wishes. When you come up with lengthy business plans, you might not get the desired result because they might not even be read.
You might use the best sample business plans as you write yours, but if you fail to understand your target audience, you will be doing yourself a disservice. The idea is to write in a language that the audience will understand. For instance, if you are coming up with a new complex scientific process and your target audiences are not scientists, you have to come to their level and use a language that they can understand. You need to accommodate everyone in your business plans and keep the explanations as simple, direct, and to the point.
A bigger percentage of entrepreneurs and business owners are not necessarily business experts. Hey might be the same as you, and they learn on the job. Some of them do not even have the right training or qualification in matters business. As such, the process of formulating business plans may seem daunting, but it does not have to be as such. Your passion and knowledge of the business should make this process very easy. You do not have to start with a detailed document; instead, you can have a single paged write up and then come later to build on it.
However, the question you need to ask here is; what makes a good business plan?
Do not take business plans as generic because you have to ascertain if it will achieve these goals or jot. Some business plans target investments whereas there are others that support a financial claim, as a loan. Different people look for different things when they come up with business plans. As such, readability, easy navigation, and covering every point are some of the qualities that will influence the achievement of the business objectives of this document. You can have a well-written and thoroughly researched business plans that are ineffectual and still, the management team understand them fully.
Your business plans should be realistic in that the ideas therein are highly implementable. You can have thoroughly researched, brilliantly written, and formatted business plans of a product or service that cannot be built. In other words, this is a bad business plan. You have to include the management team that will be mandated with the financial planning you have to make the entire document valid. All business plans require the writer to consider every aspect during the writing process.
The results that you want to achieve must be tracked via the business plans that you write. You must have deadlines, dates, tasks, projections, budgets, and metrics. In the evaluation of your business plan, ascertain if you stuck to the whole plan from the onset. You also need to consider how you track the results and compare them to the business plan. Check to ascertain that whatever that is being done aligns with the plan. For your business plans to be effective, you need to establish the what, who, when and the amount of cash being pumped in the business.
Every responsibility within business plans that you write must be assigned to someone. You can have a business plan that does jot attribute responsibilities to a person for implementation. You need to have a specific person for every implementable task if any of your business plans are to be successful.
If you are using examples of business plans as a guide in the writing process, see how they identify assumptions. Some human beings who guess about the future write business plans, and at times, they can make the wrong guesses. If you want to have effective business plans, you need to show assumptions. This is because changed assumptions lay good grounds for the revision of your business plans. They must be visible throughout the planning process.
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You need to communicate your business plans to the team that will lead to the implementation. Whether it is in written form or soft copy, it needs to be communicated to the early enough to the implementation team. The team is supposed to know and understand everything to do with the business plan.
Commitment is the process that surrounds the whole plan. The management must take the business plans to the team to get its commitment to actualizing the set goals. If it is a one-person business plan, he has to be committed to it too.
Excellent business plans must come with a good planning process. In other words, it is subject to regular reviews and course correction. A rigid business plan is not bound to work. The planning process involves steering the management and transcends envisaging the future annually, and strictly adhering to it no matter what.
Excellent business plans can be revisited constantly for updates as you learn and understand more about your customers. It is also essential in understanding sales and marketing techniques that align with your business, where you scored on your budget and the ability to forecast. This plan is essential in tracking the progress and adjusting the course of your business as you proceed. This is what you have as components of business plans.
This section is the overview of your business and the plans you have in store. This is the first thing that appears in business plans and is usually single or two pages at most. An executive summary can be a stand-alone document that covers the highlights of your plan. Some investors will ask for an executive summary when evaluating your business. If the executive summary piques their interest, they will work for the rest of the business plan, pitch presentation, and any other information relevant to your business.
In this section, business plans are supposed to answer what you are selling and the solutions you are providing to the current challenge in the market. You have to identify your target market and competition. This section also allows you to say why the solution you provide is unique from the others, as well as your plan for the expansion in the future. An executive summary will give the gist of your business, but this section expands the initial overview, provides detailed information, and answers any other question not covered in the executive summary. You can use sample business plans to see how this is written.
Any of the business plans that you come across will have this section that explains how the opportunity is going to turn into a business. You have to talk about the sales and marketing plans, operations and the ways through which you will measure success. The marketing and sales plan must incorporate how you intend to reach the target market segments as well as the way you are going to sell to these segments, the pricing plan and the activities and partnerships need to make the business a total success. A well-defined market is essential even before you start writing the plan for your market. In this marketing plan, outline how you are going to position your company or business and the service or product that you want to offer. With positioning, you are aware of the way that you will present your company to the customers.
When writing business plans, you need to understand that great ideas go hand in hand with great teams. These are some of the factors that investors care about. In this section, describe your current dream team and the possible addition of more team members. You also need to give a brief overview of the legal structure, location, and history especially if your business is already running.
The success of your business plans or the business at large largely depends on the implementation team. At his point, you have to discuss why you have the right team to carry out this vision. You have to discuss the crucial roles and responsibilities that will fuel the growth and success of your business. You can include the bios of every team member, their experience, level of expertise and education. You need not to include the entire management team.
Your business plans can never be complete is there is not a financial plan. Incorporate the projections in the next year and then the projections for the remaining duration of the business plan. Some investors are interested in a five-year financial projection, but typically you can give a three-year projection. Include in this section, sales forecast, personnel plan, profit and loss statement, statement of cash flow, balance sheet, use of funds and the exit strategy.
Any business plans that you write can have this diction or not. You only include additional information relevant to the plan. Can be graphs, tables, legal notes or other crucial information that is necessary.