A new survey reveals, “A Business Plan Doubles Your Chances for Success” According to Bloomberg, 8 out 10 entrepreneurs who start businesses fail within the first 18 months. Recent study revealed that those businesses which follow proper business plans were nearly twice as likely to successfully grow their businesses or obtain capital as those who didn’t write a plan.
“It’s not the plan that is important, it’s the planning.” Dr. Graeme Edwards
As like this saying, a business plan is important for every business, whether it is profit or non-profit organization. So, what is a business plan? Business Plans created by business owners are used for planning out specific details about their business. They can range in size from a simple few sentences to more than 100 pages with formal sections, a table of contents and a title page.
Entrepreneur Magazine says that a typical business plans ranges between 15 to 20 pages. So, here what should be included in the business plan?
There are certain necessary elements which need to be included. Such elements are:
- An executive summary;
- A description of the business;
- A review of the market, the competition and market positioning;
- The vision, mission and objectives;
- The corporate strategy;
- The plan for developing the products and services;
- Financial projections;
- An outline of the risks and opportunities;
So, what are you waiting for? Read on to know the essential sections of business plan and roll up your sleeves and get everything down on paper.
Write Your Business Plan
Writing a business plan may seem like a difficult task, but it doesn’t have to be. If you know your business and are passionate about it, writing a business plan and then leveraging your plan for growth will be easy.
Now, we are going to discuss in detail the seven essential sections of a business plan: what you should include, what you shouldn't include.
It’s just a snapshot of your business! This section briefly tells your reader where your company is, where you want to take it, and why your business stands out from other competitors.
If you’re an established business, be sure to include the following,
- Mission Statement
- Company Information
- Growth Highlights
- Your Products/Services
- Financial Information
Describe your organization's mission, its history, your unique strengths, and assets. Provide a list of your products, services, or programs. Also include how you will finance your organization both in the short and long term.
Organization and Management
This section should include: your company’s organizational structure, details about the ownership of the company, profiles of your management team, and the qualifications of your board of directors. You will need to list the names of your board members and their positions on the board as well as terms.
Here comes the idea of “How do you plan to market your business?” In this section, the first thing you want to do is define your marketing strategy. After you have created a comprehensive marketing strategy, you can then define your sales strategy. This covers how you plan to actually sell your product.
This section covers those individuals or entities who will be making contributions or volunteering their time and/or services.
After analyzing the market and setting clear objectives, you should develop this section with the historical data of your company. The historical financial data to include are your company's income statements, balance sheets, and cash flow statements for each year you have been in business (usually for up to three to five years).
Also, list any grants you've received, significant contributions, and in-kind support.
Service or Product Line
This section of your business plan is where you describe your service or product, emphasizing the benefits to potential and current customers. You need to include the following: A description of your product/service, details about the product’s lifecycle, intellectual property etc.
Also, list and describe what products you may produce or distribute, what programs you will offer, and/or services you plan to provide. Provide information on any copyrights, trademarks or patents your organization has protected.
How to Make Your Business Plan Stand Out
What makes your business plan unique? Finding answer for this question could help you stand out from the crowd and give you advantages over your competitors.
It’s important to clearly define what you’re selling in your business plan. You do not want to become a jack-of-all trades and master of none because this can have a negative impact on business growth.
Do proper research while writing a business plan and identify the following:
- Which areas your competitors are already well-established
- Which areas are being ignored by your competitors?
- Potential opportunities for your business
Whether you’re going to create a business plan for non-profit organization or profit organization, don’t forget to read this write-up before you get started! Writing a business plan for your business is not as hard as you think as long as you equipped yourself with the essential knowledge!
We hope this guide has helped you get a better idea of what a business plan should look like. Now it's time to turn that business idea into a reality. Good luck!