We all know that a business plan is an essential document for entrepreneurs and small business owners as it does not only outline the vision and mission but the projections of a firm also. But the point is how to write a business plan?
Here we have 7 essential elements to write a perfect business plan step by step:
1. Overview of your business through the executive summary
An executive summary is nothing but an overview of your whole business plan. Entrepreneurs sometimes write their executive summary at the end as it sums up the business plan.
A strong summary mentions what is expected from your business and what products/services your firm is engaged in.
Sometimes investors also end up reading only executive summaries and making their decision based on them.
2. Make your business stand out with a company description
This section is the best chance to prove why your company is unique from others and what it does differently.
If potential investors take an interest in your company description then they will want to know:
- What is your product
- To whom are you trying to sell
- Your important achievements
- Your goals
And everything else you can tell about your company in brief.
3. Market & competitive analysis
To be a successful business owner you will definitely need & want to know where you fit in the market.
Deep dive into industry analysis and know your competitors, purchasing trends, and market size. By doing this you will get to know the exact market size for your business and to what extent your product/service can capture the market.
Your market industry should include:
- Targeted consumer segments, showing their sizes and demographics
- A description of the market, projections, and data
- A thorough analysis of your competitors that identifies their strengths & weaknesses.
4. Showcase your organization and management structure
You alone can never achieve the goals you want. You will need a superstar team behind it and this is the section where you proudly disclose the team members you have onboard with you.
This part is dedicated to how you want to manage the company & could involve hiring demand, logistics, and corporate expansion. The duties of the management team, the tasks given to each division, etc. are also included.
You should be aware that when the business expands, the operations will change. As a result, you should include preparations in your business plan for these changes.
5. Define your marketing strategy clearly
Your marketing strategy, also known as a marketing plan, provides a thorough overview of how you’ll spread brand awareness to potential customers.
Explain to potential investors in this section how you’ll expand your market’s consumer base.
Give a brief description of your planned marketing strategies in the form of bullet points. Remember to mention:
- Marketing expenditure
- The marketing platforms used by your business
- Promotional activities, such as exclusive discounts or deals
- Advertisements plans through both digital and print media
6. Operational plan
An operational plan should be specific to a team or department, so there will be more than one operational plan depending on your business. Key points to remember while writing an operational plan:
- Define the operational plan’s vision clearly
- Analyze and list the important company stakeholders, funding, and resources available per department
- Track progress and regularly update team members and stakeholders about the improvement
If necessary, adjust the operating plan to the overall company goals.
7. Financial plan
In your business plan, you must describe every financial aspect of running your company. It is done to ensure that your shareholders are fully aware of both your current status and your expected future performance.
Add your income statement, which describes yearly net earnings or losses; a cash flow statement, which illustrates how much cash you’ll need to start or expand operations; and a balance sheet, which lists your assets and liabilities, should all be included.
This area is crucial if you’re looking for funding and needs to be as up-to-date, accurate, and thorough as possible.
Tips on how to write a business plan:
A well-crafted business plan will pique investor interest so check out some amazing tips for writing a business plan:
- Use clear and simple language also avoid jargon
- Provide supporting documents or evidence for everything possible
- Know your audience first (not just customers but also potential investors if looking for funding)
- Know your competitors and marketplace
- Make your projections and expectations realistic and based on data
- Document each reason that proves why your idea will work
- Do thorough research before you start writing your business plan
- Make your business plan as short and to the point as possible
- Add visuals to keep it interesting
- If you are not sure, then you can always use a business plan software to be safe
Wrapping up
By including all the above elements, a business will be able to increase its chances of getting funded. Additionally, having a well-crafted business plan will also help the business to effectively communicate its vision, strategy, and goals to potential investors and partners.
We hope this business plan writing guide will help you answer how to write a winning business plan. Keep planning, keep working hard, and keep being successful.
