Creating a Business Plan

All businesses are based on some ideas. In order to give form and structure to these ideas, creating a business plan is of utmost importance. Whether a new business is being created, or the current one being expanded, there has to be a well-written, concrete business plan in place, to ensure that people are on the right track.

Steps to Creating a Business Plan

Importance of Business Plans
One of the first steps in writing a business plan, is to know what all should be included in it. A typical business plan very clearly describes what the business is all about - the main objectives of the business, the strategies (marketing, advertising, etc.) that will be employed by the business to meet its competitors head on and make a place for itself in the market, its customer base i.e. who will be the potential customers, who will manage the business (personnel and management), from where the business will be conducted (location, office address) and lastly, what kind of profits the business expects to make. These are some of the business plan basics which should always be in place.

The main reason why all these things are mentioned in a business plan, is to streamline and define the functions that the business is going to undertake. Creating a business plan is mandatory for all businesses - whether small or big as it helps in keeping the people focused. Moreover, if the business is depending on taking a bank loan for generating the capital or is looking for some potential investors, both banks and investors decide to put money on the business, only after studying the business plan in detail. That in itself is self-explanatory as to why business plans should be well-written.

Business Plan Outline
The contents of a business plan have already been mentioned above, however, since it's a professional document and a business's future in a way depends on it, there is a definite format that should be followed when creating a business plan. Given below is a brief business plan outline, which is one of the many ways to create a business plan.

Executive Summary
This section of the business plan should be written in a very interesting and concise manner as it is the introduction to your business plan. It should not exceed more than three-four pages. The executive summary is a kind of brief of all the other sections in a business plan. So, a good idea is to write it in the end, once you are finished with the other sections.

Company Analysis
This section lists the history of the business. When it was established, how many offices it has, the number of staff and professionals working in it, any past achievements of the business, etc.

Industry Section
This section mentions the scope of the product or service that you are offering. Here, it would pay to highlight how any future negative trends will be taken care of by your business. This information is especially important for investors who are analyzing and contemplating to put money in the business.

Customer Analysis
This section defines the potential customers - their needs, aspirations, motivations and how the business's products and services are going to meet these.

Competitive Analysis
This section reveals all the possible competitors in the market, their product offerings, what are their pluses and minuses and how your business scores over them.

Marketing Strategy
This section should explain in detail the advertising, sales, marketing and pricing strategies that the business will employ to maximize its customer base and to deal with the competitors.

Operations Strategy
This section lists the systems and processes in place, to ensure smooth functioning of the business. It mentions how operations would be streamlined to reduce the costs and maximize profits of the business.

Financial Strategy
Finally, the section which most investors are truly interested in. Mention the various costs that would be incurred to carry on the business, along with the profits that the business is expecting to make in the future. This section clearly describes what the financial position or standing of the company would be in the future.

Here's hoping that the above mentioned tips prove helpful, when you set out creating a business plan. If somehow you feel under-confident about preparing one yourself, hire the services of a consultant who can guide you on how to write a business plan proposal. All the best!