How to write a business plan

Creating a winning business plan increases the chances of success and spurs investors to fund your business.


The business idea
Describe the problem you will solve with your start- ups or on-going business. The following may applies: A story with a personal reference is more likely to pull the reader away than a purely factual description of a niche in the market. Show how the problem should be solved and customer benefit generated without getting too technical, and outline the target group that will benefit from your business idea.

Be careful not to solve any “non-problems”!

Here are the key components of an excellent business plan:

Executive summary
First impression is the last impression!
An executive summary is a crucial part of this document. It provides the essence of the whole plan:
• Company details.
• Size and scope of business opportunity.
• A description of your offerings and how it will solve the problem.
• Growth projection.
• Financial requirements.

It should be informative and able to spark readers’ interest to know more about the business plan.

Overview of the business

This section lists down information on:
• Your business;
• Your target market;
• Description of your products/services;
• Why and how your offerings are a great fit for prospective customers;
• Your capabilities to handle the demands;
• Your value proposition and competitive advantage.
…and all other related details.

How do you intend to go about breaking the market?

What does your value chain look like?

In this part of the business plan, you reveal your master plan and answer the question of why your idea and your team are better, faster or more cost-effective than everyone else on the market. Name possible strategic partnerships and give an outlook on innovations and possible expansions of the business model.

Put forth a strong case built on the solid rock of data analysis and statistics – present data on target market size, industry trends, sales forecasts, and marketing strategy.

Give detail about your product and its variants and explain how they work.

Which prominent features characterize the front end, which other key functions characterize your solution?

Unique selling points; Images and screenshots are particularly important – if none are available yet, work with your IT specialist or consultant firm.

Think about whether you can describe scenarios or user stories to illustrate usage behaviour. Also discuss the infrastructure and any service components that will help you offer your product.

In this way you show that you have dealt with the complex internal processes.

The operating plan highlights the operational requirements for the smooth functioning of a business.

It includes facilities, supply chain management, inventory, manufacturing, shipment, logistics, staff management – everything under the sun that covers capital and expense (CapEx) requirements.

This section answers the question: “Where do you see the business going in the next few years?”

It provides visibility to investors on the milestones and how you will make money in near future.

The marketing plan section describes how to market the offerings to create and fulfil customers’ needs and Think through the campaigns carefully and show that you already know what you would do with a marketing budget (who are the customers, product positioning, pricing policy, and promotional strategies?)

If you still have the official launch ahead of you, you should explain the market entry strategy at this point.

This section outlines how your company or organization is structured and basically how strong you are together.

It describes the skills, background, and responsibilities of the management team.

It builds conviction that the business is in good hands and has a proficient human capital.

As with a classic SWOT analysis, write down your most important strengths (internal), weaknesses (internal), opportunities (external), and risks (external).

Be realistic and honest.

If you want to make an impression, you broaden your view to include a strategic perspective:

Cross strengths and opportunities and show that the focus of your business model lies precisely on the interface.

Then cross weaknesses and risks and describe your ideas for risk management: How do you prevent the greatest dangers?

It is okay not to have an answer for everything.

An honest risk analysis is worth more in a business plan than a seemingly seamless strategy.

Finances

Financial plan and projections

This is the part where numbers become the king.

The financial part of the business plan is a summary of the financial plan that many founders create again separately. The financial plan is the heart of your business planning and the basis for all considerations around external capital requirements, marketing and employee budgets, infrastructure investments and more. A good financial plan tells you months in advance when you will need new capital.
It draws upon inflow and outflow of money, sales forecast, profit and loss statement, balance sheet, cash flow statement, and budget expense. It discloses and forecasts the company’s financial goals, profitability model, and charts a course for the coming years.
Dealing with all of these elements will help you understand your company’s plan for making a profit. It identifies the products or services the business plans to sell, its identified target market, and any anticipated expenses.

Conclusion and appendix.

Conclude the business plan by succinctly bringing out the key pointers – the business’s vision, mission, goals, strengths, and growth trajectory. Make it compelling and to-the-point.
Add relevant appendices to strengthen your business plan.

Types of business plans >>