“All I need is money – just give me money.” That is the statement we often hear from prospective business owners, specifically those who are seeking outside capital. However, before money, you need a business plan. It is crucial to visit or revisit the necessity of business planning and to prepare a business plan.
If you are seeking outside money, you will be required to write a business plan. I recommend that if you are using self-funding – you must require yourself to write a business plan.
The classic business plan includes the following parts:
- Description of your company- Tell us about your business. Describe the what, where, and why of your business. Describe your product/products. Why should people buy it? What makes it unique or special?
- Market analysis- Who will be your target customer? Define your customer with clarity.
- Competitive assessment- Who are your competitors? Why will your customers choose your company? Define your unique selling points and prove your worthiness.
- Marketing/sales strategy- How will you reach potential customers? What channels will you use to promote your business/product? What are the estimated costs for this effort?
- Operating plan- Identify owners and their expertise. Articulate their qualifications for managing the business. Explain how each aspect of the business will be managed.
- Legal issues- What form of business will yours be? Have you determined if yours will be a Sole Proprietor, Partnership, Limited Liability Corporation, or a Corporation (S or C)
- Risks and mitigation- How are you planning for a possible disaster or downturn? Will you have off-site database storage? What insurance will you carry to mitigate disasters?
- Executive summary- This would be a synopsis of the information listed above. It will actually go at the front of your plan, but should be created last for ease of process.
- Financial plan- Indicate how and when your business will begin to make money. Include a forecast of the financial data for three to five years in the future. This plan includes all expected revenues and expenses.
- Funding request- What start-up costs are you seeking, and how will you be using those funds?
As the business owner, much of this information is in your head. You think about your business 24/7. When you take the time to write the plan, you can test the conclusions you have in your head, justify your plan, and articulate the needs you have.
If you need help in putting this all together – contact your local ISBDC. We assist business owners with this process on a regular basis, and we would love to help you write your plan. From excellent demographic information (so that you will know about your target market) to specific industry studies (so that you will have in-depth knowledge of your industry) – we have the tools you need to build your plan.
Do you need more money– perhaps, but you DEFINITELY need a plan. If you are on the entrepreneurial journey, this is your map to a successful destination, and we at the ISBDC are here to help you build that plan.