Business plans for small businesses
Companies that need start-up or expansion money seek financing, and the best way to start determining where your funding will come from is by drafting a solid small business plan.
A good business plan lays out all of the components of your business, from the company and its competitors to how HR and operations will be run, and of course the financials.
Before you start writing your first business plan , here are the basic elements you need to know:
Difference Between A Strategic Plan And Business Plan
A strategic plan fine-tunes an existing company’s three-to-five-year direction. Established businesses use this internally to set their mission, vision and values.
Business plans obsess on the present and near future. Since their raison d‘être’s to convince outside funders of the company’s viability, financial forecasts dominate. A typical business plan’s made up of five essential parts aside from an Executive Summary.
Part 1. The Company
Potential investors have to know what the business does and who it competes against. They want to see what niche the company occupies, how it stands out from rivals, and which trends are being leveraged (or overlooked).
This portion should also review market segments (offerings, pricing, distribution channels). Customer demographics and government regulations also figure in.
Part 2. Operations And HR
Where will facilities be located – be it in an owned, leased or rented office, or virtually? Then too, there are equipment and technology requirements. Research and development efforts. Plus keeping things green and shiny clean.
On the personnel front, how many employees will the business have? Outline their roles and levels clearly. Significant policies and procedures ought to be pointed out too.
Part 3. Sales And Marketing
Revenues got to come from somewhere. Here’s where to say who the customers (B2C) or buyers (B2B) are. What their purchasing patterns are. How many of them it’ll take to turn a decent profit.
As well include some intended marketing and sales initiatives. Stuff like advertising and promotion. Public relations or online campaigns. Where the products or services will be sold. Which critical suppliers will be squeezed.
Part 4. Activity Schedule
This section’s commonly known as an Action Plan. It looks damned convincing when arranged as to project steps. Who’s responsible for which activities? When they’ll start and finish. What the expected outcomes are. Affix measurable goals, not some loosey-goosey pap.
Part 5: Financials
Without the numbers, no business plan’s complete. So conjure up sales and expense figures. Capture any from the previous year if available. Forecast ahead three fiscal years’ worth, each year is displaying monthly figures.
Financiers expect a balance sheet as well, showing assets and liabilities. Also a cash flow statement and the amount of money being asked for.
Bind it all together neat and tidy. Add an impressive cover page. Et voila, one convincing business plan set to part reluctant Loonies from hands of abundance!