Writing a business plan is one of the most components for ensuring your overall business success.
You must understand it is this important document that can help you bring your entire business plan and details on paper and work out the specific feasibility aspect.
So, you would not be wrong if you referred to the business plan as a roadmap for your business.
The roadmap that enables smooth execution and clearer understanding of the entire concept.
It is one of those key parameters that enables an entrepreneur to build the basis of their business.
It also works on the avenues that need to be improved or boosted.
In other words, an appropriate business plan helps you create projection about the way your business is set to move forward.
It also shows the possible impact that your business might have on the overall implementation of the business that you are going forward.
With so much detail on pen and paper, identifying potential loopholes and plugging them also becomes equally easier.
As a result, your chances for experiencing relative success in your business also become much higher.
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Writing a Business Plan in 10 Steps
This is how you can write a business plan on your own in 10 easy steps:
- The business executive summary
- Research is important
- Description of your business
- Analysis of the target market
- Organization of business
- Development plan
- Operational efficiency
- Financial component
- Analyzing the competition in the market
- The style of writing a business plan
Writing a business plan comprises of a step by step process.
Pretty much like a book, you would need:
- an index
- a foreword
- an introduction
- a specific order in which the chapters progress
- a conclusion.
The executive summary of the business plan is no doubt a sneak peek into the overall plan and gives the readers a ringside view about the overall business.
In simple terms, it introduces the business plan to the readers in a comprehensive fashion.
Here is a quick lowdown on the various elements of creating a business plan and how to make it effective.
1) The Business Executive Summary
When the fundamental question about how to write a business plan comes up, the most important aspect of it is creating this overall business summary.
Essentially the summary in many ways is a peek into the entire business plan.
It invariably follows the title page and often tells the reader everything that they need to know about the entire plan.
This is very important because what happens in the process of writing a business plan is the fact that the actual objective is buried deep into the middle of a plan and a reader might miss it.
But the advantage of having the executive summary is, it can be highlighted upfront.
Therefore, the reader may choose to go back to the details if they wanted to later on.
In many ways, it should proceed like a movie.
Just like in a film it needs to start with a strong hook, a funny anecdote or any other instance that can keep the viewers gripped and encourage them to continue reading it.
Within the executive summary also, the most important part is the first paragraph of this summary.
If there was a case of an executive summary within an executive summary, this is what the first paragraph should go about doing.
It needs to be compelling enough to convince readers that they must follow the story and bring about a difference.
While you might think that you need to always start an executive summary with a story, that might not be true all the time.
Many times, this particular policy might fall flat and make for a rather boring reading experience.
It could even start with the particular problem that your business is set to address.
Your market analysis and in depth research can be highlighted in the very first paragraph and attract the reader’s attention.
The core idea of the first paragraph is to highlight the hard work as well as bring about the core driving point of the business.
2) Research Is Important
Research comprises of the core point of your business, and the business plan needs to do proper justice to your effort.
You must understand that the only way you can make your product stand out is by properly analyzing the product, the prospect of it and the market response that you can expect from the product.
Several business veterans even suggest that you should spend double the time you require for creating your business plan on the actual business concept and formatting of the idea.
Moreover, the research is extremely handy in terms of helping you get a better handle on the business.
The deeper your understanding is about the business, the better the business plan would be.
Therefore, in many ways, great research can help you create a stronghold on the business.
Try and ensure that you read everything that is available on the topic and engage in continuous dialogue with the various stakeholders to enhance your knowledge base in a well rounded manner.
Additionally, research will also help you identify new opportunities or potential problem areas.
You can then further sharpen your business plan manifold with this new found understanding and analysis and start writing a business plan with a better perspective.
3) Description of Your Business
The next crucial step in writing your business plan is bringing out the true nature and type of your business.
It gives a description of the business that you do and why you provide a superior offering compared to the others.
It, no doubt, helps you market your business better and assist the reader to understand your USP.
This also helps a reader identify the elements that differentiate your business and what kind of target customers that you might be serving.
By description, you should not just concentrate on the key products that you are going to manufacture.
On the contrary, use this opportunity to highlight the entire thought process and research that the business might have undertaken.
You must make adequate provisions in your business plan to emphasize the research elements properly and interact with the potential clients on as many fronts as possible.
Remember when you are describing your products on a plan, it is no less than marketing your product or perhaps spreading awareness about the same.
Therefore, the business plan is in many ways is a marketing tool, and creating a strong content on it has a positive bearing on the overall product lineup.
4) Analysis of the Target Market
A sharp market analysis is the next most important aspect of writing a business plan.
This market analysis is important to help you get a fair idea of the market, sector and the competitors that you would be dealing with.
This market analysis also throws up important pointers to help you improve your business efficiency and their overall output quality.
After all, you must understand that without a detailed understanding of the target market and the kind of competition you would have, your business plan will never have the requisite firepower.
Identifying the appropriate target will no doubt help you achieve greater finesse and better execution capabilities.
Moreover when your conviction and vast understanding about the core product gets highlighted in the business plan, it also in many ways projects an affirmative perspective on your business commitment.
It would not be wrong to term the business plan as an appropriate mirror that reflects your commitment to the business.
In many ways, the business plan does not just document your market analysis.
It sometimes also goes a step further in terms of creating a more sustainable reference point to understand the feasibility of your plan.
This inevitably also has a strong bearing on the overall analysis of the target customer quite easily.
Quite often it is noticed, especially in case of product awareness, this type of strong and aggressive mention in the business plan helps you with generating awareness about the product too.
In many ways, this is one of those channels in your core business plan that helps in putting across your product in a far more convincing manner.
It is needless to mention that this also has a far more positive response from potential buyers.
5) Organization of Business
The next point to highlight when you are looking at how to write a business plan is no doubt highlighting the structure and organization of your business.
You must understand that there is a unique way to manage every different business and they are managed uniquely.
Basically, there is no set template to run a business.
Your business plan is the ideal platform to highlight why and how differently your business organization is planned.
You can also help create a sustainable long-term plan with the help of the primary pointers that emerge while you are writing a business plan.
Writing a business plan almost invariably entails development of specific skills to manage the daily operations.
So it not only highlights the problem areas that might be in the core plan but also refines the overall organizational structure.
It, therefore, serves a two-way purpose of enhancing the plan capabilities as well as creating a tight narrative of the overall business fundamentals.
It is crisp and precise and further highlights the streamlining of organizational structure.
6) Development Plan
While writing a business plan, it is important to highlight the development that you envisage in your business.
This is exactly why it is often referred as the roadmap.
You must understand that it will never be sufficient to chalk out what you want to do today but also how you plan to develop the business going forward.
The plan of expansion and development that you have over a 5 year or 10 year period also impact the current execution aspect.
Therefore to the readers, this development plan and structure become a key comparative.
It is through this element that they can identify how you plan to take forward the business.
7) Operational Efficiency
The next element that you need to concentrate in writing a business plan is a description of how the business operates on a day to day basis.
This part of the plan typically highlights the logistics structure of the business.
This is where the readers get to understand the task division among various team members, the management composition and the resource allocation.
You must realize it is after all this operational game-plan that kind of highlights the red flags and the green flags inherent in the overall operation of the entire business.
8) Financial Component
When you are considering the various options of how to write a business plan, it becomes important to highlight the backbone of any business, the financial date and overall funding of the business.
It is in many ways as important documentation as the business concept or management composition.
It is this key data that also points to the rate of progress that a business is preceding and what is the scope of future development.
In case you are seeking to get funding for your business, then also the financial data is of primary importance.
It will give a realistic picture to all potential investors about the kind of efficiency that the business is operating at and what is the key development that is required to further the business.
The investor through this plan and especially the financial data also gets to understand if there is any concern area or over spending that the business has been engaged in.
In many ways, it therefore also helps you improve the cost efficiency.
9) Analyzing the Competition in the Market
Writing a business plan is not only about highlighting your core competencies but also taking into perspective the real challenges in the market.
Analyzing the business fundamentals of the biggest competitors in the market helps you to highlight and pay closer attention to the strength and weaknesses of your competitors.
It also pinpoints key strategic initiatives that the competition might have undertaken.
This is particularly relevant when it highlights a specific area of expertise of a particular competitor.
This further helps you to create entry barriers to the common market by exploiting the weaknesses of your competition.
Therefore writing a business plan helps you to analyze plans with greater precision.
A study of the strengths and weaknesses of competitors often help you to work faultlessly.
10) The Style of Writing a Business Plan
Now that you are pretty well versed with the content of the business plan, the next challenge is no doubt the style of writing that you should incorporate to make it a compelling read.
Surprisingly often the component that can really make a different to the overall plan is a simple and direct approach.
a. To the Point
Remember the business plan is not exactly a novel that you are writing, and that means your approach needs to be direct and to the point.
It would be pointless to beat around the bush and devote sheaths and columns to great literature.
Instead, you need to be rather to the point in your approach and directly convey your perspective in a single sweep.
This also helps in keeping the clarity of your business plan intact and undoubtedly makes the content extremely professional and uncomplicated.
Additionally, to the point approach also enhances the overall comprehension of the plan in general.
b. Do Not Compromise Clarity
Whatever you write, clarity of your plan is a very important element.
Therefore, keep the content and the matter well monitored and whatever you might be forced to write is a primary perspective that you must pay attention to.
However, cool a specific concept or style might look, it is no good if you are not able to explain this clearly.
Clarity in writing is one of the most important elements that you must focus on.
This ensures that your write-up is compelling
It helps people to sit up and take notice of what you compose instantly.
Additionally, you must also maintain clarity of concept in your business plan.
Whatever might be exact features or the purpose of the plan, your writing should be able to highlight it without any effort.
Whether you are reading a specific part of the plan or just skimming through the broad details, the clarity of concept needs to be borne out in its totality.
This also will add to the essential punch in the plan and make it for a far more compelling read than a mere statement f basic facts.
The genuineness and originality of any content matter a lot.
People many times pay extra attention to an original content as opposed to a great write-up that might be copied or inspired by an already existing business plan.
Remember that every business is unique and the needs of each one are as special.
However, much people might insist, an original content always scores much higher than something which is a blatant copy of something else.
The writer’s lack of confidence or inability to adapt a style often shows up exposing the inherent weakness of a copied concept.
d. Be Assertive
While it is important to use simple and easy to grasp style of language, your selection of tone is extremely crucial.
Through the business plan, you must look at maintaining a strictly professional and slightly assertive approach.
This invariably gives an impression that you are quite passionately involved in your business and are intimately involved in every aspect of its operation.
That would mean that as an entrepreneur, you are just not physically engaged with the business operation.
You also have a significantly large mental association with the core concept.
In the long run, it is often this factor that enables a smooth running of the business and brings out greater clarity of concept.
e. Fast Moving
Remember the business plan is a rather long document and there are moments when boredom does set in.
The trick in it is to use shorter words, shorter sentences and keep it fast paced, almost like a movie.
This will ensure that the reader breezes through it pretty much like a detective novel and is not able to keep it down without ending it.
Once your target readers read the whole concept, your job is done.
Therefore, go through the content again and again and keep tweaking till you are satisfied.
f. Introduce the Concept
Well you might have spent a lifetime in treating glasses and creating beautifully blown glass structures.
But the problem is not all of us are resident experts on the subject.
However, the success of your business plan is essentially in being able to communicate your ideas even to the uninitiated.
Therefore, you have to pay particular attention to making your concept clear to all and sundry on the first go.
Use simple to use terminology and make it into an information base that everybody can access.
The success of your concept is in the easy comprehension by the people who read it irrespective of their association with the sector.
g. Chart out a Clear Roadmap
Often a business plan falls flat despite a great content because of the simple reason that there is no forward movement.
It devotes too much of column space in explaining who they are and how they will do it.
But the problem is most potential investors want to know a little more.
They want to see the business moving forward and helping them earn a return on the principal capital that they decide to put into the whole business.
It, therefore, becomes very important to mention a forward looking strategy in your plan when you are writing it.
You have to pay extra attention to ensure that the plan is precise in communicating the forward looking roadmap.
It should not crimp on explaining where they see themselves in 5-10 years.
This would be the ultimate test of the plan.
A business plan that fails to incorporate this core element would come across as incomplete and would not be self explanatory.
Therefore, ensure that you devote sufficient space to explain to your potential investors about where you see the firm going in 5-10 years.
Therefore, writing a business plan is about being practical and creative at the same time.
While the plan needs to be catchy in terms of the presentation, it also has to project the strong points and the hard truths about the business.
It sets out a roadmap and developmental strategy that the business should follow.
Be it the 5-year expansion plan or the 10-year profit plan; it is the business plan that gives a realistic picture of the way business has been preceding.
Overall when you consider the various elements of how to write a business plan, it is crucial to consider a comprehensive picture of the way you run the business.
Overall, when you consider the various elements in writing a business plan, it is crucial to consider a comprehensive picture of the way you run the business.