The Basics of a Business Plan

Business strategy.Plan.Vector
Getty images

Most people think that a Business Plan is only used once and only serves to achieve a specific goal: get financing.

This is a very limited point of view. A Business Plan, in its different formats, can be used for a variety of purposes, including validating an idea, obtaining financing and managing a successful business. The format of your Plan will depend on what your needs are. If your potential investors ask you for a traditional business plan, you will have to follow the format of a Standard Business Plan. Are you going to create a plan to manage your company once it is already operational? Then a Lean Business Plan will be your best option. Do you only want to validate a business idea? A Single-page Plan will be more than enough.

Below, we show you the basic points you must follow for each of these Business Plans: Standard Business Plan, Lean Business Plan, and Single-page Business Plan.

1. Single-page Business Plan

This format is the simplest of all. There isn’t much difference between this document and the executive summary of the Traditional Business Plan, although, of course, as its name suggests, it must fit into a single page.

You can use the Single-page Plan to validate your idea or to provide investors with a clear and concise description of your business.

You can also use it to put all your ideas on paper before starting to write a Standard Business Plan.

These are the basic points that should include:

  • Describe your business in a single sentence. (What you do and why you do it).
  • The problem that your potential customers have.
  • Your solution to the problem.
  • How is your product or service.
  • Explain who your target market is and how big it is.
  • Your competitive advantage and how your customers are currently solving their problems.
  • How are you going to sell your products?
  • Describe the marketing techniques you will use to attract customers.
  • Detail your business model.
  • What will be your source of income?
  • A list of your main expenses.
  • A list of your main objectives and what you want to achieve in the coming months.
  • An outline of your management team and your employees.
  • The partners and resources you will need to launch your business.

2. Lean Plan

A Lean Business Plan is designed to position the company toward its goals, and also track & manage progress, expectations, and accountability.

Although, you can use a Lean Plan to create a Standard Business Plan, it can also be used to validate your ideas, as well as optimize and streamline the day-to-day management of your company. It’s not a document or detailed plan, full of descriptions, to be presented to investors or lenders.

To complete your Lean Plan, follow the steps below:

  • Write a one page plan (as indicated above).
  • Test your idea (talk to your potential customers): -Do they have the problem that you think they have? -What do you think of your solution? -What is the best way to sell yourself? -What marketing tactics will work?
  • Set your sales goals and create a budget for your expenses: sales forecast, cash flow and expense budget.
  • Once you have it, be sure to check it periodically to stay on your goals.

3. Standard Business Plan

If you are looking for financing from a bank or an investor, a Standard Business Plan will be the ideal format. This is the version of the Business Plan that offers more information about your company.

Its basic points are:

  • Executive Summary – You must talk about the problem you are solving, your solution, the market and the competition.
  • Products and services section – Enter more details about the problem and why it is worth solving it. – Describe your solution to the problem (your product or service). – Talk a little about how your idea is validated and what your plans are for the future.
  • Market analysis – Includes more detailed information about the market, your main customers, the future of the market and the competition.
  • The implementation strategy – Describe your marketing plan and your sales plan. This includes information about your location, services, technology, equipment, tools, key metrics, and important milestones.
  • A summary about the company and its management – Write about the organizational structure of your company, the management team, the deficiencies in the team, and your personnel plan. – It includes information about the history of your company.
  • The financial plan: It could be said that it is one of the most important parts of your Business Plan, this will include: – A forecast of income and sales – Expenses – Projections of profit and loss. – The projection of cash flow. – The balance. – Business relationships.

As we said at the beginning of this article, even if you are not looking for financing , a business plan can be really useful, since it will help you to manage your company more efficiently.

Advertisements
Newbie

Written by NaijaRoko

Viral news from Nigeria

Comments

Leave a Reply

Your email address will not be published.

Loading…

0

Comments

0 comments

What do you think?

25 points
Upvote Downvote

9 Ways to Increase Your Creativity

Start a Business Designing and Maintaining Websites for Customers in Africa