Thursday, January 26, 2012

How to write a business plan

As I've got another one to write in the next couple of weeks, I thought I'd start a mini-series on How to write a business plan. Today's post is simply an overview of where we're headed, but tomorrow we'll look at Why have a business plan in the first place - despite conventional wisdom, they're not always necessary in the detail that's often talked about.

But, if you're going to put together a business plan, here are the major headings to cover:
  1. Executive Summary A concise summary of your Business Plan. No more than one page long, and normally it should be the last thing you write, after all the rest is pulled together
  2. Business products/service A concise description of your business and what it will do. This section should give overview information on each of the revenue streams you envisage, and over what time frame.
  3. Analysis of market opportunity This should be consistent with your financial plan and should justify the activity: just because it's built, they won't necessarily come! This section could include an assessment of the Business Landscape and your view of Market segmentation along with Competitor analysis (showing their strengths and weaknesses).
  4. Team skills, experience and resources Background information about the skills and experience you (and your team if appropriate) have that will help you realise your business plan 
  5. Sales and marketing Describe the market – end user, sector and segment descriptions. Identify customer priorities and needs. Outline a recommended approach to the market, including how you plan to position and brand your offering; and how you will reach the customers you are targeting 
  6. Financial Plan A basic financial plan needs to show :Forecast sales; Costs (fixed and variable); Cash flow analysis; Funding requirements and recommendations. 
  7. Strategic action plan List the actions required to realise the plan. 
It doesn't sound like much, but there's a lot of work to go into making this coherent and credible. And this outline will only serve the most generic of situations - chances are that your plan will need to delve into more detail in some areas than others, and add some sections of information. But keep the whole thing under twenty pages in length. And keep it updated - there's little point in writing a plan and filing it away. If it's to be useful, it should be usable and used!
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