Before you can get financing, open shop or sell a single widget, you need to create a business plan. A well-written business plan lets your financiers, vendors, and associates know that you are serious about your business’ future and committed to making it a success—so much that you put it in writing.
There are nine elements that are contained within every successful business plan:
1. Executive Summary
This is a concise, but detailed, synopsis of your entire business plan. More than likely you will write this last. It will contain the following:
- The date the business began or will begin.
- The names and functions of the founders.
- The number and function of any employees.
- The business’ location, branches or subsidiaries and a description of them.
- A description of the product or services your business provides.
- Information regarding financial funding, such as investors or loans.
- The company's financial and market growth.
- Plans and goals for management.
2. Market Analysis
- Describe the size of your industry.
- The historic growth rate and relating trends and characteristics occurring currently.
- The major product and service users.
- Your target market’s demographics, size, and purchasing information.
- How you will obtain market share through advertising and public relations?
- Your pricing plan.
- Market tests completed and the results.
- A Strengths, Weaknesses, Opportunities, Threats (SWOT) analysis.
- Regulatory requirements.
3. Company Description
4. Organization & Management
- The organizational structure of personal.
- Who owns the company, how much and their management involvement?
- The resumes of management personnel.
- The board of directors or advisors.
5. Marketing & Sales Management
- How you will penetrate the market?
- How you will grow market share?
- Who will sell?
- How they will reach the customer?
- How you will compensate your sales team?
7. Funding Request
- Credit history
- Resumes of management
- Product pictures
- Letters of reference
- Market research data
- Licenses, permits, or patents
- Legal documents
- Copies of leases, building permits, etc.
- Your advisory team members
After you complete a rough draft of your business plan, you will want to have someone with experience in small business and your industry review it for additional guidance. If you ask those with experience in business start-ups or small business finance, they will tell you that projections are almost always too optimistic and are never achieved. A second set of eyes can help evaluate your business assumptions for accuracy and guide you to providing more thorough research.
Helpful Advice to Remember
- Are you self-motivated and hardworking?
- Are you determined, focused and confident?
- Are you organized?
- Are you comfortable with public speaking?
- Are you a decision maker?
- Are you diplomatic and fair?
- Are you financially capable of supporting yourself without an income from the business?
- Are you ready to sacrifice the perks of working for another?
- Are you a leader?
- Are you able to ask for help or know where to look for it?
If you answer those questions "Yes," then starting a small business may be right for you. If you answered "No," you need to seriously reevaluate your goals. People become enthused when they see entrepreneurs succeed, but few see or evaluate the effort or risk that preceded that success.