How to write a business plan – Beginners Guide
Now that you have an exemplary business idea, it's time you spend some time gathering relevant information and facts that will help you create a sellable business plan. It's time to pull your socks up and talk numbers. Jot down how your business idea is going to solve the problem of your target audience and what strategies you are going to adapt to ensure you are able to achieve your vision. In short, this is the stage when you start describing the essentials of your business plan - What. How. and When! After all, this is the only way to prove others whether or not your business idea is worth investing in. So how do you do it? What factors should you keep in mind when drafting your first pitch deck? With that in mind, let's just dig in...
3 Basic Rules for Writing a Business Plan
First things first, you gotta follow some rules. No matter how much you hate to play by the rules, when it comes to writing a business plan, there are a few that you must follow biblically...
Keep it short and concise
Don’t you want your business plan to be read by your investors? Ponder over the fact that in this time and age no one has the time to go through a 100-page long document. Besides according to new studies, an average attention span of humans is down about four seconds from 2000 which means a long and detailed business plan is a huge hassle to deal with for most individuals. A short, crisp and concise business plan ensures that you're able to communicate your message to your potential investors without having the risk of losing their attention.?
Make it easy to skim
Your business plan shouldn't just be short and concise, but it should be easy to skim too. When it comes to formatting the content of the document, make sure you use bullet points, a spider diagram, audio recordings, and highlight the key points or metrics that you want readers to focus on. Refine until you format the document in a way that is readily accessible and understandable at a glance.
You should be able to change it as the business grows
Most SMEs start out with a business plan, and once written, it's never revisited. Your pitch deck should be treated as a working document that should develop with your business as it grows. For example, you might want to update your marketing plan as per the changing trends for a new round of funding. In a nutshell, keep your plan alive!
Steps to Write a Successful Business Plan
Whether you are starting or growing your business, you have to have an executive summary, a.k.a the first chapter of your business plan. An executive summary serves as a standalone document that would clearly highlight the key elements of the entire business model. The executive summary should neither be too long nor too short. A page long summary of your business should succinctly cover the following:
- Company’s purpose described in a single declarative sentence
- Problem describing the challenges of your target audience and how your business plans to address those. What are the shortcomings of the proposed solutions?
- What makes your product/service/offering unique and compelling? How would you take it from "here" to "there"?
- Who are your direct and indirect competitors? How do you plan to win over them?
- How do you intend to sustain and thrive in the eco-system?
Next comes a company overview. This section provides a quick review of your company's background, history, mission statement, team members, location, and legal structure. Your company's mission should not be more than one or two sentences, and it should encompass the overall value of your business. Start with what you intend to do and move your way to explain the type of products that you are building to benefit your target audience.
This comprises of examination of your primary target audience, which includes demographics, geographical location, age categorization and gender analysis for your product or service. The purpose is to show that you have a thorough knowledge of your market segment and that they'd be interested in buying from you. The idea is to get specific with your target group. Target a small group of customers. Surveys, interviews and other research methods should help you outline the potential share of the market for your product.
This is where you expand the initial overview. You can be descriptive about what you are selling, how it would fulfill the needs of your target audience and how it fits into the current competitive landscape. In this section, you also describe how you plan to expand your product line in the future to meet the growing demands of your business.
This is where to provide a detailed structure of your marketing and sales strategies. How do you actually plan to sell your product? What measures would you adopt to create brand awareness? What tools you'd be using to amplify your sales and marketing channel? Perhaps this is the section of your business plan that your readers are looking out for a detailed explanation of your proposed advertising, promotional activities, sales strategy, pricing plan that you're going to use to persuade your target audience to buy from you.
Perhaps the most crucial of all segments, Financial Plan should clearly outline the financial model of your business. This includes startup-cost, detailed financial statements, current assets, financial projections, and funding requirements. This is the part of the document where you present three main documents of your business - income statement, cash flow statement and balance sheet. An effective online business plan writing software will help you prepare of all these documents.
There you are with a complete guide to writing an effective business plan. Whether you're writing a business plan for the first time or the hundredth time, remember that your business plan is your compass that will help you navigate a new course through uncharted territory. Hence, you want to make sure that you "put your best foot forward". If you are looking for a more professional approach toward creating your first pitch deck, you can start creating your business plan using free online business plan writing software like Upmetrics. It’s easy, fast and free. As always, looking successful and pitch-perfect at all times is half the battle won. Now go bring your idea to life and make it a life-changing success. Best of Luck! :)