First, do you even have one? A comprehensive business plan is a must when you’re applying for a loan or venture capital, or if you’re going to take on business partners.
But it’s a good idea to have one even if you’re humming along on your own funds. It’s much easier to gauge your progress and make strategic decisions if you’ve laid out a clear road map. If you didn’t create a business plan before you started your business, it’s not too late.
And if you have one, maybe it’s time to dust it off and see if it needs a tune-up. According to the Small Business Administration, a business plan should always be a work-in-progress, subject to regular tweaking.
A good business plan should consist of several related elements. Here are the most important:
– Executive Summary. Write this last, as it encapsulates who your company is and where you’re headed.
– Market Analysis. What is your target market, and who is your competition?
– Company Description and Organization. What does your business do? Who does what?
– Marketing and Sales Strategies. How are you marketing and selling your products and services?
– Service/Product Line. What are you selling? What else do you plan to sell?
– Financials. Break out Excel. These will range from simple tables to full-blown spreadsheets (balance sheet, break-even analysis, cash flow, etc.).
– Funding Requirements. How much money will you need? How will you use it?
– To be useful (and to increase your chances of obtaining funding, if that’s your goal), be brutally honest and specific. Not good with grammar and spelling? Ask someone who is to edit it.
Business plans are lengthy documents, but don’t put your potential readers to sleep. Be concise.
Don’t Go It Alone
Knowing the framework your business plan should follow may not be enough: You should lean on the experts.
The Small Business Administration has a good site that provides resources for starting and maintaining a business. One of the topics covered is business plan creation. You may also want to consult with your accounting professional and/or your attorney as you’re designing or redesigning your business plan.
A Good Roadmap
Goals are, by nature, attainable and measurable. Your business plan should not only serve as an attractive prospect for funding, but a guide for you as you continue to hone the framework of your business. Visit it often, and solicit input from your key employees. Keep it tuned up, so it’s ready at a moment’s notice should a potential investor or banker want to see it.