Creating a written plan for success in your own business can mean the difference between success and failure. Yes, start-up companies are often fluid and fast moving, but you should still have a good grasp of where you want your company to be in yearly increments, what milestones you want to meet, and how you are going to get there. Also, a good business plan should quantify the size of your market and the buying discriminators of your target clients. In short, it is an operating tool, a good reality check, and should clearly communicate your ideas to others and be the base upon which you can use to build financing proposals.
A business plan consists of three parts: concept, markets, and financing.
Address these questions in the concept portion of your great business plan:
- What do you want your business to do? Are you going to sell a product or service?
- Why are you uniquely qualified to operate this business? What makes you different from the competition?
- Where are you going to be located? Do you want to be nationwide? If so, how are you going to get there?
- What are your staff capabilities going to be?
- How are you going to build support function such as human resources, accounting and payroll, and sales?
Address these questions in the markets portion of your great business plan:
- Who are your customers? Where are they physically located?
- How big is the size of the overall market? Is the market segmented? If so, how and what is the value of each segment? How many customers in each segment do you need?
- What do you offer your potential customers that no one else does? Why should they buy from you?
- How big is your market?
- What is your plan for reaching potential buyers? How will they know about you?
- Who is the competition? What are their strategic advantages? How can you overcome them?
Address these questions in the financing portion of your great business plan:
- How much capital do you need to start your business. Quarterly, annually?
- What is the burn rate of your capital?
- What are your projected sales targets? When do you expect to make a profit?
- How can you control your finances?
- How can you maintain cash flow and liquidity?
