A business plan is a detailed description of a company’s goals and objectives with set time frames in which the company plans to achieve those goals and objectives.
The business plan involves a lot of strategic planning of different operations that will ultimately work together to achieve a profitable business.
The goal of a business plan is to analyze and plan different as aspects of business to help the entrepreneur create structure and develop a strategy for the business.
Why Business plan emerge?
A new business starts from an idea. After coming up with an idea the next step is to come up with a plan on how the business is going to operate. It is extremely important for a new business to plan and prepare for the future. The strategy of the business should be defined beforehand to make thing easier for the entrepreneur. All the strategic planning and operational planning should be well defined before starting a business. The best way to do this is by writing a business plan. In this part the definition and the benefits of a business plan are explained.
Why of Business plan is important?
- The business plan is a tool that can be used to identify potential opportunities and potential risks.
- The plan encourages the entrepreneur to consider different aspects of business before the business is established.
- In the long run, this planning for the future will save the entrepreneur a lot of time and resources because it will help in advance with the decision-making process.
- The business plan can be a motivator for the whole team, because knowing exactly what the business’ objectives are and time frames in which it plans to achieve these objectives can be a good motivator for everyone involved to make these objectives happen.
- The business plan is also a great tool that could attract investors and allow the business to potentially get loans from banks.
- Investors and banks look at the business plans to get an idea if the business will be profitable or not, and then decide if they will invest their money into the business.
Business plan content/structure
The summary is a short recapitulation of the business plan that focuses only on the main points. The main points that should be touched on are: How is the business going to operate? Who are the customers? What are their problems? How will the business solve these problems for them? In the summary there should also be mention of some of the main goals and the strategy as well as a brief overview of the finances.
Business idea
The first step when starting a business is to come up with an idea. The business idea is the starting point which will later determine the strategy, mission, and vison of the business. After some brainstorming, the idea can be modified and improved until all the factors fall into place and create the perfect business idea.
Business modal/form
When starting a business, it is important for the entrepreneur to determine from the beginning which business model the business will follow. There are many different fac tors that influence which model should be chosen for a business. The factors are the number of founders, the capital requirement, the division of responsibility, the decision-making, financing and the taxation.
Strategy, mission and vision
The strategy of the business describes the series of action the business will use to gain a competitive advantage over its competitors. A competitive advantage is something that sets a business apart from another. Anything can be considered a competitive advantage.
Products and services
The products and services part of the business plan is more than just a description of the products and services the business is going to offer to customers. This part should go into detail about all operations that will take place to bring customers the products or services they need, at the right time, in the best way to solve their exact problem.
Customers
The customer part of the business plan should focus on analyzing and understanding cus tomers. The population of this planet is enormous and constantly growing. Each person is an individual, and everyone has their own individual needs and wishes. It is impossible to appeal to so many people, therefore, it is important for businesses to focus and target smaller groups of people with similar needs so the business could try to fulfil their needs as well as possible.
Market
An exchange of goods or services between a company and customers is a market, depending on the product or the service a company is selling, the business is part of a specific market.
Competitors
In an established market, a company enters an extremely competitive zone, where a lot of companies try to sell similar products to the same customers. In this stage, the goal of the business is to determine how it’s going to make the customers purchase their product over the competitors. In the competitive analysis part of the business plan, the entrepreneur should focus on the whole competitive environment and write a detailed description of the competitive environment the business is going to enter.
Marketing
Strategy A marketing strategy plan describes the ways in which a business will promote its products or services to customers. The first step in developing a market strategy is to determine which customers the business is trying to reach, this can be done by focusing on certain groups of people based on similar characteristics such as age, location, or lifestyle.
Promotion
The target of marketing is to promote your business, product, and services to customers. The idea is to make people aware of the assets the business possesses and make them want to purchase from the business. Promotion can be done in different ways; some are traditional promotional ways and others are newer ways. Depending on multiple factors such as: budget, targeted customers, demographic, type of product or service, a business must decide which type of promotion is best for their needs.
Sales distribution channels
Distribution channels are tools that help businesses reach their customers. There are differ ent distribution channels that work for different types of businesses and customers. Choosing the best one for a specific business depends on different factors. The most important factor is the customer. Determining in which sale channel the potential customer is the most active in is the best way to choose which channel the business will be the most active in.
Risks analysis
When starting a new business, it is crucial to be prepared for any potential issue that might arise. Identifying the risks can be detrimental for a small business because it can be a good indicator of any potential weaknesses the business plan might have. Identifying the risks from an early stage could help prevent them from happening and in the end save the business time and resources. There are numerous risks a new business could face; it is impossible to 19 identify all of them right from the beginning.