January 24 2020
Step-by-step business plan guide – all you need to know
Have you got an idea for a business? That’s great! But before patting yourself on the back, you need to carefully consider every aspect of your company. That’s where a business plan comes in handy. Are you wondering whether drafting one is worth your while? Yes! It will allow you to order your thoughts, help you with operating your business and, if needed, become a bargaining chip in the process of applying for a loan or a subsidy.
We’ve put together a short guide with step-by-step instructions on how to draft a good business plan.
First – a summary
To start off, you need to encourage your reader to read the business plan. A summary should be prepared after writing the entire document. Why? You will know what your business plan contains and will be able to easily sum it up in a short and concise way to attract the investor’s attention.
What your business plan summary should contain:
- company name and owners’ details,
- objects of the company,
- company’s development concept,
- a description of the product or service, including what sets them apart from other brands,
- strategic and marketing objectives,
- financial plan.
Second – description
A description is simply a short depiction of a company, which includes the most important company information. Focus on objective data and emphasize your achievements to date. It is especially important for investors. If you are proactive – the investor will know that your chances of succeeding are higher. Give your description a bit of a personal touch, e.g. the reason for starting your own business and choosing this particular industry.
Information to include in the description:
- name and logo of the company,
- organizational and legal form,
- short presentation of the owners,
- localization, type and scope of activities,
- contact details,
- company’s mission and vision statement,
- objects of the company,
- company history (if applicable).
Third – product or service description
This is one of the most important elements of business plans. It provides information about what the company provides, i.e. a product or service. Your reader can learn why your product or service are better than those available in the market and why they should invest in your business.
“The product or service description should be as true to the reality as possible. Do not sell dreams and do not stray from the truth. This approach is doomed to fail. Also keep in mind that the description should be as detailed as possible. Especially when the product is new. It will allow readers to visualize it”, says Rafał Wilk from Solutions.Rent.
See also: How to cope with stress?
Remember the “must haves” of a product or service description:
- characteristics such as: size, color, functions and technologies,
- product comparison against the competitors’ products,
- copyrights or patents (if applicable),
- statistics or opinions (if applicable).
There is no company without a boss and employees. This part of a business plan includes information about the management’s education and qualifications, organizational structure, headcount and remuneration. When drafting your management section, try to be as precise as possible.
Half of your success lies in good research. Getting to know your competition would often save you from making the same mistakes as they did. In this section, try to include information on the industry that you specialize in and the applicable trends.
“Good research should not only cover competition, but also potential clients – who are they, what problems do they have, how can we help them? What are their needs and expectations? – answering these questions can be very helpful”, comments Rafał Wilk.
Did you know?
When drafting a business plan, it might be a good idea to carry out a SWOT analysis. List all the weaknesses and strengths of the product or service. Don’t forget business risks and opportunities. SWOT may become the point of departure for creating a marketing strategy.
Sixth: marketing strategy
Obviously, sales are the main objective of your company, so you need to prepare a marketing strategy before opening your business. A sales plan that includes distribution channels, as well as forms of advertising and promotion will allow you to gain a real understanding of the product or services you provide and match your brand’s communications to recipients.
If you feel that marketing is not your area of expertise, let experts handle this section of your business plan. A professionally drafted marketing strategy will be the cornerstone of your business.
Read also: 8 mistakes made by entrepreneurs
The financial plan is the section of the business plan that investors pay the most attention to. Their priority is to identify the costs and estimated revenue of the company. It will also be a good indicator for you to determine whether your business will be profitable, or not.
Sections to include in your financial plan:
- monthly, quarterly and yearly sales plan,
- investment expenditures (own contribution, loans, subsidies),
- balance sheet – a breakdown of assets and funding sources,
- profit and loss account (revenues and costs).
A business plan may also include a schedule of activities, additional (visual, marketing) materials and products photos. Such documentation will clearly illustrate the development of your brand.
Looking for an office in Warsaw to implement your plan for a business? Click here and check out Solutions.Rent.