With any business, a roadmap is essential in order to set your goals and understand how to get to them. This is where a business plan comes in. This document lays out what the purpose of your business is, what you hope to accomplish, and how you plan to achieve success. The following components should be included in your plan. However, do not assume that you should be tied down to a hard and fast formula. Your business plan should be unique and tailored specifically to your company and your business goals.
Mission Statement and Vision Statement
Your mission and vision statement reflects the heart of your business, projecting your intentions and communicates your motivation. The mission and vision both work together to identify your business’ purpose and the value that this purpose delivers.
These components assert your company’s main objectives and the measures that reflect success. To write this statement, you must clarify the main idea of your business and the results you want to achieve. Once you have your mission statement, you can create a value statement that reveals the human value and benefits that your organization will deliver by achieving its mission.
Explain who you are and include the basics, such as background, location, founders, size and number of employees, actual or projected. Define what your business is and its functions. Describe how you will deliver your products and services and to whom. Include a market analysis that covers the industry you are entering. Make sure to display your knowledge of your business’ market and your competitors in this section. Provide a realistic assessment of your business with a discussion of strengths, weaknesses, challenges, and opportunities.
Unique Traits of Your Products and Services
Discuss your target market and how your products and/or services will meet the needs of these consumers. What need will your business fulfill that is not being met by others in this industry? Do you possess unique advantages that set you apart, such as a patent or innovative methodology? Do you and/or your management team have applicable expertise that can help you stand out in your industry and market sector? Discuss and highlight these and any other advantages you possess that are unique to your company and its products and services.
As they say, it takes money to make money. You must identify what starting capital you need to launch your enterprise. Include a personal financial statement and a forecast of long-term financial health. You can use personal credit to help launch your business but it’s important that you also detail your efforts and plans for establishing or building business credit. A business credit rating is an important part of running a business. Explore options like a business credit card, taking out a business loan, or even pursuing a revenue-based loan. You should also develop a cash flow projection and identify all your operating expenses.
Here you will expand on the target market that you identified in your “Products and Services” section with demographics and psychographic profiles. Explain how you plan to market yourself to your audiences. Identify your brand and how you will convey that brand to consumers. Discuss your marketing and promotional campaigns and specify a budget for these efforts. Make sure to cover both customer acquisition and retention. Discuss whether you will be performing these tasks in-house or outsourcing to a marketing company.
Operations and Management Plan
Addresses the mundane, day-to-day operations of your business in your “Operations and Management Plan.” It should detail management roles and the responsibilities that these individuals are expected to fulfill. Define your organizational hierarchy, identify the individuals involved in running the company, and provide a profile for each one. Be sure to touch on all the major areas – materials, labor, equipment, facilities, and processes. Detail the nitty-gritty in how you plan to meet all your objectives on a daily, weekly, monthly, and yearly basis.
It’s important to keep in mind that your business plan does not need to be complex or overly long. Cover the basics in a clear and concise matter while also telling the story and processes of your business. Your plan is also meant to be a living document so make sure as your organization grows and evolves, so too must your business plan.
Beth Kotz is a contributing writer to Credit.com. She specializes in covering financial advice for female entrepreneurs, college students and recent graduates. She earned a BA in Communications and Media from DePaul University in Chicago, Illinois, where she continues to live and work.