Why do you need a Business Plan?

Making sure you have a well-structured Business Plan may seem obvious, but why is it so important? Here are some reasons:

• Optimize your strategies. Defining goals and identifying your target market will help you discover future trends that could harm your business or make it take off;
• Give you direction. A Business Plan can help you organize your ideas so that you can understand what the objectives to be pursued are, what the priorities are and how to move;
• Convince investors. Investors want to see why they should invest their time and money in your business, and above all, they want to know whether or not they could make a profit. The Business Plan is the perfect tool to do this;
• Securing a loan. If you are looking to secure a loan from a bank, and the lender does not already apply for it (which they usually do), you can strengthen your loan application by attaching a copy of the Business Plan;
• Create strategic alliances. The Business Plan is often used to communicate specific company projects and find potential business partners;

Selling your business. In case you are discussing the acquisition of your Startup, the Business Plan could be of fundamental importance to help the buyer better understand your business’s value and, therefore, the price of your business.

Preparing business plan is must because without it you cannot achieve your desired goal.

If you to have an exceptional business plan that can help you to outrank your competition and you could achieve your desired goals then you must hire best business plan writers.

THE KEY COMPONENTS OF A BUSINESS PLAN

If you approach the Business Plan creation with a solid understanding of the key information to include in each section and how each section works to form a coherent, compelling and persuasive project, then the Business Plan creation process will be less painful. You expect!

For this reason, we will now focus on analyzing in depth every single section that usually makes up a Business Plan.

1 – Operating Summary

Think of this section as a trailer for a great movie. A well-made trailer gives you a basic understanding of what the movie will be about and prompts you, with hilarious scenes, to go deeper into watching the full movie. In the same way, the operational summary acts as an overview of the main aspects of your company, showing synthetically the aspects you will go into later. Remember, you are not giving all the precise details about your company and business model. Instead, you provide enough to inform but intrigue the reader, prompting them to investigate further.

The operational summary will be the first Business Plan document to be read, and first impressions are worth more than everything else. So, if we can give you some advice, write this content last. Then, after completing all the other sections, you will have a better overview and all the necessary information.

A good working summary should contain a reminder of these topics:

• Corporate mission: consists of a statement that introduces the reason why the company exists, what it does for its customers, and why it is important;
• Summary of products/services: that is a brief description of the product catalog, or the services offered, with particular attention to what makes them unique;
• Market Opportunity Summary: consists of a quick explanation of one or more key problems (or trends) your product/service faces and how this can translate into a great opportunity for your business and consequences for potential investors;
• Traction summary: highlighting the goals achieved and showing how these goals represent the “foundations” for what is to come;
• Next steps: this section outlines the next objectives or goals that you want to achieve and how these affect the growth of the company;
• Vision consists of the declaration of the company’s purpose and the “overall vision” of the business you are building. If you’re in the fast food business, are you aiming to be the next McDonald’s? In other words, how big will this company be and why would an investor be excited to be a part of it?

2 – The Company Description

In this section, you’ll need to give readers a deeper look into your business and its offer. Before your readers worry about things like marketing strategy or the financial aspect, they will want to know two FUNDAMENTAL details that will shape the rest of the Business Plan:

• What painful PROBLEM are you solving for your customers? You may have the most revolutionary product ever seen on the face of the earth, but if you don’t take the time to articulate why your product exists and what problem it can solve, your Business Plan will be a complete failure. Nothing else counts at this point in the eyes of the reader. Create a compelling story around the problem, conveying to the reader how painful this problem is. In this way, when you show the solution, it will be even more engaging;
• What incredible SOLUTION do you propose to solve the problem? Once you have fully explained the problem you intend to solve. It is time to tell readers how your product/service is the perfect solution to the problem. The goal here is not to describe the functions of your product (which will happen later) but to communicate how the solution relates directly to the painful problem you described earlier. Here you should consider some key questions:

• • What is the product/service you are offering?
  • How is it able to solve the customer problem?
  • How does my product/service solve the problem more effectively than other solutions already on the market?

3 – The Description of the Products

In the previous section, you highlighted why your new product offers value to customers by analyzing how it solves their problems. Now is the time to explain in more detail how your product works. It might seem the same, but it’s not the case! Here are some key questions you need to ask yourself at this stage:

• What are the main features of your product?
• How will customers use your product?
• Is there any technology behind the product that you will need to explain to readers to allow them a full understanding of your business?

4 – Market Analysis

In this regard, we have written an entire dedicated article and, given its importance, we recommend reading it to better understand the topic! Furthermore, if you are interested in this topic, another article, ” How to identify and contact your target customers, “relating to the identification of the customer, may also be useful.

5 – The Marketing Strategy

Now that you have established who your customers are, the question you need to ask is, “how do I plan to reach them?”. This essentially refers to your marketing plan, where you will define the details of how you intend to build your brand and expand your customer base.

You will then need to identify the best channels to do this:

• Direct sales or through resellers;
• Online acquisition: through paid ads, SEO, social media, email marketing, and affiliate programs;
• Offline capture: via newspapers, radio, TV.

Each channel has a customer acquisition cost, and your job at this stage is to predict and track the cost of each channel. We would like to underline that each channel has a cost, and it is good to specify it. Yes, social media has a cost too!

In this way, you will be able to obtain an initial budget to quantify the overall costs deriving from the different channels chosen.

For more information you should visit business plan consultants.

6 – The Management Structure

In this section of your Business Plan, you will have to present the team and, if possible, indicate each team member’s background. This is because it is fundamental for the achievement of the success of a Startup! As with all other points, you will only have to enter the relevant information here. Investors will probably not care about your degree in art history if you are developing a delivery app.

Each member’s bio should include:

• The name and surname;
• The position in the company;
• The professional and academic background (if relevant);
• Any skills developed in experience.

7 – The Revenue Model

Here you will have to answer one of the most important questions for every entrepreneur “How will your company make money?”. If you’re just starting, clearly defining how and what your income will be quite difficult, but showing investors that you have a superficial idea of ​​how you will convert your product or service into sales is crucial to gaining credibility. In defining this model, we recommend that you focus on a few points:

• Entry channels;
• Prices;
• Intermediate margins.

8 – The Operational Plan

The operational plan refers to how resources will be managed to ensure that revenue can be guaranteed.

For this section, we recommend that you focus on a few points:

• Critical costs: those costs that could put your business on the ground if not managed correctly. These essentially determine your ability to achieve profitability and grow the business;
• Operational efficiencies: Here, you will need to explain what you can do from an efficiency standpoint that no one else can do. It could be the way you manage to hire young talent or the way you manage the costs of customer support.

9 – Financial Analysis

We have finally come to the part least loved by Start uppers: The Financials or financial model!

Here you will have to present the various spreadsheets, tables, graphs, and tools. That communicate to readers your company’s financial (and non-financial) projections in the coming years. Although this part is mainly quantitative, don’t forget to give a short introduction in which you show how you arrived at these numbers.

Some recurring elements in this section are:

• Income statement: to show revenues, costs, and profits of a certain period, thus showing whether your business is profitable or not in a certain period;
• Balance sheet: showing what are the sources of the capital and the commitments;
• Cash Flow Projections: Estimating the amount of money that goes into and out of the cash register. The cash flow projection will give you a good idea of ​​what the return on investment will be;
• Break-even point: As you can imagine, the break-even point analysis will help you determine the volume of sales for which total revenue will equal total expenses. Put simply, the time when your profit will be equal to 0.

CONCLUSIONS

Now that you are ready to roll up your sleeves and finally start writing your Business Plan. You can refer to this outline, customizing the various elements according to your specific business. You can also If you need a hand in realizing your Business Plan. Contact us, and we will arrange a video call to help you: info@mbplans.com.

Click here to read more articles.