Are you looking to start a new business in the near future? If so, you’ll need to create a business plan. Whether your business operates locally or online (or both), it will benefit from a well-prepared business plan. The U.S. Small Business Administration (SBA) even says that business plans are the “foundation” of a business’s success. To create an effective business plan to fosters success, follow these five simple tips.
#1) Start With an Executive Summary
Although there are numerous ways to structure a business plan, you should typically begin with an executive summary. The executive summary is an opportunity to describe the general focus of your business and what it does. It doesn’t have to be particularly long. On the contrary, most executive summaries consume just a single page of a business plan.
#2) Detail Your Business in the Company Overview
While you can describe your business in the executive summary, you should go into deeper detail about your business in the company overview section. The company overview section covers all the small details about your business, including its location, history, market and even structure (e.g. LLC vs S-Corp or C-Corp).
#3) Highlight Products and Services
Of course, you should also highlight your business’s products or services in your business plan. According to the SBA, an effective business plan should explain how customers or clients will benefit from purchasing the business’s products or services. In other words, you should create an “elevator pitch” that promotes your business’s products or services.
#4) Reveal Current and Future Projected Finances
Financial information is an important element of an effective business plan. Most businesses require capital to get up and running. In your business plan, information about your business’s current and future projected finances. When you apply for a loan — or other forms of lending-based funding — you can give the lender a copy of your business plan. Assuming it contains your business’s financial information, it will likely have a positive impact on your ability to secure startup capital.
#5) Include a Market Analysis
Don’t forget to include a market analysis in your business plan. What is a market analysis exactly? This component of a business plan delves into your business’s target market. In other words, it reveals your business’s ideal, target audience of customers as well as their respective location.
Have any other tips on creating a business plan that you’d like to share? Let us know in the comments section below!