Do you have these 7 components in your business plan?
A business plan is one of the most important piece of document that helps entrepreneurs take decisive action.
A lot of businesses consider drafting a business plan. However, many businesses skip this step completely. This simple step can cause a lot of frustration when their business does not scale as per their plan.
So, what is a business plan?
It is a formal document outlining the goals, vision, mission statements, finances, team, and future planning of your businesses. A business plan is written for various needs such as funding, growing the team, scaling up to meet new market etc.
In addition to this, a good business plan helps with the company’s growth and serves as a guiding light in times of need. This piece of document helps decision makers with the right plan to facilitate intentional growth.
Must have 7 components in your business plan
Writing a business plan must not bog you down and take up so much time that you feel exhausted at the end of the day. Make sure you add these 7 components to create a fulfilling and effective business plan.
1. Executive summary
Introduce your company, and write the purpose of the business plan. As I mentioned earlier; every business plan will not address the same challenges. Your business plan might be drafted for funding, a few others might use it align their goals and their team. So, make sure your executive summary contains the purpose, a brief introduction and an overview of your business’ financial health
2. Company description
This section is dedicated to introduce your company. Be as detailed as possible. Include your business vision, mission, financial worth, new trends that you might be following, your product and services; their future. Make sure you add relevant data and statistics to give an accurate picture of your business well being. Don’t forget to talk about your business USP.
3. Market analysis and opportunity
This component is very important and time must be spent on research and analysis. If you understand the size, growth, history of the market, you will be able to identify the opportunity. Don’t forget to add any and all data of your target audience.
4. Competitive analysis
Analyzing your competitors and what they do will help you plan your strategies better. Make sure you provide an in-depth analysis of competitors such as their financials, history, team, distribution channels etc. Now, with these information in hand you can compete with your competition easily.
5. Execution plan
This is the most important part of your business plan- the plan to execute the work necessary to achieve your objective. It will include the operations, development, and management aspects of your business. Add in-depth information about your operations, your team, plans and strategies. Outline the time required for the changes. And if you are planning to scale into different markets, don’t forget to add that information as well.
6. Marketing plan
Another important part of your business plan is the marketing plan. This plan must contain a comprehensive strategy to scale or kick off operations. This section should be shared with your investors and stakeholders so that they know how you are going to promote your business and how you are planning to build brand loyalty.
You can also include your brand message, your time and the budget you have allotted across different marketing channels. This section can also include SWOT analysis to identify your opportunities and weaknesses.
7. Financial history and projections
The final component of your business plan is the finances. IT is important to showcase all finances that you will be using to run your company. This detailed breakdown will help investors and stakeholders understand your progress in terms of generating revenue.
Income statements, annual net profit/loss, cash flow statement, balance sheet are a few of the documents that will be added to your business plan.
Always remember that each business has a unique business plan.
It is not merely there for others but to help you make sense of your ideas and take necessary steps to reach your goal. After all, you are investing time, money and resources to make it work. So, create a business plan that will help you reach those goals.