{"id":289,"date":"2020-01-11T12:45:29","date_gmt":"2020-01-11T12:45:29","guid":{"rendered":"https:\/\/paytowritepaper.com\/blog\/?p=289"},"modified":"2024-08-14T09:10:41","modified_gmt":"2024-08-14T09:10:41","slug":"write-a-business-plan","status":"publish","type":"post","link":"https:\/\/www.paytowritepaper.com\/blog\/write-a-business-plan\/","title":{"rendered":"Write a Business Plan: a Roadmap for Everyone"},"content":{"rendered":"\n<p>The purpose of the college education is to\nhelp students to become an all-around and conscientious people, and also to\nprepare them to the life where they need to find jobs, make career, and run own\nbusiness. That\u2019s why one of the usual college tasks is to write a business\nplan. <\/p>\n\n\n\n<p>This document is necessary every time you\nhave to deal with significant values of time, money and other resources to\nmanage them properly and make everything running efficiently. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">The Essence of a Business Plan<\/h2>\n\n\n\n<p>A business plan is a guide that describes\nthe way you want to run and cultivate your business. It is a general definition\nwhich in the real implementation will cover the following ideas: <\/p>\n\n\n\n<ul><li>Business purpose, strategy, and\ntactics;<\/li><li>The structure of your business;<\/li><li>Analysis of the marketplace<\/li><li>Cash flow projections;<\/li><li>Working plans with the\nmilestones and specific dates;<\/li><li>Financial plan which will\nprovide essential values and numbers on sales and expenses. <\/li><\/ul>\n\n\n\n<p>And the skill to write a business plan\nproperly can hardly be overestimated. <\/p>\n\n\n\n<p>You have to provide a business plan for the\nbusiness loan application, as it has to support your intentions. Also, you have\nto present it to the investors when you open a new business. And you absolutely\nshould have and constantly update the business plan when you already run your\nbusiness to be ready to face new challenges.<\/p>\n\n\n\n<p>Thus, we have created this article to help\nyou to write a business plan which will suit any of your purposes. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Requirements for a Good Business Plan <\/h2>\n\n\n\n<p>While it was considered before that this\ndocument must be long, detailed, and very formal, nowadays most businessmen\nprefer shorter laconic business plans. There are very short examples about one\npage long, but this is not often. <\/p>\n\n\n\n<p>An average business plan is about 5 to 10\npages long, and this is enough to cover all the required benchmarks concerning\nthe strategy and the tactics of business development.<\/p>\n\n\n\n<p>The shorter business plans have more\nadvantages: <\/p>\n\n\n\n<ol><li>They are more convenient for\npotential investors, as they would not like to dig deeply into dozens or\nhundreds of pages of text.<\/li><li>They are better for your own\nbusiness, as you will track your efforts and results, and it is easier when you\nhave clear and laconic concepts with understandable means of tracking and evaluation.\n<\/li><\/ol>\n\n\n\n<p>A successful business plan must meet the\nfollowing criteria:<\/p>\n\n\n\n<ul><li>Compliance with the purposes\nand needs of your business. <\/li><li>Practical feasibility.<\/li><li>The possibility to track and\nestimate the results of its implementation. <\/li><li>Definition of responsibilities.\n<\/li><li>Clear understanding and\nidentification of assumptions and risks. <\/li><li>Readability \u2013 it must present\nthe information properly to the audience you target. <\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">How to Write a Business Plan with the Correct Structure<\/h2>\n\n\n\n<p>Your business plan is a very practical tool\nthat must help you to achieve your targets in the business. Even if it is a college\nassignment only, you will need to research a lot of materials and create a\ndocument with the required components. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Executive Summary<\/h3>\n\n\n\n<p>This is a relatively short (1-2 pages)\npiece of the document that must include the basic information about your\ncompany, your scope, your tasks, and your needs. You may consider the executive\nsummary to be a very brief Introduction aimed to grasp the attention of the\nreaders and present the main ideas of the full business plan. In most cases,\npotential investors demand the executive summary only to get familiar with your\nplans and decide whether they want to discuss the possibilities further. If you\nmake them interested in the executive summary, they will ask for more\ninformation and proceed with the negotiations.<\/p>\n\n\n\n<p>The executive summary must also include\ncertain obligatory elements:<\/p>\n\n\n\n<ul><li><strong>The business overview<\/strong> \u2013 a one-sentence description of your work and its aims.<\/li><li><strong>Problem<\/strong> \u2013 the challenge which inspires you. It is mostly the description of some users\u2019 needs which you might satisfy with your products.<\/li><li><strong>Solution<\/strong> \u2013 the products or services which you develop. Explain how it can resolve the problem.<\/li><li><strong>Target market<\/strong> \u2013 description of the customer you create the product for. Note that it is crucial to be specific when you describe the customer. It is impossible to succeed if you target a vague audience.<\/li><li><strong>Competition<\/strong> \u2013 the explanation of other solutions which are present at the moment and their strong and weak points. Here you should briefly explain how your product would overplay the competitors. <\/li><li><strong>Company overview and team<\/strong> \u2013 it is a brief description of your team members. Here you should stress why you are the best people to perform the task. <\/li><li><strong>Financial summary <\/strong>\u2013 it is, perhaps, the most important part of the executive summary. Here you need to provide your calculations concerning the expenses you plan, and grounds you base the profitability estimation on. <\/li><li><strong>Funding requirements<\/strong> \u2013 here you should define how much money and\/or other resources you will need to implement your idea. <\/li><li><strong>Milestones and traction<\/strong> are the required conditions for the investors to understand if you have an idea only, or you already made some progress. Also, this allows tracking your further results, as they will know what and when you plan to do and what aims you want to reach. <\/li><\/ul>\n\n\n\n<p>Concentrate on the essence only in this\npart. If your investors get interested, you will provide them with the details,\nand you will negotiate the rest of the conditions.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Opportunity<\/h3>\n\n\n\n<p>This section contains detailed information\nabout the problem which you are going to solve. You have already defined it\nbriefly in the executive summary, and now you have to describe your product in\nthe context of that problem.<\/p>\n\n\n\n<p>Your task is to explain what exactly your\nproduct does and how its functionality is applied to the problem on the market.\nThis information should not puzzle your readers or listeners, because they already\npossess some basic understanding thanks to the executive summary. Here you will\nexplain the details more about the case and refer to the additional factors\nwhich you had to omit in the \u201cIntroduction\u201d. <\/p>\n\n\n\n<ul><li><strong>Provide the competition analysis:<\/strong> will you be the pioneer on the market, or you will have to fight for the place? Who are your current main competitors, which are their strongest sides? Do their products have faults, and which? <\/li><li><strong>Present your trumps:<\/strong> which advantages does your product have to overplay the competitors? How are you going to offer your product on the market? How will it resolve the problem? Refer to a real example of a user who faced that problem and was able to get rid of it with the help of your product. <\/li><li><strong>Describe the target market of your potential customers.<\/strong> You need not only to explain the ideal customer who will pay for your product. It must be very specific: you need to discover their age, gender, jobs, hobbies, personal preferences, etc. At the same time, you should already have an understanding of the size of this market. This will estimate your sales and profit. And if your potential audience is very small, it would not motivate the investors, unfortunately.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Execution<\/h3>\n\n\n\n<p>This part of the work precedes the creation\nof the business plan. The Execution part should cover the thorough\ninvestigation of the market, understanding your buyers and competition. The\nresults of this analysis are provided in the previous section, and here in the\nExecution section, you should formulate which place your company takes on the\nmarket and in the current competitive environment. Also, you need to state how\nexactly your business is different from the alternatives, and which features\ncan help you to attract the customers.<\/p>\n\n\n\n<p>The obligatory elements you have to include\nand illustrate in this part of your business plan are the following: <\/p>\n\n\n\n<ul><li><strong>Pricing model.<\/strong> It will explain how you project your product or service on the market, for instance. Here both the investors and your future consumers can see what sectors you target your product towards, and how profitable it can be. Setting the prices bases on experience and thorough marketing research, but there are some general rules as well:<\/li><li><strong>It should cover your costs.<\/strong> You should think of additional sources of profit, a several-components model. Say, you may choose the subscription model with cheaper, but regular charges instead of the one-time purchase. <\/li><li><strong>The longer-term model of relationships with your customers<\/strong> can be more profitable. The pricing should meet the marketing criteria and the customers&#8217; expectations.<\/li><li><strong>Promotion.<\/strong> Here you need to give your plans for the promotion methods you will use. There will be an ads campaign, building your team&#8217;s presence in social media, etc. In this area, you should define how much money you are going to invest in promotion strategies, and which income you think to obtain.<\/li><li><strong>Technology.<\/strong> This entry may confuse you, as it can be connected with the intellectual property and business secrets issues. But you don\u2019t have to reveal them. Just explain how you can prevail over the rest of the contenders. <\/li><li><strong>Distribution<\/strong> \u2013 here you need to define how your product will get to the consumers. Simple, fast, and convenient delivery is a great advantage if you are a product company. In case you provide service, and the distribution is electronic, you may just mention this and don&#8217;t go into detail further.&nbsp; <\/li><li><strong>Milestones and metrics.<\/strong> The section includes the definition of the key steps and planned achievements. These data are required to evaluate your progress and see if you are moving in the right direction. It can be brief, but it must be present for the investors to understand how realistic you are. <\/li><li><strong>Key assumptions and risks.<\/strong> It is a crucial part of the plan, as any business has its risks, and you have to consider how you can react and minimize the negative effects. <\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Company and management summary<\/h3>\n\n\n\n<p>A well-known \u2013 and truthful \u2013 idea is that\npeople are the key, not the technology itself. Investors give money and\nresources to the people, so they need to be sure there will be the right\npeople.<\/p>\n\n\n\n<p>Give brief information about your company \u2013\nits location, history, and legal structure. Then give more information about\nyour team.<\/p>\n\n\n\n<p>Compile a short profile for the members who\nwill work on the tasks, specify their level of expertise, mention the\nachievements. It is important to include references to the similar projects\nyour team members worked in the past and succeeded, as it makes you look more\nreliable for the investor. <\/p>\n\n\n\n<p>It is great if your team already has all\nthe experts you need. However, it is not a problem if it lacks someone right at\nthe moment. Just describe the job requirements and mention that you are\nsearching for people possessing the appropriate skills.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Financial plan <\/h3>\n\n\n\n<p>As you deal with money, you must write a\nbusiness plan in such a way that it covers all financial questions on profits\nand expenses. Usually, a financial plan includes the forecasts for the initial\n12-months period with the monthly break-down, and then plans for the next\nseveral years, with more general numbers for the total annual profit and\nexpenses. Most business plans have three-years financial plans, but in some cases,\nfive-year plans are required.<\/p>\n\n\n\n<p>Investors demand these plans to see how\nmature your team is and how serious you are in your business approach. Besides,\nthis part is a part and parcel of the data from the \u201cOpportunity\u201d and\n\u201cExecution\u201d parts. The projections you offer must be grounded on the market\nresearch. <\/p>\n\n\n\n<p>The following metrics are obligatory for\nthis document: <\/p>\n\n\n\n<ul><li><strong>Sales forecast<\/strong> \u2013 how much you are going to sell. If you implement a complex model with separate prices for the product, maintenance, additional services, etc, then you should mention all these items. However, you should not go into details here, give your general views. <\/li><\/ul>\n\n\n\n<ul><li><strong>Personnel plan <\/strong>\u2013 how much you will pay your employees. If you are a small team, mention each person, and for a big company, you can mention the departments only. Besides, you should include additional costs which are not included in the salary directly. There are different taxes, compensations, and insurances that you pay as the employer, for your team.<\/li><\/ul>\n\n\n\n<ul><li><strong>Income statement or Profit and loss statement<\/strong> \u2013 the section where you can specify all your profits and all expenses and put them together. This should provide the most objective picture of your planned growth and profits. This is the section where you must show the balance for each month and define when it is going to be negative, and when it will turn to positive, and how quickly you will grow. <\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Appendix<\/h3>\n\n\n\n<p>It is an optional closing chapter, where\nyou put notes, charts, detailed calculations, etc. You may not compose this\nchapter at all, however, if you have some data remaining which you consider\nbeing useful, and you could not put them logically and naturally into the\nprevious parts, then use the Appendix.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Some Useful Tips for Writing the Business Plan<\/h2>\n\n\n\n<p>When you gathered all the necessary\ninformation, formulated your statements and calculated the numbers of profits\nand losses, you can start to write a business plan. And here we have some\nadditional recommendations for you. <\/p>\n\n\n\n<ul><li>Don&#8217;t start with the\n&#8220;Executive Summary&#8221;. This chapter is the brief restatement of your\nfull business plan, so, you need to have it completed first. The correct order\nwould be: write a business plan, revise it, and then compose the executive\nsummary. <\/li><\/ul>\n\n\n\n<ul><li>Use the Roman Numeral order for\nthe sections.<\/li><\/ul>\n\n\n\n<ul><li>Check the document for mistakes\nafter you complete it. Do it several times and make sure that your spelling and\ngrammar are impeccable. Besides, double-check all numbers and calculations you\npresent in your business plan, wrong numbers will ruin everything at once and\nfor good. <\/li><\/ul>\n\n\n\n<ul><li>Re-read the document and check\nhow it &#8220;sounds&#8221; for the reader. Did you clear all doubtful moments?\nHow did you present the team members? Did you stress the benefits in such a way\nthat people on the other side would catch your ideas?<\/li><\/ul>\n\n\n\n<ul><li>If possible, let your trusted\nfriends or relatives read your business plan too, as they will have &#8220;fresh\neyes&#8221; and can notice issues you might miss.<\/li><\/ul>\n\n\n\n<ul><li>Read the document aloud. There\ncan be fragments that you might not notice when you write a business plan, but\nthey will seem awkward and become obstacles when someone listens to the text. <\/li><\/ul>\n\n\n\n<ul><li>Add a cover page. It should be\nsimple: just define the type of the document (business plan) and add the name\nand logo of the company and contact details. <\/li><\/ul>\n\n\n\n<p>The task to write a business plan is\nundoubtedly a serious task which demands much effort. However, it is a standard\ndocument with its definite requirements and specifications. You should not be\nfrightened by this task, as you are an expert in your sphere, and you only need\nto present it properly. Now that you know how to write a business plan\ncorrectly, you can, by all means, do it.&nbsp;\n<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The purpose of the college education is to help students to become an all-around and conscientious people, and also to&#8230;<\/p>\n","protected":false},"author":2,"featured_media":355,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/posts\/289"}],"collection":[{"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/comments?post=289"}],"version-history":[{"count":3,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/posts\/289\/revisions"}],"predecessor-version":[{"id":356,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/posts\/289\/revisions\/356"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/media\/355"}],"wp:attachment":[{"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/media?parent=289"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/categories?post=289"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.paytowritepaper.com\/blog\/wp-json\/wp\/v2\/tags?post=289"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}