When launching a startup or looking to expand an existing business, it’s critical to describe your business and the products and services it offers. You’ll also need to determine how you’ll generate money from it, what financing options to consider, which advertising channels to leverage, and what its operating model looks like. All these details, including other information relevant to the business type, goes into a business plan.
If you’re new to the corporate world, you can easily miss out critical elements that make up an effective business plan. To avoid this, follow these tips to write a business plan projected for success:
1. Check Out Existing Business Plans and Use a Template
Instead of blindly developing an outline, try to find and go through already prepared business plans for reputable businesses. This should give you an in-depth idea about what a decent business plan looks like. When you’ve explored a good number of business plans, find a business planning tool or template that works best for you. You can easily find a free template online for a one-page business plan or a traditional business plan.
When considering a business plan template, closely examine its table of contents and determine which sections are relevant to your business. Then, move on to the index and assess how well it is organized. Also, study any charts or exhibits that might be included and consider whether your business plan can benefit from similar figures for data.
2. Conduct Market Analysis
Regardless of the industry you’re operating in, market analysis makes a critical section of your business plan. This is because every decision you make will take the market dynamics into account, including new opportunities, threats from competition, and the tastes and preferences of your ideal customer.
When conducting your market analysis, determine an estimate for the market size for your niche, what the competitive landscape looks like, and an evaluation of your organization’s standing in the industry. Include all these details in the market analysis section of your business plan, backing your conclusions with facts and data.
3. Understand Your Audience
One of the most valuable tips to write a business plan is to understand your audience first. We’re not talking about the target market of your business here. The audience of your business plan includes people who will be reading it. These can include a business partner, a board member, a bank manager who may want to study the plan before approving your loan application, a potential investor before offering funding, and so on.
Once you’ve understood your audience, think about the type of questions those people may ask. If you are looking forward to pitching to a venture capitalist or a banker, think like them and be prepared to answer the questions they’re most likely going to ask. Similarly, if you wish to partner up with another organization, focus on how the collaboration or partnership can create a win-win situation for both the businesses.
Plus, no matter what type of audience you have, you must be able to clearly communicate your value proposition as well as demonstrate that your plan develops your business idea into a profitable and sustainable business.
4. Include Your Marketing Strategy
Your marketing strategy forms a critical component of your business plan that builds upon the market analysis section. Apart from defining where your company fits into the market, it clarifies who will promote, sell, and price your product or service.
When creating your marketing strategy, focus on what differentiates you from others in the market or your USP (unique selling proposition). All four 4Ps of marketing, including the product, price, promotion, and place should strongly relate to your USP.
Using the research conducted during your market analysis, include in your marketing strategy what your ideal customer looks like and what they need and expect. On top of that, base your pricing strategy on insightful data from industry reports, comparisons, and competitor ads.
5. Use Visual Elements
Try to include graphs, images, charts, and other graphic content in all sections of your business plan. These illustrations should make your plan easy to digest for your audience. For example, you may want to present a step-by-step process in the form of a process chart, use a matrix to present your SWOT analysis, or a graph to unveil any numerical data.
6. Obtain Feedback from Experts
If you’ve developed a business plan for the first time, we recommend testing your developed business plan by having it inspected from industry leaders, other successful entrepreneurs, or even potential customers in your target market. They won’t just share their thoughts on the presentation and comprehensiveness of your business plan, but also offer insights into how viable the business is likely to be.
When you approach the experts, ask what they think about the business idea, who they think are you targeting, and whether or not your target audience will consider buying what you’re selling. There answers will not just help you improve your business plan but also make better business decisions.
7. Keep Reviewing and Updating the Plan
In today’s fast-paced business landscape, you can’t keep relying on a business plan you developed years ago. To adapt to the changing market dynamics and tech innovations, your business plan should also evolve. Your assumptions and strategies may also change over time to better capture the market share and respond to competitors’ activity. Hence, you must review and revise your plan from time to time to accommodate your learning as your business grows.
Now that you have a fair idea about how to write a business plan, it’s time to get practical. Whether you’re planning a business launch, wish to diversify your product portfolio, or want to grow your business beyond national boundaries, developing a business plan is a great place to start. We hope that this guide helps you develop a solid business plan.