How to write a business plan

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The business plan is a fundamental document for every business activity, from the simplest and most traditional to the most complex and innovative. A document that describes the business idea and the program for realizing the idea itself. Simplifying, we can say that the definition of a business plan is: a description of the future of a specific business.

The business plan has multiple functions and can be of fundamental help. Both for those who draw it up and those who read it, in carrying out a series of strategic and managerial tasks. For example, it can be useful for entrepreneurs looking for investments to convey their vision to potential investors. It can be used by businesses that are looking to attract key employees. (E.g., a marketing manager of a major company, a senior sales manager, a specialist workshop manager or a renowned chef). To find new business partners, negotiate with suppliers, etc… But the most shared, central and often underestimated function is the management one. That is, to understand how to best manage the business.

In summary, the business plan conveys the company objectives. The strategies that will be put in place to achieve them. The potential obstacles that could create difficulties and the possible ways to solve them. The detailed organizational structure of the activity, and, finally, the necessary capital. Then, finance the company and the time needed to break even and start producing profit.

How long should the Business Plan be?

One of the first doubts that arise when starting to draw up the first usually concerns the length and composition of the document.

A complete , which is the most complex form, consists of at least the following nine chapters or sections:

  • Executive Summary
  • The description of the company
  • The description and illustration of the products or services
  • The analysis of the sector
  • Market analysis
  • The marketing strategy
  • The management structure
  • The implementation plan or operational Plan
  • Financial analysis: necessary capital and financial information

The length of the document may vary from a single page to a hundred in the case of very complex businesses. On average, a will consist of 15 – 20 pages, but as anticipated, wide variations from the norm are possible.

Much will therefore depend on the nature of the business and its purpose. For example, suppose the refers to a “simple” activity (e.g., a stationery shop or an artisanal thermo-hydraulic activity), and the goal is purely that of management. In that case, it will be possible to summarize everything in 3-4 pages. On the other hand, if you are planning to launch a new type of innovative business or even a new industry or a particularly complex business and the goal is to find financiers worth several million euros, the document will require a description. More extensive and detailed.

You should hire our business plan writers for a long-lasting and outstanding business plan.

Who needs a business plan?

To date, the only person who does not need a business plan is someone who does not conduct business. But, at the same time, any activity at any stage of life, of any extent that consumes significant resources (money, energy or time) and which should return a profit, you should invest some time to come up with your Plan.

Startup

The business plan is usually the typical document that occupies the mind and time of the entrepreneur looking for funds to start a new business. However, many large companies had seen their birth on paper before even a single euro was spent on their startup. In this case, the Plan is often useful to convince investors (be these individuals, venture capitalists or banks) to invest the capital necessary to give life to the project described in the business plan.

Most business planning books and guides are often aimed at this situation. For startups, drafting the business plan is also fundamental to analyzing, designing and refining the business idea in the best possible way, understanding its risks and opportunities. However, it is a mistake to think that only new businesses need a business plan. As already mentioned, the business plan is useful in all phases of the company’s life. Whether the purpose is to find the starting funds or whether you are trying to understand how to invest a surplus of capital.

Companies already started

Another typical case in which a lot of time is spent on the production of the business plan is the activities already started. Which after a few years of activity, are approaching a turning point in the growth of the business. And need to analyze and plan the steps which will lead the business to “scale” and expand. A business plan in this phase allows the management of the existing and, above all, serious analysis and growth planning.

Companies that are in an intermediate stage. And are ready to take an important step may also need to find funding to speed up the process. In the case of multiple purposes, depending on the purpose. It may also be useful to have different versions of the Plan.

How often should the Business Plan be updated?

There is no practice regarding the periodic updating of the business plan, but undoubtedly some obvious cases can be identified that more than others suggest the time for an update.

  • Perhaps the most recurring update is that linked to financial periods. It is essential to update the annual Plan by aligning it with the new objectives and resources. If the sector in which you are operating is rapidly evolving, the Plan could be half-yearly, quarterly or monthly.
  • The need to find funding is a key moment for the drafting and updating of the business plan. Lenders and lenders need and usually require an updated plan to make funding decisions.
  • Significant market changes, e.g., a new competitor. A change in customer tastes, regulatory changes, etc., can strongly influence the fate of a business. An update of the Plan in these cases allows you to update your vision on the market. And on the reality in which you are immersed.
  • When you are in the process of developing a new product, technology or service, updating the business plan is not a choice, but a duty! It is essential to ask how the novelty affects the company, its activities, projects and offer.
  • Another topical moment coincides with the management changes. New managers or partners should get the most up-to-date information on the company and its objectives.
  • Finally, it will seem trivial, but redoing the business plan when it no longer reflects reality is one of the conditions most underestimated by companies.

So which business plan is right for me?

Business plans share many things in common and some goals. But as already mentioned, business plans are not all the same and depending on the activity in question and the purpose of the Plan, it may be necessary to choose one type of business plan rather than another.

The choice of the type of top is very similar to that of a dress, and each occasion requires a specific one. The top can vary greatly in length, appearance, depth of detail and the point of view or accents placed on the various details.

There are roughly three distinct types of business plans:

  • Mini Plan: usually short and dry.
  • Worktops: typically, more voluminous and detailed.
  • Presentation plans: the business plan typically used to be exposed to potential lenders, partners, collaborators, stakeholders, etc…

The Mini plan

The mini business plan is usually very concise, can reach a maximum of ten pages and includes at least: the idea and description of the business, the financing needs, the marketing plan and the operational (implementation) Plan. In addition, providing an in-depth analysis of the management of incoming and outgoing cash flows and, therefore, company liquidity and the budget projection can be very useful.

Without a doubt, the mini Plan is perfect for quickly analyzing a business idea or for measuring the interest of a potential partner or minor investor. However, it can also be useful as an introduction or prelude to a complete business plan which in a preliminary phase can be excessively onerous both in production and reading.

For more information you should visit business plan consultant.

The work plan

The so-called “working plan” is a typical business tool. Usually, this type of business plan is particularly voluminous and can reach several dozen pages in the most complex cases.

The working Plan is mainly for internal use. It must go in-depth without neglecting details, but the exposure must know how to be dry and direct. It may therefore be functional to present each topic concisely. Even if complete, referring each section to annexes and in-depth chapters, creating a complete, in-depth but easily accessible document.

The worktop usually does not require particular aesthetics or display frills. On the contrary, it is a management document created for the company itself, it is like the mason’s trowel or the van for the carrier, it was not created to show off but to be used!

The Plan for the presentation

If you take the work plan, clean it from the technicalities and the informal approach. And complete it by giving it a more business cut in the language used and in the exhibition. We will have a perfect business plan ideal for presenting your company to bankers, investors or similar.

In drafting this type of Plan, it is, therefore, necessary to keep in mind that the recipients will not be familiar with the operations or specific products. Still, they will certainly be very familiar with economic and financial management. To convince the interlocutor. Therefore, necessary to speak his language in order to break down any possible communication barrier.

The work plan is closely linked to the more practical activities of the company. And the plan for a presentation, therefore, requires additions. For example, it will be necessary to include a complete, honest and rigorous analysis of competitive threats and risks, followed by potential solutions.

It is important to remember that this business plan is specially designed to convince and grab attention. Therefore, not only the obsessive care of the contents but also of the form and presentation is fundamental.

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