How To Create A Business Plan For Your Business

A business plan is a breathing document that maps out the details of your business. In this article, you will learn how to create a business plan.

A business plan covers what your business will sell; its structure, what the market looks like, how to sell the products and services, the funding needed, what the financial projections are, the permits, leases, and documentation that would be required.

Let’s help you write your business plan.

A business plan will help you get funding or bring on new business partners. Investors want to feel confident about a return on their investment and a business plan is an especially relevant tool for convincing people that investing in you is a smart choice.

It’s not a hefty document hence we cannot be reluctant in making one. The business plan is actually a simple tool to achieve and manage business growth. It is used to define business strategy, goals, deadlines and budget. There are many business plan templates online.

That is why it is important that you learn how to create a business plan. Our purpose for this content is to teach you how to create a business plan that will get you the result you want.

See Also: Purpose for writing a business plan.

Tips When Creating A Business Plan

Research

Before you create a business plan, you have to decide on the structure, marketing strategy, and finance for the business. This information makes your analysis and forecasts more likely to be accurate.

Determine The Purpose Of The Business Plan

Decide whether the plan is to be used internally, by third parties, etc. This helps in determining what sort of information to concentrate on. It’s important that you determine what sections of the business plan are relevant to your business before starting the business plan preparation.

Seek Help

Get professional help for your business plan if you aren’t confident in preparing it. While you have help, pay attention too, because it is important that you understand the contents of your business plan and can defend it.

Take Note Of Actual And Estimated Figures

When you are starting a business, and you are using expected figures, you need to communicate that properly, so as not to mislead investors. Of course, if you are already running your business, you should have actual figures.

Write The Executive Summary Last

I suggest this and in as few words as possible since a page summary filled with important information is enough.

Narrow Down What Makes You Different

Before creating a business plan, think carefully about what makes your business unique. Differentiate yourself from the numerous other same-products or service businesses in your area.

Keep The Business plan Short And Format For Easy Skimming

Business plans are shorter and more concise than they used to be in the past. Don’t include all the results of your market research, for example. Keep these details elsewhere for your own use or in the appendix. Formatting is important, therefore use headers and bullets and italics to highlight key information for the readers.

You Can And Should Change It As You Go

The business plan is a living document hence should be updated as situations change and as required for particular uses.

Choosing A Business Plan Format That Works

There is no right or wrong way to write a business plan. A business plan can be the traditional type or the lean startup type. The traditional type is more common. They use a standard structure and encourage details, as a result, they need more work and are dozens of pages long.

The lean startup type is less common and the most used is the Business Model Canvas. Lean startup plan focuses more on the summary of the important points or key elements of the plan, and is usually a page long.

See Also: A business plan sample that can be adapted for your business.

Traditional Business Plan

Let’s talk about the traditional type of business plan writing. This suits a detail-oriented person or someone who wants a comprehensive plan or desire to source funding from traditional sources. One doesn’t have to stick with the exact outline. Instead, use the sections that make the most sense for your needs.

A comprehensive traditional business plan has the following sections:

Executive summary

Company description

Product or service information

Market and competitive analysis

Marketing and Sales strategy,

Operational plan

Management summary

Financial analysis

Appendix (which contains supporting information)

I will go ahead and explain in detail all the sections and give examples where applicable.

See Also: Reasons why you should write a business plan.

Executive Summary

When creating a business plan, the executive summary is the first section. It briefly tells the reader what your company is about and why it will be successful.

It is always advisable to write the executive summary after you have written the rest of the plan, so you can draw key insights from different sections.

The executive summary should communicate the company’s mission statement, brief company profile, product or service information and information about employees.

Also, include financial information and growth plans if you intend to seek financing from investors. The executive summary gives a holistic view of the company and your market before readers dive into details.

The executive summary should cover 1-2 paragraphs of overview, company profile, product or services, the market, and financial considerations respectively.

An example of an overview section of an executive summary, using ReDahlia Workspaces, is:

ReDahlia Workspaces is a fully-serviced and co-working company located at 43B Emina Crescent Off Toyin Street, Ikeja. ReDahlia catches the interest of entrepreneurs because of its location, the fiber-optic internet, and business support services.

The company plans to build a strong market position in Ikeja through strategic partnerships by leveraging the strong foothold of the ReDahlia brand and other subsidiaries. ReDahlia Workspaces offers its services to small businesses and entrepreneurs at competitive prices that meet their needs.

Company Description

This section gives details about your company, the problems it solves, the businesses you intend to serve. It explains the competitive advantage that would make the business a success, the experts on your team, and the location of the business. You need to communicate your company’s strength in this section, so as to convince investors.

An example of the company description summary section will be:

ReDahlia is a brand committed to being everything to the entrepreneur. Through its different arms, ReDahlia offers integrated support services to entrepreneurs.

ReDahlia Workspaces, one of the arms of ReDahlia, provide a beautiful co-working space where business owners concentrate on being productive. Entrepreneurs.ng, another arm of ReDahlia curates insights, experiences, and information that inform, inspire and educate.

ReDahlia’s business consulting and business registration services help entrepreneurs keep their business structured. Our commitment to delivering value is compared to none.

Market Analysis

The market will automatically determine the success of your business. Will the market be interested in what you are offering? You need a good understanding of your industry and market before you create your business plan.

Competitive research will show what other businesses are doing and their strengths. Determine if you can do better than they are doing. Get specific here.

Let’s use ReDahlia Workspaces as an example. We know our target market, someone who needs a make-up studio or market stall is not our target market. Entrepreneurs who work with their laptops, who provide tech-driven solutions are our target market.

Include both an analysis of research done by others (articles and publications written about co-working spaces) as well as the primary research (interviews, customer surveys, etc.) done by you. Also, include competitive analysis here, for example, research on how many other co-working spaces have a share of the market. Who are they? Outline the strengths and weaknesses of those competitions and strategies that will give you a competitive advantage.

An example of a market analysis summary:

ReDahlia Workspaces targets three types of customers: small businesses that need an office space and work with their computer, freelancers or solo-preneurs who need a comfortable place to work from and trainers and executives who need a comfortable space to meet.

The co-working space has many niches: there are those who offer incubation to tech innovators, those created for empowerment, and those for artisans.

ReDahlia Workspaces has carved out its own niche – our services are tailored to small businesses and entrepreneurs of different sizes.

Organisation (Operations) And Management

You use this section to let the reader know the structure of your business and who will run it. Describe the legal structure of your business and state whether you will run it solely or if it is to be incorporated. So, using an organisational chart to show who is in charge of what will give more clarity.

Show the unique experience that each team member possesses and the contributions those skills will make to the success of the venture. So, include the bios of each member and highlight their experiences and education. Also, explain what the fillers of any unfilled roles will be responsible for. An example of our personnel plan:

The labour force for ReDahlia Workspaces is small and consists of the founder who will also function as the business development manager. She will be in charge of building strategic partnerships for the ReDahlia brand and also pursue other business interests for ReDahlia. In addition, she will see to the expansion plan of ReDahlia, grow the ReDahlia community and ensure the ReDahlia brand is top of mind for prospective clients.

There is also the Client Service Manager. She is in place to oversee the most basic tasks, customer service, design graphics and oversee our social media management. She also participates in strategic sessions for ReDahlia.

ReDahlia’s accounting and legal services have been outsourced. We have established a mutually-beneficial partnership with our lawyers and accounting team. Our cleaning and security services have also been outsourced. On the surface, it looks more expensive but it takes away the daily stress of supervision and leaves us peace and time to get things done.

The daily supervision of the activities in ReDahlia Workspaces is done by the Office Assistant who ensures that clients have all they need to get work done.

Service Or Product Plan

This section should explain what you sell or what service you offer and its life cycle. Explain how this benefits your customers. Share plans of intellectual property filings and research on your product or service. Also, describe the problem you are solving and how you plan to solve it. You have to talk about the competition as well.

The Marketing And Sales Plan

You answer questions like how you plan to penetrate the market, how to grow your business, distribution channels to focus on, how to communicate with customers, sales strategy, and growth over time.

An example:

ReDahlia Workspaces plans to be more than a co-working space. We are building to be everything to the entrepreneur; to be the number one premium yet affordable co-working space.

Public relations: The press release of our launch was published on BusinessDay, ReDahlia.com, and other online platforms. We also engage in other social responsibility initiatives that create awareness for the brand. For example, we use our Instagram Live programme every Thursday to share tips on how entrepreneurs can run successful businesses.

Offline events: We have offline events like our Fusion Friday community initiative where our clients and other entrepreneurs come in for an evening of networking, fun and entertainment. We employ companies to sponsor this event. The last one was sponsored by Hygeia. Another offline event of ours is The Network.

Articles publishing and offline advertising:  We publish regularly and have been featured on other blogs. We have brochures that we go out to specific places and events to share because we know our clients are there.

Internet and social media: We have a constantly-updated website and have received several inquiries from it. Our footprints are on social media as well with a uniform handle – redahliabiz and ntrepreneursng

Financial Plan

The financial plan is important, so outline your financial module in detail including startup cost, projections, and funding request for investors. The startup cost is the resources needed to start your business – the cost for leases, computers, phones, etc. Be honest with estimates.

Detail your financial projections so investors know where their money is going and how they will recoup it.

Businesses already existing will include income statements, balance sheets and cash flow for the last three to five years. List any collateral you have that can be used against a loan.

The Appendix

This part closes the business plan. Supporting documents (resumes, permits, leases, product pictures, letters of reference, etc.) are published under the appendix. The appendix, however, is optional.

There, you have it! That is how you create a business plan.

I hope I have been able to help you. It’s time to turn that business idea you have into a reality. We are committed to helping you realise your dream of being an entrepreneur, so, feel free to talk to us. We will help you create your business plan.

Talk to us on WhatsApp- at 08038874148 so we can create your business plan today.

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