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How to Create a Business Plan in 9 Easy Steps

How to Create a Business Plan in 9 Easy Steps

How to Create a Business Plan in 9 Easy Steps

Starting a new business is no easy task. Demands come thick and fast, and overwhelm is a possibility for even the most seasoned business owner. One of the things that can alleviate this stress is a business plan. Your business’s roadmap, it reminds you of where your business is going and how it’s going to get there.

Developing yours might seem time-consuming and stressful in and of itself, but it doesn’t have to be. Here’s how to create a business plan in 9 easy steps.

What is a business plan?

A business plan is a written document that essentially describes your business. It comprehensively states your business’s objectives, goals, strategies, and forecasts. Coming to grips with what a business plan is and why it’s important should be your first step in creating one.

Once you know why you need one for your new startup, or your established company, you can take these nine steps on how to create a business plan, for a loan, or any other purpose.

1. Write your executive summary

Usually one page or less, this is an overview of your business. It stipulates all the important information about who you are and what you do. Ideally, it should summarize the other sections of your business plan, so a good idea is to leave this blank and complete it last, once the rest of the information has been written.

2. Company description

Provide detailed information about your business or company. What problems does your business solve? Who will your business serve? What competitive advantages does your business have? Who makes up your company? You can break this section down into three areas:

· Mission statement

This is your business’s reason for existing. This is your why. Mission statements are usually aspirational and emotional. This is where you write about the things you care about.

· Company history

Create a detailed history of your business. Include when the business started, milestones, number of employees, who the executives are, and what services or products you provide. It doesn’t have to be too long; a couple of paragraphs will do.

· Objectives

Your objectives must be clearly defined so that everyone knows exactly what it is your business does, including your employees. When your goals are specific and measurable (yes, SMART goals apply here), there won’t be any room for confusion as to what the common purpose is for all stakeholders. Investors also want to see measurable objectives.

3. Market analysis

Who does your business serve? The best way to do this is outline your ideal potential customer. Try and get really specific with this. Start with an individual and then work your way outwards into bigger segments. So, initially, detail one person your business would serve. Identify these factors:

· Age

· Gender

· Relationship status

· Income

· Location

· Profession

· Hobbies

· Education

Once you have that person in mind, try and nail down how big your target market is likely to be. When you get specific you inspire confidence in your stakeholders and investors. Try and drill down into the hard numbers. What is your market’s estimated size and monetary value? And don’t just look at the total market. Look at local numbers, or numbers within specific segments.

4. Competitive analysis

It’s vital that you identify the businesses that are already operating in your marketing space. Learning as much as you can about the competition can be incredibly useful. Find out where they’re advertising, what their customer service is like, what their sales and pricing strategies are. Also think about how you can set yourself apart from them. This is something that investors will be looking for.

5. List your products and/or services

This is where you show off all you have to offer. Focus on your benefits and features and what your competitive advantages are. What pain points will you solve for your customer? What emotional or practical benefits will your customer get from your

services or products? If you are selling products, explain what the product life cycle will look like.

6. Marketing and sales strategy

Here you can briefly reiterate your value proposition, who you’re selling to and where your target market is.

But then you have to explain how you’re going to sell your products and services. Your sales and marketing strategy is what will make or break your business. You need to think about the following:

· How will you attract new followers?

· What are your growth tactics (especially if you are an established business)?

· Retention strategies

· Advertising channels (social media, search engines, radio, TV, print)

Bear in mind that your sales strategy may change and grow. Focus on how you plan to attract and retain customers.

7. Financials

This section of your business plan will depend on how established your business is. If you’ve been around for a while, this is where you’ll put income statements, profit and loss statements, cash flow statements and balance sheets. Ideally include three years’ worth of information.

If your business is new, include a budget and financial projection, and a funding request if you’re looking for an investor.

8. Organization and management

Tell your reader who will comprise your business and who will run it. Identify all your team members and what role each person will play. You can highlight each person’s qualifications and experience.

You also might want to outline who you intend to hire to grow your company and what this will cost.

9. Appendix

This is where you can put all the important documents that you’ll need to show people as part of your business plan. These may include:

· Credit histories

· Resumes

· Product pictures

· Permits

· Patents

· Legal documents

· Licenses

· Associations and memberships

Business plan benefits Bplans worked with the University of Oregan to research the benefits of business planning. Some stats include:

· Business with a plan grow 30% faster than those without

· 71% of fast-growing businesses have plans

· Entrepreneurs who create a business plan early establish more credibility than those who don’t (they’re also 152% more likely to actually start their business)

You can find a business plan template online. How long does it take to create a business plan? This depends on whether you’re creating a business plan for a startup or for a more established company. When it comes to startups, it’s generally agreed that less is more.

If you’d like to find out more about the support we give to business in and around Washington DC, visit our website.

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