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Published On: Wed, Jul 4th, 2018

HOW TO CREATE A BUSINESS PLAN: PROCESS STEPS

Don’t know how to make a business plan? Do not panic! We will teach you how to do it with examples! It’s simple!

How to make a business plan? This question is very often asked by most people who have decided to open or have already opened their business! Even if you decided to open small business, for example starting your own blog, believe me – you need the business plan.

photo/ OpenClipart-Vectors

By the way, recommend you for reading this article how to become a blogger .

Everyone knows that a correctly written business plan is the key to the successful development of any enterprise.

The completed business plan should describe your expectations from the new (or currently available) business and talk about your wonderful ideas to the prospective lender.

In short, the business plan is a critical starting point and the basis of all planned and performing activities of the enterprise. This is the most important source of accumulation of strategic information and a method of direct management influence on the future position of the enterprise, which describes ways to achieve profitability.

In general, the financial, operational and investment policies of an enterprise should correspond to the directions and strategic goals identified in the business plan.

Ultimately, it is necessary to emphasize the following: first, it should be clear that the business plan is essentially a test of knowledge and understanding of business environment managers, as well as the position of the enterprise in the market. The business planning process provides close attention to the management system of all its shortcomings, forcing to consider specific characteristics and factors that affect the competitive ability of the enterprise. Thus, the requirements for the business plan are a condition for the self-improvement of the management system and the creation of an effective management strategy.

Secondly, significant forces and resources are involved in the development of the business plan. Therefore, subsequent planning requires less effort to collect and process information.

The value of a business plan is determined by the quality of the information and assumptions contained therein. It should not reflect the actual exaggeration or prejudice of the drafters.

Qualitatively compiled business plan is also a highly effective and useful tool for marketing activities. The likelihood of its execution over time directly reflects the competence of the enterprise management, which is particularly emphasized by investors.

Things that are usually forgotten, drawing up a business plan

  • lack of sufficient awareness of potential customers about a new product;
  • insufficient investment in building an effective sales system;
  • excessive sales forecasts;
  • underestimation of the required amount of financing;
  • a lowered amount of monthly operating costs;
  • failure to implement the planned plan on time;
  • underestimation of competitors;
  • non-fulfillment of obligations by partners;
  • exceeding the indicator of the actual cost price of production of the product over the planned;
  • rapid demotivation of partners in the struggle for market share.

What sections should be in the business plan?

In order to understand the structure of the business plan, you need to decide on its sections. I will propose to you my own version, which is classical for most business plans.

Sections of the business plan:

Introduction (summary);
Description of goods and services;
Market analysis and marketing strategy;
Production plan;
Organizational plan;
Financial plan (budget);
Expected results and prospects (final part).

 

photo/ Gerd Altmann

Starting to develop a business plan, I recommend that you conduct a small “brainstorming”, describing your idea on 1-2 A4 sheets. This is necessary in order to understand the picture as a whole and only then proceed to a detailed description of the above sections.

I bring to your attention 10 useful tips for the proper drawing up of a business plan!

1) How to make a business plan? Initially, make a description (summary) of the project.

It is the first aspect of your business plan, although it is necessary to make it last.

It needs to explain your strategy and vision of the project (what you expect to do), outline the market and the capital that you need (what you expect to do with it) and your advantage over competitors.

In short, this is a mini business plan that allows you to explain to any person about what your business is about after getting acquainted with it.

2) In order to draw up a business plan – specify the name of the company.

You must specify the name of the company, the license, the form of ownership, the legal structure, a brief description of the product or service, and what you plan to do (provide services, retail, wholesale or production).

Specify the address of the company, the required area, landlords.

Indicate whether your business is new or is an extension or purchase of a ready business.

It is necessary to describe the goals and objectives of the company and any planned changes.

3) How to make a business plan? Analyze your market.

Outline your sales market, segments and consumers for each of the segments.

Indicate the scope of the market, translating it into profit for three years, and analyze the growth or decline in your income with the growth of the market.

What value do you want to get for services and products in order to achieve profit and become competitive?

Explain why buyers will agree to pay the price indicated by you.

How to attract customers?

4) To create a business plan – tell us about the goods and services.

Tell us about your proposals for services and products, about which consumers they are designed for, what benefits the buyer will have.

Justify what your products are or what you offer, better than the products of your competitors.

Also tell us how you search for products, and if you expect to produce something, then raw materials.

5) How to make a business plan? Outline your business strategy and its implementation.

Show how you intend to occupy your niche in the existing market.

Will you use advertising or visit trade shows?

6) How to make a business plan? Do not forget about the competition.

Name about five of your main competitors, explain why the products / services you provide are better than others.

Do they have a stable market? Is it developing or falling? For what reason?

Highlight their strong and weak points, how do you intend to act?

How will you monitor the activities of competitors in the future.

7) How to make a business plan? Characteristics of your production.

Tell us how the production and delivery of goods and services will be carried out, what your financial policy is and how you are going to get debts from your debtors.

Also indicate how many employees you need, what skills they should have, whether you will train them.

It is necessary to clarify what equipment and related technology you need.

Remember, did you consider the legal and licensing issues related to future business.

8) How to make a business plan? Describe the organization of the workflow.

Who will manage the company?

Attach a summary of key managers.

Add a description of the job descriptions of all key specialists and a list of relevant consultants.

Calculate the estimated costs of financing.

9) How to make a business plan? Do a financial calculation.

Calculate the costs associated with the creation and lease of the company.

If this is a ready-made business, tell the financial history or expected financial indicators within 3 years after starting the business.

Indicate the monthly income and losses for the first year and quarterly calculations for two years in advance.

Also count the cash flow and current accounting records.

Good luck!

Author: Float Media

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