A Business Plan is a blue print that works for a business to look ahead, plan finances, manage resources optimally and assess opportunities. It is a formal statement of a set of business goals, the reasons why they are believed attainable, and the plan for reaching those goals. It may also contain background information about the organization or team attempting to reach those goals.
What’s a startup plan?
A simple startup business plan includes a executive summary, mission statement, vision statement, market analysis summary, operation, financial and break-even analysis. Having a plan in advance gives a clear picture to decide whether or not to proceed with the idea, to tell if there is a business worth pursuing. It would be a wrong assumption if you believe that just having a business plan is good enough to run a business. The responsibility lies in the hands of the entrepreneur or the decision maker to work his ideas with a passion and persistence. It can be a competitive advantage to focus on the lead generation mechanism and in order to attract new clients.
Does an established business need a Business Plan?
Business plans are normally internally or externally focused. Externally focused business plans are aimed to create value to external or financial stakeholders. Internally focused business plans are aimed at internal goals required supporting the external goals and it provides key input to the organization strategic direction. They may cover the development of a new product, a new service, a new technology, a new operation procedure, HR policies, a restructuring of finance, the refurbishing of a factory or a restructuring of the organization. Business plans that identify and target internal goals, but provide only general guidance on how they will be met are called strategic plans.
Unfortunately, many people in mid-sized companies and major corporates assume that business plans are meant only for starting a new business or applying for business loans. Business Plans can also be vital for companies’ internal understanding, running a business, apart from using them for the business needs, finances, new loans, new investments and equity. Businesses very much need plans to optimize growth and development according to priorities.
Is there a standard business plan?
Unfortunately, there is no standard template which is designed for business to work well. A normal business plan includes a standard set of elements such as descriptions of the company, product or service, marketing strategy, forecasts, human resources, operations, management team, and financial analysis. Your plan will depend on your specific company, market, industry or a situation. For example, description of the management or leadership team is very important for investors while audited financial history is most important for banks and other investors and focus on a specific project is important for an infrastructure company.
What is most important in a plan?
It depends on the case, you will have to assess what stage of the product or the industry life cycle your business is in. But usually it’s the marketing strategy analysis and cash-flow analysis and specific implementation details.
• The main section of your plan includes the market size, growth rate, and relative stage of development. It is important to describe the overall market as well as the segment that are you targeting. There can be some discussion regarding any significant changes that are occurring in the market, short term and long terms trends, impact of technology, government rules and regulation impacting the sector or the economy.
• Marketing Strategy demonstrates target segment of users of your products and services. It defines, target audience, geographic concentrations, demand, segment growth, domestic, international target audience. This segment reveals how you will reach your customers, market to generate leads and create awareness of your company, brand, image, and products. It also emphasizes regarding the skill-sets required to handle the sales and marketing responsibilities and their background.
• It’s also important to analyse whether you cater to Small Office Home Office Businesses (SOHO), Small Businesses, Medium Businesses and Large Businesses. It is also important to assess market trend and market growth. It is believed that strategy that works well in ‘x’ market may not work well in ‘y’ market. Therefore a company sees it as a safest option to adopt market focused strategy.
• Sound financial management is one of the best ways for your business to remain profitable and solvent. How well you manage the finances of your business is the cornerstone of every successful business venture. Each year thousands of potentially successful businesses fail because of poor financial management.
• Managing finances such as income, expenses, especially cash flow is a painful task. Cash flow is both vital to an individual and the company which is hard to follow. Cash is usually misunderstood as profits, and they are different. Profits don’t guarantee cash in the bank. Lots of profitable companies go under because of cash flow problems, however, they learn to overcome it either themselves or with the help of an expert to start doing well. The plan helps the business owner to identify and implement fiscal policies that will lead to and ensure that you will meet your financial obligations.
Implementation details are what make things happen. Your brilliant strategies and beautifully formatted planning documents are just theory unless you assign responsibilities, with dates and budgets, follow up with those responsible, and track results. Business plans are really about getting results and improving your business and profitability.
For further details, please contact
Benaka Business Consultancy
96633.83550 / 080-4212.3550