Do you need a business plan?
Whether you develop an official "business plan" or do some type of informal business planning, this is a key component in the future success of your business.
A business plan is a management tool which will help guide the future of your company.
A business plan is a mandatory document if you plan to seek business financing.
A business plan helps you succeed by laying out a roadmap that will:
- Determine where your company needs to go
- Forewarn of possible roadblocks along the way
- Formulate your responses to contingencies
- Test some of your assumptions
- Identify the cash needs of your business
- Help raise funding from banks and from investors
- Tell employees, investors, and others about your plans and strategies
- Keep your business on track to reach its planned goals
- Provide benchmarks to measure your progress and performance
Business plans come in many shapes and sizes. Some sections that are common to most business plans include:
- Executive Summary which highlights key points of the plan in one or two pages
- Overview of introducing the reader to your company and the industry
- Description of the products and services
- Analysis of the market in which your business will compete
- Marketing strategy summarizing the product, promotion, pricing, and distribution strategies of the business
- Operations plan showing how you will produce your product or perform your service
- Description of the experience, training, and talent of your staff
- Schedule of activities outlining your timeline
- Analysis of critical risks and problems including competition and any barriers to your business
- A financial plan including actual and projected balance sheets, income statements and cash flow statements
Business plans can vary in length from a few pages to over 100 pages. Although there are no hard and fast rules, many sources recommend that business plans should be between 10 and 25 pages in length. Remember that the business plan is in summary form. You can always provide more information if asked, or you can attach more detailed background documents to your business plan.