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Home » A great business plan – What do I need to write about?

A great business plan – What do I need to write about?

The blueprint for any business is a business plan, which must be carefully constructed and updated. It establishes performance metrics, facilitates correspondence and sets direction. Better yet, well planned business plans force business owners to continually assess their operations, and identify their strengths and weaknesses.

And of course, these documents are highly coveted when courting professional investors.

Investment-grade business plans–usually about twenty pages long–are grounded in deep understanding of an industry and the money making opportunities within it. I cannot do that job for you, however, I can discuss the 10 primary elements that matter most–to business owners and their investors.

  1. Specific description Of The problem. A business plan should always begin with an explanation of the problem being solved, not just a description of the business and its products. Lay it out in terms your mom could understand, and quantify the “cost of pain” in time or even dollars. Stay away from airy assertions like “every client needs gobbledygook and this” like “next generation platform”–they mean nothing and weaken your credibility.

Benefits and Solution 2. This’s not the place for a thorough product specification. Instead, your business plan service should explain how and why the product works, including a customer-centric quantification of the benefits. Once more, ignore the technical jargon and hyperbole.

Sizing by Market and Industry. Capture the evolution of the market, market dynamics, market segmentation, and client landscape without producing a tome. Charts plus graphs which are relevant and backed up with figures from reliable sources provide a story quite effectively.

  1. A Short Overview of The Business Model This section must state clearly how you will make cash, who pays you as well as how much of the cash you always keep after expenses. A mere glance should yield a good understanding of the business’ development potential.
  2. Competition and also the Sustainable Advantage Show and describe all of your competitors, which includes substitute products or maybe services. (Simple example: If you’re selling a vehicle, do not forget about trains. and motorcycles) Then detail your alternative naturally competitive advantage, and highlight barriers to entry that will maintain your competitors away.
  3. Marketing & Sales Strategy. In this report we’ll be looking at the way in which you are going to go to market, which includes pricing and distribution channels (which may possibly also incorporate strategic partnerships). This’s a great place to map out a timeline of key milestones.
  4. An Executive team. Investors ultimately bet on people, not ideas. Demonstrate to investors that your team has got the skills and perseverance to begin new companies and has a deep understanding of airers4you’s industry. Include people of the Advisory Board and key business players working in the company.
  5. Funding Requirements. Explain exactly how you arrived at the total amount of capital you’re asking for, and describe in depth just how you plan to make use of the cash. Show the amount of fiscal commitment founders as well as equity owners have in the organization, such as sweat equity (hours slaved in return for a percentage of the company, rather than cash salary).

Financial Forecast, nine. Include revenue and expenses for the last three years (if relevant), and project them for the next five. Show clearly and justify any growth assumptions. Highlight the stage that is located at the breakeven point.

  1. The exit Strategy. This aisl is needed when courting outside investors eager to know how and when they are going to get their money out, as well as what kind of return they may expect. (Initial public offerings–the exit of choice for many investors–are few and far between these days.) Plan to maintain the business in the family? You need to ignore this section. Trap: Plenty of entrepreneurs have created companies only with an eye to promote them. This’s the greased street to perdition for several. Focus instead on creating a really sustainable business. The money, fame and stock tickers will come.

A final word on great business plans: longest and Fanciest does not win the race. The intent of these documents is to inform and reassure, not occupy. The very best plans anticipate and respond to every question an investor could very well consult, except maybe: “Where do I sign?”