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Write a business plan

Below is a detailed overview of how to build a business plan, and if you're wondering, yes, you really do need to know the answers to all these questions.

Some of these will develop over time and some are covered by other elements in the checklist, but persevere and make a business plan that you can be proud of.

What to include

An executive summary

  • An overview of all the key points that appear in your plan, but you should write it last
  • Make it a concise (two pages at most) summary of the entire plan - interesting, explanatory and informative. It shouldn't be an extended contents list, sketchy or full of jargon
  • It may be the only part of your plan a potential investor reads before deciding if you are worth their money, so make it good

A summary of the business opportunity

  • Who you are, what product or service you will sell and to whom
  • Give a short history of the business to date (when did you or do you intend to start? If you acquired it, who owned it previously and what did they achieve with it?)
  • Set out your vision and outline what makes your business different, its benefits over its competitors, how you will develop it, your understanding of the key market features and any patents, trademarks or similar you hold

Your sales and marketing strategy

  • Why people will buy from you, how you will promote, price and sell your idea
  • This is often the weakest link in a business plan. Don't let it be your downfall. Put in the research to make it strong and believable
  • Identify precisely your market position, your customers, how much you will charge for different market segments and quantities and why
  • How will you make use of different advertising types and why? What PR methods and sales channels will you pursue?

You and your team

  • Outline the skills and experience you possess to head the business
  • Describe your strengths and those of your key employees, but also any obvious weaknesses and how you will mitigate these
  • Include a CV for each team member and explain how the team fits together
  • Also outline any advisers you have on board (e.g. accountants, lawyers etc) to add weight and experience to the mix
  • Demonstrate that between you there is the right mix of drive, skills and experience in sales, marketing, financial management, production, operational and marketing experience, and detail any outsourcing of expertise if necessary

Your operations

  • List any premises, management systems, suppliers and IT
  • Explain clearly if you own or lease any premises or work from home, what your financial / contractual commitments are, and the advantages and disadvantages of your location
  • If relevant, outline your production facilities, or outsourcing arrangements. What is your capacity? Will any investment be needed and who will be your suppliers? You also need to reassure investors, and be sure yourself, that you have good stock and quality control and finance management in place
  • IT is an essential part of most small businesses so detail your systems and any strengths and weaknesses
  • For all of the above make sure you show you have allowed for future expansion

Financial forecasts

  • Okay, this is a big one – your future in numbers. This is the nitty-gritty of all the above
  • You need to show your cash flow projections in detail for at least the first 12 to 18 months and ideally for three or more years, and a profit and loss forecast (don't be over-optimistic) for various scenarios based on slower-than-expected sales
  • This is where you state how much capital you need (if you are seeking funding), the security you are offering against it, and how you will repay it
  • You should include your personal financial circumstances here if they are relevant

Risk management

  • To look really efficient, show that you have thought of contingencies and insurances for internal and external risks like competitor action, operations failure, staffing problems and acts of God (e.g. fire and flood)

But remember, a business plan's not just for launch…

  • It's for the lifetime of your business. It should be a living, breathing document that you return to as your idea comes to life and you take your new business to the next level. Adjust it, refine it, grow it and treat it as your blueprint for success

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Last updated: over 3 years ago