Writing a business plan does not have to be difficult and you don´t have to buy any software/templates to do the job. Follow the following simple steps and complete your business plan without expensive help:
1. Executive Summary
Write a summary of your idea. This should include a brief description of your proposal explaining its commercial viability, expected returns, market opportunities and threats. Everything should fit on one page. This is your selling pitch. Learn it by heart!
2. Market Analysis
This section should explain the market opportunity, i.e. the total size of the market, trends and the target segment. A market research, even if conducted only with the help of search engines, would strengthen the conclusions of your analysis. Don´t focus only on opportunities. Identify market threats, such as competition and the change in technology, and explain how you will counter them.
3. Operational Plan
Provide a reasonably detailed operational plan. This section should focus on human resources, technical and other assets required. If available, add CVs of your managers and staff. Explain where your business will be located.
4. Financials
First, provide projections for estimated sales, if possible segregated across different product/service lines.
Second, prepare a budget with separate budget lines for staff salaries, equipment, telecommunications, equipment, rent and other expenses.
Third, if any external debt financing or leasing is planned, include this as a separate line to take into account interest/leasing payment costs.
Once you have the three lines you can proceed with the construction of the financial statements, namely, the Balance Sheet, Profit & Loss (Income) and Cash Flow Statements. Calculate Return on Assets (ROA) and Return on Equity (ROE) - these terms will be explained in later blogs. Provide an estimate of your break-even point, i.e. the date when the business will start covering its costs.
5. Legal Part
Explain how the business will be incorporated, the taxation implications, and governance. This section should also discuss potential exit mechanisms for investors.
This short blog provided an overview of some of business planning concepts that will be explored in further blogs. For more ideas visit BusinessTomato.com - a free guide to starting and growing your business.
1. Executive Summary
Write a summary of your idea. This should include a brief description of your proposal explaining its commercial viability, expected returns, market opportunities and threats. Everything should fit on one page. This is your selling pitch. Learn it by heart!
2. Market Analysis
This section should explain the market opportunity, i.e. the total size of the market, trends and the target segment. A market research, even if conducted only with the help of search engines, would strengthen the conclusions of your analysis. Don´t focus only on opportunities. Identify market threats, such as competition and the change in technology, and explain how you will counter them.
3. Operational Plan
Provide a reasonably detailed operational plan. This section should focus on human resources, technical and other assets required. If available, add CVs of your managers and staff. Explain where your business will be located.
4. Financials
First, provide projections for estimated sales, if possible segregated across different product/service lines.
Second, prepare a budget with separate budget lines for staff salaries, equipment, telecommunications, equipment, rent and other expenses.
Third, if any external debt financing or leasing is planned, include this as a separate line to take into account interest/leasing payment costs.
Once you have the three lines you can proceed with the construction of the financial statements, namely, the Balance Sheet, Profit & Loss (Income) and Cash Flow Statements. Calculate Return on Assets (ROA) and Return on Equity (ROE) - these terms will be explained in later blogs. Provide an estimate of your break-even point, i.e. the date when the business will start covering its costs.
5. Legal Part
Explain how the business will be incorporated, the taxation implications, and governance. This section should also discuss potential exit mechanisms for investors.
This short blog provided an overview of some of business planning concepts that will be explored in further blogs. For more ideas visit BusinessTomato.com - a free guide to starting and growing your business.
2 comments:
I appreciate all of the information that you have shared. Thank you for the hard work!
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