A good business plan is essential to understand how the business will look through starting and managing your business. A business plan gives complete clarity about how to proceed with the business, whether for startups or ongoing businesses,.Which is why it is the most crucial document to induct new business partners or get funding, clarifies David JC Cutler. Business plans follow either the traditional format or the lean startup format. Choose the format that meets your requirements.
A traditional business plan consists of the following elements.
Executive summary – explained by David JC Cutler
The opening lines of the business plan describe the business of the company briefly and provide the reasons for its success. It includes the mission statement, whereabouts of the leadership team. Information about the product or service, location, and employees. Also, it provides financial information and growth plans.
Provide detailed information about your company in this section. Highlight the problem-solving aspects of your business and give details of the organization Other businesses that your company wants to serve and the list of customers. Mention the competitive advantage of your business that spells success.
Most Importantly, a good understanding of the industry to which you belong. And the target market gives confidence to people about the business prospects. Your market research must cover themes and trends. You must also recognize what your competitors are doing and their strengths. Focus on what successful competitors breed success and how you could be better than them.
Organization and management
This paragraph gives the scope of explaining the company structure and who spearheads the organization. First, provide a legal structure of the business. And its type – C or S corporation, type of ownership- limited partnership or general, or an LLC. Second, provide an organizational chart to understand better who is in charge of the company. Finally, explain how to use best the expertise of the people in charge of the business.
Service or product line
However, describe the products or services you intend to offer to consumers, their benefits, and hint about how the product cycle looks. Share your plans of patent, copyright, and intellectual property filings. Therefore, explain the research and development activities in detail, if applicable.
Marketing and sales
However, Outline the marketing strategy but be ready to change it to suit the evolving and unique needs of the business. That is to say, explain how you would attract and retain customers. As well as the actual process of the sale. Thoroughly describe the strategies of marketing and sales.
Outline the funding requirements with a clear vision about the fund requirement for the next five years and its purpose. Above all mention, the type of financing you prefer- whether equity. Debt funding but the preferred terms, and the nature of fund utilization.,
Provide financial projections to supplement your funding request for convincing people about stability. Existing businesses can include a balance sheet, income statements, CAPEX budget, etc., for the preceding 3-5 years. List the collaterals that you can offer.
This section provides additional documents like resumes, credit histories, reference letters, product pictures, permits, legal documents, etc.
This format can work for any industry if you seriously peruse it.