A business plan is a written description of your business’ future. It sets the direction for your business and keeps you on track once you’re up and running.
It may also be a requirement when seeking finance.
Your plan should reflect the current reality of your business, the environment in which it operates, and your present and future goals.
When and why should we prepare a Business plan?
Anybody beginning or extending a business should take the time to draft a Business Plan. It is essential to have a realistic, working business plan when you’re starting up a business.
There is no single formula for developing a business plan, but some elements are consistent throughout all business plans.
There are three primary parts to a business plan:
This section should briefly but clearly describe what your business is all about.
You must be able to clearly describe what your business does, the products and services you intend to market and the business’ legal structure.
You should then define your market, your position on this market and who your competitors are. You should also describe and analyze potential customers: who and where they are, what makes them buy and so on.
The next step is to describe your strategy. A SWOT analysis must be conducted and goals determined.
As part of your plan you will need to provide a set of financial projections which translate what you have said about your business into numbers.
Your forecasts should run for the next three to five years.
This section should answer several questions such as: how much capital do you need, if you are seeking external funding? What are your sources of revenue and income?