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Writing a small business plan
If you are just starting your small business, you need to have a small business plan. A business plan can be thought of as your roadmap to your future. It clearly outlines where your company plans to go in the future and how you plan to get there. Simply, a business plan has 4 sections; business description, marketing, finances, and management.
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Business plans help companies to prepare for future problems and look forward to future opportunities. A good business plan can help you allocate your resources and focus on key points that will build your company. Most companies need to have a business plan when they apply for a loan or when they are just starting out. You should not only have a business plan for times when you need financing but for the day-to-day operating of your company.
Every business plan will have a small start-up plan included. The start-up plan normally provides information about the company background. It talks about the mission statement and how you plan to break-even with the money you borrow. The start-up plan will also provide an area for market analysis and a section for you to define what the goal of your business will be.
When you create a business plan, it is important to receive the input of several different advisors. Some people at your company will provide you with the financial information you need in your plan while others will provide you with the marketing information. You need to include information about your management team, even if you are the only manager.
Every business plan is different because they each pertain to their own companies. You may have a large management team and the bulk of your business plan will talk about your management team and your goals for the future. You may have a small financial history, so you don't have a lot of information to include in the business plan. Include all the background information you can so that the bank or lender will have something to go by when they are evaluating if they want to give you a loan.
What should you put in your small business plan?
Some of the important things you need to include in your business plan include the following:
- Cash-flow information
- Marketing strategies
- Competitor advantage
- Insurance information
- Financial data like loan applications, balance sheets, and break-even costs
- Tax returns
- Other supporting documents
Financial managers can review your business plan to make sure you are including the correct information. Cash-flow is often misunderstood as profits and it can be easy to generate the wrong report and include it in your business plan. A lot of companies look at their cash flow and think they have more money than they actually do, causing them to make some poor decisions and eventually go-under.
Your marketing plan needs to be included with the business plan. It must provide a clear picture on how you plan to make a big profit with your company. You must include documents that support your plans. Create a list of all the people that will be responsible for implementing and following through with your marketing plan. A marketing calendar should be included with a business plan because it will show you when you need to make a big marketing push and when you need to spend marketing money.
The goal of a business plan is to improve your company. You are making some goals that are attainable and you and making a simple roadmap to show others how you plan to achieve those goals.
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