Primary Components for a Comprehensive Business Plan
Business plans are critical to the success of any new venture include these components.
Entrepreneurs should dedicate time to create them, regardless if you’re searching for investors. Business plans serve as the framework for your company and provide benchmarks to see if you’re reaching your goals; they are key to helping you think through your business and keep you on track.
As an business owner, you should take some time to work with mentors, business partners, and colleagues on your plan. Ask them to look for holes so you can adjust accordingly. Seeking input is a great way to get an objective view, so don’t forget this step; it’s way too important.
As with most things in the business world, the size and scope of your business plan depend on your specific goals. If you’re drafting it for investors, you should make the plan more detailed. Be sure to keep in mind that potential investors might not be as familiar with your industry so you have to clearly explain your concept and where it fits in.
If you’re just developing the plan for you and/or business partners, it doesn’t have to be as detailed, but you should still outline your goals and how you want to reach them.
Likewise, if your product or service is not overly complex, your plan doesn’t have to be very lengthy.
Although the exact structure of business plans vary.
Here are my ten personal requirements for potential investments plans:
- Mission statement and/or vision statement so you articulate what you’re trying to create
- Description of your company and product or service
- Description of how your product or service is different
- Market analysis that discusses the market you’re trying to enter, competitors, where you fit, and what type of market share you believe you can secure
- Description of your management team, including the experience of key team members and previous successes
- How you plan to market the product or service
- Analysis of your company’s strengths, weaknesses, opportunities, and threat, which will show that you’re realistic and have considered opportunities and challenges
- Develop a cash flow statement so you understand what your needs are now and will be in the future (a cash flow statement also can help you consider how cash flow could impact growth)
- Revenue projections
- An action Plan with time lines showing goals; and a Summary/conclusion that wraps everything together (this also could be an executive summary at the beginning of the plan).
Your Financial information will include the following:
- Profit and Loss Statement and Balance sheet – Update Quarterly.
- Cash Flow Projections for 3 years
- Accounts Receivable and Accounts Payable – Update Monthly
- A current schedule of existing debt – with payments and interest rates Update Monthly
- A current Personal Financial Statement for all owners of company with an interest of 20% or greater
When creating a Business Plan or Executive Summary, keep in mind the following six points:
1. It has to be updated periodically to reflect your current position on the journey.
2. It has to be adapted to the reader.
3. It is a useful management tool.
4. It should highlight the strengths of your business and your short and long term goals.
5. It should be concise-personal-and highlight achievements.
6. It can be expanded or contracted, depending on the specific audience.
Include the above including: the requirements for investment plans, financial information disclosure items and six business plan excutive summary.
This series ongoing series handbook prepared by Marjorie Weber was prepared will also be part of the Miami Bayside Foundation to qualify small business owners for the Miami Bayside Foundation loan program.
Handbook series Small Business Start Up
Part 1: Small Business Start Ups Making It Legal; Part 2: Small Business Start Up Capital Access Primer and Key Steps ; Part 3: Definitive Steps to Create the Optimal Small Business Growth Team Part 4: Once You Have the Dream Team, It’s About Employee Retention, Part 5: Delegating Responsibilities Policies and Procedures – Letting Go Part 6: Breaking Down the Set Up of Small Business Financial Records Part 7: Three Best Bet Picks for Small Business Accounting Software Part 8: To Lease or To Buy? Issues Relating To Both In Today’s Market part 1 Part 9 Decided on a Business Lease? 20 Lease Provisions Part 10 What Small Business Contracts Are Required and Who Reviews? Part 11 What are the most serious small business risk and coverage issues? Part 12: Keeping Sightlines on Specific Small Business Target Markets Part 13: Small Business Targeting and Related Branding Components Part 14: Keys to Developing an Essential Small Business Marketing Plan Part 15: Small Business Social Media Blocking and Tackling 101 Part 16: Small Business Owner’s Primer- Understanding the Balance Sheet Part 17: 5 Considerations to Properly Price Products and Services Part 18: How to Handle Inventory in Cash Flow Projections
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