As an entrepreneur, it is important that you know how to write a good business plan. If you can then your business will be better for it. Of course, you can get access to an amazing free sample business plan online which isn’t a bad idea.
However, we think you should be looking at how to write a business plan step by step. This will help you to always to put your business ideas on paper without stress. There are tons of advantages you are bound to enjoy from knowing how to write a good business plan.
In this post, we will take a look at the rules or steps in writing a business plan. This should be fun and educative so seat back and enjoy the read.
What is a Business Plan?
Before we go ahead to discussing how to write a business plan step by step, let’s check out what a business is. In the simplest terms, a business plan can be described as a strategic map for your business. It shows you, or anyone who reads it, where you are currently as a business and where you are heading to.
In doing this, the business plan states your mission and vision statements, current assets, needed resources, impending liabilities, amongst others. Let’s describe it in simpler terms. Your business plan states clearly point A and point B. It then explains how you plan to make it point B from point A in a few years.
Generally, a business plan should be simple and straightforward. But the truth is it can be difficult to write, especially if this is your first time. This is why we recommend that you read this post on how to write a good business plan to the end.
Who do You Prepare a Plan For?
Writing a business plan may not necessarily be for the entrepreneur’s consumption alone. Your business plan can have different audiences. It is important that you know who your audience is.
This will help you understand exactly what information you should provide in the business plan. Generally, there are four entities you can write a business plan for, they include:
- You – When you write the plan for yourself, then it is well detailed because it is written as a guide for you. You need a map to lead you through the path of business success. Your business plan is that map. Therefore, you ensure that all the details about the business are written in your business plan when it’s for you.
- Subordinates – Your subordinates are your co-managers and employees. The idea behind writing a business plan for these people is so that your business can work when you’re not present. It is ideal that your business is able to run you around. This is the secret of some of the most successful businesses in the world.
- Investors – Investors are people who infuse their funds into your business so they can take part in the profit later. The funding could be in the form of loans or partnership. Whichever they are providing, you don’t have to go into so much detail except in a few areas.
- The bank – In a way, the bank is an investor the only difference between the bank and the regular investors is payment plans. A bank puts in money into your business not because they want to enjoy your profit. They are basically helping you to raise capital. This means that your plan must justify why they should provide you such funding.
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Elements of a Good Business Plan
So far you have already learned a lot about how to write a good business plan. Now we will take a look at how to write a good business plan step by step based on the contents of the plan. If you get the contents right, then it is safe to say that you have a good business plan.
The rules guiding writing a good business plan prescribe the following sections in your business plan.
- Title page – Technically, this is not part of your business plan but it tells the reader what to expect. It usually contains the title of your business plan and who is presenting it. The title page also contains the date the business plan was written and the address of the business.
- Table of contents – Your business plan is like a book so your reader needs a guide to navigate through it. Basically, your table of contents shows the different sections of the book and their corresponding pages. This way, anyone reading can pick out a topic and go to the exact page in the plan.
- Executive summary – This is the abstract of your business plan. It contains only the juicy pieces of information since it is a summary of your business plan. The executive summary is an overview of the business plan so anyone who reads through can either gain or lose interest in the overall plan. This is why it is important that you are as straightforward and interesting as possible in this section.
- Company overview – Your reader wants to meet your company, especially the bank and any other investors. Hence, it is imperative that you share specific pieces of information that allows them to do so. When they know who you are and what your business stands for, the chances of them investing in the business are far higher. Some of the contents of this section include mission and vision statements, history, objectives, current status, and keys to success.
- Product or service description – Depending on which you are offering, it is imperative that you give a bit of information in this section. As described earlier, if the plan is for you or your subordinates, it can be comprehensive, otherwise, it should be peripheral.
- Market and industry analysis – This is regarded by many people as the show-off section. Here, you tell anyone reading the plan that you have lots of information about what is going on in the industry. Go into detail as much as you can so that the reader can also gain some knowledge. This section may contain industry and market analyses, SWOT analysis, and competitor analysis.
- Marketing strategy – How do you plan to penetrate the existing market with your products or services? This section answers this question in detail. Here you talk about your target market, pricing strategy, sales and distribution strategies, and advertising strategies.
- Operations – Your operations section tells the reader how you plan to run the business. It discusses the operations strategy and the scope of operation.
- Management – Anyone that wants to invest wants to know the leadership structure of your business. Who leads and manages the business will determine to a large extent how successful the business will turn out. So you have to enumerate your management team members, their qualifications, and the cost of having them on board.
- Financials – Most readers of business plans regard this section as the most important. It discusses your current financial position and future projections.
- Appendices – This is the last section of your business plan and it contains all the rough work. Rough work includes calculations, graphs, tables, etc. that don’t have to be included in the body of the plan.
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How Much Does a Good Business Plan Cost?
You already know how to write a good business plan based on the steps above. However, it is not as easy as it looks and most people prefer a professional to do the job. If you fall into this category, you must be wondering how much a good business plan costs.
Usually, a good business plan is costly but from our end, we present it to you at N10,000 for a sample business plan. If you prefer to get one customized for your business, then it will cost a little more. Simply contact us and we can discuss further on this subject.
Now that you know how to write a good business plan you must be elated. With the simple steps above you can write a good business plan step by step. If you have any challenges, you can reach us in the comments section.