A business plan is a business development map. Not only does it show your end destination, but it also maps out your travel path. Set out realistic goals and a stable path.
Every business venture can benefit from the preparation of a carefully written business plan. The purpose of the business plan is to:
- Help you think through the venture and ensure that you have considered all options and anticipated any potential difficulties
- Serve as an operating guide as you turn your ideas into a viable business
- Aid in arranging strategic alliances and obtaining contracts
- Convince potential funding programs, lenders and investors that the proposed venture has merit
Writing the Plan
The hardest part of writing a business plan is getting started. The thought of writing a document of this length may seem overwhelming to many people. This is why it is recommended that you use the bite-size approach to writing your business plan.
Set aside a specific period of time each day to sit down and write a few paragraphs or pages.
If you are not able to fully answer a question, write a few short notes that immediately occur to you, and think further about what the questions suggests.
As you continue to write and do more research, you can go back and add things that you have previously missed.
You may not find it possible to answer every question; however, you should be aware of these issues as they may affect your venture in the future.
A common mistake in writing a business plan is to recognize only the data that supports your concept and to ignore facts that, when considered objectively, might change the direction of your business.
Issues must be seriously and objectively considered and you should be somewhat open minded in your approach.
It is better to recognize needed changes when your business is in the planning stage than when the business is already underway and your investment is at stake.
Many good business plans go through several revisions and take up to six months to complete.
As changes in the business environment occur (i.e. new competition, new product design), a company’s business plan should be modified to reflect the new environment. A business plan is not a static document – it will continue to evolve as the business grows and things change in the internal and external environment.
Avoid highly technical terms and diagrams that the reader may not be familiar with. You want to write the plan as if the reader knows nothing about the type of business you are starting.
Think of your business plan as a sales document. After all, it must convince you and other readers that your venture has the potential to be successful. Your enthusiasm, dedication and confidence in the project should be evident to the reader, to the point that they will share your view.
Remember not to ignore or omit risk factors that are inherent with your project. Risk is inherent in every business venture.
Should I Write the Business Plan Myself?
The management team should develop as much of the business plan as possible.
Much of the information, data retrieval and the setting of objectives and targets can only be completed by the management team. These objectives and targets will be issued to measure the success of the business by investors, lenders employees and management.