If you have ever dreamed of starting your own business, the first step is to create a detailed business plan. It doesn’t have to be complicated, but it needs to be well thought out. Not only will this give you a sense of direction, but it’s something you can bring to investors if you need funding.
A well-written business plan can help you monitor your finances, provide an opportunity for unique partnerships, make you attractive to industry leaders, give you a basis for future business decisions, and ultimately help you grow your business. . Below, we’ve broken down 17 tips to get you started.
“While it may depend on your industry, in general, your business plan should take about 15 minutes or less to go through. A reader should be able to get a good idea of your main content with a quick read ”, explains Patrick Samy, CEO of Spanner health. “Use the format, titles, illustrations and white space to your advantage. The length can vary widely, but around 20 to 40 pages is a good rule of thumb for standard start-ups.
Know your audience
It may be a good idea to have several versions of your business plan tailored to different audiences. You can have one for bankers or venture capitalists, one for individual investors, and one for companies that want to create a joint venture with you. By tailoring your plan to your target audience, you are more likely to generate their interest and funding.
Know your competition
“It’s important to know who your competition is. You shouldn’t denigrate them to anyone you speak with, but you should be able to express what makes you different from them and why you think you are superior to them, ”says Mehdi Marrakchi, CEO of Mob Hookah. “Many industries are overcrowded, so it is important for you to be able to differentiate yourself in your business plan. “
Have proof (to support your claims)
“Make sure your business plan isn’t filled with fluff or promises you can’t keep. Your claims and statements need to be backed up with facts and figures. If you are confident in the success of your business, we need to know why, ”says Miles Beckett, CEO and Co-Founder of Flossy.
“Is your team made up of the best talents? If so, what are their references? If you think you will become a leader in your industry within a year, why? For every statement you make in your plan, make sure you have concrete reasoning behind it, ”says Beckett.
Be careful in your financial estimates / projections
It is always wise to err on the side of caution when developing financial estimates or projections. You want to make sure that your business is going to grow and potential investors want to make sure that they are making a good investment. By being careful with your projections, you take into account factors that are either beyond your control or unexpected. Sometimes the expense is higher than originally planned, so it’s always better to under-promise and over-deliver, than the other way around.
Be realistic with time and resources
“Being realistic can give your business plan credibility. Many entrepreneurs are overly optimistic about how long they think things are going to take. A good rule of thumb is to expect things to take 15% longer than you expect, ”says Jason Wong, CEO of Building Blocks. “When you order supplies, answer the phone and pay the bills, time is easily wasted. Know that this is a marathon, not a sprint.
Have a strong management team
“Surround yourself with the best talent. It is important to hire people who are different from you. You want your team to complement you, not imitate you, ”says Lindsay McCormick, Founder and CEO of Bite.
“Make sure they have experience in your industry. When you are starting out, you will need some advice. If you are able to hire people with a lot of experience or quality references, then do so. You need a strong team behind you if you want your business plan to be successful, ”says McCormick.
Prove why your idea will work
“In your business plan, you have to justify your idea. Is this a solution to a common problem? If so, why do you think it will work? Says Juan Pablo Cappello, co-founder and CEO of Nue Life. “Your plan should include all of the variables that will impact the outcome of your idea. Explain how you would overcome them and why your idea will succeed when others did not.
Discuss payment options for your investors
Every investor is different. Some want to be very practical, while others don’t want to be involved in everyday activities. What they have in common is that they want to know how and when they are going to be paid. Be sure to include options for all serious investors so that they know what they are getting into and if it is a worthwhile investment for them.
Test your business idea
“Before you sit down to write your business plan, test it on people. Chat with industry experts, potential clients, and other entrepreneurs to assess its viability. Ask for honest feedback, ”sasys Chris Gadek, Growth Manager for AdQuick. “Before you develop your plan, it’s wise to know what you might be facing. Take their constructive criticism to heart and keep it in mind when writing your plan. “
Establish goals and objectives
“When writing your plan, it’s important to list your goals and how you’re going to measure those goals. You can set volume goals, revenue goals, business goals and / or individual sales goals, ”says Akhilesh Srivastava, Founder and CEO of Fenix Commerce.
“Once your goals and objectives are established, decide on your timeline to achieve them. If you have an annual goal, break it down into monthly goals so that they’re easier to manage for your team, ”says Srivastava.
Don’t be intimidated
“Writing a business plan can be intimidating, but it doesn’t have to be. Remember, you are the expert when it comes to your business. You know your idea better than anyone. Be confident when writing your plan. If you need to, start with a simple one-page document. From there, you can flesh out your arguments until they are more complete, ”says Jake Langley, CEO of Luma Nutrition.
Many entrepreneurs are not business experts. They don’t necessarily have an MBA or an accounting degree. They are able to acquire knowledge on their own and learn as they go. Don’t let your lack of education or experience stop you from pursuing your dream.
Incorporate visuals to support written statements
“Charts, charts, diagrams, tables and pictures are your friends. Visuals can bring your written statements to life, ”says Kashish Gupta, Founder and CEO of Hightouch. “It also breaks your business plan and makes it more appealing to read. No one wants to read a dense document of more than 30 pages. Make your plan more appealing with visuals that back up your claims.
Be prepared to adjust it as you go
Once your business plan is written, it is not set in stone. Be prepared to make adjustments. As you grow and learn as an entrepreneur, your business plan will evolve as well. It is important to update it at least once a year, but you should review it often.
Has your industry changed at all? Did you encounter any unforeseen obstacles? Are your finances in line with what you planned? At the end of the day, don’t get stuck with your business plan. No one can predict the future, so be sure to adjust your vision once you are aware of the reality.
Use your own resources
“If in doubt, bootstrap. Using your own personal resources is the easiest way to start a business. You don’t have to convince investors of the merits of your idea. You just have to convince yourself, ”says Ryan Holmes, president and co-founder of Hootsuite.
Persevere no matter what
“Whenever I meet a successful CEO, I ask them how they did it. Mediocre CEOs emphasize their brilliant strategic moves or intuitive business acumen or a variety of other self-congratulating explanations. Great CEOs tend to be remarkably consistent in their responses: They all say, “I didn’t quit,” says Ben Horowitz, co-founder and general partner of Andreessen Horowitz.
Write an executive summary
One of the most important parts of your business plan is your summary. Ideally, you would write the latter. This article summarizes all the critical points of your plan in one page. If someone is running out of time or wants a quick summary before delving into your plan, this section is useful. It also requires you to develop your elevator pitch.
You should be able to summarize your plan to potential investors and know with confidence what your concept, your goals are, what sets your product apart from your competition, and who your target audience is. You should also be able to state your marketing strategy, your current and projected financial situation, how much you are requesting and who is on your team.
Posted on December 31, 2021