Operations: To explain how the business is run Financial Pro Formas: To forecast successful financial performance for all activities Financial Requirement: To present the type and amount of financing needed, based on the previous sections, to accomplish the whole plan Exhibits: By definition, to close the plan and separate any supporting materials that would otherwise interrupt the flow of the story A professionally written startup business plan has all 12 of these basic sections presented in the order of the outline.
Most of the segments listed will also be reflected in the same order of presentation, although there may be slight variances depending on your type of business. When your business plan is written to obtain financing, the financial requirement section may be tailored either as a loan request or as an investment offering proposal, and then titled accordingly. A Winning First Impression The saying, "There's no second chance to make a good first impression," is highly appropriate when it comes to the opening sections of your business plan and its overall appearance.
With current desktop publishing, business plans are looking more professional--prospects are competing for neatness and an impressive presentation that sets them apart. As to format, the norm is to bind your business plan in booklet form with high-quality materials.
Better ones have quality report covers in dark or rich colors and are labeled on the front. The title page serves better than a label if laminated or positioned behind a windowed cover or behind a full clear cover.
Most types of binding are available at copy centers: Ibico and GBC presentation bindings, Wire Bind, and Velobinder are a few of the better ones. Some businesses go the extra step to have printed covers or printed binding strips. Three-ring binders have been used for years and are still acceptable, but you improve your odds for making that favorable first impression by using the latest and most professional-looking, high-tech materials available. Page layout. Make sure the layout of each page is balanced and artistically pleasing, with a lot of open or negative space--paragraphs, lines, and characters should not be too closely spaced.
With desktop publishing, many types of fonts are available. It also gives you some momentum and traction and helps you recruit partners and employees. Undoubtedly, version 1 of your product will not be as good as version 2 or version 3, but you need to start somewhere. When starting out, your product has to be at least good if not great. Everything else follows from this key principle.
Thoroughly Research the Market Opportunity and Your Competition Make sure you are thoroughly researching the market opportunity and competitive products or services, and keep on top of new developments and announcements from your competitors. One way to do this is to set up a Google alert to notify you when any new information about those companies appears online. Expect that prospective investors in your company will ask questions about the market opportunity and your competitors.
So anticipate these questions from investors: How big is the addressable market? How much of it can the company realistically capture? What traction have those competitors obtained? What gives your company the competitive advantage? The focus should be on bringing your first products and services to market.
Marketing and sales plan The marketing and sales plan section of your business plan details how you plan to reach your target market segments also called target marketing , how you plan on selling to those target markets, what your pricing plan is, and what types of activities and partnerships you need to make your business a success.
Before you even think about writing your marketing plan, you must have your target market well-defined and have your buyer persona s fleshed out.
Without truly understanding who you are marketing to, a marketing plan will have little value. Your positioning statement The first part of your marketing and sales plan is your positioning statement.
Positioning is how you will try and present your company to your customers. Are you the low-price solution, or are you the premium, luxury brand in your market? How are your competitors positioning themselves? How do you plan on differentiating from the competition? In other words, why should a customer choose you instead of someone else? Where do you see your company in the landscape of other solutions? You just need to explain where your company sits within the competitive landscape and what your core value proposition is that differentiates your company from the alternatives that a customer might consider.
You can use this simple formula to develop a positioning statement: For [target market description] who [target market need], [this product] [how it meets the need]. Unlike [key competition], it [most important distinguishing feature]. Unlike [name omitted], LivePlan creates a real business plan, with real insights—not just cookie-cutter, fill-in-the-blank templates. Your positioning strategy will often be a major driver of how you price your offerings. Price sends a very strong message to consumers and can be an important tool to communicate your positioning to consumers.
If you are offering a premium product, a premium price will quickly communicate that message to consumers. Deciding on your price can feel more like an art than a science, but there are some basic rules that you should follow: Covering your costs. There are certainly exceptions to this, but for the most part, you should be charging your customers more than it costs you to deliver your product or service.
Primary and secondary profit center pricing. Your initial price may not be your primary profit center. For example, you may sell your product at, or even below, your cost, but require a much more profitable maintenance or support contract to go along with the purchase.
Matching the market rate. Your prices need to match up with consumer demand and expectations. Price too high and you may have no customers. Price too low and people may undervalue your offering. You can establish your pricing based on several factors.
You can look at your costs and then mark up your offering from there. Market-based pricing. Another method is to look at the current landscape of competitors and then price based on what the market is expecting. You could price at the high-end or low-end of the market to establish your positioning. Value pricing. A promotion plan details how you plan on communicating with your prospects and customers. Here are a few areas that you might consider as part of your promotional plan: Packaging If you are selling a product, the packaging of that product is critical.
If you have images of your packaging, including those in your business plan is always a good idea. Be sure the packaging section of your plan answers the following questions: Does your packaging match your positioning strategy? How does your packaging communicate your key value proposition? How does your packaging compare to your competition? Advertising Your business plan should include an overview of the kinds of advertising you plan to spend money on. Will you be advertising online?
A key component to your advertising plan is your plan for measuring the success of your advertising. The template will help you make sure all areas are covered, so your startup goes more smoothly. Make plans. Probably the most important thing you can do with your business plan is to use it to build your startup business. Small business expert Susan Ward suggests creating goals for each section of your business plan and making an action plan to achieve each one.
Begin with a General Description of Your Business Write a general description of your business, which includes: Type of Business Describe what type of business this is retail, manufacturing and what the business produces or sells. Legal Organization Discuss how the business will be organized corporation, LLC, sole proprietorship, for example and the process you will use to set up this organization form.
Business Location Describe the facility you will use for your business, including an address and information about the area.Going through the process of writing a formal business plan will increase your chances of securing an investment and also improve your potential growth rate. Appendix If you need more space for product images or additional information, use the appendix for those details. This description should include: A description of your "ideal" customer in terms of this person or company's characteristics, attitudes, and buying behaviors. Getting a prominent review of your product or service can give you the exposure you need to grow your business.
Your prices need to match up with consumer demand and expectations. Excerpted from Rule's Book of Business Plans for Startups by Roger Rule, from Entrepreneur Press More from Entrepreneur David provides constructive insight to help businesses focus on their company growth, build brand awareness and know when and how to raise money. A discussion of the information about the "population" to whom you will be selling, in terms of numbers and demographics characteristics , like age, sex, education level, income level, and other important information.
Every business will have key metrics that it watches to monitor growth and spot trouble early, and your business plan should detail the key metrics that you will be tracking in your business.
Content marketing A popular strategy for promotion is engaging in what is called content marketing. Business Location Describe the facility you will use for your business, including an address and information about the area. How are your competitors positioning themselves?
Remember, your business plan is a tool to help you build a better business, not just a homework assignment. Where do you see your company in the landscape of other solutions? If public relations if part of your promotional strategy, detail your plans here.
When these are justified to the right or left margin, they are referred to as sideheads.
You can always use the appendix of your plan to provide the full specs if needed. While large auto manufacturers do build large components of their cars, they also purchase common parts from third-party vendors and incorporate those parts into the finished vehicle.
Market and Competition: To evaluate what you are getting into.