Business plan writing is an essential skill that every student should acquire whether they intend to go into employment or start their businesses after school. Business plan writing is a compulsory unit for students undertaking business-related courses. Peachy Essay receives thousands of business plan writing orders every semester, which indicates the significant number of students taking up the unit.
A business plan is a detailed strategy for the business’s growth, development, and sustainability. The main agenda for a business plan is to source funding, but it can also be developed for planning purposes.
Business plans may differ depending on the type of business, but the structure remains the same. Business plan templates come in handy when a student intends to do all the work by themselves. There are numerous templates available online for each type of business that has ever been established.
A complete business plan has ten essential parts, and these are as follows:
Executive summary
An executive summary is simply a general overview of the business. It can either be written as the first item of the business plan or at the end. It covers the acmes of the business, and in some cases, it is presented as a stand-alone document. Some investors will even request an executive summary of the business instead of an entire business plan. It is a concise document, mostly taking not more than two pages.
Company Description
In cases where the executive summary is written as a separate document from the business plan, the first item of the business plan will be the Company description. In most cases, the two are merged since they more or less describe the same item.
A well-written company description is an effective communication tool for a business to the potential investors, customers, employees, and lenders.
The company description must clearly explain the main agenda of your business and the factors that set it apart from the rest. Lenders and potential investors should be able to see through the industry by reading the document. Mission and vision statements are a necessity in the company description section.
Market research
Before settling on a business idea, you must have conducted market research. This involves collecting data on the market trends and getting into the minds of your potential customers to see what they feel about the product or service, the spending habits of the target population, and how the competition is performing.
Since trends are changing daily, market research should be a continuous process to improve the business idea and provide your clients with exactly what they need at that particular time.
Competitive Analysis
Competitive analysis indicates the advantages that you have over your competition. Writing a business plan is the most challenging part because you must analyze your competition. How sure are you that the information available is true?
The first step here is to find out who your competitors are, and then you try and gather information about them. You should try and establish why customers would prefer them to you, their pricing models, and the promotions that they run.
Product or Service Description
This part is the most important in writing a business plan because it describes what you offer. Here, it would help if you explained the problems you are solving in the marketplace.
The product or service description should be highly detailed. This is the backbone of your business plan. The stakeholders will seek to understand what you do from here. Do not leave out any critical information.
Sales and Marketing Strategy
This is another crucial part of the business plan. How are you planning to put the word out there concerning your products or services? Sales and marketing are the links between the business person and the customers. You should also provide information on the growth prospects of the market share in the industry.
If you can define your target market with clarity, you can create an effective marketing plan to reach a broader client base.
Financial Projections
Doing financial projections are a challenge for most start-ups because the performance of a business depends on a number of unpredictable factors. This should, however, not be so since it is just a forecast and not the actual financial position.
Financial projections are made by researching other similar organizations and studying the trends in the market.
When writing a business plan, you cannot get the financial projections right. The items that you must include in financial predictions include:
- Sales and revenue estimations
- Cash flow statement
- Profit and loss statement
- Balance sheet
Remember, these are estimations, and the absolute values can go either way.
Management and Company Structure
In this part, you will describe the kind of workforce that you are looking to hire. You are supposed to highlight the qualifications and experience of the people that you intend to employ in each department. It would help if you convinced the stakeholders that you have the right strategy to hire a workforce that will see your dream for the organization come to pass.
On the other hand, the Company structure should include the nature of the organization that is whether it is a partnership, a sole proprietorship, an LLC, and so on. You should also indicate the ownership structure since this information is critical to investors and lenders.
Funding Request
If you are looking to be funded by investors, your business plan should include a section where you indicate how you plan on using the cash. Every coin of an investor’s money has to be accounted for.
Since the organization is expected to grow, you should also include an exit strategy that details what you intend to do when the business outgrows you. This information is very crucial to investors as well.
Appendix
This section is neither here nor there since it is only included when there are extras that did not fit into the main document. It can consist of Charts, illustrations, tables, details of a patent or a pending patent, licenses, and contact information, among other items that might interest the parties concerned.