Developing a good business plan is an essential first step for any entrepreneur. If done well, a good business plan serves the dual purposes of helping focus and motivate the entrepreneur while at the same time conveying his message to prospective investors. The perfect business plan will be clear, concise, well thought out, and based on realistic projections.
The first step in developing the perfect business plan is to establish a Statement of Purpose. In other words, why are you embarking on the business you’ve chosen? Why was this business or field chosen over another? Being able to convey your purpose largely affects whether or not you’ll be moving in the right direction.
Next, your plan should include a complete and detailed description of your business. Be careful to avoid the temptation of wordiness; be concise and write only what’s necessary to complete an accurate description. You can follow this with an objective list and description of goals. Include short, mid, and long-term goals along with the methods you will employ to reach those goals. Careful research in the industry of your choice will help you set realistic goals.
In the next section you’ll need to spell out who your target customers are, why they are your targets, and how you will reach them with your product or service. Include marketing methods such as advertising strategies, promotions, and how much you plan to spend as a percentage of your total budget. In this section you should also write a paragraph or two assessing your competition, both locally and regionally.
The final section of your business plan deals with finances. Here you will discuss cash flow, balance sheet, and an honest assessment of your finances. Discuss potential sources of investment and how you plan to make your company attractive to investors. As you did with your goals, do the research necessary to find out how similar business are doing in your area.
Putting the plan in writing can be a daunting task, so make sure to seek out others who have started their own successful businesses. Even the most well thought out plan will have its flaws, and no one is in a better position to help you correct those flaws than someone who’s already succeeded. If you’re on the right track others will see it and let you know.
Lastly, developing the perfect business plan certainly increases your chances of success but it’s still no guarantee. If things don’t turn out exactly as you had planned it’s not necessarily the result of a poor business plan. Take a copy of your plan and meet with a business counselor, or someone else you respect in a similar field, and go through it together. If flaws are found you can correct them. If you find sections which are not flawed, but which need to be updated to fit your current circumstances, this is the time to do that as well.
Remember, a business plan is not set in stone. Rather, it is a guide which can be changed or adapted to fit your current circumstances. Just be realistic and willing to flex as your business environment evolves.
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