Tag Archives: business planning

Back to the Basics: What is a Business Plan?

If you’re driving cross-country to a destination you’ve never visited before, would you want to leave home without your GPS?

Probably not.

However, new business owners sometimes make the mistake of accelerating at top speed to launch their companies without having a business plan to guide them.

A business plan serves as your roadmap. It describes your objectives and the strategies you’ll use to achieve them. Like a GPS, it offers assistance to help you get to where you’re going. And like a GPS’s directions—which change depending on traffic conditions, detours, and other unexpected circumstances—a business plan is a flexible tool. As you encounter market demand changes, new competitive pressures, altered regulatory requirements, and more, you can revisit your business plan and make adjustments to reset your course.

What does a good business plan cover?

What a company includes in its business plan depends on the nature of its business, whether it wants to pursue funding, and other factors. Some companies might find that a simple two-page business plan provides enough direction while others will need one that’s far more extensive and detailed.

The following elements are commonly found in business plans:

  • Executive Summary
  • Business Details
  • Market Analysis
  • Management and Organization
  • Description of Products and Services
  • Marketing and Sales Strategy
  • Financial Projections
  • Supporting Data

 

Executive Summary

This section of a business plan summarizes what your company is, what it does, where it’s located, and its mission. You might decide to include an overview of your leadership team, staff, finances, and growth objectives.

Business Details

This includes detailed information about your company and the problems it solves for its customers. In this section, share about your business’s competitive advantages (e.g., team expertise, use of advanced technology, etc.)

Market Analysis

To complete this section, you’ll need to do some research to learn about your target market and industry outlook. This is where you’ll identify what your competitors are doing, the market challenges you anticipate, and how you intend to successfully compete in your market.

Management and Organization

This section explains how your company is structured and managed. Will you operate as a sole proprietor, partnership LLC, or some form of corporation? It should also share about the people who are running your company, including their level of experience, education background, and skills they bring to the table.

Products and Services

In this part of your business plan, share details about the products and services you offer. How do they benefit your customers? Are you safeguarding your intellectual property by applying for patents or copyright protection? What is your research and product development process? What is your pricing strategy?

Marketing and Sales

Describe your strategies and tactics for attracting new and retaining existing customers. How will you reach your target audience and what does your lead generation process look like?

Financial Projections

This portion of the business plan has a two-fold purpose. It’s for your own benefit (to help you establish your financial goals and expectations) and for potential lenders who want to assess how well your business might perform financially. Within this section, businesses often include sales and income projections, an expense budget, cash flow statement, balance sheet, and break-even analysis. Graphs and charts can be particularly helpful in this section to aid understanding and highlight key information.

Supporting Data

Having an appendix at the end of your business plan will allow you to provide supplementary documentation and information, such as credit history, resumes, patents, licenses and permits, contracts, product guides, or items specifically requested by a lender or investor.

Where to Find Help in Developing Your Business Plan

You can find many online resources that offer business plan templates. For example, the Small Business Administration has a Build Your Business Plan tool, which provides a step-by-step guide for creating a business plan. Also, SCORE has a downloadable Business Plan Template for startups. As you use these tools to get started with your business plan, consider reaching out to a SCORE mentor for guidance and feedback, too. With experience in helping business owners in nearly every industry start their companies, our mentors can offer valuable insight as you develop your business plan and use it as your company’s GPS to success.

 

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Your Year-End Checklist: Items to Review with Your SCORE Mentor

As 2017 winds down, it’s time to think about what’s ahead for your business in 2018. The best way to start is by reflecting on what went right—and not so right—for your company over the past year, and considering where opportunities lie in the new year.

Fortunately, you don’t have to go it alone. SCORE mentors are here to serve as sounding boards and advisors as you evaluate your business and plan for the future.

Here’s a checklist of essential items a SCORE mentor can help you assess:

  • Your business plan (road map)

It’s rare that a company writes a business plan that completely stays the same over time. With so many internal and external influences, your company’s procedures, goals, and objectives are bound to change. Now is the perfect time to revisit your business plan and update it, so it accurately reflects the roadmap you’re envisioning for your business in 2018.

  • Your budget

Take an objective look at your financials (including comparing your actual revenues and expenses to those that you budgeted in 2017). Use that information to identify discrepancies that need further analysis and to realistically forecast your budget for 2018.

 

  • Your marketing strategy and tactics

Consider how effective your efforts have been throughout the year. What campaigns and activities have provided the most ROI and what has fallen flat? Are you on the right social media channels to reach your target audience? Identify your successes and failures so that you can develop a solid marketing plan for the upcoming year.

 

  • Your products and services

Will it make sense to expand or enhance the portfolio of products and services that you offer? Consider what customers have been asking for and market trends. Also, identify any products and services that are failing to sell or that sell but aren’t profitable. You may want to consider removing them from your offerings.

 

  • Your market

Sometimes the difference between the success and failure of a product or service can lie in reaching the right prospects. Are you targeting the ideal market segments in your marketing and sales efforts? You may find you need to change your focus or extend your brand’s reach to obtain better revenue opportunities.

 

  • Your systems and processes

Your business’s profitability can depend upon how efficiently you run your company. Are you able to keep up with sales inquiries? Are you able to fulfill the demand for your products and services? If you’re having issues with these and other aspects of running your business, you may need to implement (or fix) processes and systems that enable you to operate your business more effectively. Or you might discover you need to outsource some tasks or hire employees.

 

Owning a business requires an open, objective mindset and a willingness to adapt if you want to put it on a trajectory of success. SCORE mentors can help you down that path by providing insight and guidance as you review your business’s past performance and goals for growth. Mentoring is free, so there’s no reason not to take advantage of SCORE volunteers’ expertise and experience in all aspects of starting and running a business. Contact us today.