March 19, 2024

Business Basics

Plan It

Business Plan Components and Tips

| 4/22/2015

All new businesses are founded on the basis of an idea, but the ones that succeed also have a written plan. And while nothing quite matches the exhilaration of buttonholing friends and family with the words “Wait ’til you hear this great idea I’ve come up with for a new business,” if you want to be taken seriously by probable funding sources you will need to have more than enthusiasm and a fabulous idea — you will need to write a formal business plan.

Business Plan Basics

What Is a Business Plan?

A business plan is a written document that describes the nature of your business and the product or service you mean to provide. It’s a must if you intend to seek outside capital. And even if you don’t, a business plan is useful as an operational guide for you personally and as a way to communicate your goals and strategies to others. Simply putting a plan on paper helps you to solidify the details and takes your business to a new level.

While businesses may be as unique as their owners, every business plan should encompass the following same basic topics, upon which the individual components of the final plan are built:

Business Concept
What am I selling?

Market Aassessment
Who will buy my product or service? Who are my competitors?

Financial Assessment
How much will people be willing to pay for my product or service? Can I make a profit at this?

Self Assessment
Do I/we have what it takes to succeed?

 

The Components

How to Structure Your Plan

A business plan is essentially a road map to follow on your journey to business success. Every formal business plan should include the following titled sections:

Executive Summary
Highlight the strengths of your plan, including where you want to take your company and why your idea will be successful.

Company Description
Make this your extended “elevator pitch” to help readers, especially potential investors, quickly grasp the uniqueness of your business.

Market Analysis
Show that you understand your industry, target market, customers, competitors and pricing structure.

Organization and Management
Describe your company’s organizational structure and introduce ownership and members of your management team.

Service or Product Line
Emphasize the benefits you can provide to current and potential customers.

Marketing and Sales
Explain how you plan to promote your product/service, create customers and boost sales.

Funding Request
Lay out your current and future funding requirements, the intended use of any funds you may receive and the types of funding you would prefer.

Financial Projections
Projected income and expenses, past credit history, intended allocation of resources and other financial details.

Appendix
A compilation of supporting information and actual documents such as: your credit history; letters of reference; resumes of key managers; leases; licenses, permits and/or patents; a list of business consultants such as your attorney and accountant; and relevant magazine articles or book references.

Tags: Florida Small Business, Business Basics

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