For those who have no idea what a business plan is, A business plan is a detailed document that is written to outline what a business’s objectives are and how it intends to achieve these goals. A business plan shows a business’s road map in terms of marketing, finances and operations. In this comprehensive article, you will learn how to write a business plan quickly. Writing a simple business plan can be quite easy. There will be a free business plan template for you to download at the end of this article.
Writing a great business plan does not require you to have a business or accounting degree.
As an entrepreneur, you need to have business plans and here are some of the reasons why:
- It shows potential lenders and investors that you have insight into your market.
- It helps you know your competition and how you can provide something they’re not.
- This lets you know how feasible your business idea is and you’ll know whether to go ahead or to tweak some things.
- Writing a business plan helps you know how much you need to raise for your business
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Key Business Plan Components
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There are 6 essential sections a typical business plan covers. Whether the business plan is for raising money, growing your business or seeing if the idea is feasible, having these 6 sections will help you bring out a detailed and complete business plan.
These 6 sections include:
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1. Executive summary
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The executive summary is the section of the business plan that talks about your company, defines what your company does and shows what you need from potential investors.This is the first chapter, structurally. Now while this is the first part that’s read, it is advisable to write it last. This is because it is a summary of everything in your business plan.
The executive summary can be a stand-alone document that gives the highlights of your detailed plan. More often than not, investors will ask for the executive summary first. If they are interested in it, they would ask you to send in a full business proposal.
What to include in the executive statement include:
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Business overview
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The business overview, also known as value proposition, is written at the top of the page, under the business name. Business overview is simply a one or two sentence description of your business. include a one-sentence overview of your business that sums up the essence of what you are doing.
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Problem
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Write about the problem or problems, in one or two sentences, that your business is going to solve in the market.
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Solution
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You talk about the solution to the problems mentioned above in this part. This will be your product or service.
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Target market
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Here, you specify your target market. Who they are, how many they are and why they’re ideal for your product or service.
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Competition
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This is where you talk about other businesses that offer a product similar to yours. You should, in very brief terms, talk about how your product or service is unique. What you offer that your competition doesn’t.
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Company overview and team
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Give an overview of the members of your team (if your business consists of more than one person) and explain why they’re competent and are the right people to take the idea to market.
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Financial summary
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Highlight your planned sales, expenses and profitability in your financial plan, more likely with a chart.
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Funding requirements
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You should state how much money you need in your business plan if you want a loan from a bank or if you’re submitting it to potential investors. Endeavour to include the details of what you need in the executive summary.
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Milestones and traction
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The last important part of the executive summary that will make investors interested in your business plan is the progress that you’ve made so far and future milestones that you intend to hit. If you can show them that there’s a lot of interest in your product and that some customers are even buying them, indicate it in the milestones and traction section.
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2. Opportunity
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This chapter of the business plan is where you include all the details of your business. The opportunity chapter talks about how you will solve the problem your business is solving, who your products or services are for and how your product will stand out from the competition.
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Problem And Solution
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Describing the problem that you’re solving for your customers is how you start the opportunity section. In this section, you’ll describe, accurately, what your customers’ pain points are.
Once you’ve talked about the problem, the next section should be about how you intend to use your product or service to solve those problems. Talk about how exactly it will solve their problems.
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Target Market
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Now that you have clearly outlined the problems and the solution you’ll offer, the next thing to include in your business plan is your target market.
Do your market analysis and market research to determine who your target market is.
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Competition
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Giving details of your competition is what comes after describing your target market. Talk about other businesses in your industry with the same offering and most importantly, talk about how your business stands out and what makes it b better.
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3. Execution
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The execution chapter of your business plan consists of everything you plan on doing to make your business idea work. In this chapter, you reveal your marketing and sales plan, operations, how you intend to measure success and the key milestones that you expect to achieve.
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Marketing and sales plan
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This section of your business plan describes how you will reach your target market, how to make your target market buy from you, how you intend to price your product or service and other activities and partnerships that can help make your business a success.
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Operations
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The operations section is how your business works. Here, you should describe activities that your business will engage in on a daily basis to increase the value of the enterprise and earn a profit.
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Distribution
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If your business is product based, you should describe what your plan for distribution is. If it is services your business offers, you can skip this section.
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Milestones and metrics
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Milestones are goals that you set for your business, with dates and the person or team responsible for meeting those goals. In this section, you outline the milestones you have reached or intend to reach and the steps you will take to reach them.
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4. Company Overview And Team
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In this chapter, you’ll review the structure of your company and who the key team members are.
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Team
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The company overview and team chapter of your business plan is where you make your best case that you have the right team in place to execute your idea.
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Organization chart
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Finally, you may choose to include a proposed organizational chart in your business plan.
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Company overview
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The company overview will most likely be the shortest section of your business plan.
this section should include:
- Mission statement
- Intellectual property
- A review of your company’s legal structure and ownership
- The business location
- A brief history of the company if it’s an existing company
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5. Financial Plan
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The financial plan is the final chapter of the business plan. A typical financial plan will have monthly sales and revenue forecasts for the first 12 months, and then annual projections for the remaining three to five years. Three-year projections are typically adequate, but some investors will request a five-year forecast.
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6. Appendix
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While the appendix is not a required part of your business plan it is a useful place to put all your charts, tables, definitions, legal notes, or other critical information that are either too long or too out-of-place to include elsewhere in your business plan.
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Click the link below to download a free business plan template:
https://ogcapital.com.ng/wp-content/uploads/2021/11/business_plan_template_2020.docx
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My name is Emmanuel Ejiga. Content lead of OG Capital
I am a writer. Technical writer, song writer, and sometimes fictional writer.
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