How to write a compelling small business business plan? Even if you know your business inside out and outside in, it is a good start, but still writing a small business plan takes patience, perseverance, and iterative refinement.
Whether it is aspiration or desperation, inspiration or compulsion, you have started a small business. After some sputtering, the company is on the verge of taking off. You know how to get from Point A to Point B to the point where your business is a success, but you don’t have the money to get there. You need a loan. Or equity investors. Or business partners. You also need managers and other employees.
A written business plan reminds you of what your goals are and often compels you to make decisions that will help you achieve those goals.
What you need is a business plan — a plan that converts all the ideas in your head into a document that you can show people. Investopedia defines a business plan as “a written document that describes in detail how a business, usually a new one, is going to achieve its goals.”
A compelling small business business plan is typically 15-20 presentation slides (or 3-4 pages in a word document).
Perhaps, you should have written your business plan before you started your business. You need one if, like most entrepreneurs and small business owners, you don’t have enough money to finance the company of your dreams on your own. Banks need to be convinced that your business will succeed in the long run if they loan you money. You should have presented a business plan to a loan officer or a prospective investor or a potential business partner before taking the financial risk of quitting your job.
A business plan’s components include projections of sales, revenues, expenses, and profits as well as what you need to do to attain those projections. It sets goals to achieve by particular dates — short-term goals as well as long-term goals.
Putting on paper what you need to do enhances the chances that you will do so. For example, you might have figured out that your company needs to make 10,000 sales calls to sell 1,000 insurance plans by a particular date. A written business plan reminds you of what your goals are and often compels you to make decisions that will help you accomplish these aims. If it appears your sales calls and sales are short of your goals, you could provide better incentives for your salespeople or hire new ones.
The probability of achieving your goals is even more prominent when the business plan with those goals is in the hands of loan officers, investors, business partners and others who have made decisions based on their confidence in your business plan.
The sooner you write a business plan, the better. If you want to write the best program possible, though, you should consider the following steps:
Compelling Small Business Business Plan:
The most important thing you need to do in a company profile explains the products and services you are selling and why they will fulfill a need in the marketplace. Be specific about your customer base and prospective customer base. Writing an excellent company profile can also help in other ways. It can be a foundation, for example, on your website, and in your promotional materials.
An excellent market analysis will describe your industry, your competitors, your target market, your business’s anticipated market share, and the revenue your company will earn via this market share.
Lots of entrepreneurs and small business owners have great ideas about products and services the public will love. As a business owner, though, you need to convey more than great ideas in your business plan. You need to describe how your company’s leaders have the skills and experience to convert those ideas into a successful business. Does someone in your corporation have experience in running a business? Do you have employees with financial expertise, marketing expertise, and sales expertise? Hopefully, you can write several paragraphs about several managers that detail their educational and professional background and accomplishments.
Your business plan has said your company’s products will fill a need and your labor force can accomplish that goal. Now, you need to show people who read your plan that your business will succeed. You should pay a company to do a market research study. An excellent market analysis will describe your industry, your competitors, your target market, your business’s anticipated market share, and the revenue your company will earn via this market share. This Small Business Administration (SBA) report has more detailed recommendations for your market analysis.
How many salespeople will you hire? What regions will each sales division be responsible for? How will they meet prospective clients? What’s their sales pitch? How will they convert leads into sales? How are you going to notify the public about your company and its products and services? Do you plan on utilizing advertising and/or free media? These are all questions that should be answered in your business plan. The SBA’s report on this topic notes that you need a market penetration strategy, a growth strategy, a distribution strategy, and a communication strategy.
If your company is in business, your business plan must include past sales, revenues, expenses, and profits. Submit balance sheets, income statements, and cash flow statements that show trends and results over time. Then, include projections of sales, revenues, expenses, and profits that are based on your sales and marketing strategy. Being realistic about your early years is crucial. Bank officers can spot an unrealistic plan. The SBA’s report on financial projections recommends monthly or quarterly forecasts in your first year, quarterly and annual projections after the first year. “Make sure that your projections match your funding requests,” the SBA says. “Creditors will be on the lookout for inconsistencies.”
An executive summary is the last part of the business plan that you write, but the first thing that readers see. It should be one page. Remember that prospective investors and business partners aren’t like bank officers. They don’t have to read your entire plan before making a decision. Thus, you need to draw them into the details of your proposal by writing a concise and compelling summary. The summary needs to include a brief but exciting description of your products and services and a short but exciting description of your company’s growth and/or prospective growth.
The difference between an effective business plan and an ineffective business plan could be the difference between getting a loan and not getting a loan as well as the difference between getting financing from investors and not getting funding from investors. Thus, it is crucial that at least a few people you trust to review your business plan and make recommendations on how to improve it before you show it to decision makers.
Hopefully, the final iteration is a compelling small business business plan that is worth every minute spent on it and will help your business to achieve the goals and objectives.