- Elon Musk, Investor & Entrepreneur
With businesses facing so much competition on a daily basis, each business owner must have a plan in place in order to succeed. An established business plan is how most businesses achieve this end.
Business plans outline the best strategy, or strategies, for the success of any individual business owner. To that regard, a business plan makes an argument that a product should be made or action should be taken.
A business plan also makes clear what is profitable and productive to the company or a business partner, what you want each stakeholder to do, and what’s in it for each involved party.
A business plan is the documented plan marinated by business owners. The purpose of a business plan is to convince a company or potential business partner that a proposal is profitable, workable, and is an overall good idea. Terms are outlined in a way to convince the stakeholder that they should follow the business plan.
THE BEGINNING OF A BUSINESS PLAN
Generally, business plans have an introduction that spans multiple pages. Each page of the introduction has a different meaning and purpose.
The first page of a business plan should be the name of the plan. The name should convey what the business is or what it does. Because the name is the first thing that anyone sees or hears, owners should put a lot of thought into that initial message.
The next page should contain an executive summary, explaining the reason why the plan is needed for the company. It’s a page to convince an executive board, funder, or potential business partner why the plan is important. It usually explains that they have an opportunity to make a lot of profit.
The last page of the introduction should cover the interest and goals of the company and how they relate to the business plan. This portion of the business plan is called the company description, in that it offers a breakdown of the company itself. It shows that the business plan was made to help the company succeed or make more profit.
THE MAIN CONTENT OF A BUSINESS PLAN
The next section of a business plan is called the company description. It should cover the product or action that the person presenting the plan wants their audience to make. The description is the main part of the business plan and is the thing that every part of the business plan is based on. Owners should make sure that a sincere amount of thought goes into making this part of the plan.
The main content of a business plan should be as many pages as it needs to be to cover the basics of what the product or action is. For example, one business plan might have an extensive description of the product that they were suggesting, while another business plan might explain its product in a couple of sentences.
WHAT A BUSINESS PLAN IS USED FOR
To make use of an effective business plan, owners need to have a marketing plan, an operational plan, a management plan, and an economic plan. These are essentially what businesses are looking for when evaluating whether or not the proposed business plan is beneficial to them.
A marketing plan is a suggestion of how a product or action can attract customers or improve communications. This is a plan that shows the company that this plan helps them earn money. It is important because this is one of the biggest selling points for the company and is the best chance to have them want to listen to the product early on.
An operational plan explains how the product or service will be carried out. Thus, it explains the process of how to make the product or perform the service in a way that the company can understand. This is important to include because this is what the plan is asking the company to do and is what the company is looking for to determine how difficult it is to back the plan.
A management plan explains how the company can supervise the efficiency or completion of the operational plan. It should cover the number of different positions needed, and how many people are needed in each position. This is important because it tells the company how many people they should put move or hire to carry out production for the business plan.
The last portion that you need is an economic plan. This should explain projections of income and the amount of funding needed. It should cover what the company needs to spend and why, as well as an estimate of what they’ll earn and reasons as to why the numbers are the way they are. This is the last point to sell the company on the product, so making sure that the economic plan is convincing and the logic is good is one of the most important steps while making a business plan.
WRITING THE CONCLUSION
The conclusion for a business plan should be a summary of all of the major points that the plan explained. These points should tie in with one another, thus the organization should be clear. Owners should make sure to reinstate what the product or action is, how to make it or perform it, and why it is beneficial for the company to do so.
Remember, a business plan is usually about fifteen to twenty pages of content, sometimes with an additional couple of pages for forms and applications. Having enough content to thoroughly explain the business plan is one factor in having a convincing plan.
If the plan was really short, it makes it look like there wasn’t enough thought put into it. If the plan is too long, then it won’t have the attention of the people that it’s being demonstrated to. Having a length that is in between too long and too short is key.
If the plan doesn’t explain why it’s important or profitable for the company, then the business plan might not work. Making everything as clear as possible, whether that means explaining things in more detail or less detail, is important so that the business plan can be conveyed properly.
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