, Part 1By Ryan M, Hoback, Motivated Entrepreneur Incubation & Consulting
Preparing a business plan is a detailed process. Your first step is to decide who this plan is being prepared for; is it for internal usage or raising capital? You must structure your plan to attract
interest of any party who may read it.
Begin by developing a mental vision of your operation as you would like it to run over next 2-3 years. Then take all your dreams for future and hopes for success and compare that with reality and fact that most businesses do not make it past their first few years.
In order to prepare a document which is truly realistic and representative of what you see for future of your operation, you must do market research and detailed financial summaries to paint an accurate picture of your business prospects.
Let’s talk a little about different sections in business plan.
The Executive Summary is a short document, 1-3 pages, and it is written after rest of business plan is completed. The reason is, this section compiles all information you are trying to get across throughout business plan into a condensed time efficient reading.
The main purpose of executive summary is to state business plan objectives. It is important to show your company’s’ competence – factors that will make your business successful in a competitive market.
The executive summary is incredibly important when pitching your plan to potential investors. Investors spend their time looking at numerous investment opportunities, in order to grab their attention you must develop a short and concise statement of your plan. This allows investor to become attracted immediately without having to spend his time reading entire plan. Once they become interested, they then can move on to rest of document. Think of executive summary as a sales tool, you must utilize this tool effectively in order to close deal and receive funding!
The description of business or business concept outlines what business will do and value it will provide to all relevant constituents. It is foundation for all follow-on activities.
What is your vision of company presently as well as for its future? Why will you be successful in your business? What is your experience in this business? What will be special about your business? These are questions you should ask when developing your description.
Market Analysis is marketing research that yields information about marketplace. Who exactly is your market? Describe characteristics of your target market, demographic, geographic, etc... What are products or services you will offer to satisfy those needs? Market analysis is a regional and neighborhood study of economic, demographic and other factors made to determine supply and demand and current and potential market trends. This area of your plan is incredibly important to understanding your customer base.
