What is an Investor Ready Business Plan

A Business Plan, as all good entrepreneurs starting out in life should know is the foundation, or rather a springboard, towards the establishment and growth of a new business. A business plan is an essential tool for companies raising capital – and your business plan needs to be Investor Ready.

What is an Investor Ready business plan?

An investor ready business plan is a document that has been professionally prepared to meet the needs of both Venture Capitalists and Angel investors. In your Business Plan, you should be able to see your own project through the investor’s eye. Your plan must be able to answer the concerns of an investor.

The investors, both VCs and angels, are risking their hard earned capital by investing in your venture in the hope of long term returns that are worth many times their original investment. An Investor Ready Business Plan demonstrates to investors that you are an expert in your industry and that you have a clear mission. An entrepreneur addresses these needs by prepareing a comprehensive and detailed view of their business objectives and goals. Some important sections that address different concerns of the investors are below:

Management

Investors invest in management – not just ideas. It is very important that you express your knowledge, passion and dedication to your business as best as you can. The competence of your team along with their experience levels and their commitment levels are also factors that investors look into before making their investment decisions.

Customers

It is important to communicate to the investors that you understand the needs and requirements of your customers and to articulate your marketing strategy within your business plan.

Product/Service Description

A complete description of the product or the services offered by you should be outlined in detail. A description of the overall market for your product or service, along with the details of your customer base is essential. The investors need to know the reach and the kind of customers your product / service is catering to.

Marketing Plan

One of the most important sections of your business plan is your marketing plan. This section will outline your sustainable competitive advantage to your investors. In a way assure them why you will succeed where others have failed. This section is where you include a definitive description of your customers, market size, demographics, characteristics, growth prospects, trends and sales potential per product / service category.

Here is where the pricing strategies are outlined and how they can directly influence the growth potential of each product /service. It is also important to include the future growth, market share and trend influences.

Barriers to Entry

Along with giving the details of what your product / service is and who your customers are, you also have to inform your investors how you will you prevent your competitors from taking away your customers. The barriers to entry section outlines your business strategy to keep your competitors at bay and grow in the market. Investors need to feel comfortable about the soundness of your strategy before they invest in your venture.

Click here to contact us to learn more about writing an investor ready business plan: http://www.investorbusinessplan.com/writing-business-plan.html

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Writing Business English Lesson Plans

Today, communication is the key to success of any business whether big or small. With the advent of globalization entrepreneurs should have a good command of their communication skills both oral and written. To attain competitive market advantage and control, their business English should be superb. This explains the high increase in demand for lessons. Therefore, teachers should ensure they are writing business English lesson plans that are relevant and effective to satisfy the uprising demand.

Business English comprises of the same fundamental principle as general English. However, the context of business English, that is, the examples, topics and vocabulary is modified to suit the needs of the students. The lessons are designed in a way that the students will be able to immediately implement what they are being taught into their daily business activities. Therefore, teachers should ensure they are writing business English lesson plans that will enable their students to adapt a responsive approach in order to effectively meet all the needs of their customers. Moreover, the lessons should help them adopt a flexible business attitude in order to supply high quality services and products into the market.

However, some of the experienced teachers usually oppose the idea of writing business English lesson plans. They are of the opinion that writing business English lesson plans is not realistic. According to them, lesson plans emanate a rigid structure that is not conducive for the corporate world. In fact according to them, with the constant change of the business environment, flexibility should be the key principle. Well, I do not disagree but read on and see why I keep on emphasizing on the importance of teachers writing English business lesson plans.

Any experienced teacher should be able to juggle routine and flexibility into his teaching style. Establishing a balance between routine and flexibility enables teachers to effectively pass across their points to the students. Business English demands a comprehensive study of the business environment. Therefore, the lessons comprises of oral presentations, speeches, study trips and close reading among others. This implies that structure is required to ensure the lessons are perfectly presented. So, tutors should draft lesson plans to curb uncertainty, randomness, indecisiveness and unpredictability in the classroom.

Writing business English lesson plans also ensures that the semester is well planned for, that is, it is challenging, realistic and the content relevant to the skill levels of each student. Furthermore, provision of the lesson plans adequately prepares the students. For instance in case they need to raise funds such as trip expenses they will be able to do so before hand. They will also be able to effectively plan their time so as to create a balance between their daily activities and studies.

Most of the students who undertake lessons are corporate clients either running their own businesses or planning to engage into a similar activity in the future. Therefore, tutors should not assume the importance of writing business English lesson plans but embark on the practice of formulating relevant, interesting and high quality lessons. Remember, it is quite fulfilling and motivating to see students enjoying the lessons presented to them.

10 Things Investors Look For in a Business Plan

A business plan does so much more than layout the internal structure of an organization. It provides some key insight to the money-men, the venture capitalists, the angel investors, the private investment bankers or even the traditional bankers. Remember that these people see hundreds, thousands of business proposals a month. And they’re all looking for certain things that either make them love your proposal — or send it immediately to the shredder. We’ve worked with nearly 50 investment firms at one point or another for clients for whom we have written business plans, and based on our experiences and the people involved, there are some important factors investors look for the most from the business plan.

1.) How much money is already invested? Do the client or other individuals/companies have a stake in the business?

Sometimes the difference between getting a loan and getting rejected is as simple as that. Imagine you’re coming to an investor with a fabulous business plan and you need, say, $500 million for a resort and real estate project. In your proposal you clearly state that you do not have one single dime invested yourself (yes, we had a business proposal like this once!). Do you honestly believe an investor is going to give you the time of day? Of course not. You haven’t taken any sort of risk — why should the investor?

In your business plan, it is key to explain fully, in the executive summary and then later on in the financials, just what monies are involved. Okay, so maybe you don’t have any money involved in that resort project, but you DO own the roughly 50 acres of land it will sit upon which is worth maybe $75 million. Good! Mention that in the proposal clearly and accurately, including what kind of land it is, along with a map, some distinguishing features (is it ready for construction, water, pathways, roads, accessibility, etc.) If you have other sorts of assets, something, ANYTHING that can be used as collateral against your loan, make sure it is explained and described.

If you have partners who have chipped in $250,000 for a project worth at the most $2 million, you have a significant edge over other people. Most investors we have dealt with like to see at least 10% of the required funds already in place.

2.) How accurate is the research involved? Does the client know the market, the competitors, and his or her chances?

We can’t begin to tell you how many business plans we have come across that had little or no market analysis or competitive structure. The client had no idea about the target market, the competition he was facing, nor even demographics of the area. He had an exciting product, but it was difficult to ascertain just how much success he was going to have SELLING it.

In many cases, an investor isn’t as interested in the product as he or she is in the product’s success on the market, so a good business plan should have a clear, accurate description of that market. Many things should be included like:

a.) Demographics of your target market and market analysis, with factors such as age, race, income, etc. Think about your average customer walking into your store for your product or service. What are they looking for? What do they look like? How much do they want to spend?

b.) A market analysis that describes the trends and statistics of your potential market. Will your product or service be in high demand for a long time — or will it have limited ‘shelf-life’ on the market, coinciding with a new fad, for example. Will the product or service be affected by shifts in the market? Is this a stable target market with limited shifts taking place, or does the market wildly fluctuate?

c.) Do you know your competitors? What are the similarities and differences between what they sell and what you sell? How are you better than them? How are you inferior to them? (Yes, you need to include that, as much as you don’t want to.)

3.) How realistic are the financial projections?

Be extremely honest. No start-up business makes a profit in its first year, no matter what you are selling. So make sure not to show that in your business plan. Also don’t be too alarmed at the first-year loss. We had a client with a business plan that showed a $400,000 loss against a $2,000,000 loan in his first year of operations and he panicked. Then we explained that he was going to have a loss because his first year of operations would have high expenses as he organized and finished all his preparations for his new company. Investors expect you to have a lousy first year — don’t beat yourself up about it. It’s not the first year that concerns them anyway — they are thinking 3-5 years down the road. If after three years your company isn’t showing a profit, that is when the investors get nervous. After all, why should they put their money into something if your business proposal shows that you won’t be able to pay them back? Luckily for our panicked client, his second year showed a profit of about $30,000 and his Year Three profits would equal $375,000, almost erasing his first year loss. He was going to have a steady 40% increase every year after that.

In many instances, the investor thinks long-term, and so should you. Your financials should explain what is going on, and what will happen. Don’t try to sugar-coat things, per se, but put a healthy spin on a mediocre beginning. Don’t impress the investor with what IS happening — impress them with what is GOING to happen.

4.) Does your proposal look professional?

You’d be surprised how many proposals are overlooked with something as simple as a large ‘BUSINESS PROPOSAL’ on the first page. This is merely common sense. If you want people to take you seriously, show your most professional side. Your proposal should be checked for errors, misspellings, proper formatting, and headings, and have clear, easy-to-read graphics or images. A client tried to convince us to use a dazzling bold red text over a green bar-chart and we hastily explained to him why it’s not a very good idea to ruin the eyes of a potential lender. Include pictures or illustrations, maps, diagrams and other visual aids, if possible. Also, take a good look at your writing. The character Rusty, played by Brad Pitt, in ‘Ocean’s 11’ said it quite well: “Don’t use 7 words when 4 will do.” Talk about your management team, but don’t drone on about how instrumental a part they have played in your life. Talk about the great product you have, but don’t go on about testimonials from other people,(or if you must, include them in the appendix) And don’t be funny. Humor should be left at the doorstep. If you want to be funny, become a stand-up comic. Treat your document and the people reading your document with the utmost respect.

5.) Is the management team solid? Are there good people involved?

Remember that your business is not, and should never be, about you. There have to be some good people involved with you to make it run smoothly. It does not matter what service or product or project is being offered, if you think you can convince an investor you’re a veritable one-man show, you are out of your mind. A client we recently wrote a business proposal for was creating a new mobile-phone service, and amazed us with the list of engineers, technical advisors and IT professionals he had attained. When we saw how the management structure was fully laid out, and how each individual was going to fit in, we knew right away this particular proposal had a good chance to get in the front door.

Investors want to know who is on board, what their job is, their experience in the field you have chosen to represent, and a little of each person’s background and education. A solid management team, with a full layout as to positions, responsibilities and backgrounds, is a sure-fire way to get an investor looking at your proposal a lot more.

6.) Is the exit plan well defined?

Unless your lender is going to get involved with you through a joint-venture, or partner, chances are he or she does not want to stick around with you forever. Investors want to know what you’re offering them later on down the road, when it’s time to cut you loose and count the money you made for them. Some examples of exit plans include:

a. Creating an initial public offering (IPO). If your business has the possibility of going onto the stock exchange later on, and investors can share in dividends, this is very important for them to know from reading your proposal. Let them know how long it will take to get an IPO, and estimate the price per share you foresee, if you’re offering investors a first-buy once the IPO goes public, etc.

b. Buyout. Perhaps your shoes-string business is going so well, your investor is impressed enough to want to buy your company completely for several million dollars. If you want to offer this alternative to long-term investing, make sure you let the investor know the approximate value of the company after a certain number of years. A business valuation report is very helpful in this regard. Let the investor know exactly what he or she might be getting into and if it’s really worth pursuing. If you can do a valuation of the company based upon your projections, it may assist the investor in determining if you are worth the time and effort to invest.

c. Sell the company to others. If your business has the possibility of going up for sale to other interested parties, the investor should know details such as possible buyers, how much they could pay, the value of the business at the point of sale, etc.

d. Pay out of equity. Let’s say Steve wants equity in George’s company and receives 20%. Steve loans George the initial funding and an agreement is made that Steve will own this equity for 10 years. Each year, George will pay Steve 20% of the gross profits. At the end of ten years, if any money is still owed on the loan, which is doubtful, George will pay the equity of 20% and a balloon payment of anything that remains on the loan. All this, of course, must be agreed upon at the outset, so make sure you define this clearly.

7.) How much money do you need and how will it be used?

As weird as it sounds, we have had business proposals come past our desks that explain how much money is needed — but fail to tell us what it’s being used for. An investor will balk at someone who says they need $100 million for an oil well project yet doesn’t explain where all this money is going. Our business proposals include a special heading for Start-up expenses (when dealing with a start-up company, of course), that explains and lists the expenses the investment will cover, and for how long.

If you want to really impress investors, include what we call a “phase plan”. For example, let’s say you want to start that oil well project. In Phase One, you show the investor what you’ll be spending, in this case, for surveys of the land, preparations for drilling, etc. Phase Two could show expenses for drilling equipment, personnel, and construction of the wells. Phase Three could discuss refining procedures expenditures, and so on. You have detailed out a full “shopping list” for the investor, and they not only know what you’re spending, but how it’s being spent, and an estimated time when it will be spent.

8.) How will the money be paid back?

On the heels of exit plans, an investor likes to know how you’re going to pay him or her back. If you can agree on a certain percentage each month, or each year, that is fine. If you want to offer annual equity and a share of profits, that’s great too. But whatever your options are, make sure the investor knows what you’re offering. Detail out all the pay-back options that are available, and order them in importance to you. You might want to think twice if your business has the ability to make $50 million per year, and your investor only gave you $5 million at the beginning, yet you offer a 35% equity every year! Reward your investors, yes, but don’t shower them with untold riches for nothing. A happy investor is always good, but make sure you’re happy too so that your business continues to prosper.

9.) What is the SWOT like?

SWOT stands for Strengths, Weaknesses, Opportunities and Threats — and if you do not know these, you have no business, well, running a business. Your proposal should describe each of these areas accurately and with great detail, at least a few paragraphs for each.

Strengths: What really makes your business stand out? Where does it excel?

Weaknesses: Where does your business need help? Where is it lacking?

Opportunities: What positive trends, actions or events do you see that will have a profound and positive effect on your company’s success?

Threats: What negative trends, actions or events could cause harm to your business — and how will you sail past those rough waters smoothly?

10.) How relevant is the business to our society?

A lot of people will try to tell you that investors really don’t care about this factor, but from our experiences you would not believe the amount of investment firm applications we have seen that ask this exact question. How your business impacts society, whether locally, nationally or world-wide, can have a positive or negative impact on investor interest. If you have a business proposal that offers 4,000 jobs to your city, or will strengthen economical development, or includes environmentally-friendly factors or some sort, your proposal looks that much better. Try to take the time when writing to think about how your project affects others around you. What are the benefits? The long-term effects? The opportunities for others? Every business has the ability to impact society in some way. Informing an investor in detail about how your particular project will do so, tells an investor that you care enough about your project to do the extra research, go the extra mile — and it shows a great deal of determination and heart.

And every investor loves that!

How to Create a Business Plan For a Service Business

Creating a professional business plan for your service business is just as important as the business itself. It is a sales tool as well as a possible means for getting financing. If you are a novice, there are many free templates on the internet. Search for “free business plan service business. Microsoft also has free templates on their website.

When you finish writing, carefully read and spell check your plan, look for and add keywords to make your plan easy to read and remember. Include all of the sections below then add some of your own.

Get help from Better Business Bureau
Get to know your local Better Business Bureau. Apply for Accreditation. Being accredited with the BBB shows you meet specific standards of truth and honesty, and automatically instills a trust for your customers. Be sure to include the BBB logo in all of your advertisements.

Small Business Association
The Small Business Administration has many free resources including “Free Online Courses”.

Mission Statement
The mission statement should be a very specific description of the reason you are doing this business. The mission statement should be a very specific description of the reason you are doing this business. For example:

“Our services are designed to help the elderly, disabled or anyone who needs a little assistance to stay in their home, be more independent of family and friends.”

Services Offered
List and describe the types of services and the cost of services you will provide. Include current and new services that will be offered in the future and the projected dates. This section should start with a summary of services followed by a very detailed list including: description, your cost to perform service, fees, and profit.

The People
This is a list and a short description of the each person who will be part of the business. Include a list of accomplishments if any of each person. Also include an organizational chart and detailed job descriptions.

Competition
Know who your competition is! Detail the advantages your business will have over theirs. What services do they offer? How much do they charge? This should be a detailed list of all the competition.

Market Research & Plan
Is there a market for your service? What will your costs be to get started? How has the industry changed in the last ten years? What are the new ideas and trends? What type of marketing will you do now, in one year?

Goals & Objectives
List short term and longer term goals. Where should the service business be in one year, in five years? Make a list of objectives and how they will be measured. These should include: finances, customer base, equipment and so on.

Financial Plan
Estimate the cost of doing business and how much income will be needed for the first, second and third years. This should be a detailed estimate that includes all income and expenses. You should have at least one year’s worth of cash in the bank before you get started if you plan to hire several employees. They expect to be paid no matter how much money the business makes or does not make.

Resource
List the required equipment both computerized and other equipment needed to provide the services. Include any equipment that you may need to rent or purchase. Also include personnel and financial needs.

Risks
Be sure to check into business insurance for you and any employees. Property, liability, workers compensation, and auto insurance are good places to start. Do a Google search on “Business Insurance” or check with the company who insures your home or car to get some referrals.

Key Issues
Are there any short or long term problems that will need to be resolved? Issues may be funding, business location, marketing or changes in the industry.

Techniques For Writing a Business Plan

A business plan may be defined as the formal statement of a collective set of business goals or planning. It can also contain the background information about the organization. Business plan is mandatory to run a company because it is an essential part of initial strategic planning of any company. The capability of writing this plan effectively is a fundamental quality that a businessman should have, especially while starting a new business company or organization. The plan acts like a road map which may guide the company towards success.

There are some objectives or reasons to write a plan for business. These are mentioned below:

– It’s a tool or equipment for obtaining financing
– This helps to unite joint venture partners in a common goal or destination
– It makes the whole business goals feasible to study and analyze
– It will serve as the blueprint for the debut business companies.

A business plan works to convince individual or institutions for investing money in his business or loaning money. Sometime the plan writing is more important than the plan itself. While attempting to write a plan, the businessman’s strategic foundation should be identified first. This strategic foundation explains about the type of business he wants to start or which type of firm he wants to establish. It also indicates the basic elements that are needed to start the business firm. One can predict about the future condition of the company by the plan on his business. In the plan, the main products and the information on the clients should be written down in detail. To get more idea about it the business man can contact with business marketing consultants who can help him.

The planner can be able to declare the financial conditions and financial goals of the company by the help of written form of the business plan. A businessman must think about the present and the future conditions, which mean that he must analyze recent conditions as well as the upcoming needs. He should categorize the ideal and awful clients so that he can take steps to attract the best clients, at the same time to refuse the others. A business plan should be written in brief way so that he won’t forget any topic or information.

Writing a business plan proves the deadly seriousness of a businessman. It is very important in acting as a guide in different stages of the business. While writing a business plan one should follow some criteria which make the plan more effective and work worthy. To set up a unique business goal that is verifiable. The main purpose of writing the plan is to notify the specific goals or plan that a company is going to perform. It will guide the businessman to take decision himself as well as it will explain his plans on business and aims to anyone reading his plan. It also states the long term objectives of the business.

The plan must be realistic in every aspect. It includes the time line, market analysis, specifies projected expenses and revenues, and creates an accurate forecasting. One must keep his plan simple, easy and clear to be understood easily. If the language is difficult and inflate for impressing the customers, it may affect in reverse way. It may be confusing for the businessman himself. It should be very easy and naturally described without any excess verbiage. It should be in proper tone so that the reader can response and react positively to that tone. One must consult with some of the institute concerned with the business sector. These firms and organizations help you to take proper decision at the right time. Consulting institutes such as business consulting firms, business technology consulting, business plan consultants, organizational consultants etc. They help and give you the proper guideline in every aspect and decision. These types of firms summarize the plan and efforts that is effective for the company.

One must write a plan staying along the lines of traditional business plan format. Creative thinking is always appreciable, but to make yourself look more professional you must go with the guide of a tested business plan template. This may organize the plan into a well structured data and document.

One must clearly state and define the main purpose of the business plan. Similar to the identification of the goals of business, the writer must identify and specify the goals of the written business plan. It will help to secure the financial backing from the investors.

Once the plan is ready for the inauguration of the business, the businessman should decide his priority. These priorities will make the success in business easier. The main contents of writing a business plan are given below:

Cover sheet
Statement of purpose
Table of content
The business
-Description of business
-Marketing
-Competition
-Operating procedure
-Business insurance
Financial data

Summary:
Overall a business plan should be written in such a manner that it is easily understandable and that have the ability to attract newer clients. After these mentioned process been finished, one would be ready to face challenges that a new business would bring.

Writing a Good Business Plan Takes Time

Any software, book, or course which promises the secret to writing a business plan in one day or even one week must be considered warily. The truth is that writing a good business plan takes a great deal of time, both in actual hours that must be put into it and the weeks over which the process must be spread.

Preparation is Most of the Work

The preparation, research, and planning which leads up to the actual writing of the plan constitutes most of the time required to create a business plan. Planning and strategizing cannot simply be done in a day or even a few days. Not only is it important to get feedback from advisors or other trusted parties, which can take time, but the entrepreneur himself must let the plan ruminate a bit in order to uncover aspects he may have missed or thought about incorrectly previously.

Research Time

Research for the business plan may be the most time intensive element of this preparation. Research should, ideally, be more than secondary sources such as articles, blogs, and industry reports. Primary sources, including interviews, surveys, or focus groups with customers, vendors, and competitors, are very important and more persuasive. Developing data from these types of sources takes a good deal of time. Even information in secondary sources must be pored through carefully to find the nuggets of interest for the business plan. Finally, research into the costs of the business can require calls and even negotiations with vendors to learn about rates and volume discounts. There is no easy shortcut for this type of direct research, which can make launching a much easier process if this legwork has been carefully documented.

Writing Time

Finally, the writing cannot be rushed, as convincing prose does not generally flow under intense time pressure. Time must be given to allow for the writing and then revision of the plan itself. Finally, time should be allowed for proofreading by qualified individuals other than the entrepreneur. This is the only sure way to spot mistakes in the plan at this late stage.

Format of a Business Plan – Major Sections to Convince Funders

Generally speaking, I recommend having ten sections to your business plan. The purposes of these sections boil down to the following five purposes.

Setting the Stage

The executive summary sets the stage for the entire plan to come, while the company overview gives readers a more in-depth idea of where the company is, how it got there, who it consists of, and what it sells. These two sections provide readers with a basic idea of what the business is and what it has achieved so far, leaving supporting data to the sections to come.

Providing Background

The industry, customer, and competitive analysis sections look at these key elements of the market to show how the business in question fits in. This research and analysis sets the stage for the market situation, putting a particular focus on how the business can exploit these elements to succeed. While these sections may be heavy on statistics and data points, make sure to synthesize the data with some of your own analysis as to how the information will affect your business.

Showing the Action

The marketing and operations plans show how the company will perform its most important functions: bringing in customers and serving them. The plans given should be specific enough to show your understanding of what must be done. Nitty gritty detail is not necessary, as funders will not need to micromanage your operation.

Introducing the Team

The management team description must introduce the team in a way which highlights the qualifications of the individuals to launch and operate the business. Their entrepreneurial, industry, and functional management expertise should be covered.

Showing Results

Finally, the financial plan and financial statements within the appendices put the focus on the projected financial results. As all for-profit businesses of course have profit as a major goal, the revenues, expenses, and profits are charted in pro forma income statements. The level and types of assets in the company, as well as the details of whether they are funded by debt or equity are illustrated in the balance sheet. The cash inflows and outflows of the company in the areas of operations, investing, and financing are shown in the cash flow statement, as well as the projected cash reserves the company will keep in the bank.

7 Elements of an Ecommerce Business Plan

Writing an Ecommerce Business Plan can be a tough task. More importantly, writing a business plan that your intended audience wants to see is also a tough task. Doing a search online yields results from many experts in the industry.

Gathering information from several industry leaders has produced our list of the 7 essential components of writing an ecommerce business plan. Here they are in order:

1. Executive Summary

2. Business Description

3. Competitive Analysis

4. Marketing Strategies

5. Design and Development Plans

6. Operations and Management Plans

7. Financial Components/Requirements

The Executive Summary should be no longer than half of a page typed double spaced. The executive summary should serve as an overview of your ecommerce business plan hitting on every key topic including but not limited to a short description of your business, your business objectives, your marketing plan, your targeted demographic, your financial requirements and your financial objectives.

The Business Description should be very detailed.Consider your audience when writing a business description for your ecommerce business plan. Is your audience a city planner who has to give his approval, or is it a banker who is possibly lending you money? Knowing your audience will allow you to write a detailed business description.

The Competitive Analysis portion of your business plan is important for banking officials and investors. They will want to know who your competition is and will be at every level of business. They will want names, traffic, price points, product information and comparisons and service records.

Detailing your Marketing Strategies is also important for potential investors and lenders. They will want to see how quickly and aggressively you plan to market the business. This will play into how quickly you can repay loans or pay dividends to stock holders. A quality discussion on marketing also shows that your ecommerce business plan is complete, all too often new business owners have a solid idea but no way of knowing how or where to reach their customers.

The Design and Development Plan element is created to give bankers or investors a description of the product’s design, create a timeline for the product’s development and create a development budget that will enable the company to reach its goals.

The Operations and Management Plan is designed to give your audience and idea on how the business functions on a day-to-day and month-to-month basis. The operations plan shows the logistics of the organization like the responsibilities of the management team, the jobs of employees within the company and will show the capital and expense requirements related to the operations of the business.

The Financial Components and Requirements element is always at the back of the business plan, but that doesn’t mean it’s any less important than up-front material. All bankers and investors will examine at the charts, tables, formulas and spreadsheets in the financial section. Understanding this information is crucial to determining the outlook of a business.

For more information on writing business plans you can visit http://www.ecommercebusinessplan.net.

How to Write a Start Up Business Plan

Your business’s future is represented in a business plan. That is basically all that there is to it. It should contain the business goals that your company is looking forward to meet, a little bit about the product or service you plan to serve to the consumers and also who they are. Even if you write down your business’s future on a scrap of paper it is if not the final but the germ of the final draft.

Business plans complete a lot of tasks for the writer and the reader of the business plan. An investment seeking entrepreneur uses it to seek investors; a firm may use it to attract employees etc. Thus, the importance of a business plan is unimaginable.

The business plan must convey clearly, the goals of your company and how you plan to achieve them under what financial limits and how. While you do this, as it contains a lot of mundane facts and figures the only way you can grab attention is to sound impressive and positive. Being positive in your plan is the key to succeed with your audience.

The business plan may be divided into three parts. These are; the business concept; the marketplace section; the financial section.

In the business concept section, you write about your organization, the service you plan to provide and how. In the market place section you discuss the potential buyers or customers, who are they and where also why you choose them. You also describe your potential customers here. In the last, financial section you include the income, balance sheets, financial ratios etc. You may seek help from your accountants here.

A business plan, depending upon what you are using it for can be of various lengths. Typically it can be of about 20 pages in length. This isn’t a norm though. The length is decided by the purpose.

You may wish to read more at: Writing a Business Plan and Sample Business Plans.

Writing an Effective Business Plan For Your Small Business

Plans are Useless; Planning is Indispensable

“Plans are useless; planning is indispensable,” according to Dwight D. Eisenhower, then Commander of the Allied Forces in Europe during WWII. Now, you may be in total agreement with the first part of that statement, but you are really not convinced of the truth of the second part.

At this point, you may be tempted to skip writing a business plan altogether, viewing it as an unnecessary exercise in jumping-through-the-hoops, suggested by some old business professor who probably never held down a “real” job anyway. Maybe it’s okay as an assignment for an MBA class, but it would be just too confining and irrelevant for today’s fast-paced business environment. Anyway, you’re ready! You’ve thought about this business venture for a long time and talked it over with friends and everybody agrees it’s a great idea. Best to strike while the iron is hot!

Press for Success

Far be it from me to dampen your enthusiasm, but you should give yourself every opportunity for success. That’s what the planning part of the process of creating your business plan will do. By the time you have pressed your way through it, you will not merely have some neatly arranged document to keep on file, you will have a working tool that addresses the essential factors that influence your future.

Besides, your friends may be 100% behind you in your new venture, but, in case you are hoping to involve others who have actual money to invest, you may need to be able to make a convincing case. Wouldn’t it be nice to have anticipated possible questions and be ready with plausible answers? If you are risking your own money, that is perhaps even a stronger reason to do some indispensable planning.

Easy Writer

If you are one who is intimidated by the blank page, never fear! There are several good software packages that will guide you through the process, such as Business Plan Pro Complete from PaloAltoSoftware. Business Plan Pro Complete walks you through the entire planning process and generates a complete, professional and ready to distribute plan with a proven formula for success. The planning wizard makes it a snap to get started since you simply answer yes or no questions to create your custom business plan framework. Bplans.com offers free business plan samples and how-to articles as well as a wealth of other information. It is definitely worth taking the time to checkout. Microsoft Office Online Templates also has a variety of free templates to use with their products. The wizard indicates the information you need and you fill it in as you go.

You may find that the easiest part is the actual writing of the plan. The real work comes in the data-gathering, which may take you a hundred hours or more, depending on what you already know or have researched. If your new venture is in an area where you’ve been working, you may already know about your customers, your suppliers, your marketing plan, your organizational structure, your financial and cash flow needs, equipment, inventory, and so on. If you know all of these except for Marketing, say, then this is where you will need to invest some time and effort. You can find a wealth of information by utilizing the traditional data sources such as chambers of commerce, major cities’ websites, trade associations, the US Census Bureau, trade journals, magazine and online articles and advertising, etc. Performing keyword searches on Google, or Ask will bring up websites to check out. Following are some places to start:

  • James J. Hill Reference Library (jjhill.org): One of the nation’s premier business libraries to bring you FREE and affordably priced tools and resources you can use to create a better business plan based on relevant and credible data.
  • U.S. Census Bureau (census.gov): A source for a variety of useful statistics, especially the Economic Census that comes out every 5 years.
  • American Demographics (adage.com/americandemographics): Just as the title suggests, numerous free reports about consumer demographics in the U.S. nationally and by statistical area.
  • Internet Public Library – The Census Data and Demographics (ipl.org)/: An especially useful site that has links to information about countries other than the U.S.
  • Corporate Information (corporateinformation.com): Features information summaries on over 350,000 companies in the U.S. and abroad for competitive analysis.

You can find a variety of companies online to help you with your market research. For example: Sundale Research’s (sundaleresearch.com) primary goal is to provide new and mature businesses with objective, accurate industry data and market analysis on a wide range of topics. Their market research is intended to save you time and money while keeping up with industry trends.

But your idea may be so new that you may also need to talk to potential customers, host some focus groups, talk to an ad agency, or maybe even make a prototype and float it past some people. Be prepared to spend the time. Remember, it’s not about the Plan but the Planning.

Build It on Paper First

Whether you decide to use business plan writing software or to just follow this guide and create your plan with your word processor, here are the sections of a good plan and the questions that need to be addressed:

  • Cover Page – Show the name of the company, your name, and the date.
  • Introduction – What is the name and address of the business? Who are the principals, their titles, and their addresses? What is the nature or purpose of the business? What is your launch date? How much start-up and/or operating capital is needed?
  • Executive Summary – One to three pages that summarize all the information to follow; come back and write this last.
  • Industry Analysis – How does your product or service compare with what is currently on the market? What is the trend in the overall industry? What have been the total sales in this industry over the previous 3 to 5 years? What new products or technologies have had the biggest impact on this industry recently? What is the future outlook for these and what trends are emerging? Who are the competitors, where are they located, and how are they doing? What advantage do you offer over them? Who is buying this product or service now? Describe the typical customer for this product or service. Are there emerging markets or market segments? Where does this product or service currently perform best? Possible Data Sources: trade associations; trade journals; attorneys & accountants dealing with the industry; industry salespeople; state business websites; focus groups.
  • Description – What product(s) or service(s) are you offering specifically? Are any patents, copyrights, or trademarks needed? Have they been acquired/filed? What is the size of your business? Where will it be located? Will this require purchasing or building a facility? Will this require leasing a facility? At what cost? Has a lease been negotiated? What personnel will you need? Where will you find suitable employees? What equipment do you need? Will it be purchased or leased? What are the qualifications of your principals? How do their backgrounds promote the success of this venture? Why do they think this will be a successful venture? Possible Data Sources: local Chamber of Commerce; community colleges & local universities; local employee leasing company; real estate agents; US Patent & Trademark Office; US Copyright Office.
  • Production Operation – If a product must be manufactured, what is the process? Will the work be done on-site or subcontracted? Who are the subcontractor(s)? If on-site, what space, equipment, machinery, production employees are needed? What suppliers are needed? Who are they? How will quality be assured? What is the anticipated production output? What established credit lines do you have? Possible Data Sources: local Chamber of Commerce; yellow pages; trade associations.
  • Service Operation – If a service is offered, describe it. Will the work be done by company personnel or subcontracted? Who are the subcontractor(s)? If on-site or in cyberspace, what employee qualifications, equipment, and technologies are needed? How will quality be assured? What performance levels are anticipated per employee? Possible Data Sources: local Chamber of Commerce; yellow pages; trade associations.
  • Marketing – How is the product or service priced? How will it be distributed? How will it be promoted? Will it be promoted by the venture or an outside agency? What agency? How have you determined what amount to set aside for marketing? How have you determined product or service forecasts? Possible Data Sources: on-line searches; Amazon; local outlets; trade journals; industry attorneys & accountants; salespeople.
  • Organization
  • How is the business structured? Who are the principals and the principal shareholders? What authority does each principal have in the venture? What are management’s qualifications? What is the job description for each position? What does the organizational chart look like? Possible Data Sources: on-line templates for job descriptions & organizational chart.
  • Risk Assessment – What weaknesses are inherent in this venture? What vulnerabilities face this type of venture? What impact will these have? What new technologies may affect this venture over the next 1 to 3 years? What contingency plans are in place? What level of liability insurance is required? What does it cost? Who is the carrier? Possible Data Sources: trade associations; trade journals; Service Corps of Retired Executives (SCORE); industry salespeople; customers; focus groups.
  • Financial Plan – What is the anticipated income? What are the cash flow projections? What is the anticipated budget over the next 3 years? What is the break even point? When is it anticipated to be met? What funding is needed and where will it come from? What funding is currently available? What collateral is available? What is the net worth of the principals, if applicable? Possible Data Sources: accountant; accounting software; Small Business Administration; Small Business Development Center; SCORE; banks; venture capitalists.
  • Appendix – Resumes of principals/management; letters of recommendation from current business associates/customers/suppliers; marketing research data; demographic data; leases or contracts in place or as promised; business licenses; price lists from suppliers; trade or industry articles or data; floor plans; information on subcontractors; liability insurance policies.

Impress for Success – Now you have to admit, this is going to make an impressive package! Put it in a binder and you have built something to be proud of – the first of your many business accomplishments. Your potential investors will appreciate the depth of your analysis, but this tool will prove helpful in describing your venture to your employees, customers, and suppliers, as well. After you have been up and running for a few months, you will find that the planning that you have done will sensitize your inner “business compass” and allow you to flexibly adjust to contingencies. And that is indispensable!

In Summary

Planning out your business on paper first gives you long-term benefits with potential investors, employees, vendors, and suppliers. The business plan becomes your roadmap to success, with pertinent data that shapes the course of your business start-up and lets you adjust your journey as contingencies arise. Business planning templates are readily available and data sources abound at your fingertips. You will achieve a solid understanding of your business as you work through each section of your plan.

IMPress Action Checklist:

Below is a list of the steps that will help you put together your business plan. Check off each step as you complete it to keep track of your progress.

  1. Purchase business plan software or download a template
  2. Read over the business plan sections to decide what data you have, what data you need
  3. Gather data via the internet, phone interviews, print material
  4. Fill in the plan’s sections
  5. Write the Executive Summary
  6. Print and Bind Your Plan