The business plan is a written document that is used to attract investors, establish business relationships and to show the business idea. It is a document that addresses different audiences on different occasions. I propose that you organize the information in different chapters and then prepare specific versions for each of these opportunities.
If the document is addressed to investors or financial services, it calculates between 25 and 30 pages. On the other hand, if it is for internal consumption, reduce it to 8 or 10 pages. Save information to those who already know the proposal and will use the document only as a roadmap. In both cases, edit the text well, use a font that facilitates reading, double line spacing, and the appropriate vignettes. Avoid jargon to the extent that the investor does not have to know the industry at first.
The business plan is a written document that explains the business idea, develops the financial information and establishes the steps that must be followed.
Below I have pointed to know how to write a business plan
The executive summary
Are you able to tell me in a folio (850 words) your business idea? All right. Because that is the space we have for a first contact. Go straight to core-business, opportunity and financing. The rest can be developed in the following pages.
In this section, it is about explaining why there is a business opportunity, what advantages your product or service presents to the competition and what objective markets can be developed. Approach your argument well using data that can be checked (market studies, surveys, analysis of consumer trends or similar tools).
Organize the information in four aspects. First present the opportunity. An old boss of mine summarized it very well: where there is a line, there is an opportunity to find a dissatisfied customer. Explain where that row of discontents is and what is expected of us. Then explain what solution you offer and argue your idea about competitive advantage. Fundamentally, it can be a differentiation based on the costs (you can do it cheaper and) or on the quality (type of product, service of attention, distribution or any similar key). Then, detail the business model: why people (or a company) will hire your services, how and at what points of sale. Add other relevant information about brands and design, patents or other exclusive forms of intellectual protection.
Marketing plan, sales, and business relationships
There already has been written tips to develop your marketing plan. I am touching some more tips, follow those tips keeping in mind that the investor wants to know the behavior of the client (whether B2B or B2C), the size of the market and possible future developments. It also includes a section on who and how operations are developed. It is not enough to have a good marketing plan or a good product, but we have to know how to organize day to day. Explains how the product is placed at the point of sale (distributors), who is the supplier (experience, location), how the returns are handled (technical service or collection) or what equipment needs are required (a warehouse, an industrial warehouse), a vehicle or a computer equipment). There lies the heart of the business.
You cannot start a business without equipment. It details who are in the proposal, what their experience is, what services you are going to outsource (accounting, tax advice or lawyers) and what each of the members contributes. The contribution can be in time or money (salaries that will be received or investment of each partner). Moreover, it explains what hiring plans there are to better assess personnel needs (fixed and direct costs).
You cannot be a part-time entrepreneur.
The numbers have to support the ideas we have presented. It clarifies sales forecasts, margins, losses and profits and, above all, cash flow (Cash is king!). Your proposal should explain the short term (at what point are we?) And the expectations at three years (where do we want to go?). An investor has to see when the break-even is reached and how much capital is required up to that point. Do not tell beautiful stories about immediate success, but also avoid expressions such as “in the worst scenario”. Probably, that is the scenario.
When the meeting is over, what are the next steps for the next six months? Identify concrete and measurable stages. Explain how and why you have to follow a specific roadmap that details where you would put the first euro received. It is a way to check which the most important aspects of the business are.
Do you have it all? Before printing, take the test with friends: send them the document and check that they understand the business well. It’s the Warren Buffet trick. 😉 Good luck!