You’ve decided that the dynamic world of entrepreneurship is for you; congratulations! Modern society was built on the backs of aspiring entrepreneurs who wanted to provide goods and services that were more efficient, less costly, or filling a niche that was theretofore unserviced. Your grand ideas in mind, it’s now time to flesh your business out into something more concrete; something investors and potential clients can sink their teeth into, and that will guide your business as it grows. You need a business plan. There’s lots of variety within plans, but at its most basic your plan will have:
- Executive Summary
- Business Strategy
- Marketing Strategy
- Operational Plan
- Financial Forecast
The executive summary, appearing first on your business plan, will be the last thing you write. This summary is the “elevator pitch” of your plan; a one-page, concise description of your business’ concept, your experience in the industry, and your competitive advantages. This section should contain highlights from the other sections, much like the abstract of a scientific paper.
The business strategy section will contain the basics about your business; you should include a history, which in this case will likely be your own experience in the industry, as your business is a start-up; your start-up status should be mentioned here. You’ll want to discuss the state of the industry, and your position in it; what have you accomplished, and how will you stand out? Is the industry growing or contracting, and how do you plan on using its growth or contraction to succeed? You’ll want to touch on your competitive advantages, including who your competition is, and why you’ll succeed when compared to them. Describe your milestones and goals, and how your business model will allow you to achieve those goals within a given timeframe. The legal and managerial structure of your business, its name, and the date it was incorporated should all be included here.
Your marketing strategy must include the Four Ps of Marketing:
- Product: What is your product or service, and how does it meet the needs of the market?
- Price: How much will your product cost? Why?
- Place: How will you get your product or service to consumers?
- Promotion: How will consumers know that your product or service is available?
Most of the data you’ll get for your marketing strategy will come from market research, which we’ll cover on another blog post. Remember that you want to include your budget for promotion and sales within your market strategy; you may also consider creating “customer segments” with ideal consumers and their purchasing habits, as well as why that segment will want to buy your product.
Throughout the process of creating your business plan, it will be important to consult professionals who have a firm grasp on budgets, pricing and their implications to your overall business plan. An experienced accounting firm can help you create a budget, advise you of incentives and lines of finance that can be beneficial; these firms have the ability to help you from the formation of your plan, through growth, to your development into a titan of industry. In part two, we’ll analyze the rest of the business plan, as well as some other sections you can include to make your plan stand out.