How to properly create a business plan from scratch yourself?
Mar 24, 2018
- The overview part of the business plan is its basis and should maximize the essence of the entrepreneur's commercial idea, while all the details need to be stated competently and in a concise and informative manner. Investors to whom this document will be presented should easily find there answers to questions of importance to them( the amount of necessary investments, the payback period of the project, etc.).They are interested in the level of risk of such an investment or a loan, if they are lenders. Other sections are more focused on the argumentation of the business idea itself and each element described in the overview part( marketing, production, declared profitability, and so on).It is recommended to make a duplicate of the business plan in an international language, namely English, in order to expand the range of possible investors. In this case, the chances of finding a foreign investor are increasing. Here the main requirement is informativeness, literacy, and therefore it is recommended to hire a professional interpreter for such work. Ideally, however, make business plans in the main European languages (French, German, Italian, Spanish, Portuguese), Japanese and Chinese. In this case, the chances of finding an investor will increase even more, and one-time translation services will pay off afterwards.
- In the section that is devoted to the characteristics of the enterprise, it is necessary to clearly outline the strategic objectives of this project taking into account the financial and economic, administrative factor. It is useful to mention in this section such moments as human resources, the sphere of enterprise development, the consumption market. Often they talk about the advertising resources that will be used when applying modern technologies in the production, implementation and after-sales service. It is useful to mention the already existing commercial relations with the entrepreneur, partners in this area of business, the territorial coverage of the enterprise and the organizational and legal basis of this activity.
- Investors are interested in the section that is devoted to the description of the enterprise's products( goods, services).It is necessary to clearly characterize the product, its consumer qualities, prospects in the consumer market. When describing it is recommended to take into account in detail the current situation in this consumer market and the level of competition. It is worth while stressing that it is safe for workers and does not harm environmental standards. A couple of proposals should be devoted to the pricing and product quality control scheme. After-sales service, that is, providing warranty service and post-warranty service, the sale of spare parts is also an element of the business plan worthy of attention of investors. It is necessary to add in addition to the above information material more license document numbers( licenses, permits and patents).It is very important that there are photographs and drawings of samples of the products of the future enterprise.
- There is also an item that is devoted to the analysis of the consumption market. We are talking about marketing research on the market for future products. In the section it is necessary to try to convince investors and creditors in the big prospects of products, that is, that the products you produce will have a stable and high demand in the market due to the unique properties of the service or product. There it is also necessary to tell how the attention of the buyer will be drawn( distribution of gifts, promotions on the Internet, sponsorship, and so on).All data should take into account the ratio of the price of the product and the volume of its sales, where it is worth mentioning about competitors and their possible response measures.
- In the dedicated description of the production process, the chapter should take into account such elements as the costs of production and sales of products. Including designate the approximate costs of labor remuneration for the personnel of the enterprise, repair of equipment, maintenance of premises. Of interest are the costs of utilities, raw materials, waste disposal, production and service of equipment for production.
- In the chapter devoted to the organization of marketing, it is necessary to list all the factors that can affect the sales performance of products. It also indicates the expected degree of their significance and methods of influencing them. It is necessary to share in the business plan considerations regarding demand-stimulation plans, for example, by optimizing production costs, manipulating prices. It can also be about discount systems, the introduction of credit programs that make it easier to purchase products and services of the enterprise.
- The basis for the financial part of the business plan is information regarding the expected revenues, the costs of the enterprise, the financial mass flow system. It is worth mentioning here such important indicators for investors as the level of profitability, the period of self-repayment of the project. It is not superfluous in this section to prescribe all the obligations of the borrower, the scheme for fulfilling the terms of the loan, that is, to offer the system of loan repayment optimal for both sides.
- The section on economic viability presupposes the publication of information that can inspire an investor and creditor with the belief that this commercial project can survive various economic and political shocks, for example inflation, the temporary inability of buyers to pay off the enterprise for goods or services received on credit, and so on. Possible jumps in sales figures, the cost of this product in this region should not represent a threat to the company for bankruptcy. In the same paragraph it is worth mentioning the indicator of the break-even of the enterprise, its commercial prospects in this niche of the market.
- Clerical problems and methods for solving them should be stated in the appropriate section, while emphasizing the fact that all necessary permits for the company are available, and the production itself in no way violates environmental norms.
- In the add-ons and applications section, it is necessary to place the diagrams, graphs, tables, normative acts, copies of permits and related documents related to all the above sections of the business plan.
If the business plan clearly outlines the business and economic positions in the business plan, the search for investment is significantly simplified. That is why in this document it is important to explain to the entrepreneur as much as possible the program for realizing the idea of business, to take into account such nuances as management, production, sale of products. You need to convince the investor of the prospects of this business, you, as a person who will be able to implement the project based on experience, professional knowledge of this field of activity and personal managerial and leadership qualities.
It should be noted that the structure of the business plan must meet a number of requirements established by the support service, business development and the international service of UNIDO.By the way, these organizations are created to provide more favorable conditions in the countries of the post-Soviet camp for the development of small and medium-sized businesses, that is, the creation of normal economic conditions. Based on their recommendations, the business plan in its structure should consist of an overview( summary), a description of the enterprise, characteristics of its future products, whether it is a service or an item and marketing analysis of the future market. The document establishes the availability of sections on the ways of implementing various tasks of production, marketing sales, and the search for financial resources. In the business plan, it is necessary to state the results of research on the viability of the business, taking into account regulatory, economic and environmental factors. All the information outlined there must be clearly and as briefly as possible, so that a healthy ratio of readability and informativeness is observed.
12 Steps to Drawing Up a Business Plan
Professionals Creating a business plan is not a simple task if you look at all the details in the article above and also the responsible ones. An entrepreneur can make a business plan independently or turn to someone who will make it on a professional level, although this is already costly. Having found a specialist who will analyze the business idea and justify its chances of success, the entrepreneur will receive a document that meets all the requirements.
In the case of an independent compilation of this document - an entrepreneur may lose more time, but it will not be a waste. He, in the process of drawing up a plan, working out economic, legal and commercial aspects, will be able to revise something previously unobserved by him, fix some defects at the initial stage. The entrepreneur will deepen the level of his understanding of this business, expand his horizons, which in the future will obviously come in handy.
The best option is the combination of the first and second option, that is, first to create a business plan yourself, and then give it to the correction of the authority in this area who is using the expert.
The final version of the business plan must meet a number of printing requirements for performance, that is, on the cover page it should be noted that the information therein is confidential. The very text of the document is published easy for the reader to understand the language and font. All the material presented must have a strictly structured basis, that is, speech about sections, explanations, diagrams and photographs of products.
It is worth remembering that the overview part is of great importance. It should invest the investor, otherwise he will go deeper into the study of your business plan will not.
In the process of document preparation and translation it is recommended to use words and word forms corresponding to professional vocabulary, to observe literacy norms, otherwise your business plan will have a "not solid" look in the eyes of potential investors.
The business plan, as mentioned in the article, has importance for the developing enterprise. The commercial fate of the enterprise, the pace of its development due to attracted external investments, borrowed funds at the development stage, are determined by how well the document is drawn up. A correctly drawn up business plan is a big step towards realizing business ideas.
Prosperity to your business and good luck!