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Creating a Business Plan

A business plan is basically just a blueprint for your business. Business plans are a very integral part of starting a business as well as growing a business. There are many different formats for business plans so it is important to choose the one that is most appropriate for the purpose of your business as well as most suited to the kind of business you have chosen

You need to determine who the intended audience is for your business plan as everyone's is not the same. It might be geared towards an internal audience such as employees, owners, senior management, boards of directors or boards of advisors. In this case the business plan is to encourage growth of a business by way of a strategic plan. It also might be a way to cite the vision for your developing company and/or your goals.

Some business plans on the other hand are geared to appeal to external audiences such as bankers, lenders, clients, investors, suppliers and newly hired individuals. In this case the business plan could be used to find financing for your company or to attract new talent or new suppliers. A document may be drawn up that is a briefer version of the larger business plan that came first. In this case the document is sometimes called a business funding proposal or a business opportunity document. Getting financing is an important part of developing a business and that is why the business opportunity document is vital.

What is a part of every business plan?

A business plan is a detailed document that carefully lays out what you want for your business and what direction you want it to go in. A business plan must include:

  • an executive summary
  • the background and history of the company
  • a vivid description of the concept of the company as well as the value proposition of the company
  • a marketing analysis (which takes into account a market development plan as well as a competitive analysis)
  • a development plan for the business as well as a production and operations assessment
  • a financial assessment of the business and financial projections for the future
  • a human resources and management assessment for the business as well as a plan for it
  • a plan of implementation
  • a list of resources as well as a proposed deal structure to present to investors (if investors are being sought)
  • a survival strategy that takes into account mitigation strategies as well as risks that are inherent in the business
  • a growth strategy
  • an exit strategy
  • a summary
  • appendices for the business

First impressions are essential therefore you want your business plan to be as sophisticated and as well organized as possible when you present it to prospective lenders and/or investors. A business plan helps you see the business in a concrete way as opposed to it being some obscure notion in your head. It is highly recommended that you spend a couple of hours each month updating your business plan to keep yourself on top of things.

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