In the opening paragraph of an article about business plans, you probably expect to see the words of a well-known and successful business leader or strategist. But they’re not the only category of people who have to make plans, right? That’s why I will quote a fantastic French writer—Antoine de Saint-Exupéry—instead, “A goal without a plan is just a wish.”
If you want to turn your business wishes into the goals, you should learn how to compose proper business plans. Start by following these 10 steps:
1. Define your goal
Why are you making this business plan? Do you want to start your own company or develop a new project for your employer? You have to answer these questions, as your responses will determine the type of business plan you need:
- Start-up business plan
- When you need it: If your business doesn’t yet exist.
- Goal: to present your business idea to potential investors and partners.
- Growth business plan
- When you need it: your business exists, but you want something more.
- Goal: to plan the development of your company.
- Feasibility business plan
- When you need it: you don’t know whether your business idea is good or not.
- Goal: to find out whether there is a need for your product and whether you’re able to meet demand.
- Internal business plan
- When you need it: you plan inner projects in your company.
- Goal: to define whether this project will be profitable and whether you can afford it.
2. Provide valid information
Imagination is appropriate for poetry, not for business plans. Your future success may depend on the accuracy of the information that you gather and present in your plan. You have to describe your ideas, company, and product in detail and don’t miss anything.
3. Do your market research
Our modern world is cruel, complex, and full of dangers. This is no place for naïve simpletons. You have to get prepared before composing your business plan. Collect all the data about your competitors, consumers’ needs and preferences. Without this information, you’ll be like a newborn kitty—clumsy and helpless.
4. Do a SWOT analysis
There are many ways to evaluate your resources and opportunities, but we highly recommend you try a SWOT analysis. SWOT stands for “Strengths, Weaknesses, Opportunities, and Threats.” Let’s learn more about each aspect:
- You analyze positive inner features of your company that will be helpful for development: advantages, unique resources, experts, etc. If you can’t define the strengths of your business, write down all the qualities that come to mind. The positive ones are your strengths, and the negatives ones will be a base for the next aspect.
- Answer two questions: What features make your business worse than other companies? And What you should improve? List these ideas, and the second aspect of your SWOT analysis is ready. Weaknesses are negative inner features of your business that may prevent you from achieving your goals.
- Opportunities are the external factors that might positively affect your business. Take into consideration political (government regulations and policies in your field), economic (market conditions), social (tendencies, demographics, and fashion), and technological factors (new applications and devices).
- Threats also belong to external factors of your SWOT analysis. Obstacles, challenges, competitors—you have to take into account everything that might be harmful to your business idea. Be attentive! Maybe you should try another plan if the stakes are too high.
5. Develop your strategy
Congratulations! You’ve gathered all the information that you need for your business plan. Now, it’s time to generate ideas for your strategy. You can use well-known and time-tested models or come up with a brand-new way of doing business. If you have a working group, set up a meeting. Good ideas can appear from the most unexpected sources.
A realistic time frame is your best tool to convince partners and sponsors. Use concrete numbers and dates—no “soon” or “lately.” You don’t have to plan every day of your business activities, but you certainly have to present a clear strategy.
7. Division of labor
You’re not a food processor or smartphone—you can’t do everything at once. You have to distribute responsibilities among the members of your team. If you plan a one-person business, you should hire specialists for the task that you’re not qualified for. Of course, you could just learn to do everything by yourself, but it will take much more time.
8. Make predictions
Business plans are about the future. You have to analyze a current state of affairs, but your primary goal is to forecast. Your predictions have to be realistic and based on valid and comprehensive information. Don’t forget about the risk factors and force majeure circumstances. Although you can’t prevent them, you can still be as prepared as possible.
Presentations that have pictures in them are 43 percent more persuasive. Of course, you don’t have to believe this fact, but you can’t deny that pictures and videos rule the world. Our brain processes and memorizes the information presented in images better. This phenomenon is called the “picture superiority effect.” Fill your business plan with diagrams, photos, schemes, and other bright details that help illustrate your points.
10. Provide a summary
A well-structured summary fulfills two needs. First, it helps you to restate each part of your business plan briefly and define whether you stuck to the logical order in your presentation or not. Second, if somebody doesn’t want to read the whole text, he or she can always take a look at your summary and understand your ideas in general.
Creating a strong business plan can be challenging, especially for the first time. But you should never give up trying! If you don’t have enough time to compose your business plan or you’re not sure you can do it justice, you can enlist professional help. There are companies and individuals out there who can help you deal with various types of business writing—including business plans.