Steps To Writing A Small Business Plan

A business plan should be able to talk about your company, its functions and the growth prospects in different markets. It is not something that is prepared only when you are planning to start a new business. An entrepreneur can write a business plan at each growth stage of his business. It will act like a map and guide to managerial level people and help them in moving in the right direction to achieve specified targets.

Writing business plan is a step by step procedure. Business plan should give a clear picture about the company, its products/ services, market conditions, management team, human resource, funds and various growth strategies. There are no specific guidelines in writing a business plan. However, each step should give clear and detailed description. When investors look into a business plan to check details about management team, its current performance and the future business goals, a bank will check financial history and debt bearing capacity.

Steps involved in writing business plan:

Creating a business proposal - Base of any business is its carefully designed objectives, strategies and goals. This altogether makes a business proposal. Crafting a business proposal gives right direction to a business. Goals and objectives can be achieved only through the successful implementation of the strategies. So ask yourself - What are the products you like to sell, markets you wanted to utilize, type of customers and growth prospects.

Different selling points - Write about the goods or services you like to offer. This should include details regarding different ways that should be adopted to make it appealing to the customers. Everyone knows that customers will be attracted towards a product or a service when there is something special in it. So make sure the product or service designed and manufactured by your company has some striking qualities.

Specify target markets - To determine the target market write down the geographical locations where customers of each product are located. For example: woollen clothes have demand in cold regions and cotton clothes in sunny areas. As an entrepreneur you should be able to pinpoint target market by providing information like customer demographics, distribution methods and competitors. A small research can help in finding customer requirements, customers of which economic level likes your product and consumers residing in which particular area needs your product.

Competition in the market - If your product / service have to compete with big business brands then it should definitely have some outstanding features or reduced rates. Write down the names of the main competitors and their influence in each area. You should do a research to find out how consumers can turn their attention towards your products. Again, if the demand for your product in a particular market is low then find out the reason for that and try to compensate it, if possible. Knowing strength and weakness of your business and your competitors business can help a great deal in enhancing the growth of your business.

Structure of your organization - A clear chart should be created to designate each person with specific responsibilities. This helps in finding the proposed size of the organization. Each managerial position along with responsibilities should be included in the organization structure's plan.

Human resource requirements - Business plan should include responsibilities of the HR department. It should speak about the number of people to be selected for each type of job. Finance, production, material management, supply chain, marketing and selling departments should have professionally qualified employees. The business plan should include details regarding the employees required for each department.

Office and materials required- This space in the business plan should be filled with the number of rooms or space required for starting an office or extending it. Details regarding materials like machineries, apparatus, tools and technology should be also included.

Fund required - Calculate funds required to start a business and expand it. Details related to different funding sources should also be included.

Legal department - To address issues related to tax, insurance, liability concerns and employee grievances there should be a legal department.

Executive summary - This is the final step of writing business plan. It should highlight whether the business plan is for starting a new business or expanding the existing one. Summary should include expected profit from the business and the number of years to achieve it.