Business Plan – Definition
A Business plan is a written document that describes the nature of Business, Mission and Vision statement, Goals, and how to achieve those goals in the future.
It is a structured document that vividly elaborates Funding and Investments for your Business, Sales, and Marketing strategies. It includes Business development Plans, and how to manage Finance for your Business in the long run.
Also, it describes every resource that you will utilize for your business. And it illustrates a clear roadmap to execute all kinds of operations that are involved in your business including team management.
Also Read How to Write a Business Plan
8 Important Elements of a Business Plan
The new Startup companies prepare a Business plan for many purposes. At the initial stages, you may seek help from investors for Funding your Startup. So your Business plan should be very clear, subjective, and comprehensive to understand all your financial needs for the company.
Precisely describing the key components of your Business plan is important for you to attract investors.
Here we are going to see all the important key components for your Startup Business plan.
The executive summary outlines the entire business plan for your Startup. This section describes your Business concept, goals, end product details. Also, it defines your target market, financial requirements for operations, sales forecast, and estimations on future profits of the company.
All these details and prospects that you will mention in this section should be clear and concise.
Because you ought to impress the stakeholders and investors who read this summary and you must gain their interest in investing in your company.
- This part describes the industry that you are planned to do Business, which states the purpose of your Startup Business to play a role in that particular industry.
- Clearly mention the type of Business you are planned to do, like Sole proprietorship, Partnership, Corporation or Limited Liability Company, etc…
- Unlike the executive summary, it includes an elaborated description of the Mission and Vision statements of your company.
- It also includes goals, objectives, and milestones of the company that you want to achieve in the future.
Product and Services
After describing your business and its types, the next thing you would need to describe is the Product that you deliver in the market. Or the kind of services you provide to the customer.
It specifies all the features of your Product or Service and how it is different and better than other competitors’ products in the marketplace.
It is important to mention the customization of your Product or Service according to different groups of customers and usages. This will justify the presence of your product in the market.
Customer Analysis is another crucial factor after describing the product or service for your Business plan.
To run a successful start-up, you have to find a customer or end-user for your product or service.
You need to identify your target audience considering the demographic data such as
- Married or unmarried
- Children or adult
- Educated or uneducated
Your product or service should be more relevant to your customer by providing more variables to meet their needs and problems.
Detailed Market analysis is essential before fixing the product price, sales forecast, and distribution of your product into the market.
Some of the key points that you need to write in your Business plan are
- Size of the market
- The behaviour of your target audience in recent time (i.e in months and years)
- Market trend
- Sales forecast
- The purchasing power of consumer
- Distribution channels in the market
- Advertising and public relations.
It would be easy to understand if all this Statistical information is depicted with graphs and flowcharts or any other art forms.
After market analysis, you have to define who are your competitors? Can you outperform them?
Because it would be obvious to know that how you are obsessed with your success among competitors by exploiting their weakness.
The important details that you need to analyze and present about your competitors are
- Identifying and listing the top competitors in your niche industry.
- Know their strengths and weaknesses.
- Marketing Strategies of your competitors to crack down their best and to implement in your strategy.
- Unique Selling Proposition (USP)
Getting all these factors about your competitors would help you to devise your Marketing Strategy for your startup. Therefore, it will gain a competitive advantage in your marketplace.
The startup team includes all the human resources that work for the company.
It describes the top-level management like founders, co-founders, and product managers, etc…
The business plan describes about who are the owners, the partnership, and their liabilities.
Who will be your employees? How will you hire them? what kind of operations they will do? And also you have to mention the cost to the company.
The last important factor you would need to focus on is to describe all your Financial requirements for all the elements that you have described in the Business plan.
The financial planning includes
- Startup funding and Investments at the initial stage.
- Operations cost.
- Sales and Marketing costs.
- Salary for Employees.
- How to maintain Cashflow through the entire Business process.
- Monitoring your expenses and revenue.
- Balance sheet.
Let us know if we missed out on anything in this article What is a Business Plan? Definition and Elements and share your thoughts in the comment section.