Dec. 26 – BBB Business Tip: How to write a business plan – FW Business

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A few clouds. Low 28F. Winds SE at 5 to 10 mph..
A few clouds. Low 28F. Winds SE at 5 to 10 mph.
Updated: January 15, 2023 @ 10:55 pm

If you’ve got a great business idea, it’s wise to lay the foundation with a solid business plan. A well-developed plan acts as a guide to starting, managing, and growing your new business. In some cases, they can even help you get funding for your startup.
So, how do you write a business plan? And what components will help ensure your business is successful? BBB recommends the following tips:
• Convince yourself first. Business plans allow you to think logically and objectively about your new business. However, don’t think of this as a document meant to persuade investors to give you funding (although it might achieve that, too). Instead, ask yourself if your business plan convinces YOU the business will succeed. If you identify areas that need additional work, take care of them before starting your business.
• Customize your business plan. Depending on what kind of business you are starting and whether you are seeking funding, your business plan’s layout and sections may vary. There’s no right or wrong way to put together a business plan. In fact, you might even benefit from starting with a lean startup plan instead of a traditional business plan. The U.S. Small Business Association provides free examples for both kinds of business plans.
• Always proofread. Any spelling, punctuation, or grammatical errors could draw the focus away from your excellent business idea and make people focus on your mistakes. Avoid distraction by carefully proofreading your business plan. If writing isn’t your strength, consider hiring a professional to write, edit, or proofread your document.
• Start with an executive summary. Start your plan by outlining the purpose and goals of your company. Include a summary of your business objectives, products, and services, along with a realistic description of market opportunities. Use this section to justify your probability of success by giving readers a quick overview of the competitors and your advantage over them.
In addition, outline your potential for growth and any funding you might require. Be concise, but cover all the main points. Your executive summary will serve as an outline for the rest of your business plan.
• Follow up with your company description. This section provides an overview of what your company is and why it will be successful. Use this chance to detail the problems that your business solves and explain your competitive advantages. Provide relevant examples of opportunities in your industry, explain your ideal customers and their needs, and provide a plan for how your business will fix these pain points.
• Explain your products and services. In the “products and services” section of your business plan, you’ll dive deep into what you will provide for customers. You don’t need to get too technical here. Simply explain what you will offer and why your products and services will stand above the competition. List any patents, trademarks, or copyrights you own (or have applied for) in this section.
• Outline your market opportunities. Without market research, you’ll have no real proof your business can succeed. Do research to understand what the current market looks like in your area and what opportunities are open to you. Find out the size of your market, whether it is growing, what the demand is for your products or service, and what customers expect to pay.
• Discuss your sales and marketing strategy. This is your marketing plan. Use this section to outline how you will promote your product or services and how you will make sales. Get specific about your marketing budget, how you will measure your marketing efforts, and what advertising or public relations activities you’ll need to get the word out. You can include any marketing materials you already have in this section.
• Analyze your competitive advantage. Delve into the strengths and weaknesses of your current competitors. Check out their websites, physical stores, and marketing efforts. This is a chance to learn from what other businesses are doing right and take advantage of their weak points as you decide on your own business strategies. Get specific in this section, especially if you’re looking to get outside funding. Investors will read this section carefully, and it’s unlikely they’ll be convinced if your only plan is to run “the same business, but better.”
• Develop a plan for operations. In this section, give the details on how you plan to care for facilities, hire employees, obtain permits, get insurance, train employees, handle inventory, etc.
What will your business look like on a day-to-day basis? What steps are needed to fulfill your customers’ orders? Be specific as you explain, taking your industry, customers, and market sector into consideration. Even if you aren’t seeking financing, this part of your business plan will come in handy later when questions about operations arise.
• Introduce your management team. In this section, discuss the experience, skills, and resources your team of managers will need. If you’ve already put your team together, introduce each member, explain their role and title, and list reasons they are highly qualified to care for their responsibilities. Keep focusing on what each person adds to the business instead of fancy titles or credentials. Include the salary level qualified candidates will expect and/or the salary of each manager who is already actively working.
• Reveal your financial analysis. Financial projections are what determine the risk level of your budding business. If you are looking for outside capital, this section will meet with plenty of scrutiny. Do your research before putting your financial analysis in writing. Include a balance sheet to describe what funds your company has right now, a profit and loss statement with projected expenses and revenue, a cash flow statement to show how cash flows through the business, an operating budget, and a break-even analysis to show when you expect your business to become profitable.
• Include an appendix. If you have additional information to add, such as resumes for key employees, business licenses, photos of potential products or facilities, other financial documents, etc., you can include these in an appendix section.
Rick Walz is the President/CEO of Better Business Bureau Serving Northern Indiana, which services 23 counties across the northern portion of the state.
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