A business plan is essentially a blueprint for a business. It makes it easier for you and your partners to manage your company properly and to move from stage to stage in your strategy.
The name of the enterprise, the address and the governing principles should be clearly written on the cover sheet. However, there are still other elements that must be included.
This article contains tips for writing a winning business plan. Let’s get into it.
- What Are The Basic Elements of a Business Plan?
- 10 Quick Tips For Writing a Business Plan
- Who Needs a Business Plan?
- How Can I Write a Strong Business Plan?
- What Should I Not Include in my Business Plan?
- How do You Make a Winning Business Plan?
- What Makes an Excellent Business Plan?
- What Are The 12 Components of a Business Plan?
- What Are The 4 Types of Business Plans?
- 10 Reasons Why You Need a Business Plan
- What Kind of Name Can I Give my Business?
- How Can I Improve my Plan?
- What is The Most Important Part of Your Business Plan?
- The Body of Executive Summary
- Who Should Develop Business Plans?
What Are The Basic Elements of a Business Plan?
The abstract
The abstract is also called the executive summary of the business. This is simply a summary of the information that is provided in the plan and acts as an introduction to investors who are interested in the business.
Read Also: Simple Investment Tips for Beginners – When and where to start?
It should include the company background, the goals, a mission statement, the capital requirements, an overview of the management as well as the opportunities and competition. This should be written in persuasive language and should not be more than four pages.
Overview of the business
This is where you will provide further details and explain why the business was conceived. The business strategy, mission and model will be expanded in this section.
As part of the explanation of the concept of your business, you should mention the associated costs of running the enterprise, the property that you own and the legal structures that are in place. Issues such as management, security and accounting may also be covered in this section.
Business offering
This section is where you will describe your product or service in great detail. If you are selling a product, state clearly whether it is produced by your company or you are a retailer or distributor for another manufacturer.
If you are the manufacturer, you should talk about the materials, inventory and the manufacturing process. If you are a service provider, this service has to be described in detail. You may also mention other offerings that are planned for the future.
Business strategy
In this section, you will provide the details of your strategies and how they will be implemented. Issues such as sales forecast, product launch dates and potential customer statistics should be highlighted. Investors will be particularly interested in your deadline and dates. Use a simple milestone format to make it easier to understand.
Marketing plan
The details of your marketing plan should be provided in this section. Start with the market research that you have done then explain your sales process and customer relations. At this point, it should be clear that your business has a great chance of success.
Your points should be validated with detailed market research as well as industry trends. If your business is too small to conduct this level of research, you can include some positive reviews from existing customers.
Your management team
Give a brief explanation of the background of the members of your management team and your executives. Investors will want to know the kind of people who will handle the affairs of the company. This is one of the factors that will be considered before they invest in your business. Investors will be happier if your management team has a lot of relevant experience.
Financial projections
Lastly, you have to break down the information provided in all the other sections into figures. Investors want to know the type of profit that is expected from your operations within specific periods of time. Your balance sheet, projected profit and loss as well as cash flow statement for about three years should be included.
10 Quick Tips For Writing a Business Plan
Here are 10 key factors to keep in mind when writing a business plan. These overarching principles will help you write a business plan that serves its purpose (whatever that may be) and becomes an easy reference in the years ahead.
1. Don’t be long-winded
Use clear, concise language and avoid jargon. When business plans are too long-winded, they’re less likely to be used as intended and more likely to be forgotten or glazed over by stakeholders.
2. Show why you care
Let your passion for your business shine through; show employees and investors why you care (and why they should too).
3. Provide supporting documents
Don’t be afraid to have an extensive list of appendices, including the CVs of team members, built-out customer personas, product demonstrations, and examples of internal or external messaging.
4. Reference data
All information regarding the market, your competitors, and your customers should reference authoritative and relevant data points.
5. Research, research, research
The research that goes into your business plan should take you longer than the writing itself. Consider tracking your research as supporting documentation.
6. Clearly demonstrate your points of difference
At every opportunity, it’s important to drive home the way your product or service differentiates you from your competition and helps solve a problem for your target audience. Don’t shy away from reiterating these differentiating factors throughout the plan.
7. Be objective in your research
As important as it is to showcase your company and the benefits you provide your customers, it’s also important to be objective in the data and research you reference. Showcase the good and the bad when it comes to market research and your financials; you want your shareholders to know you’ve thought through every possible contingency.
8. Know the purpose of your plan
It’s important you understand the purpose of your plan before you begin researching and writing. Be clear about whether you’re writing this plan to attract investment, align teams, or provide direction.
9. Identify your audience
The same way your business plan must have a clearly defined purpose, you must have a clearly defined audience. To whom are you writing? New investors? Current employees? Potential collaborators? Existing shareholders?
10. Use it
A business plan shouldn’t just be a line on your to-do list; it should be referenced and used as intended going forward. Keep your business plan close, and use it to inform decisions and guide your team in the years ahead.
Who Needs a Business Plan?
A business plan can be particularly helpful during a company’s initial growth and serve as a guiding force amid the uncertainty, distractions, and at-times rapid developments involved in starting a business. For enterprise companies, a business plan should be a living, breathing document that guides decision-making and facilitates intentional growth.
“You should have a game plan for every major commitment you’ll have, from early-stage founder agreements to onboarding legal professionals,” says Colin Keogh, CEO of the Rapid Foundation—a company that brings technology and training to communities in need—and a WeWork Labs mentor in the UK. “You can’t go out on funding rounds or take part in accelerators without any planning.”
How Can I Write a Strong Business Plan?
When it comes to content, these 10 tips will help:
1. Know your competition. Be prepared to name them and tell what makes you different from (and better than) each of them. But do not disparage your competition.
2. Know your audience. You’ll probably want several versions of your business plan—one for bankers or venture capitalists, one for individual investors, one for companies that may want to do a joint venture with you rather than fund you, etc.
3. Have proof to back up every claim you make. If you expect to be the leader in your field in six months, you have to say why you think so. If you say your product will take the market by storm, you have to support this statement with facts. If you say your management team is fully qualified to make the business a success, be sure staff resumes demonstrate the experience needed.
4. Be conservative in all financial estimates and projections. If you feel certain you’ll capture 50 percent of the market in the first year, you can say why you think so and hint at what those numbers may be. But make your financial projections more conservative—for example, a 10 percent market share is much more credible.
5. Be realistic with time and resources available. If you’re working with a big company now, you may think things will happen faster than they will once you have to buy the supplies, write the checks and answer the phones yourself.
Being overly optimistic with time and resources is a common error entrepreneurs make. Being realistic is important because it lends credibility to your presentation. Always assume things will take 15 percent longer than you anticipated. Therefore, 20 weeks is now 23 weeks.
6. Be logical. Think like a banker, and write what they would want to see.
7. Have a strong management team. Make sure it has good credentials and expertise. Your team members don’t have to have worked in the field, but you do need to draw parallels between what they’ve done and the skills needed to make your venture succeed. Don’t have all the skills you need? Consider adding an advisory board of people skilled in your field, and include their resumes.
8. Document why your idea will work. Have others done something similar that was successful? Have you made a prototype? Include all the variables that can have an impact on the result or outcome of your idea. Show why some of the variables don’t apply to your situation or explain how you intend to overcome them or make them better.
9. Describe your facilities and location for performing the work. If you’ll need to expand, discuss when, where and why.
10. Discuss payout options for the investors. Some investors want a hands-on role; some want to put associates on your board of directors; some don’t want to be involved in day-to-day activities. All investors want to know when they can get their money back and at what rate of return.
Most want out within three to five years. Provide a brief description of options for investors, or at least mention that you’re ready to discuss options with any serious prospect.
What Should I Not Include in my Business Plan?
And here’s what not to include in your business plan:
1. Form over substance. If it looks good but doesn’t have a solid basis in fact and research, you might as well save your energy.
2. Empty claims. If you make a statement without supporting it, you may as well leave it out. You need to follow-up what you say in the next sentence with a statistic, fact or even a quote from a knowledgeable source that supports the claim.
3. Rumors about the competition. If you know for sure a competitor is going out of business, you can allude to it, but avoid listing its weaknesses or hearsay. Stick to facts.
And here’s what not to include in your business plan:
1. Form over substance. If it looks good but doesn’t have a solid basis in fact and research, you might as well save your energy.
2. Empty claims. If you make a statement without supporting it, you may as well leave it out. You need to follow-up what you say in the next sentence with a statistic, fact or even a quote from a knowledgeable source that supports the claim.
3. Rumors about the competition. If you know for sure a competitor is going out of business, you can allude to it, but avoid listing its weaknesses or hearsay. Stick to facts.
7. Overly optimistic time frames. Ask around or do research on the Internet. If it takes most companies six to 12 months to get up and running, that’s what it’ll take yours. If you think it’ll take three months to develop your prototype, double it. You’ll face delays you don’t know about yet—ones you can’t control. Remember to be conservative in your time predictions.
8. Gimmicks. Serious investors want facts, not gimmicks. They may eat the chocolate rose that accompanies the business plan for your new florist shop, but it won’t make them any more interested in investing in the venture.
9. Amateurish financial projections. Spend some money and get an accountant to do these for you. They’ll help you think through the financial side of your venture, plus put the numbers into a standard business format that a businessperson expects.
How do You Make a Winning Business Plan?
Nothing lays the groundwork for success like a well-written business plan. Besides helping you land investors and strategic partners, creating one also clarifies your goals and points out potential challenges.
Here are their top six strategies.
1. Begin with the basics
Tackle your plan in small steps to make the task manageable, says Tim Berry, founder and chairman of Palo Alto Software, which provides startup and management tools for small companies. You can write bullet points first and expand on them later.
Start with the essentials: your business strategy, the tactics you’ll use to execute it and key milestones such as launch dates. List startup costs, such as equipment, inventory and permits, and calculate your best estimates for sales in the early months. Working through your financials will help you determine how much funding you’ll need.
2. Consider your audience
If you intend to pitch investors, your plan should demonstrate that you have a superior product or service that solves a difficult problem for a large target market, says Akira Hirai, founder and CEO of Cayenne Consulting, a business plan consulting firm.
If you hope to win over a strategic partner, your plan—typically accompanying a partnership proposal—should describe your vision and ability to help the partner reach its strategic goals.
No matter whom you are writing your plan for, Hirai adds, make the case that your founding team has the experience and skills to build a successful company. The description of your organizational and management structure should include a brief bio of the founders detailing their employment history, education and background as relevant to your venture.
3. Think growth before profits
“Quite often, startup founders think investors want to see profits, and they’ll come up with wildly unrealistic projections,” Berry says. Investors, however, won’t find such numbers credible, and may also see them as a sign that an entrepreneur isn’t prioritizing growth.
“There’s a tradeoff between profits and growth, since growth comes from spending,” adds Berry, who is also an angel investor. “If you have too much profit, you’re going to have trouble generating growth.” Focus on explaining how your business will generate growth.
4. Demonstrate solid cash flow
The financial section of your business plan should thoroughly document your projected revenues and expenses, and expected cash flow. Not planning for the timing of inflows and outflows of cash will leave your business vulnerable to failure, no matter how strong your idea. “You can’t just suddenly run out of cash,” Berry says. “If you don’t plan for and manage cash flow, you’re putting yourself in danger.”
Be sure to estimate your company’s expenses and revenues as closely as possible. Certain expenses, such as merchant services fees and some types of insurance, can be easy to overlook. If you use a cash flow template to project your expenses, be sure to account for all of your spending categories.
5. Keep it clean
“Aesthetics matter,” Hirai says. “An attractive, neatly formatted plan is more likely to be read than a disorganized plan.”
Investors tend to favor brevity, with executive summaries running one to three pages and complete plans at 20 to 25 pages. Plans with spelling or grammar mistakes, or those packed with technical detail or scientific jargon, may get discarded.
6. Review and revise your plan
Some entrepreneurs complete a business plan only to set it aside and never look at it again. Review your plan monthly, Berry suggests, to compare your projections with reality and to be sure you’re on track for hitting key milestones. “All of that review creates real management and accountability,” he says. It also allows you to shift course quickly if sales, market conditions or other factors diverge from expectations.
What Makes an Excellent Business Plan?
A business plan is a blueprint of how a company will be run. A company often needs a business plan before it can borrow money from a bank. Good plans are usually highly detailed and include information on all aspects of the business, including the industry, marketing, finance, personnel and various operating procedures. They are specific, communicate to all company employees and require commitment from everyone.
Identification
State the industry in which you will be operating in your business plan. For example, if you are in the RV (recreational vehicle) industry, define which types of vehicles you offer and their prices. Indicate whether you will offer premium-priced vehicles or discounted and slightly used vehicles.
Clearly outline who the major competitors are in your industry by market. Competitors will likely vary if you serve multiple cities or states.
Compare your strengths and weaknesses to these competitors. Identify the advantages you have over each competitor and plan how you will exploit those advantages. For example, you may have a much more qualified service repair department than most competitors.
Features
Highlight details about your executive and management team in your business plan. Determine in which functional areas you have the most experience. A good business plan fairly identifies employee strengths and weaknesses.
For example, your management team may be heavily engineer-oriented but lack marketing experience. Pinpoint specific hiring needs. Determine when you will need to add personnel. Define what qualifications you will be seeking in all new employees.
Function
A good or effective company business plan must include all sales and marketing plans. Knowing how you will market your business will get your business up and running much more quickly.
Explain whether you will primarily be using outside or inside sales reps and in which regions you will base your sales managers. Also, include detailed information about your advertising plans, such as magazine or newspaper ads, direct mail campaigns, Internet marketing or radio and television advertising.
Considerations
A good business plan will also include details about a company’s operations. Your business will operate much more efficiently if you know how various departments and production will be run. One way to ensure a more efficient operation is deciding on the right organizational structure.
For example, if you decide that a functional organizational structure works best for your organization, include it in your business plan. Companies with such structures organize departments by functional area, such as marketing, finance, accounting and research and development.
What Are The 12 Components of a Business Plan?
But not every business plan needs to be extensive. The important thing is that the reader understands what the venture is about. A business plan has fixed components. The 12 main components shall be introduced in the following passages.
1. Executive Summary
The executive summary is the summary of the entire business plan. It can only be compiled when the business plan is finished. It provides a short overview over the basic contents of the plan. The most important details should be easily comprehendible.
2. Founder (team) and business leadership
An important component of the business plan is the introduction of the founder(s). It is important to point out why this person should lead the business to success. You should make a distinction between professional qualifications and entrepreneurial ones, meaning between education and job experience, and leadership experience and the ability to work as part of a team.
3. Product or Service
The product (or the service) is the heart of any company. Characteristics and stages of development should be listed in the business plan. What makes the product one-of-a-kind, what is its so-called unique selling proposition? The product description should be easily understandable, even for laypersons.
The question of what you want to accomplish should be answered. This includes short-term and long-term goals and how you want the product to develop. Should you be producing complex products, the individual stages of production need to be listed. Is the product new or unusual, the functionality should be described in detail.
4. Market and sector
A competent business founder should have a keen sense of the market and the competition. If you only see as far as your own nose, you will not get far. A market analysis is indispensible. Not only should you be aware of your competitors, you should also know your customers well.
The easiest method of getting to know your potential customers is a survey or the questioning of other businesses of the sector. For almost every sector, there are current analyses. In most cases, you can attain the results from banks or view the corresponding theses at universities.
The business plan should show how you expect your business to develop in comparison to other businesses in the sector. It is usually easy to find out, who your competition is: Google search, Yellow Pages, in forums, from experts of the corresponding chambers. The situation on the market also determines the site selection.
Internet-based companies or freelancers, who work from home, clearly have the advantage here. They can work anywhere, or where salary and rental costs are lowest. Otherwise, the choice of location depends on the proximity to distributors and customers. There could also be regulatory requirements. It is important for the business plan that the choice of location justifies the costs.
5. Distribution and marketing
This is one of the most important points of the business plan. You can therefore divide distribution and marketing into offer strategy, price strategy, distribution strategy, and marketing strategy.
The product offer is critical and presents an opportunity to set yourself apart from your competitors. The business plan should stress the difference between you and your competition and what makes your product special. Your strategy for further development should not be missing here.
The chosen price strategy is also of importance. Did you opt for high or low prices, or even a threshold price strategy? Your business plan should demonstrate how your price strategy secures cost recovery and at the same time sets you apart from your competitors.
You should therefore list the prices of your competitors for comparison. The price needs to be competitive, which should be visible in the business plan. You should also elaborate on the composition of your price, how high your profit margin is, and the minimum price of the product.
The distribution concept should be visible as an entity. Naturally, it has to match the product, which should be demonstrated in the business plan. Every chosen channel of distribution should be explained.
Those that were not selected should also be listed, explaining why they were not chosen. This shows that you have considered all options and weighed the advantages and disadvantages of each choice.
Publicity is needed for making your product known. Which strategy is to be pursued and why, is also part of the business plan
Some products and services can gain a high profile with the help of clever PR-strategies. This should not be underestimated.
6. Co-workers and business coordination
Your business plan should outline your overall orientation regarding organisation: is there a strict hierarchy or do you prefer project teams? Where lie the responsibilities? The choice of co-workers and the suitable job description needs to follow accordingly. It may be better to employ part-time workers or consult external experts for individual projects.
The business plan should also show the planned development of the employee situation. With the growth of the company, the number of employees may also need to be increased. You may, however, plan not to hire employees and rather commission external service providers for individual projects. This is useful in the area of bookkeeping
7. Legal form
A good business plan should also contain explanations about the chosen legal form of the company. Which person or other corporation holds a part of the company? Why is the current legal form the suiting the best? Are there any changes planned when growth is coming? This is part of the business plan.
8. Chances and risks
The risks, but also the chances are the most interesting parts of the business plan for investors, loan creditors, and bankers. Risks are naturally a delicate topic. However, if you are honest and mature about them (and they are listed in your business plan), they should not present a problem.
Worst-case scenarios and best-case scenarios can be helpful to make your point. The appropriate numbers should be listed as well.
9. Capital requirement
The seed capital has to come from somewhere. No one founds a business without any resources. In most cases, the equity capital is not enough. The business plan should therefore show, which capital goes where and for what it is used.
The reserve capital is also of importance. Self-employed people or freelancers have to budget for their personal needs. Current as well as prospective loans should not be forgotten.
10. Finance plan
The finance plan is likely the most complex component of the business plan, because it is not easy to show where the money comes from, where it goes, and for what it is used.
The equity capital is one component of the finance plan. The amount you contribute should be noted in the business plan, as banks appreciate it when personal resources support new-business loans.
External funds and their amount and distribution are an important part of the finance plan. Often the funding occurs through capital providers, such as investors or banks as loan providers. (Public) subsidies are also external funds. Should you plan to claim such funds you should include it in your business plan.
The so-called liquidity projection demonstrates financial solvency over a planned period. There are benchmarks for every sector, which can help you orientate yourself.
Here, you should also mention the break-even point, meaning the point in time when you move from the red into the black. Your business plan should also point out how you intend to get by until then.
The profitability statement or earnings forecast demonstrates,which proceeds a customer generates with which product (should there be more than one). Of course, these are only estimations but they can be well founded.The profit and loss statement shows how the capital and value is expected to increase. The turnovers are contrasted with the expenses.
11. Further documents
You should complete your business plan with other relevant documents, such as a CV, surveys, or drawings.
12. The right measure
Many business plans are too extensive, as the authors (the business founders) believe they need to describe every small detail extensively. You should not lose yourself in flowery phrases, but make precise statements.
It is helpful to let friends, who are strangers to your line of business, read your business plan. If they can understand everything, the plan is comprehensible. You should be able to recount your business plan by heart and know the numbers in your sleep. This ensures that a presentation, or a visit with the bank or other investors will go smoothly.
What Are The 4 Types of Business Plans?
Organizations should develop a better understanding of how to approach business planning. The following sections expand on the four types of planning.
Operational Planning
“Operational plans are about how things need to happen,” motivational leadership speaker Mack Story said at LinkedIn. “Guidelines of how to accomplish the mission are set.”
This type of planning typically describes the day-to-day running of the company. Operational plans are often described as single use plans or ongoing plans. Single use plans are created for events and activities with a single occurrence (such as a single marketing campaign).
Ongoing plans include policies for approaching problems, rules for specific regulations and procedures for a step-by-step process for accomplishing particular objectives.
Strategic Planning
“Strategic plans are all about why things need to happen,” Story said. “It’s big picture, long-term thinking. It starts at the highest level with defining a mission and casting a vision.”
Strategic planning includes a high-level overview of the entire business. It’s the foundational basis of the organization and will dictate long-term decisions. The scope of strategic planning can be anywhere from the next two years to the next 10 years. Important components of a strategic plan are vision, mission and values.
Tactical Planning
“Tactical plans are about what is going to happen,” Story said. “Basically at the tactical level, there are many focused, specific, and short-term plans, where the actual work is being done, that support the high-level strategic plans.”
Tactical planning supports strategic planning. It includes tactics that the organization plans to use to achieve what’s outlined in the strategic plan. Often, the scope is less than one year and breaks down the strategic plan into actionable chunks.
Tactical planning is different from operational planning in that tactical plans ask specific questions about what needs to happen to accomplish a strategic goal; operational plans ask how the organization will generally do something to accomplish the company’s mission.
Contingency Planning
Contingency plans are made when something unexpected happens or when something needs to be changed. Business experts sometimes refer to these plans as a special type of planning.
Contingency planning can be helpful in circumstances that call for a change. Although managers should anticipate changes when engaged in any of the primary types of planning, contingency planning is essential in moments when changes can’t be foreseen. As the business world becomes more complicated, contingency planning becomes more important to engage in and understand.
10 Reasons Why You Need a Business Plan
What is the purpose of a business plan and why are business plans so important? Below are our top 10 reasons why you need a business plan.
1. To prove that you’re serious about your business. A formal business plan is necessary to show all interested parties — employees, investors, partners and yourself — that you are committed to building the business. Creating your plan forces you to think through and select the strategies that will propel your growth.
2. To establish business milestones. The business plan should clearly lay out the long-term milestones that are most important to the success of your business. To paraphrase Guy Kawasaki, a milestone is something significant enough to come home and tell your spouse about (without boring him or her to death). Would you tell your spouse that you tweaked the company brochure? Probably not. But you’d certainly share the news that you launched your new website or reached $1M in annual revenues.
3. To better understand your competition. Creating the business plan forces you to analyze the competition. All companies have competition in the form of either direct or indirect competitors, and it is critical to understand your company’s competitive advantages. And if you don’t currently have competitive advantages, to figure out what you must do to gain them.
4. To better understand your customer. Why do they buy when they buy? Why don’t they when they don’t? An in-depth customer analysis is essential to an effective business plan and to a successful business. Understanding your customers will not only allow you to create better products and services for them, but will allow you to more cost-effectively reach them via advertising and promotions.
5. To enunciate previously unstated assumptions. The process of actually writing the business plan helps to bring previously “hidden” assumptions to the foreground. By writing them down and assessing them, you can test them and analyze their validity. For example, you might have assumed that local retailers would carry your product; in your business plan, you could assess the results of the scenario in which this didn’t occur.
6. To assess the feasibility of your venture. How good is this opportunity? The business plan process involves researching your target market, as well as the competitive landscape, and serves as a feasibility study for the success of your venture. In some cases, the result of your planning will be to table the venture. And it might be to go forward with a different venture that may have a better chance of success.
7. To document your revenue model. How exactly will your business make money? This is a critical question to answer in writing, for yourself and your investors. Documenting the revenue model helps to address challenges and assumptions associated with the model. And upon reading your plan, others may suggest additional revenue streams to consider.
8. To determine your financial needs. Does your business need to raise capital? How much? One of the purposes of a business plan is to help you to determine exactly how much capital you need and what you will use it for. This process is essential for raising capital for business and for effectively employing the capital. It will also enable you to plan ahead, particularly if you need to raise additional funding in the future.
9. To attract investors. A formal business plan is the basis for financing proposals. The business plan answers investors’ questions such as: Is there a need for this product/service? What are the financial projections? What is the company’s exit strategy? While investors will generally want to meet you in person before writing you a check, in nearly all cases, they will also thoroughly review your business plan.
10. To reduce the risk of pursuing the wrong opportunity. The process of creating the business plan helps to minimize opportunity costs. Writing the business plan helps you assess the attractiveness of this particular opportunity, versus other opportunities. So you make the best decisions.
What Kind of Name Can I Give my Business?
Finding the right name for your startup can have a significant impact on your success. The wrong name can do worse than fail to connect with customers; it can also result in insurmountable business and legal hurdles. In contrast, a clear, powerful name can be extremely helpful in your marketing and branding efforts.
Here are 5 helpful suggestions on how to come up with a winning name for your business:
1. Avoid hard-to-spell names.
You don’t want potential customers getting confused about how to find your business online. (I never understood why “Flickr” was pushed as the name for the photo-sharing site.) You want to avoid having to continually correct the misspelled version of your name. Keep it simple.
2. Don’t pick a name that could be limiting as your business grows.
Picking too narrow of a name may cause you problems down the road. Imagine if Jeff Bezos had picked the name “OnlineBooks” instead of “Amazon.” So avoid names like “Wedding Dresses of San Francisco” or “LugNuts Unlimited.” You don’t want to limit your business to a particular product or a specific city.
3. Conduct a thorough Internet search.
Once you have determined a name you like, do a web search on the name. More often than not, you will find that someone else is already using that business name. While that won’t be a total showstopper, it should give you pause.
4. Get the .com domain name.
My strong preference is that you secure the “.com” domain name for your business rather than alternatives such as .net, .org, .biz, or other possible domain extensions. Customers tend to associate a .com name with a more established business. Undoubtedly, someone will already own your desired .com name, but many domain owners are willing to sell their name for the right price.
Think of acquiring the .com name you want as a business investment. You can check on the availability of a domain name on sites such as GoDaddy.com or NetworkSolutions.com, and if the domain name is taken, you can often track down the owner of the domain name and see if they are willing to sell it by using the “Whois” tool at GoDaddy or Network Solutions.
Also make sure to grab your desired business name on popular social media sites such as Facebook, Twitter, and Pinterest.
5. Use a name that conveys some meaning.
Ideally, you want the business name to convey something meaningful and positive related to your business. Can people instantly get what your business is about? While meaningless names like “Google,” “Yahoo,” or “Zappos” have some appeal due to their catchiness, these kinds of names will cost you a lot more to brand.
Some examples of clear, simple, and intriguing domain names include Canny.com, Cling.com, Afire.com, and Administer.com. A domain name like “OnlineTickets.com” is genius as it conveys the meaning of the business and is helpful for search engine optimization purposes.
How Can I Improve my Plan?
Learning how to plan – especially if you’re new to organizing your time – can be a frustrating experience. And for some individuals, the reason could be their brains.
But it doesn’t mean that we can’t develop those skills by actively building neuroconnections in our brain through persistent practice.
Here are some key steps for using knowledge of your natural brain strength to build your planning skills.
Recognize your strengths and weaknesses
If you find planning extremely difficult, the back-left part of your brain is probably not dominant. To find out what part of your brain dominates, complete the self-assessment in the book Thriving in Mind, or participate in the more formal Benziger Thinking Styles Assessment. Learning more about your natural thinking style can help you better understand what works best for you.
Accept the difficulty
If we think something should be easy when it’s hard, we tend to get upset and are more likely to give up. But if we set expectations that a task will be difficult, we may still flounder, but we’re more willing to work through any issues, since we understand that challenge is part of the process.
Let go of all-or-nothing thinking
Some people think that they must follow their plans perfectly, or their efforts have been wasted. Instead, try to view learning as a process where improvement counts and every day matters. This will build your resilience because you won’t beat yourself up as much when you deviate from your plan, and in turn, you will find it easier to get back on track.
Find systems that work
Instead of forcing yourself into an established scheduling process, find a system that works for you, whether it’s using sticky notes, whiteboards, spreadsheets or apps on your phone. Experiment until you find the right fit.
Borrow other people’s brains
If you know people who excel in planning or have good organizational skills, ask for their advice and insight. They may be able to offer solutions to problems that overwhelm you.
Keep trying
When you find yourself getting frustrated in the process of planning, have self-compassion when you make mistakes, refocus when you get distracted and adjust your plan when new issues crop up.
Understanding what’s going on in your brain as you acquire time management skills can make a dramatic difference in your ability to plan. When you convince yourself that you can change and accept that you’ll need to work harder than most, you’ll have a much higher chance of improving your planning.
What is The Most Important Part of Your Business Plan?
The executive summary the most important part of your business plan, and perhaps the only one that will get read so make it perfect! The executive summary has only one objective : get the investor to read the rest of your business plan.
When you’re starting a small business, a sound business plan is a critical element you need to secure funding and develop your operational and marketing tactics. While there are several different sections within a business plan, it’s critical to focus on the most important ones so that you can guide your business where you want it to go.
According to the U.S. Small Business Administration, a business plan is like a GPS for your new venture. Without it, you can often feel lost or confused. Taking time to write out a solid business plan helps to cement your ideas and fine tune your tactics.
This is a good exercise to do even if you don’t need to get funding for your business. A business plan helps entrepreneurs think through their ideas carefully, and provides the next steps they need to take to succeed.
When you’re writing a business plan, it’s important to consider your audience. In many cases, this includes potential investors, partners or financial institutions. They want to understand why your business is posed to succeed and why you are the person that’s going to get it there.
The Body of Executive Summary
The rest of executive summary must follow a progression. Start with the business description and the team, then the market and your financial highlights, and finally the funding requirements.
Business description
Try to introduce the company in a couple of sentences (legal structure, location, shareholders and management team), its activity, and the main milestones to date.
The aim is to build interest from the reader of your plan by showing that you have the right team to carry this project and some traction around the product. If you have some skill gaps within the team you need to address this concern by showing how you are going to fill the gap (recruitment, external advisor).
The reader now knows:
- in what he will be investing
- along which shareholders
- and who will lead the project
Market
The next step is to give a brief overview of the market:
- Customers: who are they? How many are they? What is the estimated value of the market?
- Need: why will customers buy your products?
- Competition: who are your competitors? What sets you apart?
- Strategy: what is your market positioning? How are you going to access the market?
If you are writing your business plan for a bank, try to reassure by showing that there is a real need for your product and that you are going to generate revenues quickly. If your business plan is for an equity investor, you also need to emphasize the market size and demonstrate that there is the potential to establish a large business.
Financial highlights
Here you need to present your key historical and forecasted financials, along with the main assumptions underlying your forecast.
Which figure should I mention? This really depends on both your sector and stage. As a minimum, try to show:
- That you are profitable: your EBITDA is positive
- That you generate cash: your operating cash flow is positive
- That you are growing: your revenues, EBITDA, and operating cash flow are growing regularly
Depending on your sector you might also want to include a few Key Performance Indicators (KPIs). For example the number of active users for a software company.
Need
Finish the executive summary by stating the funding requirements and the use of proceeds. If needed, detail the offer (% of equity on offer, the ideal length of the loan, etc.).
If you are trying to raise equity and already received binding offers from a few investors, mention it here as this will reinforce the attractiveness of your project.
Who Should Develop Business Plans?
The person or persons responsible for implementing the plan should be heavily involved in its development. Some people hire consultants or have employees draft the plan. If you’re going to be accountable for the decisions that will be based on the plan, then you need to be involved in its development.
Read Also: Investing With Intelligence: 7 Tips for Tracking Performance of Your Investment
You might have input from experts as you develop the background and analysis for the business plan, but as the owner and entrepreneur, the business venture is an extension of your desires, goals, philosophies, skills, and abilities. If you are not directly involved, then it will not be an effective planning document.
Conclusion
Whether you’re just starting out or running an existing operation, writing an effective business plan can be a key predictor of future success. It can be a foundational document from which you grow and thrive.
It can serve as a constant reminder to employees and clients about what you stand for, and the direction in which you’re moving. Or, it can prove to investors that your business, team, and vision are worth their investment.
Using these steps to write a business plan will put you in good stead to not only create a document that fulfills a purpose but one that also helps to more clearly understand your market, competition, point of difference, and plan for the future.