The goal of this article is to familiarize you with the nature of a business plan and to get you started writing your own. In other words, to remove the mystery or magic from the project and help you actually do it.
I. WHAT IS A BUSINESS PLAN?
A written description of your business, its history, what it does, who does it, who your customers are, what the finances are, what the competition is, what your plans are, perhaps what your exit strategy is.
In other words, a good business plan ought to summarize the past, present, and future of your business as you now see it succinctly and accurately.
this is not meant to be the great American novel.If ten words can convey your idea, don’t use twenty.
You and others are going to use this plan as the guideline for your business activities. Lenders may use the plan to evaluate the business. The Plan is not a public relations puff piece for you and others are going to rely on it. It should be solid, descriptive and factual.
II. WHY SHOULD I WRITE A BUSINESS PLAN?
- Because every business needs a plan.
Without a plan, someone or a whole group of someones will be in charge of what happens to your business but it won’t be you. For any sense of direction, you must have a plan. Without it, your business will simply coast at the mercy of active forces in the outside world. Your Business Plan will put you in charge. It will set forth where you are now and where you want to go.
If you don’t do a plan for your business, your competition will decide where you are going.
- Because your lender may require it.
Those putting money at risk in your business want to be able to evaluate what your business does and how well it does it. Your business plan can present that objective information, as well as setting forth the hopes you have for the future.
Your lenders/investors not only want the information, they want to see that you can present it effectively in a document that can be studied and analyzed.
- Because it will help your employees function as a team.
A plan helps everybody know where the business is going and how each is helping the business to get there. The plan sets forth the goals and the roadmap for reaching them. This makes potentially difficult or trivial tasks make sense, as well as building an appreciation among employees for the responsibilities of others.
In other words, the Business Plan is very useful inside your company as well as outside.
- Because your franchisor requires it.
This may be part of your application or training process before opening. It may also be later as you strive to reach your next performance or profit level, or purchase an additional outlet. These plans may be required annually or more often.
III. WHAT DOES A BUSINESS PLAN LOOK LIKE?
A full Business Plan is a written document about 25 to 50 pages long, though both shorter and longer versions may be used.
The Plan has several main sections.
Outline of a Business Plan:
o Cover Sheet
o Table of Contents
o Executive Summary
o Description of Products/Services
o Organizational Structure
o Marketing Plan
o Financial Documents
The form above should work for most businesses, but individual franchisors or lenders may have their own outline. Or the headings may be slightly different. Business Plan outlines can also be found in numerous self-help business books. Regardless of the precise form, the core content remains the same:
o What your business does, who does it, where, and how
o What is its past, present, and as far as you know its future
o What is the competition
o What do the numbers show, i.e., what do the key financial documents indicate?