A thoroughly researched, well-written business plan serves as a blueprint for your company, your employees and your current and potential investors. But what goes into a top-notch plan? How do you make yours stand out from those competing for the same investment dollars?
If you ask five business plan pros, you might get five different answers. However, investing extra effort into these three areas can get your business plan moving in the right direction.
3 Business Plan Tips
1. The executive summary is like an elevator pitch or a cover letter. It's a short-and-sweet one-pager that highlights your products or services, target market, management team, short-term and long-term objectives and overall mission. In your executive summary, clarity is your ally. Investors want to see that you have your head on straight. Some people may interpret ambiguity in a business plan as disorganization, sloppiness, or, even worse, weakness.
2. Thorough market analysis shows you've done your homework. You're at least somewhat aware of the challenges you could face in a particular industry or location, both when you first launch and years down the road. When presenting your analysis in the plan, include the following elements:
- Industry overview. Outline the size and scope of the industry, its growth over a given period of time and major customers to be served. Define the needs of your customers and the ways in which they are under-served. Include key demographics about the market, such as age, race and income, as well as historical purchasing trends that could affect your decision-making.
- Market share. Forecast the market share you plan to capture, and how fast you plan to do so. Be sure to include price points and profit margins. Furthermore, defending these calculations with a logical analysis can answer many of the questions investors ask.
- Competitive analysis. Identify your competition, what they offer and how they serve their customers. Include their strengths, weaknesses, marketing tactics and any barriers they pose to your success (and, of course, how you'll overcome them!)
3. An executive team with documented education and experience can be crucial to business success. If you have talented execs on your roster, sing their praises in your plan. In addition to highlighting their expertise, discuss notable achievements, skills, industry recognition, community involvement and more. The more confidence your plan builds in investors, the better.
Finally, if you're not a professional writer, don't pen the plan yourself. When seeking a loan, investment or other forms of financial backing, you need your best foot forward at all times.
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