Start Your Own Business - Preparing Your Business Plan

Introduction:

The Business Plan has been compared to a road map. It should show you where you are, where you want to go to and how to get there. To succeed in any walk of life you need to plan, monitor your progress and take corrective action to bring you back on track again. So remember a plan is not set in stone and to be effective must be used and reviewed constantly to reflect the changes in your business.

Prepare your plan comprehensively but try to be as concise as possible. This will make it easier for potential investors, state agencies and lenders to review and comment on it. Remember no one is looking for a thesis but a document, which is relevant and addresses what needs to be addressed.

The following is one suggested outline to assist your preparation of a business plan. Only address those sections, which are relevant to your business project.

1. Objectives:

  • Why are you starting your own business?
  • What do you wish to achieve?

2. Market:

  • What is your target market?
  • Where is the market located?
  • Who are your customers?
  • What is the potential size of the market?
  • Is the market growing, static or falling?
  • Has your product/service any export potential?
  • Who are your competitors and what do they offer?
  • Have you completed a thorough market research?
  • Are there any changes taking place in the market that are likely to impact on your business?

3. Sale & Distribution of your Product/Service

Now that you have completed a thorough market research address the following:

  • What is special about it and what added benefits can it offer over existing products/service
  • Describe it giving details of branding, design, packaging etc.
  • What is your projected sales and market share? Show this progressively month by month for the first three years of operation.
  • How much do you intend to change and how does this compare with your competitors?
  • How do you intend to sell and distribute it?
  • What is your customer base by number and location?
  • How will you promote and advertise your product/service?
  • Do you need a Public Relations Strategy and if so define it?

4. Key Personnel:

Give the following details for key personnel:

  • Name and personal details
  • Qualifications relevant to the business
  • Prior work and business experience
  • Management experience
  • Details any relevant courses attended
  • Details of existing bank account and personal assets

5. Management:

  • Detail your management and organisational structure
  • Outline the management responsibilities
  • Detail the management team and include qualifications, experience etc.
  • Highlight the skills needed in the business with particular regard to weaknesses and how to compensate.

6. Personnel:

  • List personnel skills along with those skills needed to be acquired from outside the business
  • Give brief but accurate job descriptions along with anticipated monthly and annual costs

7. Business details:

  • Business name, trading name, address, telephone, fax, e-mail, Internet etc.
  • Indicate whether you are trading as a limited company, partnership or sole trader. Provide back-up documentation to provide details
  • Business Activities
  • Indicate when you commenced or intend to commence trading
  • Indicate details of your legal advisor and accountant
  • VAT registration number, if applicable

8. Production details:

You should clearly explain the production process of your products or services, such that anyone reading it will fully understand your business. List the raw materials needed and how much they cost, along with sources of supply.

9. Cash Flow Forecast:

You may need assistance in compiling the cashflow forecast, as it is very important this is completed accurately and realistically. The results from this will indicate the future cash requirements of the business.

  • List realistic costs of premises, vehicles, machinery, office equipment
  • Show the assumptions used for cost of sales, administration and selling expenses
  • Indicate the investment from promoter, private, grant aid, along with the required funding needed from a lending institute

Additional Information

  • Where are your business premises located? What's it's size and how is it suitable for your business?
  • Indicate if you intend to lease the premises on a rental or purchase basis
  • In the cash flow section you will have listed the machinery, vehicles, equipment etc. required, now you should indicate whether you intend to lease, rent or buy them

Summary

In this section briefly but accurately overview your business plan.

Now that you have your draft plan ready, read over the plan to see if you have omitted any item or need to re-work any section. Once this is complete it is recommended that someone else peruse the plan. This affords you the opportunity of having a critical but friendly re-view of your plan, prior to realising it to grant agencies, banks etc.

It is better to discover deficiencies at this stage than have them picked up by those whom you are attempting to fund or invest in your business.

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