subject: The Three Most Important Tips For Writing A Business Plan [print this page] Before you begin to seek funding for a new business, it is important that you begin writing a business plan. A business plan functions as an outline for lenders to understand your thought process about how your business will be structured. It also allows them to understand your product, your marketing plan and how you will make sales. A business plan often provides additional information about your budget and spending plan.
Tip #1 - Fully Describe Your Product or Service
Your business plan is an opportunity for you to describe your product or service in a way that is easy to understand. Include information about how it will be used and who might be your potential customers. For example, you might want to include a description of the demographics of clients who might buy your product or services. You may also want to include brief descriptions about ways in which your services or product offerings might be expanded in the future. All of this information combined provides a blueprint from business growth in the future. It also allows you to fully flesh out your business product or service concept.
Tip #2 - Develop a Marketing Plan
You may have a terrific product, but if you do not have anyone interested in it, then you cannot make any sales and will soon be out of business. A marketing plan describes how you will generate interest in your services or product. It specifically describes your targeted audience and the ways in which you plan on reaching them. Marketing can encompass product packaging, advertising and networking. For example, one method you may use to generate interest in your services or products is with social media. You might use news releases to announce your services or other methods to bring your business to the public's attention.
Tip #3 - Develop a Budget
A budget may be the most important part of writing a business plan. This is true regardless of whether you are developing a business plan to present to potential venture capitalists or are just beginning your business and want to have a written plan for the future. A carefully thought out budget provides you with a guide for what it will cost to operate your business. In the first year or two, projected budgets will be based on educated guesses about the real cost of items. In future years, you will have a better idea of what your projected income will be against expenses.
A complete budget should include all expenses associated with running your business. You should include things like expected utility costs, rent, internet expenses, equipment purchases, staffing, taxes, manufacturing costs and any other expenses you may incur. Keep in mind that most businesses do not run at a profit for the first three to five years, so it is important for you have a source of funding for expenses during this period time.
A business plan is an extremely important part of running your own business. By sitting down and writing out your business plan, you will be able to refine your business concept and gain clarity about how you will be able to make your business grow into a success. Even if your business has been in operation for several years, you can benefit from periodically sitting down and reviewing your business plan and writing a new one for the next few years to come.
