Business Plan Basics

While it is true that business ideas are free flowing in a competitive market, it is equally true that many good and innovative ideas never get past the conceptual stage.

Along with this is a popular misconception that many successful entrepreneurs and executives can merely rely on their reputations or charisma to get their ideas approved. Suffice it to say that personal power, while certainly an asset, is rarely enough to influence most savvy decision-makers.

There is no getting around the fact that championing a business idea involves commitment, persistence, and a lot of back room fact-gathering. The result of which is the writing and submission of a well-thought out and defensible Business Plan.

Of course, putting together a formal Business Plan can be quite an intimidating task for anyone. But as is the case with most Professional Communications, writing an effective Business Plan is a process, and if you approach the task in this manner, it can be made less overwhelming and more manageable.

Granted, some entrepreneurs may resist using such a reasoned approach, but the upshot is when Business Planning is approached systematically, it is less likely the final plan will be dismissed as being long on vision, but short on details.

That said, the first step in the writing process is to translate your business idea into a clear vision of what is to be accomplished. This is usually done by articulating goals, strategies, and values vis-a-vis a Mission Statement.

When writing a Mission Statement, use superlatives in describing your vision. However, this should not be an exercise in writing fancy boilerplate. After all, these statements supposedly reflect the rationale for the enterprise. Thus, take the time to get a consensus on what the Mission Statement should say and mean in real terms. Make it tangible and attainable.

For additional insights about Mission Statements, look up examples of published statements on the Internet or in the opening pages of many Annual Reports.

The next task involves formulating answers to the following key questions in support of the Mission Statement:

* What type of Business is to be established? (Proprietorship, Partnership,etc.)
* What will be Management and Organization of the business entity?
* What are its products or services?
* What is the target market and who is the competition?
* What is the Marketing and Sales Strategy?
* What are the financial projections?
* How will the business be funded?

It is critical that each of these questions are answered in detail and with specificity. Also, remember that those who will be reviewing the plan will be doing so with critical eyes, as well as with a certain degree of skepticism. Thus, write clearly, expansively, and persuasively. If you need help in this regard, enlist the expertise of a good Wordsmith.

Once the above questions are answered, the actual formatting of the Business Plan can begin. While there is no hard and fast rule for organizing and packaging these documents, reviewers will have expectations as to what information should be included, and in what manner it should be presented.

This should not suggest that Business Plans should be devoid of creativity; however, the writer's focus and energy should be on content. Adding a few "bells and whistles" may be a nice touch, but only so long as they are not used to mask any questionable facts or assumptions in the Business Plan. Reviewers are not fooled by such tactics.

With the above in mind, the basic elements that are typically found in most Business Plans are as follows:

*Cover Page
*Table of Contents
*Executive Summary (see below)
*Business type and description
*Management and Organization
*Products and Services
*Marketing and Sales Strategy
*Financial projections and funding sources
*Appendix of relevant supporting documents

Arguably, the most important part of a Business Plan is the Executive Summary. A simple truth is that reviewers and decision makers, whether they are bankers, investors, or corporate CEOs, are busy people who will often judge the merits of a Business Plan based solely on the Executive Summary.

Accordingly, an effective Executive Summary will describe all the elements of a Business Plan, but in a shortened format. As a general rule, two or three pages are usually sufficient, but the writer must ensure the Executive Summary covers the highlights without glossing over essential details.

The final step in the writing process is review and revision. Editing and Proofing are a given, but before finalizing the Business Plan, have others critically review what has been laid out. After all, one's success and livelihood may be at stake, so relying on the input of trusted third parties is a common sense way to reality test the Business Plan.

If you need additional help, the Business Section of your local library and the Internet are good depositories of free information and advice on this topic. By all means, check out these resources. The more insights you can gain about writing your Business Plan, the better equipped you will be to write an effective and persuasive document.

To help you get started with your research, check out the Business Plan Links below.

Related Links:

http://www.planware.org/businessplan.htm

http://www.myownbusiness.org/s2/

http://www.sba.gov/smallbusinessplanner/plan/writeabusinessplan/index.html


Jack