Business Plan

There’s a lot of work to be done when creating a business plan whether you’re opening a location, working from home or doing E-commerce. An effective strategy cannot just be slapped together. Taking the time to formulate a business plan is vital.

Planning Your Business Plan

The first step is thinking about what you want your business to look like. Here are some of the questions you should ask yourself, and anyone who will directly involved in the business such as your spouse or business partner.

• What kind of business am I going to run? Will I sell products, services or both? How many different products or services do I want to have?
• What need(s) am I fulfilling?
• Will the business be operated out of the home, a storefront or an office?
• Will there be employees other than members of my immediate family? What functions will they perform? How many employees do I need?
• Who are my target customers and how will I reach them?
• How will I fund my business from startup through the first year?

A Business Plan Has Four Main Sections

• Description of the business
• Marketing plan
• Financing information
• Management plan

Each of these aspects is important when creating a business plan, because your plan must reflect an understanding about how your business will be run on a daily basis.

Business Description

This section should include the name of the business, what you plan to sell or services you will render, number of employees, location and general operations.

Marketing Plan

You could have the best products or the most useful services in the world, but if you don’t have a way to reach potential customers, you won’t make any money. The marketing plan is important for your business because it will help you to best reach your target audience and how much it will cost to reach them including radio, television, magazine and newspaper advertising. Your marketing plan should include a Web site, posting on blogs, writing online and print articles, press releases, radio interviews and buying ads on other Web sites.

Financing Information

If you don’t have enough money to get your business off the ground, none of the rest of your planning will matter. How much money do you have to put into your business? What other forms of financing are you expecting, such as loans from friends, family members or banks?

All of these questions come down to one big one: How are you planning to support yourself, your family and your business for the first year? You need to have financing figured out for at least a year because that’s the amount of time it will probably take to start making money from your business.

You should consider projected earnings, a budget plan, a summary of month-to-month operations for the first year and a three-year plan projecting earnings and expenditures.

Management Plan

Finally, you must know how you are going to run your business, how work will flow among employees, what each person’s responsibility is and who is ultimately “in charge” of what.

If you are the only employee of your business, it still helps to plan how you think the business will run and exactly what you will spend your time doing each day. Determine minimum needs to be done each day to keep your business afloat: production, marketing, current client work, education and divide your time accordingly. This will give you an overview of how the business will really work, instead of operating on best-case scenarios.

Check Out Sample Plans First

It can be very helpful to look at a sample business plan in your industry as you write your own. There’s a great resource for this, called BPlans, which offers sample plans on everything from an aircraft manufacturing business to wedding consultant.

Effect Strategy

Business plans are often used to help the business owner get a startup loan and recruit employees. It can provide a road map by track progress of your goals as your business grows, helping you to see potential problems and work around them before they become insurmountable obstacles.