A business plan is a road map that helps a business to plan its course ahead and also helps it avoid obstacles in the future. The time you invest in making your business plan precise and thorough, and then keeping it updated, are an investment which pays returns in the long run. There are different methods available for preparing a business plan. You can either prepare it yourself or hire a professional business plan writer to do it for you. However, before choosing a business plan writer, be sure to choose one who not only has the requisite experience in writing business plans but also one who has the requisite credibility and reputation in his field.
To start with, you need to decide what type of business plan you want. It can be either an executive summary or an initial market study report. The former covers general topics such as the nature of the business, the objectives, key personnel, funding sources, market trends and competitors. The latter consists of more detailed information about the startup costs, operational expenses, sales forecasts, business concept, marketing strategies, operations, cash flow analysis, and other pertinent financial information required by banks and creditors for approval.
Executive Summary Business plans are not just a list of facts, they are also written documents which lay down the basic ideas and concepts of the business. An executive summary is not really a “plan” in itself as it is merely an outline. However, an executive summary is extremely useful when it comes to getting banks and investors to take a look at your business plans. The advantage of an executive summary is that it gives a clear picture of the startup and operating costs, business concept, target market, marketing strategy, finance sources, working capital, and other aspects important to prospective investors.
Lean Startup Companies Many traditional business plans still include an executive summary and an overall financial statements. Even a lean startup will always include some level of an executive summary and financial statements. For a lean startup, these forms are unnecessary. Because lean startups are not about production and profit margins, the executive summary and financial statements provided should focus on details such as management expectations, financial need, funding sources, business objectives, and strategy. All other aspects of the business plans are usually left to other parts of the document.
Technology and Customer Development Companies often use an executive summary and an overall business plan to provide entrepreneurs with a simplified version of their venture. In addition to using an executive summary and a company description, these documents also usually include marketing plans and venture goals. Often, these documents are used to attract new venture capitalists, raise venture capital, or as a basis for obtaining a loan from a bank or other lender. Because technology and customer development companies often operate in an early-stage of development, the documents usually contain information that is still relevant to the company at that point in time.
Marketing Plans Usually, an executive summary and business plan will not contain a full description of the current and future product line or service. However, they usually do contain market analysis data that can help determine if the company has the right direction to succeed in today’s marketplace. Market analysis data can take many forms, ranging from consumer surveys to survey of competitors to detailed competitor analyses. A good market analysis will help a startup business make the necessary decisions to enter into the marketplace.
Venture Capital As mentioned above, venture capital is one type of financing that is often required for a successful startup. However, this type of capital can come in many different forms. Angel investors, for example, are wealthy individuals who usually provide seed funding for startups with business goals that are related to their own. Private equity firms can provide early-stage financing for startups in which the principals serve as the sole owners of the business. Private placements, on the other hand, are used for companies in which the principals do not hold a direct majority share of the company. In a private placement, potential investors are invited to invest a limited amount of money in exchange for shares of the company stock.
No matter what form of financing is received for a startup, it is always a good idea to follow up on any loan or investment provided. Maintaining good records of a company’s financial performance will make it easier to obtain additional financing in the future, should the need arise. Finally, it is never too early to start preparing business plans for a new venture.