How does one create a business plan?

farst

How do you create a business plan?

I get this question a lot! You have an idea that you have transformed into a service or product. What should you be thinking about to make your business grow successful? Here is a list of typical content pieces in a business plan. Use it as a checklist.

You don’t need everything, unless you are seeking outside investors, in which case, you should seek help from a consultant or business coach. In general, this is what should be included and more importantly, given your thought and consideration.

Cover sheet
Table of contents
Executive Summary
Mission Statement:

What is the purpose of your business? Why do you exist?

Description of the Business

What problems are you solving, for whom, and how?
If you have a physical office, where is it? What type of legal entity are you: sole proprietorship, corporation, LLC, LLP, etc.

In-depth Management Plan:

How will you lead and manage your staff? What roles and responsibilities will everyone have in order to make your business work?
SWOT yourself/ personnel and your environment to identify who has which strengths and weaknesses and which strengths and weaknesses the relevant opportunities and threats in your external environment require your and/or staff to have.
What salaries, benefits and vacations will you be offering? How will you meet your staffing needs during vacations and absences? How often will you be absent from the office? Who assumes management duties during your absence?
Describe how your personnel needs could change and how you will handle this.
Describe your management structure and how decisions will be made.
Who are your competitors. How are you different? How will you grow? Who is your target market?
Operating plan. Will you need an office, manufacturing facility, or other space? What equipment and technology do you need? Will customers/clients/consumers be coming to you? If so, what do they need to get to you easily? Will you need insurance? What will it cost you to run your business weekly, monthly, annually?
People. Who do you need to help you do everything that the business requires to be successful? What skills do the need?

In-depth Financial Plan:

Set up and describe your start-up budget (business capitalization) or annual budget. Loan and credit facilities arranged. Equipment and services required, and whether these are leased or purchased, ex.software and hardware costs and supplies.Personnel costs. Deposits, permits and office improvement costs. Accounting startup fees.Utilities, etc. Estimate all fixed and variable costs and ‘unanticipated’ expenses. Build in all fixed expenses (rent, insurance, staff, leases) and variable (file disbursements, part-time staff, taxes and expenses that are dependent on the volume of business).
Describe your budget by quarters, second and third years. Detail everything by month, first year. (See above -Describe all costs including salaries, insurance, rent, loan payments, taxes, marketing costs, accounting and bookkeeping costs, payroll expenses, utilities, professional dues and subscriptions, repairs and maintenance costs etc.). Your salary.
Balance sheet (assets, liabilities, retained equity)
Breakeven analysis. Describe your sources of cash for all periods from startup up to and including your projected break-even date. Describe how you will repay these sources of cash after your practice turns into the black. When will you breakeven? What profit do you expect to make each year after?
Plan for Profit and Loss statements. Daily? Weekly? Monthly? Annually?
Formally state all assumptions upon which cash flows were based (to include: billings, salaries, income, collections and write-offs)
Describe how your accounting system will monitor your budget against actual costs. Show that you understand how to use your accounting system to produce the reports that you need to manage your practice. Demonstrate that you know what are the key financial indicators for your practice (WIP, billings, billings per client, unbilled disbursements, accounts written-off, accounts receivable, change in receivables, receivables as a % of total billings etc…).

In-depth Marketing Plan:

Describe your target market and its sub-segments.
Describe what will attract them and keep them coming back?
Describe how you propose to reach your target market
Describe your sales funnel. How will you reach your targets? With what value will you reach them? Once you reach them, what will you ask them to do? How will you get them to buy whatever you are selling? How will you keep them returning to your business?
Describe your lead magnets, sales platform, and avenues in.
Identify marketing costs.
Have SMART marketing goals.
Describe how you will build your customer loyalty and referral network within your target market
Demonstrate that you understand your competition and their pricing and how your marketing and pricing will lead to sales and profit