Write your business plan
A business plan has three basic purposes: communication, management, and planning.
You can use your business plan as a communication tool to attract investors, secure
loans, convince workers to hire on, and assist in attracting business partners. A
business plan can confirm whether or not a business has the potential to make a profit.
It requires a realistic look at almost every phase of business. It shows lenders
that you have worked out all the problems before launching your business.
As a management tool, the business plan helps you track, monitor and evaluate your
progress. By using your business plan to establish timelines and goals, you can
gauge your progress and compare your projections to actual accomplishments.
As a planning tool, the business plan guides you through the phases of your business.
A complete plan will help identify obstacles so you can avoid them and develop
alternatives. Many business owners share their business plans with their employees
to foster a broader understanding of where the business is going.
Plan your work
Many entrepreneurs drag their feet when it comes to preparing a written business plan.
They argue that their marketplace changes too fast for a plan to be useful or that they
just don't have enough time. But just as a builder won't begin construction without
a blueprint, business owners shouldn't begin ventures without a business plan.
Business plan outline
The following outline of a typical business plan can serve as a guide. You should
adapt it to your specific business. Break down the plan into several components if
that helps make drafting it a more manageable task.
Introduction
- Give a detailed description of the business and its goals
- Discuss the ownership of the business and the legal structure
- List the skills and experience you bring to the business
- Discuss the advantages you and your business have over your competitors
Marketing
- Discuss the products/services you offer
- Identify the customer demand for your product/service
- Identify your market, its size and locations
- Explain how your product/service will be advertised and marketed
- Explain your pricing strategy
Financial Management
- Explain your source and the amount of initial equity capital
- Develop a monthly operating budget for the first year
- Develop an expected return on investment and monthly cash flow for the first year
- Provide projected income statements and balance sheets for a two-year period
- Discuss your breakeven point
- Explain your personal balance sheet and method of compensation
- Discuss who will maintain your accounting records and how they will be kept
- Provide "what if" statements that address alternative approaches to any problems
that may develop
Operations
- Explain how the business will be managed on a day-to-day basis
- Discuss hiring and personnel procedures
- Discuss insurance, lease or rent agreements, and issues pertinent to your business
- Account for the equipment necessary to produce your products or services
- Account for production and delivery of products and services
Concluding Statement
Summarize your business goals and objectives and express your commitment to the success
of your business.
Once you have completed your business plan, review it with a friend or business associate.
When you feel comfortable with the content and structure make an appointment to review and
discuss it with your lender. The business plan is a flexible document that should change
as your business grows.
We're here to help
Once your business plan is complete, feel free to bring it in to your local branch and
review it with one of our credit union representatives. We can find the right
financing for your small business. We also offer many business
services to make your work day run smoothly.
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