Learning how to write a business plan, whether for an imaginary or real business, is a common assignment in business school. Business plans are usually ten or more pages long; however, students should consult their individual rubrics to see how long their professor wants their business plan to be.
What is a Business Plan?
According to Investopedia, a business plan is a “written document that describes in detail how a business…is going to achieve its goals. A business plan lays out a written plan from a marketing, financial, and operational viewpoint…” Business plans are usually used for future business or when a current business wants to make major changes to the ways it operates. Students are most likely to have to write a business plan for a new business.
What to Include in a Business Plan
There are several important features that every business plan should include. Some of these features include a basic description of the company’s products or services, customer base, and general business goals. A market analysis, which will show customer demographics, sale competitors, and projected earnings are also important to add.
Tips to Write an Effective Business Plan
Now that we’ve discussed what goes into a business plan, here are some the sections you need to include in your business plan to make it as professional as possible. Tips, as well as descriptions of each section, are given to make the requirements of each section as simple as can be to understand. Keep these tips in mind as you work on your business plan.
- Summary. The business summary, also known as an executive summary, is at the beginning of every professional business plan. It is exactly what it sounds like– a summary of the rest of the business plan. Even though the paragraph will be at the beginning of the business plan, it is best to write it last. That way, you will already have the rest of the business plan written, which will make it easier to summarize.
- Company Description. The first section of the business plan after the summary is the company’s description. This section will need to describe the type of business you plan on forming, where it will be, and which type of clientele it will focus on. Adding information about why you believe your business will be a success is also key. An example of a company description is below. “Betsy’s Natural Cosmetics focuses on producing and selling cosmetics and related products that are made with only natural and organic materials. The business will be located in a small rental space inside the Main Street Mall. The shop will have a calming atmosphere, encouraging customers to stay and browse. By focusing on staying close to nature and having lower prices than our competitors, Betsy’s Natural Cosmetics is sure to stand out from the other women’s stores in the mall.”
- Market Analysis. The market analysis is based entirely on fact. This section of your business plan is bound to take a fair amount of research if you want it to be professional. A few things students should research include business competition and how your business compares and contrasts, profit margins of similar businesses in the area, and demographic information for your target customer base. Make sure to organize this section in such a way that it is divided up in several paragraphs, not all bunched together. This will make the section easier to read.
- Organizational Structure. When writing about a business’s organizational structure, the main factors that need to be written are how the management of the business is going to work. Discuss the business owner’s role in the business. Will they take on primary tasks or will those tasks be delegated to employees? If you know who you are hiring for managerial positions, write about their accomplishments and past experiences in business. If you do not know this information yet, then simply write about the owner’s qualifications and relevant business experience.
- Product/Service Description. The product/service is one of the most important parts of the business plan. The title is self-explanatory: this section will include a description of what products the business will sell or the services it will offer or both. Mention what makes the products or services unique. If you have invented or patented a special product for your business, make sure to mention it.
- Marketing and Sales Strategy. How will your business manage to sell products or services to your customers? That’s what this section is all about. Write about how you will use advertisements, social media, and customer sales representatives to get the attention of customers.
- Secure Funding. The last section of the business plan is the “secure funding” section. This is the section in which you need to prove that your business is worth investors giving money to. This section will take some research, but into your own business affairs, not the affairs of others. Things in include in this section are how the start-up business funds will be used, financial statements (and summaries of similar paperwork) that prove that you need as much money as you have requested, and profits and expenses you are expecting to have.
Once you are done writing your business plan, make sure to run the plan through a spelling/grammar checker, check it for plagiarism, and have a friend or teacher look it over for you. If you keep these tips in mind and edit your paper carefully, you are sure to turn in a top-notch custom business plan written like by an expert.