Businesses don’t plan to fail……they fail to plan.
Although businesses should prepare a plan throughout its existence, a well written, carefully thought out business plan is essential to every new business. Preparing a business plan will help you to set clear objectives for your business and clarify your thinking. It will also help to set targets for future performance and monitor finances and profitability.
What should your business plan include?
A business plan is a written document that describes a business, its objectives, its strategies, the market it is in and its financial forecasts. The main sections to include are as follows:
- An Executive Summary – this is an overview of the business you want to start. Its purpose is to explain the basics of your business in a way that both informs and interests the reader. It should include highlights from each section of the rest of the document – from the key features of the business opportunity through to the elements of the financial forecasts and is therefore usually the last section to be written.
- A Short Description of the Business Opportunity – Include your objectives for the business and how you plan to achieve them. Say who you are, what you plan to sell or offer, why and to whom.
- Your Marketing and Sales Strategy – why you think people will buy what you want to sell and how you plan to sell to them. You should also include an overview of your competitors and your likely market share together with details of the potential for growth.
- Your Management Team and Personnel – your credentials and the people you plan to recruit to work with you – including external consultants. Highlight the skills and expertise that these people have and outline how you intend to deal with any weaknesses.
- Financial Forecasts – The plan should cover your projected financial performance and the assumptions made in your projections. This part of the plan converts what you have already said about the business into numbers. It will include a cash flow forecast which shows how much money you expect to flow in and out of the business as well as profit and loss predictions and a balance sheet. Detailed financial forecasts will normally be included as an appendix to the plan. As accountants we are particularly well placed to help with this part of the plan.
We would be happy to discuss how we can help with your business plan, alternatively if you would just like an indication of how to set out a business plan, sample plans are available to view here.