What is the process for creating a business plan? Creating a business plan is not an easy undertaking, but if you develop a clear roadmap for what you need to accomplish and use that as a checklist going forward, you might find it a little less daunting. The more you know about the business you want to start, and the more tools you have access to, the better the process of developing a business will go. To oversimplify, the business plan needs to cover a small handful of “big picture†concepts in detail:
• What will you sell?
• Who are your customers?
• What competition do you face in the industry?
• How will you market to your target buyers?
• Who will run your company?
• How much profit can you make after expenses?
Seem easy? It won't be once you get into depth with these topics, but these bite-size pieces make for a better approach than trying to fill in a long template. Another big differentiator that can help you get started is the question of your audience for the plan… do you need private investment, or will a bank loan suffice to get the business off the ground? If you only need a bank loan or line of credit, the plan will only require three-year financials, and you can use a checklist from the Small Business Administration to ensure that your plan is on track. Investor plans, which will need five-year financial projections, can be trickier as the standards for content depend on the firm you're presenting to. Also, you will need to estimate the investor's share by applying industry multiples to the investment and Year 5 profit totals. In either scenario, showing your anticipated cash flows, revenue forecast, monthly expenses, personnel plan, likely break-even point, and a sensitivity assessment is generally considered a requirement. Do you need help preparing this document? Professional business planning companies can help. MasterPlans has been in business since 2002 and has helped more than 8,000 entrepreneurs get the funding-ready documents they need. Call a consultant at 877-453-2011 for a free quote.
