A Business Plan is a written document that helps entrepreneurs focus on specific steps (short-term and long-term objectives) necessary to make their business ideas succeed.
The faintest pen is always better than the sharpest of brains, so, writing down your business plan is always the best starting point for your business. However, having abusiness plan is no guarantee that your business will just succeed, you need to work-out your plan
Not having a business plan to guide your decisions (short and long term goals) is like throwing darts in the dark and hoping to hit the eye. The probability of you failing is high and this is what most entrepreneurs do, they run their businesses from gut feelings, a business that will stand the test of time must be researched, documented and followed as a plan,. This document becomes your working guide to success. Remember, according to Forbes, ” 8 out of 10 start-up businesses fail within their 18 months in operations” Having a guide (business plan) will increase your chances of survivability.
Importance of a Business Plan
If you have ever lost your way in a busy city, then I’m sure you understand the importance of a map. A map will not only take you to your location, but also save you time and resources. So, Instead of stopping over at every junction to ask people for direction, a map will lead you to your exact location. Just as important as a Map is to finding a location, your business plan is also a guide to succeed in your business.
Report from the research we carried out on MSMEs showed “over 75% of start-up businesses that failed did not have a business plan before starting up their businesses.” Developing a business plan for your company will not only provide direction from operational standpoints and position you for growth, if you’re seeking business funding to scale your business or an initial investment to get your business off the ground, you’re going to need a business plan.
Business Plan Elements
Putting together a business plan can be an intimidating process that involves a lot of steps and writing — but breaking it down piece by piece can help you accomplish this seemingly insurmountable task.
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Business Plan Topics
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Table of Contents
The executive summary of a business plan is presented first, but written last. It highlights the key aspects of the plan and gives structure to the document.
It must describe ownership and history of formation. It is an abstract of the entire plan, describes the mission statement of the organization, and presents an optimistic view about the product/service/concept.
A busy executive who reads your executive summary can decide whether to go ahead and read your over 30 pages business plan or shove it into the paper-bin
1. Company Background
- Description of the business
Business descriptions provide the concept of one’s place in the market and its benefits to future customers.
This section of your business plan presents the vision and mission of an organization and its objectives, to be able to write it, ask yourself these questions:
Who are you? (The business)
What is the product or service, and what are its differentiating characteristics?
Where is the opportunity located?
When will you start implementing your plan and expects cash flows or profits?
Why should customers choose your company?
How do you plan to run the business in terms of structure and regulatory compliance?
See an example of a business description:
Emtos Marketplace is an online platform that connects buyers with sellers for an amazing shopping experience
- Vision and Mission Statement
In your business plan templat, State a clear and achievable vision, what do you want your business to be or become? What will you want your business to be known for in the near future?
See an example of a vision statement from Emtos Marketplace
To be the sought after marketplace platform in Africa by 2030
A mission statement must incorporate what the business offers to its employees, customers or stakeholders.
Note: Mission statements are very brief and can include 1-3 qualities, but if you have the capacity to do more, then you can go ahead, but i would recommend that you stay within 3 and be focused.
see example of a mission statement from Emtos Marketplace:
Serving our online marketplace users focusing on convenience, quality and price
- Business Objectives
Big ideas are redundant without specifics that can be tracked. Business objectives are the results you are aiming to achieve in order to accomplish your long-term company vision. Think of this as your metrics to measure your overall business success.
Good business objectives are SMART (Specific, Measurable Achievable, Realistic, and Time-bond).
22 types of business objectives:
See example of a business objective:
To gain market share of 40% in Nigeria by 2030
- Value Proposition
Your value proposition explains what benefit you provide for who and how you do it uniquely well. It describes your target buyer, the pain point you solve, and why you’re distinctly better than the alternatives.
Why would customers buy from you and not your competitors?
See Example of value proposition:
Making available online marketplace for SMEs and training them to grow smarter in business management and to remain afloat as customer satisfactions are met – “Emtos“
- Critical Success Factor (CSF)
CSF helps you focus on what can help your business achieve its mission and specific goals effectively.
As a business owner or decision maker, it is important to know what your company needs to achieve a positive outcome for your various projects, strategies, goals or the organization as a wholeCSF allows your company to focus on increasing its capabilities to meet these critical success factors
- Current Status of Business
Give a complete history of your business, how far you have gone, how long you have been in the business, your past performances etc. E.g. Is it at Idea stage, Start-up, existing or expanding business
- Potential Challenges in the Business Industry
You can get the full business plan template here