In its essence, a business plan is a detailed explanation and alignment of available work in the field of creating your practice or opening a new direction in the existing sphere. When a person is thinking about how to open his or her business, he or she immediately begins to analyze the best possible ideas. The more views on this score appear, the harder it is to start your project because a lot of details, subtleties, pitfalls, and other things emerge from the idealized and inspired state of anticipation of some new activity.
In this case, the ideal solution is the creation of a business plan. Similarly, if your business suddenly needs third-party financing, then there appears a need to understand how to write a business proposal. Banks, for example, focus their attention on the financial part of the business plan, and private investors require the full consideration of all parties to this document.
As a result, it turns out that a business plan is needed not only for funding but also for your own structured understanding of business processes. Even if you are planning to open a gift shop, you will need to use the structure of the business plan, which is given below.
Basic Elements of a Business Plan
Business Plan Structure
- If you want to learn how to write a business plan, first you need to describe the short content of the future project and the expected results from it.
- Next, you need to consider the market of the product or service in which the company will operate, indicating the capacity of this market, the share of your company, main competitors, and their differences from your firm, as well as to make a clear idea of who the consumer of your product or services is.
- Now, you need to consider a particular product or service in more detail. In other words, you need to give a capacious and meaningful description of the product, to mention its environmental properties, especially the technology of production, licenses, which are necessary for its legal protection, to give a more detailed description of all components, raw materials, and methods of their supply for the production.
- If your business is productive, then this item is a sort of production plan. It is necessary to work out the following points: carrying out research and design work for production, stages of preparation of serial production, all necessary equipment, lack of capacities and methods of their attraction, etc.
- You will also need a detailed workforce plan. That is, you have to specify how many employees are already working, the kind of “staff turnover,” the methods of staffing capacity building, employee training, and staffing.
- It is also necessary to characterize all risks and, of course, insurance against them.
- Perhaps, the most serious and complicated point is the financial and economic justification of the project. It should indicate the investment costs, which include all the costs of production and sales of products. It also must contain information about the source of funding of the project, the schedule on which production capacity will be developed, financial flows on payments and cash receipts, data to calculate the payback period, profitability, the schedule of the repayment of loans, the calculation of the need for working capital and, of course, the economic effect of project implementation. Sometimes, you may need to consult some business plan writing services.