What Must Be In Your Business Plan

People typically write business plans to raise capital for their business. But apart from this evident reason, a business plan (BP) is an important tool to help direct your business. A good BP can help you identify where you are in your business and market, where you want to be in the future and how to get there.

If you haven’t written your BP yet, your business is still in the fantasy stages and it isn’t harsh; it’s how it is in the real world.

A BP is as much of a management tool as it is a document. It should force the management team to think about the business issues and problems facing them and begin to develop the necessary solutions and ways to solve them. It’s the main company document that your employees - and you - use to gauge your company’s success and to make decisions about what should you do first, second, or not at all.

A BP is a thorough written explanation of your goal and series of operational instructions for achieving it. A BP is your road map for how you expect to succeed and how you’ll measure success.

You must have a well-written BP if you hope to attract investors, obtain financing, or preserve the confidence of your creditors. Having a good idea or a first-mover advantage does not automatically qualifies you for funding. You need to do research to prove your BP will work. A company’s BP is what lenders use in deciding to lend you money.

Not all BPs follow the same outline as each business has its differences, but all BPs contain similar elements.

The body of the BP can be divided into four distinct sections:
1. The description of the business
2. The marketing plan
3. The financial management plan
4. The management plan

Additions to the BP should include the Executive Summary, supporting documents and financial projections.

Read the following description of what each part of a BP must include.

Executive Summary
This is the separate document and is the hardest part of the BP. It should comprise 4 to 5 pages. And it should be written last, after you have completed evrything else and know your business inside and out. Why?

Because the Executive Summary introduces your business strategy and is the most important section for any lending institution. It is the Executive Summary that a lender will read first and if you can’t persuade him in the first two or three pages, better in the first two or three paragraphs of the very first page that you’ve got a viable and profitable business proposal, you’re going to leave empty-handed.

Executive Summary must give a concise description of the contents of the BP. You must cover you products/services, market and the reasons making your business unique and viable. Executive Summary will make your first impression, so make it strong and professional.

On top of the Executive Summary don’t forget to put details of the business such as: name and purpose of the project, location, company’s name, full address, telephone/fax numbers, e-mail addresses, names of the executive managers.

And end with something specific, such as, ”I will contact your office next week to discuss the matter in more detail.” Don’t ask them to call you.