The business plan

The most vital component of any enterprise or business is a sound business plan. There are many templates which can assist you in building a sound business plan; however knowing which one would be the best for you will be crucial to the success of the business. In order to judge this, you will need to put a few questions:

  • Your Audience: The audience the business plan is targeted to is a vital factor. The business plan is intended to create a positive impact on the audience where it is presented for different reasons, such as request for finance, talent or infrastructure. Business plans presented to internal audience (directors/ employees/ advisors, etc) are different from those that presented externally. Internally the facts and figures will help in sharpening the focus, mission and goals as well as the company's direction; while when it is presented for outside audience, it will present whether the business is a sound investment or not. The external audience may consist of clients, investors, banks, suppliers, government and so on)
  • The contents of a good business plan: What are the compulsory components and what are the optional components in a business plan again depends upon the audience. However, the following are the most used features:
    • Executive synopsis
    • A brief history of the company
    • A detailed narrative of the business concept and its value
    • Market development plan (containing marketing analysis and competition analysis)
    • Assessment of production and operations cost and plan
    • Human resource management plan and assessment
    • Detailed implementation plan
    • Proposal for using identified resources and the clear deal structure (specially for investors)
    • Analysis of risk factors and mitigation strategy
    • Expansion strategy and growth plan
    • An summary of all the factors stated above
    • Annexure containing supporting documents
  • It totally depends upon you how much information you put under each head. A normal business plan will be around 20-30 pages though there are times when business plans consist of 100 pages plus reports. A lot depends upon who you are showing it to, and for what you are showing it to them.
  • The main aim however should be to put across the correct picture of your business to your intended audience. The reader should be able to understand without any effort what is your business about, what are its strengths and weaknesses and where it is heading. Unless you are able to put your best foot forward b creating a good impression in the first shot, you will not be able to make any progress in expanding your business.
  • Many people like to use special templates designed for producing standard correct business plans. This is good as far as the main headlines are concerned. However, if you do not want to have a pat business plan, it is always better to refine it according to your needs - both external and internal. The business plan is not only a tool to get something from outside; it is also an invaluable tool for introspection. Many times the very process of planning and looking inwards minutely and with focus makes one realize the potential and the dangers that the business is exposed to.
  • Hence, a business plan is not only a vehicle for promoting your business it is also a diagnostic tool with which you can carve a better future. This is one of the best guide for your business expansion and inner strengthening. This is actually the difference between a good business which goes off the market in about three years time (and the statistics show that almost 60 percent of business close down in this period of time) and a good business which grows from strength to strength with each year passing.
  • Knowing the direction of your business expansion and the way to reach that point is most of the times all it takes to make one successful.