Creating and starting a good business plan

A business plan is a written document prepared by the entrepreneur that describes all the relevant external and internal elements involved in starting a new venture. It is sometimes called the road map of a business that answers the following questions:

• Where am I now?
• Where am I going?
• How will I get there?

Skilled required in writing a business plan?

• Accounting/taxes.
• Planning.
• Forecasting.
• Marketing research.
• Sales.
• People management.
• Product design.
• Legal issues.
• Organizing.

• It helps determine the viability of the venture in a designated market.
• It provides guidance to the entrepreneur in organizing his or her planning activities.
• It serves as an important tool in helping to obtain financing.

1. Introductory Stage

• Name and Address of business
• Name and Address of principal
• Nature of business
• Statement of financing needed
• Statement of confidentiality of report

2. Executive Summary

3. Industry Analysis

• Future out look and trends
• Analysis of competitors
• Market segmentation
• Industry and market forecasts
• SWOT Analysis

Internal Factors:

S = Strengths

W = Weaknesses

External Factors:

O = Opportunity

T = Threats

4. Description of venture

• Products/Services
• Size of business
• Office equipment and personnel
• Background of entrepreneurs

5. Production plan

• Manufacturing process
• Physical plant
• Machinery and equipment
• Names of suppliers of raw materials

6. Operational Plan

• Description of company’s operation
• Flow of orders for goods/services
• Technology utilization

7. Marketing plan

The marketing plan establishes how the entrepreneur will effectively compete and operate in the market place.

• Pricing
• Distribution
• Promotion
• Product forecasts
• controls

8. Organizational plan

• Form of ownership
• Identification of partners
• Management team background
• Roles and responsibilities of members of organization

9. Assessment of Risk

• Evaluate weakness of business
• New technologies
• Contingency plan

10. Financial plan

• Pro forma income statement
• Cash flow projections
• Pro Forma balance sheet
• Break-even analysis
• Sources and application of funds

11. Appendix

• Market research data
• Leases or contracts
• Price list from suppliers

Why some business plans fall?

• Goals set by the entrepreneur are unreasonable
• Goals are not measurable
• Lack of total commitment to the business
• Lack of experience in the planned business
• Having no sense of potential threats or weakness to the business
• Customer need was ignored