ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

How to write effective business plans

Updated on September 20, 2009
business plan
business plan

Introduction

Your business can benefit from your sell written, and carefully produced business plan.

As the famous saying goes, "if you don't know where your going how will you get there?"

Planning to write

You should write the plan in present tense, as if you have achieved all the things you are planning to try. This way you can start to imagine what is realistic, and picture in your mind if what you are proposing is possible.

If you can consider all your important variables that the business needs, as well as the ones that might seem minor just now, but could easily become a major part of your business. An example of this could be borrowing interest rates increasing.

You can easily speak to people in the same industry and with similar business to find out what they wish they had considered when they started up. If your business plan includes things that might not be obvious, then this will impress anyone who is reading it. It will show you have done your homework, and considered professionally how to create a successful business.

I have outlined the types of variables that are importantly specific to each sector of business.

Purpose of the business plan

The purpose of the business plan is to:

1. Help you think though your finished  venture and ensure you have considered all your options and anticipated any potential difficulties.

2. Convince lenders and investors that you are in control of the project and that their money will be safe with you.

3. Serve as an operating guide as you turn your idea into a viable business.

4. Create a measurement against which to judge your  forthcoming decisions and results.

If your going into the Retail sector

  1. Your Company image, and branding.
  2. Pricing strategies, including Explain markup policies.  
  3. Prices should be profitable, competitive and in accord with the company image.
  4. Calculate your annual inventory turnover rate. Compare this to industry average for your type store. You can find this information easily on the Internet
  5. Customer service policies: should be competitive and in accord with company values.
  6. Location:  Does it provide the exposure you need?  Is it convenient for customers?  Is it consistent with company image and brand?
  7. Promotion:  methods used, cost.   Does it project a consistent company image?
  8. Credit:  Do you extend credit to customers?  If yes, do you really need to, and do you include the cost into prices?

If your going into the service sector

Service businesses sell intangible products. They are usually more flexible than another types of business, but they also have higher labor costs and generally very little in fixed assets.

  1.   Prices
  2.   Methods used to set prices         
  3.   System of production management
  4.   Quality control procedures
  5.   Standard or accepted industry quality standards
  6.   How is labor productivity measured?
  7.   What percent of total available hours are actually billed to customers?
  8.   Breakeven billable hours
  9.   Percent of work subcontracted to another firms            
  10.   Profit on subcontracting?           
  11.   Credit, payment, and collections policies and procedures
  12.   Strategy for keeping client base    
  13.   Strategy for attracting new clients

If your going into the Manufacturing sector


  1.   Present production levels
  2.   Present levels of direct production costs and indirect (overhead) costs
  3.   Gross profit margin, overall and for each creation line
  4.   Possible production efficiency increases
  5.   Production/ Capacity limits of existing fleshly plant
  6.   Of expanded plant (if expansion is planned)
  7.   Production/ Capacity limits of existing equipment
  8.   Of new equipment (if new equipment is planned)
  9.   Prices per creation line
  10.   Purchasing and inventory management procedures
  11.   Anticipated modifications or improvements to existing products
  12.   New products under development or anticipated

Comments

Submit a Comment

No comments yet.

working

This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

Show Details
Necessary
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
Features
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Marketing
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Statistics
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)