4 Simple Steps to Write a Successful Business Plan
Here are 4 simple steps to write a successful business plan:
Step 1: Complete a Situational Analysis as the Basis of the Business Plan
Who is your customer?
Define the ideal target for your product or service. Why do they want what you provide? What motivates them? If you had to describe them as person to a friend, what attribute would you use? Capture the answers so you can use the in you business plan
Who is the competition?
Define your competitive set, strengths, weakness, etc. Compare their to yours. Note the gaps in the business plan.
Who might be collaborators?
Identify who can help/hinder your success. How can you influence them or lessen their impact?
What is the business context?
Define the environmental factors which can impact your business. Capture how they can they negatively or positive affect your business in your plan.
Step 2: Clearly Outline the Business Model in the Business Plan
The business model outlines how your business creates value and makes money. What’s the process of how you acquire orders and convert them into cash? What are the cost drivers and inefficiencies? It can be helpful to make a diagram of all the steps required to run your business. Start at the beginning. What steps do you take to reach your customers? All the way through to how that money is deposited into your bank.
Step 3: A Good Business Plan Answers the Following Questions
- What are the Business Objectives & Goals?
- Have you identified all the market factors and business environmental factors that could impact the business?
- What strategies will you use to reach your objectives and goals?
- Who is your ideal target? How will you reach them?
- How much will it cost to execute your plans?
If you have don your homework in steps 1 and 2, some of these questions will already be answered.
Step 4: Create a Financial Summary for Your Business Plan
There are four financial documents you will most likely need to complete your plan
- Income Statement – Revenue, Cost, Income
- Investment Requirements – Do you need extra money to cover your costs?
- Cash Flow – How much money will flow in and out of the business per month?
- Balance Sheet – Assets (things you have), Liability (things you own), Equity (the amount that’s left)
If you mapped our your business model, step 1 should be relative straightforward. While the other three are less so, we offer some free tools that might help.
These are the steps to write a successful business plan. Some may seem easy. Others are more difficult. If you find yourself getting stuck, ProStrategix can help