Thursday, April 3, 2014

The Secret to a Successful Business Plan

The Secret to a Successful 
Business Plan

As a small business owner or future one, you will experience the opportunity to write a business plan. It is not an evil invention of the financial or business industry full of hoops to jump through to delay your dreams. It is a tool to help you evaluate your idea’s potential before you take to the bank or share it with other potential partners.

A business plan is the tool to help you see how feasible your idea is and if the local community or target consumer is ready for you. The great thing about a business plan is when you reach that stage, you already know a lot about the idea and it can simply become a way to write down what you know in an organized fashion. You get to realize the gaps you did not know about and start to fill them in with new knowledge.

Each plan is a custom one because no one business is exactly alike. All lady dress shops are not alike just as jewelry stores are not the same. Your business will not be the twin of the same concept down the street. With that in mind, you usually have three choices in writing the plan: 1) hire someone to do for you, 2) purchase business plan writing software or 3) write it yourself. It is strongly encouraged, you write it yourself to have the most knowledge of the plan and ideas and are better able to answer questions regarding the plan.

There are seven main sections of a business plan. The executive summary which capsulizes the plan and is written last is the first section. The second section is the business description where you talk about the industry, the company and the products/services to be offered to the target customer. The third part deals with marketing and how you plan on reaching the target customer. It is here you will show the need for the product/service and how many potential customers are in the market. A customer profile is usually included here also. Your pricing strategy is discussed along with your sales strategies.

The fourth part is a study of the competition. Competitive spying is legal as long as you do not break any laws according to the law books. You need to know who are your current competitors as well as any potential future ones who currently have no storefront but could be coming. The fifth section deals how you plan on managing the business and the structure. You will also talk about the management team. Every industry has its own set of risks so you need to address them in the sixth section.

The final section deals with financial projections and statements. You may want to enlist the assistance of a banker, accountant or a business counselor to help you prepare the necessary statements for this section. They are a balance sheet, profit and loss and cash flow and three years of projections.

A lot of research goes into writing a business plan to help make it a solid document so a potential funder will consider providing the necessary funds. As a small business owner, you are not alone in this venture. You have many resources to help you, bankers, accountants, business advisors and small business development counselors. All have the ability to provide assistance to help you move along in the writing.

Your local Small Business Technology Development Center business counselor is available to discuss your options and provide many services. All you need to do is call 573-243-3581 and ask for Richard Proffer. 
Funded in part through a cooperative agreement with the U.S. Small Business Administration. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA. Programs are extended to the public on a non-discriminatory basis. Reasonable accommodations for persons with disabilities will be made if requested at least two week in advance. Contact Richard Proffer, University of MO Extension, 684 West Jackson Trail, Jackson, MO 653755 or at 573-243-3581.

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