How to write a business plan for a new company.
Writing a business plan for a new company is one of the most important first steps you will make. I remember being hired to a senior position by a new business and when I asked for the business plan, I was told “we know what we are doing”. There was none and I felt that this would either choke the business performance or curb the chances of the business surviving. Knowing how to write a business plan for a new company is a skill that any entrepreneur will need. It sets out the goals and strategies over a Short, Medium and Long term period. A business plan should be revisited regularly, and also used as a tool to generate and develop ideas for the business. One of its main uses will be to access funding. Investors and lenders will want to see this plan and will be well adapt to reading and scoring a good or a bad plan. The contents of your plan should cover the following.
Table of Contents: Readers will want o quickly guide themselves through the plans Sections and Sub-Sections.
Confidentiality: Any plan is confidential to the business and the plan may also contain non-disclusure agreements to be signed by the reader.
An Executive Summary: In many cases the executive summary of the business plan is read in most detail, and the rest of the plan is skipped over. Necessary time should be taken to draft this section in detail.
Market Analysis: A detail on the target markets for your products and services should be outlined here with SWOT (Strengths Weaknesses Opportunities & Threats) and PESTLE (Political, Economic, Social, Technological, Legal and Environmental) factors that can affect the business now and into the future.
Marketing: Areas covered should be Price, Promotion Place of business, Client/Customer service, the Marketing ans sales strategy, industry trends and opportunities, and also reference to the separate Marketing Plan.
Organisational Structure: Outline the Legal structure of the business (Limited Company etc), the Shareholders of the business, and its conformity to the Companies Act. Outline using an organisational chart the companies Management Structure. You should mention anyone who has influenced your business from Mentors to advisers. Prospect investors and lenders want to see a good organisational structure with mixed relevant skillsets.
Financial Forecasting & Data: Assistance from an Accountant should be sought here i necessary. Outline your existing funding here. Historical and projected figures should be outlines. Prospect investors will be looking at healthy cashflow actual and projected. Include Balance Sheets and Profit & Loss accounts. If you are seeking loans, or investors are looking for short periods of return on investment you will need to include a plan for this also.
Risk Factors: Good business is about managing risk. Outline the risks to the business and how to mitigate against it. Outline Costs, Technological developments, Competition, Labor issues, Business cycles etc.
Once prepared, a good business will give the business the ability to compare projected performance with actual performance. Have a conclusion for your plan which summaries in words the contents of the plan.