What is a business plan?
This is an outline of how a business would operate. It includes the objectives of the business, information on marketing, staffing and also financial forecasts. It is often used to raise finance.
Business Plan Contents
* Executive Summary- An overview of the business. Includes main features and is a type of summary.
* Business Description- A description of the businesses history including structure, owners qualities and qualifications. (The vision of the owner)
* Product/Service- WHat a business produces and future product or service plans.
* Market Analysis and strategy- Product, place, promotion, price. What market does it exist in an dis it growing.
* Management Team- A description of the key members of the business.
* Financial Plan- Budgeted profut and loss account and balance sheet: cash flow forecast. It may include some ratios.
Business Plan Purpose
1. It helps to plan for the future because it requires the owner(s) to think carefully about the business and commit all the main information and ideas to paper. It will help the business set objectives. It helps give the owners a focus.
2. It can help the business raise finance. Through developing a business plan, it gives potential investors detailed information on the business (what product/ service to be sold, who are the owners, financial projections). This can give potential investors confidence in the business and can lead to investment.
3. The business plan can be used as a planning tool. It will provide a regular check on progress regarding aspects such as cash flow, objectives and financial forecasts. It can keep the business organised.
4. If the plan is well done it cna also help the businesses finances as smaller businesses can use it to get a grant from the government.