If a business idea was all it took entrepreneurs to become successful, then 8/10 entrepreneurs would have made the headlines. Yes, you got that right! There is more to running a successful business than just the idea. For entrepreneurs to become success stories like Donald Trump and Oprah Winfrey and to run business empires seamlessly, a winning business plan is very important.
The dexterous combination of the two, idea and plan of execution, can help you make your dream of becoming a successful entrepreneur a reality.
Business Plan-What’s the Need?
Running a business without a business plan is just like going on a treasure hunt without a treasure map or jumping into the deep blue sea without knowing how to scuba dive.
A business plan is a roadmap to turning a new start-up into a big business empire. It includes ways to optimize resources, promote business, get investments and secure a business edge. With a business plan in hand, you can think objectively and come up with flawless business strategies to achieve your business goals and targets. You can evaluate your business progress and see if your strategies are aligned with the business plan or not.
Before you start writing a business plan, here are some tips you should keep in mind:
1. Outline Your Business Vision
Vision is the cornerstone for developing a business plan. It defines where you want to see your business in the future. To create a roadmap, you need to know where you are headed. Vision serves as your business destination and the plan defines the path. Therefore, first visualize the future of your business and clearly outline the vision.
2. Define Your Mission Statement
To ensure you are moving in the right direction, you need to develop a mission statement. This helps set short-term business goals and formulate strategies in order to achieve your long-term business goal/vision. It helps define pit stops that you can flag on your way to business success.
3. Realistic Financial Forecasts
Whether you are looking for a financial investor to invest in your business plan or not, you need to make sure you create realistic financial forecasts. Creating an impractical business plan to attract investors and to show that they will get high return on investments if they invest in your business will put you in deep waters. If you have unrealistic forecasts and you are unable to break-even in the stated time and earn business profits, the investors will demand investment recovery which will be difficult for you.
So the real question is how do you make realistic financial forecasts? For this you need to do proper industry research; this includes competitors, customers, industry growth and prevailing market conditions. With this information in hand, you can make realistic financial estimates in terms of capital required for your business setup and the number of years to breakeven. This tip will surely help you when you write the financial summary of your business plan.
4. Be Prepared To Take Risks
The road to success is not easy. You will come across challenges and opportunities. A winning business plan anticipates such scenarios and includes strategies to manage risks and tap opportunities on the way.
5. Focus on Target Audience
For new entrepreneurs it’s important to understand that the success of the business lies in its customers. Therefore you business plan needs to focus on your target audience/customers. Many great business plans often fail because the entrepreneurs build the business plan based on what they assume customers need. This is wrong. Therefore another tip for you is take time out to learn about your target market. This will help you create a business plan that revolves around the needs and desires of your target audience.
6. Identify Your Rivals
The competition across industry verticals is getting tougher by every passing year. More entrepreneurs are coming up with new business strategies and ideas. This has raised barriers. This means you need a business plan that helps you survive and thrive in today’s competitive business world. For this you need to identify your rivals clearly so that you can study them, their business strategies, strengths and weaknesses and their market share before you start to compete with them. This will help you create strategies to outdo the competition and secure a business edge. If you don’t identify your competitors, you will never be able to set a benchmark. The best way to do this is to clearly detail your direct and indirect competitors.
7. Honest yet Engaging Executive Summary
If your goal is to attract investors to invest in your business, then you will have to pay extra attention on the executive summary so that your business proposition looks good and appealing. Make sure the summary is concise and not full of fluff. It should provide a good understanding of your business and highlight all the key points like your business vision, idea, audience, strategies and of course expected business profitability.