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What you need to know about writing a business plan
Business plan writing is an art, but before you hit the keyboard to create your next masterpiece, take a few steps back and remember that writing a business plan requires a mix of patience and diligence blended with passion and creativity. Business plans are important documents that serve as roadmaps to your business’s existence and ultimately its success. To find out more about business plan writing, go to LINK.
Ready, Set, Write…
All successful organizations have one thing in common: a detailed business plan. It dictates the business concept, summarizes the vision, mission and objectives of the organization, lists needed financial and human resources, details how those resources will be acquired and implemented, and explains why the business will succeed.
The best way to start writing a business plan is by ensuring you have enthusiasm for your company. “Frame your vision and prove that passion to everybody,” said Mark Costanzo, director of Blue Water Capital , a venture capital firm based in Fairfax County, Virginia. He also advises clients for the non-profit Business Alliance of George Mason University Inc.
One should clearly articulate to investors the potential problems the business will solve, and establish accurate financial projections that are well thought out and planned. Costanzo said a good way to start writing a business plan is by constructing an outline that includes the following :
- company vision and mission;
- description of the company’s product or service;
- research that proves potential success of a product or service;
- target market/need;
- return on investment;
- financial projections/exit opportunity;
- background on management team;
- case studies for third-party validation and testimonials.
Perfecting the plan
After building the outline, start expanding each of the points by including:
- an executive summary with key points of the business plan in less than two pages;
- an overview that introduces the business;
- a description of the company’s products and services;
- an overview of the industry in which the business will compete;
- a marketing strategy that summarizes product, promotion, pricing, and distribution strategies;
- a description of the management and staff;
- an implementation plan;
- a financial plan.
Further, business plans should address questions pertaining to cash requirements, fundraising from banks and other investors and a benchmark against which to compare the progress and performance of one’s business . A complete plan should be between 15 and 20 pages.
As you near completion of writing the plan, test it by taking it to your future customers. “You can learn a lot by talking and probing your customers,” Costanzo said. One should also have someone outside of the company – a trusted source such as a reputable lawyer or accountant – evaluate the plan. This is the best way to gain external feedback and insight prior to pitching a plan to prospects and investors.
Nuts and bolts
You can never start writing a plan too early, said John Casey, director of the Small Business Development Center at Mason Enterprise Center at George Mason University in Fairfax, Virginia. “Good writers think of their plan as a living document that is very fluid in its early days and test drive their product/service by making contact with their audience,” he said.
Writing a good plan is a balancing act, Casey said. You want to be clear and brief because investors are “expert scanners,” but the plan should also “sizzle” and grab the interest of potential investors.
Casey offered these “do’s” when writing a business plan:
- start writing your plan as early as possible;
- tailor your plan to your audience;
- back your claims and assumptions with research;
- Include your contact information
- keep your ‘unsold’ plans – you could re-use parts of them in the future;
- revisit your business plan frequently
Resources exist in many communities to help with business plan writing, Casey said. Many libraries carry books on business plan preparation. Many colleges, universities and local economic development organizations run business incubators and accelerators where assistance is available. Formal presentation venues exist in many communities where you can test-drive your business plan.
Every well-written business plan benefits by being executed in a prosperous environment. “With all the resources available for entrepreneurs and wealth of investors in Fairfax County, business plans have a better chance of being successful in this area, and our organization stands ready to help entrepreneurs get the assistance they need,” said Gerald L. Gordon, Ph.D., president and CEO of the Fairfax County Economic Development Authority.
The FCEDA, which promotes Fairfax County as a business location, hosts monthly “Starting a Business in Fairfax County” workshops that highlight local, state and federal resources for entrepreneurs. More information on the workshops is available on the FCEDA Web site.
Writing a business plan can seem like a daunting task. It is, however, a necessary task that will help you achieve success. Your goal should be to produce a thought-provoking document that reflects your enthusiasm but aims for realistic goals.
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