Post Image
By Mason Frederick elements of a business plan For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it? – Luke 14:28 Planning is bringing the future into the present so that you can do something about it now. – Alan Lakein Business planning is very vital to the success of your business. The benefits of drawing up your own business plan are worth the time and effort. For entrepreneurs who are just starting out, a business plan will help you; a) Create a road map to help you get to your desired destination,  b) Check your ideas and your resources, and c) attract funds and investments. If you already have a business, a business plan can give you a fresh perspective on handling challenging situations, new ideas on outsmarting your competition, and  it can help motivate your employees and business partners. Here are 7 key elements in every business plan, a short description of each section and questions you need to answer when filling each section. 1. The Executive Summary: This is the introduction to the business plan. It briefly covers all other sections, and so is written last. This section should be written in a manner that anyone who would reads it would understand what your business is about. It is important that you try to excite your readers about your business at this point, if not; they won’t bother reading the rest. 2. The Business Description: Here, you briefly describe your business. Who you are, what you stand for, where you are headed and who you are working with.  Here are some questions you need to answer in this section
  • What’s the business name and location?
  • Is it a sole proprietorship, a partnership or a corporation?
  • What is your mission and vision?
  • How will your company be organized?
  • Why should an investor invest in your company?
  • Who is your target market?
  • And who do you market your product to?
3. The Market: Successful businesses succeed because they know their market more than anything else. In this section of your business plan, you will critically look at your industry, your target market and your competition.  Industry analysis
  • How is your industry defined?
  • What are the industry current trends?
  • Who are the largest industry players?
  • What problem is the industry facing?
Market analysis
  • What is your market demographic?
  • How big is the target market?
  • How fast is it growing?
  • Where is the market heading?
  • What are the market trends
Competitor analysis
  • Who are the players targeting the same market?
  • What are the factors that empower your competitors
4. The Product: Explain your product/service in detail, describing features and benefits of what you offer from your customers perspective.
  • What exactly is the product?
  • What need does the product address?
  • Who is the product for?
  • How does it work?
  • How will it be produced and delivered?
  • What are the features and benefits of the product?
  • What is the pricing strategy?
5. Marketing and Sales: This is one of the most important sections in business planning. This is where you convince potential investors that you are capable of running the business successfully, and that your business will be a profitable venture for them.
  • What is your marketing strategy?
  • What is your targeting strategy? Which sub-market will you target?
  • What is your pricing strategy? (high price – high – quality, low price – high quality, low price – low quality)
  • What distribution channels will you employ?
  • How would you promote and advertise your product?
  • What is your sales strategy
6. Development: A road-map to help you move from where you are to reach where you want to be. Outline how you intend to improve your business.
  • State your development strategy
  • State your development timeline
  • State your development expenses   
7. Operations:  Here, you will outline the processes you will use to produce and deliver your product to your customers, and explain how your business will be run.
  • How will you produce?
  • What will you do in-house and what will you need to purchase?
  • Does your operation design give you a competitive advantage?
  • How will you use your operations to compete?
It is important, that after you have completed your business plan, that you review and update it as often as possible. Why? Plans are nothing; planning is everything. – Dwight D. Eisenhower
You might also like:
This article was first published on 19th April 2013

pagboga

Chojare Pamela Agboga is a Legal Practitioner, Writer, Editor, Chartered Secretary and Administrator. She is currently working on her first novel 'Weekends are for Loving' as well as a devotional for women.

Comments (412)

412 thoughts on “7 Key Elements of a Business Plan”

Leave a Reply

Your email address will not be published. Required fields are marked *