What Makes a Good Business Plan?

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What Makes a Good Business Plan?

Most people only think about producing a good business plan if they are going for finance or a loan but they can be a useful clarification tool for any company.

Business plans vary according to industry or purpose but all will adhere to a basic structure and narrative:

Executive Summary

A clear, concise overview of the business and the purpose of the plan. A good tip is to write it last so you will have already worked through the finer details of your plan and you can summarise your thoughts succinctly and get to the point.

Company Description

A holistic overview of your business to explain who you are, what you do and what you want.

This section should outline the legal structure of your business; a brief history of the firm; the nature of your business and the needs or demands you plan to meet; an overview of existing products, services, customers and suppliers; a growth summary including financial highlights or important milestones; a summary of your long and short term business goals and how you plan to make a profit.

Products and Services

What do you do? How do you do it better than anyone else? How is this beneficial to customers?

Clearly describe your offer with details of any suppliers, costs and net revenue expected from sales. A detailed description of your products and services; where you fit in the market and your unique advantages over competitors; any relevant details about copyrights, patents, secret sauces etc you own and any Research and Development activities you are developing that will lead to new revenue streams.

Market Analysis

What is your industry? What’s going to happen? Do you have any market research to back it up? Look at customer segments, demographics etc; and industry description and forecast; any other historical or current data relating to your products and an evaluation of your competitors.

Strategy and Implementation

What is your sales and marketing strategy? How are you going to pull it off? What is your plan and what will it cost?

Organization and Management Team

How is the company set up? Who are the owners, management team and board? Include an organisational chart and profiles and information of all critical staff.

Financial Plan and Projections

The final section should be developed with a professional accountant once you have completed a market analysis and set goals for the company. If you are an established business include historical financial data here including income statements, balance sheets and cash flow statements for the past three to five year; realistic forecasts and information for the next three to five years and a brief statement of where you are now.

Business plans vary but all must have these main sections and content to stand any chance of operational or financial success.

Business planning

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