Now that you understand why you need a business plan and you've spent some time doing your homework gathering the information you need to create one, it's time to roll up your sleeves and get everything down on paper. The following pages will describe in detail the seven essential sections of a business plan: what you should include, what you shouldn't include, how to work the numbers and additional resources you can turn to for help. With that in mind, jump right in. Within the overall outline of the business plan, the executive summary will follow the title page.
The summary should tell the reader what you want. This is very important. All too often, what the business owner desires is buried on page eight. Clearly state what you're asking for in the summary. The statement should be kept short and businesslike, probably no more than half a page. It could be longer, depending on how complicated the use of funds may be, but the summary of a business plan, like the summary of a loan application, is generally no longer than one page.
Within that space, you'll need to provide a synopsis of your entire business plan. Key elements that should be included are:. When writing your statement of purpose, don't waste words.
If the statement of purpose is eight pages, nobody's going to read it because it'll be very clear that the business, no matter what its merits, won't be a good investment because the principals are indecisive and don't really know what they want. Make it easy for the reader to realize at first glance both your needs and capabilities. The business description usually begins with a short description of the industry.
When describing the industry, discuss the present outlook as well as future possibilities. You should also provide information on all the various markets within the industry, including any new products or developments that will benefit or adversely affect your business.
Base all of your observations on reliable data and be sure to footnote sources of information as appropriate. This is important if you're seeking funding; the investor will want to know just how dependable your information is, and won't risk money on assumptions or conjecture.
When describing your business, the first thing you need to concentrate on is its structure. By structure we mean the type of operation, i.
Also state whether the business is new or already established. In addition to structure, legal form should be reiterated once again.
Detail whether the business is a sole proprietorship, partnership or corporation, who its principals are, and what they will bring to the business. You should also mention who you will sell to, how the product will be distributed, and the business's support systems.
Support may come in the form of advertising, promotions and customer service. Once you've described the business, you need to describe the products or services you intend to market. The product description statement should be complete enough to give the reader a clear idea of your intentions. You may want to emphasize any unique features or variations from concepts that can typically be found in the industry.
Be specific in showing how you will give your business a competitive edge. For example, your business will be better because you will supply a full line of products; competitor A doesn't have a full line.
You're going to provide service after the sale; competitor B doesn't support anything he sells. Your merchandise will be of higher quality. You'll give a money-back guarantee. Competitor C has the reputation for selling the best French fries in town; you're going to sell the best Thousand Island dressing.By Steven D. Peterson, Peter E. Jaret, Barbara Findlay Schenck.
Nearly all business experts agree on one thing: the importance of drafting a business plan. Yet plenty of companies plunge into the competitive arena without a formal plan.
A lot of new businesses are carried away and figure their passion and optimism are enough to build a successful company. Others say they were just too busy to develop a formal business plan. But operating without a plan can prove even more time-consuming in the long run. The time you invest in your business plan will pay off many times over. Some of the most obvious benefits you can gain from business planning include. An opportunity to test out a new idea to see if it holds real promise of success.
A set of values that can help you steer your business through times of trouble. Benchmarks you can use to track your performance and make midcourse corrections.
How to Write a Business Plan
A description of your business model, or how you plan to make money and stay in business. An action plan that anticipates potential detours or hurdles you may encounter.
A handbook for new employees describing who you are and what your company is all about. The many benefits of having a business plan should be enough to convince you. You risk. Becoming overwhelmed by too many options because you never took the time to focus on a mission and vision for your company.
Take our word for it: Time spent putting together a solid business plan is time well spent. The basic components of a business plan are fairly simple. Why is a Business Plan Important?Now that you understand why you need a business plan and you've spent some time doing your homework gathering the information you need to create one, it's time to roll up your sleeves and get everything down on paper.
The following pages will describe in detail the seven essential sections of a business plan: what you should include, what you shouldn't include, how to work the numbers and additional resources you can turn to for help. With that in mind, jump right in. Within the overall outline of the business plan, the executive summary will follow the title page.
The summary should tell the reader what you want. This is very important. All too often, what the business owner desires is buried on page eight. Clearly state what you're asking for in the summary. The business description usually begins with a short description of the industry. When describing the industry, discuss the present outlook as well as future possibilities.
You should also provide information on all the various markets within the industry, including any new products or developments that will benefit or adversely affect your business.
Market strategies are the result of a meticulous market analysis. A market analysis forces the entrepreneur to become familiar with all aspects of the market so that the target market can be defined and the company can be positioned in order to garner its share of sales. The purpose of the competitive analysis is to determine the strengths and weaknesses of the competitors within your market, strategies that will provide you with a distinct advantage, the barriers that can be developed in order to prevent competition from entering your market, and any weaknesses that can be exploited within the product development cycle.
The purpose of the design and development plan section is to provide investors with a description of the product's design, chart its development within the context of production, marketing and the company itself, and create a development budget that will enable the company to reach its goals. The operations and management plan is designed to describe just how the business functions on a continuing basis.
The operations plan will highlight the logistics of the organization such as the various responsibilities of the management team, the tasks assigned to each division within the company, and capital and expense requirements related to the operations of the business.
Financial data is always at the back of the business plan, but that doesn't mean it's any less important than up-front material such as the business concept and the management team. How To. Next Article -- shares link Add to Queue. Opinions expressed by Entrepreneur contributors are their own.
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Latest on Entrepreneur.A business plan is a written description of your business's future.
That's all there is to it--a document that desribes what you plan to do and how you plan to do it. If you jot down a paragraph on the back of an envelope describing your business strategyyou've written a plan, or at least the germ of a plan.
Business plans can help perform a number of tasks for those who write and read them. They're used by investment-seeking entrepreneurs to convey their vision to potential investors. They may also be used by firms that are trying to attract key employees, prospect for new business, deal with suppliers or simply to understand how to manage their companies better.
So what's included in a business plan, and how do you put one together? Simply stated, a business plan conveys your business goals, the strategies you'll use to meet them, potential problems that may confront your business and ways to solve them, the organizational structure of your business including titles and responsibilitiesand finally, the amount of capital required to finance your venture and keep it going until it breaks even.
Sound impressive? It can be, if put together properly. A good business plan follows generally accepted guidelines for both form and content. There are three primary parts to a business plan:.
Breaking these three major sections down even further, a business plan consists of seven key components:. In addition to these sections, a business plan should also have a cover, title page and table of contents. Depending on what you're using it for, a useful business plan can be any length, from a scrawl on the back of an envelope to, in the case of an especially detailed plan describing a complex enterprise, more than pages.
A typical business plan runs 15 to 20 pages, but there's room for wide variation from that norm.
Much will depend on the nature of your business. If you have a simple concept, you may be able to express it in very few words. On the other hand, if you're proposing a new kind of business or even a new industry, it may require quite a bit of explanation to get the message across.
The purpose of your plan also determines its length. If you want to use your plan to seek millions of dollars in seed capital to start a risky venture, you may have to do a lot of explaining and convincing.
If you're just going to use your plan for internal purposes to manage an ongoing business, a much more abbreviated version should be fine. About the only person who doesn't need a business plan is one who's not going into business.Click here for the original.
The truth is that business planning offers serious benefits for everybody in business. It takes an hour or two to do the first plan, then just an hour or two to review and revise monthly. Either starting a business or just collaborating for a gig, It is very important to have a likewise mindset partner. And especially we are into supply and manufacturing which you explained very well.
I have personally never been able to plan or organize things without penning them down on a piece of paper. It helps me visualize things in a better way. Also, seeing things written down in front of me helps connect the dots. A great article and absolutely in line with my perspective. Wow, I had never considered the fact that business planning can help you keep track of the most important things and prioritize them. My entire life I have strived to be an organized person, and I think it is a good skill to have when it comes to a professional career.
Do you know how often one should revise a plan in order to make corrections according to new circumstances and opportunities? Sam, generally once a month, but it depends on the nature and specifics of the business. Thanks for asking. Thank you very much for helping the world to understand the genesis of how to plan business and make it reality in life.
Business is made by minded person with great and love.
Why is a Business Plan Important?
Hi Tim I appreciate you for writing this article,it has really helped me understand the importance of planning and how vital it is to a business and now to me planning is like the foundation of each and every business,keep up with the good work. Very useful article and very well written. A business plan is important for every person who is planning to start a business because of the mentioned benefits in the article.
Thanks for sharing it. Could you point me to the list with your recommendations?
Elements of a Business Plan
The closest thing I have to a list of book recommendations is the blog category books here on this blog, which is a list of blog posts about books, most of which are books I recommend. That is really interesting that business planning can help you catch new developments and adjust.
Something I have been thinking about lately is starting an online business. It has been something that seems to do well for others, and I want to find the opportunities. I like how you said that business planning helps you keep track of the important stuff. That seems like a really important thing to do because it would allow you to progress more.
Focusing on the necessary and essential would really mean that you could do more and accomplish more it seems to me. Very good summary. One of the key elements of the BP is to drill down from the overall defined strategy, down to the critical success factors and define metrics to achieve them.
As you gain experience, this way of thinking will become more and more embedded and I honestly believe it will help you be a more analytical person i.
That is obviously my opinion, some people might argue.If a test shows a. If you do a large number of tests, falsely significant results are a problem. If you took a totally random, meaningless set of data and did 100 significance tests, the odds are that five tests would be falsely reported significant. As you can see, the more tests you do, the more of a problem these false positives are. You cannot tell which the false results are - you just know they are there. Limiting the number of tests to a small group chosen before the data is collected is one way to reduce the problem.
If this isn't practical, there are other ways of solving this problem. The best approach from a statistical point of view is to repeat the study and see if you get the same results. If something is statistically significant in two separate studies, it is probably true. In real life it is not usually practical to repeat a survey, but you can use the "split halves" technique of dividing your sample randomly into two halves and do the tests on each.
If something is significant in both halves, it is probably true. The main problem with this technique is that when you halve the sample size, a difference has to be larger to be statistically significant. The last common error is also important. Most significance tests assume you have a truly random sample. If your sample is not truly random, a significance test may overstate the accuracy of the results, because it only considers random error.
The test cannot consider biases resulting from non-random error (for example a badly selected sample). The preceding discussion recommends reading probability values in reverse (1 - p). Doing so will normally lead to correct decision making, but it is something of an over-simplification from the technical point of view. A more complex, technically correct discussion is presented here.
Unfortunately, statistical significance numbers do not directly tell us exactly what we want to know.
They tell us how likely we would be to get differences between groups in our sample that are as large or larger than those we see, if there were no differences between the corresponding groups in the population represented by our sample. In other words, these numbers tell us how likely is our data, given the assumption that there are no differences in the population.
What we want to know is how likely there are differences in the population, given our data. Logically, if we are sufficiently unlikely to get a difference found in our sample, if there were no difference in the population, then it is likely that there is a difference in the population. We used this logic in the first part of this article when we said that you can interpret significance numbers by considering 1-p as the probability that there is a difference in the population (where p is the significance number produced by the program).
For example, if the significance level is. While this logic passes the common sense test, the mathematics behind statistical significance do not actually guarantee that 1-p gives the exact probability that there is a difference is the population.
Even so, many researchers treat 1-p as that probability anyway for two reasons. One is that no one has devised a better general-purpose measure.
The other is that using this calculation will usually lead one to a useful interpretation of statistical significance numbers. In some non-survey fields of research, the possibility that 1-p is not the exact probability that there is a difference in the population may be more important.
In these fields, the use of statistical significance numbers may be controversial. This is the only product in our lineup that offers all features and tools we considered. For these reasons, The Survey System earns our TopTenREVIEWS Gold Award. A recent book by two of our faculty honors a third. Bernie spent almost all of his career here at the University of Minnesota. He joined the Department of Statistics, a precursor of the School, in 1963 and was the chair of the department for several years during the 1960's.
One of the first Statistics books that I read was one of his and it was a pleasure to have him as a colleague after I moved here. He was a gentleman, a scholar and a sweet man.
He was 88 and was still ice skating a week before he died.By default, anything you put in Dropbox will be stored locally.
You can access selective sync settings by choosing Preferences and then hitting the Accounts button. As you can see in the photo above, I have my photo backup disabled from Dropbox on my Mac.
My only advice would be to make sure you have a complete backup of your photo library before enabling iCloud Photo Library. I ended up with a lot of duplicates and some folks have reported albums going missing. That being said, there are millions of happy iCloud Photo Library users out there. Just be sure to prepare, in the event that something does go awry.
To enable it, just launch the Photos app on your Mac, choose Photos in the top navigation and then Preferences. Under the iCloud section, simply check the box for iCloud Photo Library. Then just make sure the sub-option for Optimize Mac Storage is also selected.
Hat tip to Eric in the comments who pointed out that remembering to empty your trash periodically is important. This post was syndicated via The App Factor. There are no disks in SSDs. You may only re-download an app from the Mac App Store so long as that app is still sold in the Mac App Store. This is one of the things that irritates me most. If I purchase it, it should be available in the cloud forever. Kind of hard to save storage space if you have to worry about a movie being removed from the Store.
None of my computers or iOS devices have used hard drives for years. MaH This is one of the things that irritates me most.
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