Writing a Business Plan? Top Tips for Business Plan Writing
Writing a business plan entails several key elements and components to ensure the plan reaches the intended goals you have set for your business. Developing a business plan takes some consideration and thought, to ensure the information is not only compelling, but also worthy of a potential investors time and consideration. In this post we will cover a few tips to help you write a business plan to increase the chance the plan is well received by your potential investor. Let’s now take a look at these key tips:
Study your competition
The idea that your idea is completely unique or original is becoming more and more rare. Today there are more and more businesses who offer a similar set of services to a similar set of clients or customers- and that’s a good thing. When writing a business plan, it’s important to study your competition. Identify how they do what they do, who they target, what’s their angle, who is their demographic, etc. By understanding the competition you can identity how you can benefit from entering into that space and also how to set your idea apart. In terms of business plan writing, completion is a good thing: it means others are seeing the value in the idea too!
Know your audience
When drafting your business plan you always want to put yourself in the perspective of the person who will be reading your plan. It’s important to study and know your audience. It’s OK to adjust your business plan based on who you’re pitching it to. A wise idea is to always consider creating a fictitious person who would be potentially reviewing your plan speak and your plan as if you were speaking to them. How would they read what you said? How would they interpret what you meant to say? Does everything come across in an ideal and clear concise way for that one individual person understand? If you can create a fictional character that may be reading your plan and write to that person then you were on track to targeting your specific audience.
Support your claims
If you are going to report it: make sure you can claim it. No, we are not talking taxes, we are talking the claims made in your plan. If you plan on making a claim that you will reach 1000 new customers a year, or you will make x number of new business contracts by mid-year, make sure you can support the claim. It’s best to start out more general and then work your plan down to specific claims that based on trends, numbers, and yes some positive thinking. Once you found what claims you feel you can support (no not 100% sure WILL happen), then list those claims out and stand behind them with confidence.
Don’t inflate projections
One thing to avoid any business plan is inflating numbers that don’t exist. If you’re going to claim something in your plan make sure you can support it. For example, reporting that you will make $1 million dollars selling bike tires the first year of business, may raise some questions. Now take the same concept and report that in the next year you plan on moving 100 tires a month, at $12 a tire, for an anticipated profit of $1200 a month- that’s a claim that is more conservative than overinflated. You won’t know for sure how the market will respond to your projections, but ground them in some realistic ideas of what can be accomplished with the help of the person your plan is being pitched to.
Identify needed resources
Businesses need resources. This includes startup costs, personnel, tangible items such as computers, equipment, and other things that will make the business run smoothly. These need to be factored into your business plan as part of your overall cost that you are asking for support in funding. A business plan is not just asking for dollars- it’s asking for the support in resources to get the plan off the ground. When initiating a plan, outline what you will need and what long term upkeep may need to go into those resources. It’s best to map the full picture out and not leave the long term details off the plan.
Ok this one may seem obvious but we have to say it: be logical with your plan. If you are selling goods online as your sole source of revenue, avoid claiming your store will make x sales from foot traffic. If you plan on launching a web platform, ensure your google ranking can actually be “number one” within a matter of a week (this is nearly impossible by the way). In short, report logical, well thought out ideas and dreams so others can buy in on the dream too. If it’s too off base you will lose potential investors faster than you started.
Identify your team
Plans take people to execute so don’t leave your team off the plan. When pitching your plan on paper, include the team and their specific talents that they bring to the vision of the business. Include who they are, what their role is, and what their background has been to justify that role. By sharing the team, investors are more likely to trust that the aspects of the business will be managed on all fronts. If you don’t have a wide range of talent on the plan, include what you have and how you will make the roles otherwise filled by other work.
We have all heard of KISS right? Not the band, but the philosophy of keeping it super simple. Plans can follow the same. Long winded, overly complex plans usually come of as confusing to the reader and drowns out the actual content you want to be absorbed. Don’t add fluff, and stay concise.
Business plan writing is quite the task. It can be embraced and executed well, and with a clear vision on what steps to take in beaking down the process, can streamline the experience. While very business and plan will be different, following some similar tips and guidelines can help you focus in on what sections matter most and what aspects your plan can go without. Best of luck on the planning and get after it!