How to write a winning business plan

Author : em-admin

Posted : 24 / 07 / 11

Whether you’re setting up a new business venture or trying to get the go-ahead for a project, there’s one essential document you need. Rob Ashton, Chief Executive of Emphasis, gives a step-by-step guide to writing a good business plan.

Why you need one

There’s a memorable conversation in Lewis Carroll’s novel Alice in Wonderland, where Alice asks the Cheshire cat for directions. She says it doesn’t matter where she gets to, as long as she gets somewhere. This leads the cat to reply: ‘Then it doesn’t matter which way you go.’

If you don’t have a crystal-clear vision of where you want your business to go, you’ll be as confused as Alice when you hit a crossroads. Your business plan is your route to growth and success. But in order to write it, you need to know what you really want to achieve. This means you’ll have to spend time examining the strengths and weaknesses of your business, a process that has numerous pay-offs in itself. Researching your own company helps you to take a critical look at what you have to offer and who your competitors are. This enables you to better navigate the industry minefields and gives you a benchmark against which to measure success.

Many people think of business plans as a necessary evil, written only to gain external funding. Instead, look at yours as an essential planning tool, whatever your financial situation. Remember, if you don’t plan where to go, you’re inadvertently planning on going nowhere.

Crafting your business plan

Here’s a seven-step guide to writing your business plan. Work through each section and you’ll have an ordered, content-rich document that gets you where you want to go.

Step one

Description of the business

After the executive summary (see step seven), the first thing you’ll need to do is describe your business.

Get started by asking the following questions:

What do I sell or offer? Why?
To whom do I sell?
What is the history of the business?
What is my vision for the future?
What is different about the services I offer?
What is the legal structure of the company?

Think about your audience carefully before you write the description. Ask yourself what words and phrases they will understand and be careful not to include too much jargon.

Step two

Market research

Think about your industry and what you think the future trends will be. Then analyse your competition. Determine what size of the market they hold and then clearly define where you fit into the mix.

Step three

Marketing and sales strategy

Ask yourself why companies buy what you offer, and how you sell it. Think about how you are going to reach the organisations that need your services and what pricing plans you’ll offer. Whether you’re an in-house department, specialist contractor or a large multi-service company, there’ll be a variety of ways to reach prospective clients.

Step four

Management and personnel team

Many facilities management companies claim that people are their best asset. Think carefully about your management team and outline the background, experience and qualifications of each individual. The people on your team will often make or break your success. Fully evaluate their credentials and look out for any skill gaps that could be improved with training.

Step five

Operations

Analyse the location of your business, in terms of advantages and disadvantages. Your own premises, production facilities and IT systems must be excellent. Make sure you address any weaknesses in your plan with recommendations for improvement.

Step six

Financial forecast

This section requires you to translate the contents of your plan into numbers. Include cash flow statements, profit and loss forecasts and a sales forecast. Don’t forget that if you’re looking for funding, you need to spell out how much you need and how you’ll repay the loan.

Step seven

The executive summary

Leave this until last, even though it goes right at the beginning. Once you’ve followed all the other steps, you’re in a position to write this stand-alone document, which outlines the key points in your entire plan. Keep it to a maximum of two pages. Remember, some people will only read this section – so make it shine. Tip: rather than trying to distil the full document down, follow your original document plan. Just write less in each section this time (a couple of sentences or a paragraph, rather than several pages).

Finally, the ink may be dry but your business is constantly changing. Your business plan is a dynamic document, so you’ll need to update it regularly.