A well-prepared business plan is the absolute necessity for a successful business project. The business plan outlines the missions, visions, and goals, along with the products/ services, sources of financing and many other aspects of business. It also helps to set out objectives for the business and to establish priorities for these set objectives. The business plan may vary from business to business and aspect to aspect, but the general theme of the business always remains the same.
Why Do You Need a Business Plan?
- Drawing the bigger picture of the business and the timelines
- Prioritizing the goals, objectives and setting deadlines.
- Defining the pre-requisites for promotion and the promotion mediums
- A better understanding of the competitors and the targeted customers
- A better understanding of the business and business processes
Key Elements of a Business Plan
The different elements of preparing business plan are described below:
Choosing a name for the business is an important process, as it sets out the clear direction for your products or services. The name of the firm or business will set out the public image, thus, it is an essential part of preparing a business plan.
The business owner could be an individual, a group of individuals or a public company owned by a larger mass. Regardless of the owners, every business requires strong leaders to pave its way to success.
Information about the Business
The information about the business may include details about the nature of your business, the products or services and so on. Also include the goals and objectives of the business. The other aspects of an expansive project plan could be the targeted market, techniques for bringing business and the pricing for the product and services, with respect to quality and competition.
A brief historical background of the company may or may not be featured in a business plan. The general idea of including a history is to add an aura of loyalty or brand value or display redundancy of the business product or services.
You should let your readers know where you are located. The physical location of the headquarters or the branch-offices will directly affect the business cost. Different factors like cost of occupancy (renting, leasing or owning), cost of operating in the area, taxes imposed – all may significantly affect the final cost of the project. If it is a manufacturing business, the cost of production, storage or shipping along with the environmental outcomes, availability of resources (both human and raw material) also have to be considered while preparing a business plan.
Market Analysis and Strategy
Your plan should explain the type of business you’re in, the market in which you are competing and the size of the market. It should also include competitor’s analysis, their key strengths and weaknesses. The business plan focuses on the strategy for selling the product or service with a detailed plan for promotion, advertisement and consumer base.
An important part of business planning is analyzing the available sources of funds and of the fund within the business. Your business plan should clearly specify the purpose of your business. This can be done by analyzing historical data or by predicting the future flow of the business (which includes estimation of break even points, variable expenses, and fixed expenses). The business plan should incorporate all the financial costing along with the plans for mitigation of financial risks.
The location of the business base will highly determine the method of audits, bookkeeping and accounting. Your business plan should account for all the aspects of keeping a record of the financial input and output, to meet the standards and avoid misuse of funds. Accounting should also address the recording through statement of expected profit, return on investment, and salaries; Statement of assets; Statement of necessary start-up funds; cash flow; statement of profit and loss;
Each business organization has different business requirement in terms of legal issues. The business has various licensing requirements, funding requirements and environmental specifications to meet the legal recognition for the legitimate and smooth running of the business. Your business plan should address all the legal aspects to ensure the smooth running of the business.
Documentation is one of the major elements for successful execution of a business plan. The general format of the business plan documentation is listed below:
The executive summary of the business plan provides a concise view of the business by briefly describing the company, the background of the industry, and the information on the competitive edge of the business. The executive summary also describes the details on the project that needs financing and the amount of finance required.
Executive summary is a very critical section because if the investors don’t like your executive summary they won’t read further. Take time to write this section and write it at last even though it appears first in your plan.
Include all the important points from each section of your business plan. Describe your unique selling propositions and success factors. What are the different market problems that your business is going to solve? And few good reasons why your business is going to be successful.
The purpose of writing an executive summary is to convince the reader to invest in your company. So try to get it just right.
Description of the company goals:
The body of the business plan includes details on the company’s history, the mode of operations and strategies for maximizing the strengths and mitigating with the threats and risks. It also includes details on the goals and objectives.
Team management strategy:
The business plan should also say something about the management team, and the skills, qualifications and experiences of each member of the management team. It is very important for the bankers to know about the strengths of the management team.
The financial section of your business plan should highlight the financial strength of the business. This section should also include the budgeting and the financial prediction of the business. This information will provide a better insight about the philosophy of the company and where it is headed.
The marketing plan includes the identification and focusing of the target audience, the strategy of promotion for products and services, an overview of the competition, the campaign for advertising and medium of advertising.
Your marketing plan should identify your customers, where they are, their needs, how to reach them and how to deliver your product or services to them. Whether your plan is for your own management purpose or it is going out to banks and investors, you should be very sure that you know your market.
The production plan is basically for the manufacturing businesses. It includes the use of raw materials, the inventory management of raw materials and storage and distribution of the finished products. The human resource is also included in the production plan, of the business plan module, that demonstrate its ability to recruit, develop and retain the right people, to take the business projects further.
Components of a Business Plan
The general components of the business plan are
- Cover Page with your contact details
- Executive Summary and Business Profile
- Company description with vision & mission
- Product & services
- Details on the target market and audience
- Competitive analysis
- The marketing plan
- Operational plan
- Production plan
- Human Resource plan
- Financial projections & planning
- Other Supporting Documents
- Appendices (Legal documentation)
The British Virgin Islands is a successful international financial center renowned for its strong yet flexible legal and regulatory framework for innovative and traditional businesses. Planning and execution is the key to all success. Making a business plan is an important factor for the success or failure of any business.
Diligent Company Services is a service mark of CCP Group of Companies, a multi-disciplinary financial services group based in the British Virgin Islands. We are fully licensed and regulated by the BVI Financial Services Commission for providing financial services in BVI. Our services include developing and preparing business plan in BVI.
Whether small or large, preparing a business plan should be a basic requirement of any business. Your business plan works as a guide for your business. We have more than 20 years of experience in developing business plans in the BVI. We will help you determine the overall market, your competitors, your operating costs and much more. We cover all types of businesses and one of our hallmarks is the attention that we pay to each and every project.