A business plan helps you to do all the necessary research to take a business concept and lay out how it is likely to work out in practice. It will be particularly important in order to help attract finance for your business.
Financial projections are a particularly important part of the plan and a large amount of detail will need to go into them covering sales, margins, overheads and break-even analysis.
Potential lenders need to get an insight into your current operation and future plans. For this to happen the plan needs to be well organised and presented.
The amount of detail required will vary depending on the situation but the plan should cover the planning of the business using best estimates of future operations, the financing of the business and how it is to be funded, how the plan is to be implemented and the method of monitoring the progress of the business against the plan.
As well as being used by lenders, a well thought out business plan is actually an excellent management tool, allowing you to plan what is going to happen and deal with potential problems.
The plan does not need to be too long, just enough to clearly give the relevant information that a lender may need. Every last detail is not required as you do not want to bore the reader and further information can be requested if required.
The introduction is important as this will determine the extent of interest the reader has in the rest of the plan. Many are thrown out at this point! It is also important to sum up well at the end.
The following can be used as an outline for the arrangement of a business plan…