How to write a business plan' focussing on startups/SME's

Every business whether it be startups or SMEs begins with a vision that is articulated and conveyed through a well-written business plan. Read on for our guide on how to write a business plan.

 

Why is it important to have a business plan 

 

There are a range of reasons why you might consider writing a business plan, from clarifying your intentions to securing a business loan.

 

Establish your business objectives

 

During the planning process, specific goals are established and strategies to achieve them are developed. In another word, it will help streamline and refine ideas by distinguishing between priorities and non-priority, conserving valuable time.

 

Identify potential issues 

 

While conducting a business plan helps identify potential issues that were not evident before conducting research or that you had not previously considered. 

 

Obtaining financing or investment for your business

 

A good business plan is crucial if you are seeking financing from a bank or external investors, as it can help attract new business partners, such as agents or distributors, and senior management. 

 

Writing Your Business Plan: A Section-By-Section Breakdown

 

A typical business plan consists of the following elements:  

• Market research

• Descriptions of products and/or services

• The management and operational structure

• Marketing and sales strategy

• Financials

To easily create a business plan that will keep everything organised and to prevent confusion, refer to DocPro’templates for business plan.

 

1) Explain your market analysis and problems 

 

In this section of your business plan, you should clearly articulate the market pain that your product or service will address. This can involve conducting market research to identify the specific needs and pain points of your target customers, as well as analyzing competitors and existing solutions in the market.

 

2) List your product and services 

 

It is crucial to have a section dedicated to detailing the products or services that your business offers. Additionally, if you hold any patents or trademarks, this is the ideal place to showcase them. It's advisable to include any relevant visual aids in this section, as well as a comprehensive explanation of your pricing strategy and materials. 

 

Demonstrate how your offerings are critical to the market and fill a significant gap. You also need to describe how the company will attract and increase its customers base. It's also an opportunity to position your business within your industry and highlight any notable distinctions that give you a competitive edge in the marketplace

• Understand your ideal customer profile

• Research relevant industry trends and trajectory

• Use of advertising and marketing media  

3) Provide a product, business and corporate development progress summary 

 

This section is important because it allows investors and stakeholders to understand the current state of the company and its progress towards achieving its goals.

 

Product development progress summary 

 

Provide the current state of the product, including any updates or changes that have been made since the last business plan. This section should also include plans for future improvements or enhancements, and the launch date of the product. 

 

Business development progress summary 

 

Provide an update on the company's performance and financial status. This should include information on revenue, expenses, profitability, and any key milestones or achievements that have been reached since the last business plan. This section should also provide roadmap for future partnership and client development initiatives, include information on new partnerships or clients that the company is targeting, as we as any progress made with existing partners and clients.

 

Corporate development progress summary 

 

Provide various elements such as IP, organisation chat, shareholder structure, fundings, and other factors related to the company's corporate development initiatives. 

 

Intellectual Property (IP): Discuss any progress made in terms of IP development, acquisition, or licensing. This could include any patents or trademarks secured since the last business plan, as well as any new licensing agreements or technology partnerships that have been established.

 

Organisation: Discuss any changes to the company's organizational structure, including any new hires or promotions, and how this has impacted the business.

 

Shareholder Structure: Describe any changes in the company's shareholder structure, including any new investors, equity issuances, or changes to voting rights. This section should also provide an overview of the company's capitalization and ownership structure.

 

Funding: Provide an update on the company's funding status, including any recent funding rounds or other sources of capital. This section should also highlight any key investors or strategic partners that have provided funding to the company.

 

4) Cash Flow 

 

This is a crucial component of any business plan as it provides an understanding of how the business will generate cash and how it will be used. Here are some important elements to consider when including the cash flow status in a business plan:

 

Cash inflows: generate cash, including revenue from sales, investments, and any other sources of income.

 

Cash outflows: various expenses that the business will incur, including salaries, rent, utilities, and any other operational costs.

 

Frequently asked question

 

What are some common mistakes in a business plan? 

 

Typical writing errors such as grammatical mistakes and misspellings are among the most frequent mistakes found in business plans. To ensure clarity in sentence construction, it is crucial to proofread your plan before presenting it to potential investors or collaborators.

 

A lack of exit strategy is a significant drawback. Investors interested in your business plan primarily seek a clear indication of your venture's potential for profitability. Without a well-defined exit plan that outlines the means for them to depart the business while maximizing returns, you're likely to face difficulty in securing funding.

 

Read more here 

Building the Foundation: A Guide to Choosing the Right Legal Business Structure for your Company

Developing a Business Continuity Plan: A Comprehensive Guide