What is a business plan? A Business Plan is a formal statement of a set of business goals which are believed to be attainable and how to reach these goals.
The business plan is structured in a way that it covers a wide range of the business in totality. Here are 10 basic parts of a business plan:
- Executive Summary: This is a snapshot of the business as a whole. It covers the company’s profile and goals.
- The Company’s Description: This provides the information on what the organization is investing in and what differentiates the business from others. It also looks at the market it intends to cover.
- Market Analysis: Market research is important before products are launched into the market for sale.
- Marketing and Sales Strategy: This aspect of the business plan covers the method of marketing, company’s sales strategy, location, and the target audience.
- Organization and Management: This section analyzes the market structure and organizational hierarchy. It also looks at various departments or units that will be included in running the business.
- Services/Product Line: What to sell and the nature of services to be provided by the organization is analyzed. Also how products benefit customers and the product life cycle is looked at.
- Funding Request: This aspect of the plan, covers issues relating to funding and borrowing. It’s necessary to identify the best possible means of raising funds, if borrowing is required.
- Financial Projections: In any business plan, It is always necessary to provide funding projections to back up funding requests. It’s also necessary to include information on the means of payment of loans and duration of payment.
- Profit Sharing: This aspect describes the mode of profit and loss shared among investors either active or passive. This is necessary to avoid conflict.
- Appendix: This gives the opportunities to cover other information not included. It includes information on leasing liquidation. Though, it’s optional.