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How to Draft a Good Business Plan

If "start a company" is on your to-do list or you'd like it to be, you'll need a business plan. Even the smallest businesses will benefit from a clear vision and strategy to help you get there. Let's take a closer look at these five strategies to draft an amazing business plan.

Jul 9, 2018
  • Student Tips
How to Draft a Good Business Plan

If "start a company" is on your to-do list or you'd like it to be, you'll need a business plan. Even the smallest businesses will benefit from a clear vision and strategy to help you get there.

Business plans include market research and details about your marketing strategies, intended audience, staffing, potential obstacles, and overall goals.

The first part? The executive summary. This critical piece of the plan gives you--and potential funders--the elevator speech version of what you intend to do: your products and services, a brief market analysis, your strategy, and your risk analysis.

Ready to get started? Great. Let's take a closer look at these five strategies for creating the perfect business plan.

Pick a format

Format matters. You might need the traditional 20-30 page business plan if you're going after big funding right off the bat. To get started, you may need a smaller version of your plan, or several smaller versions depending on your audience. A slideshow is a nice idea if you're presenting your plan in-person to a potential investor, customer, or potential employee.

A one-page plan is the shortest version possible, and something you can use when you want that potential investor, customer, or employee to take something with them when they leave your meeting.

Business plan software or a good old-fashioned paper plan can do the trick, too. Most software offers templates that you can tailor to meet your intended audience's needs.

Regardless of the format you choose, know that you may want to have a few versions. Need help? Ask for it.

Keep it short

And sweet, while you're at it.

No one wants to read that 30-page plan, let alone 100 pages.

Write your business plan as a refined work-in-progress that you use to run and grow your business. A long business plan is a hassle. A short, clear one gives you a clear roadmap with room to grow and improve.

Your mission, vision, goals, obstacles, and strategy should be clear. Your purpose should be clear, too.

Have a clear vision of what you want to achieve

The secret to a successful business? A clear vision. What do you want to achieve as a company? Before you begin writing this plan, sketch out the vision and there or four key strategies that you'll use to facilitate your vision.

The mission and vision are related. Your mission is the "why" of what you're doing now. Once you're clear on that, you need to develop the "why" of what you'll do in the future. That's the vision. That's key. Investors want to know how they can expect to see a (big) return on their investment.

Identify your target audience

Easier said than done, right? You need to figure out the answer to this question: "For whom are you solving a problem, or offering a better solution?"

Once you determine your "for whom," and you may have multiples, write your plan in language for them.

Here's an example: if your company is developing technology that helps banks, but your prospective investors are scientists, and don't understand banking language, adapt. Make your langauge accessible to your target audience--and your target investors.

Hard to do when they're from different sectors, but worth your time.

Make sure it includes all necessary elements

Ready? At a minimum, your plan needs some iteration of these six things: an executive summary, opportunity, execution, team and company, finances, and an appendix.

Your executive summary includes your mission and vision, product or services, and basic information about the company and its finances. It should offer a one-sentence business overview, a problem, your solution, and your target market. It needs to be short, sweet, and concise.

Your opportunity section delves into the detail of the problem you're solving, the solution, your intended audience, and how your product or service is unlike the competition. You'll also detail more of your vision here. You may opt for a formal market analysis here, too.

A word of warning on formal market analyses: your target audience is never "everyone." Be specific and broad at the same time.

Your execution section explains how you're going to achieve your goals, and your team and company section describes who's going to do it for you. Keep these sections clear, detailed, and concise.

Your finances need to include your current financial situation--and how you got there--your financial goals, a plan for getting there, and a respectful ask, if you're making one. Don't be afraid to use graphics to illustrate your points.

With a clear business plan, you can make your dreams realities. Remember: audience and purpose are just as key as clean language and a clear vision.

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