A business plan is a must-have for all businesses. Not only is it absolutely necessary if you want to approach an investor to ask for financial investments, but a well-written business plan can also help you scale your business. A business plan can be treated as a brand representation of your company; it covers everything a prospective investor or person interested in your business would like to know.
The plan should cover everything from your goals and objectives, to how you fare against your competition, what sets your product apart from others, what needs your business meets, and more. But the key to a well-written business plan lies in what you do before you actually start writing.
The more research you do, the better your business plan will be
A successful business plan provides accurate and concise information on the industry as a whole, as well as where a business stands in it. A well conceived business plan is a good indication that a business has the potential to make it in the marketplace. For that reason, investors are more drawn to businesses that come with a clear, thorough and carefully thought out business plan. And the only way you can gain the clarity you need to write a business plan that meets these criteria is by doing market research.
Your research must be industry-specific. For example, a gym business plan would present very different information than a business plan for a restaurant or software company. In order to know what is happening within your industry, you must gather as much data as you can. You should know everything about your product, and ideally about the most important products your competitors are selling as well. If you can showcase what makes your product unique against what is currently popular in the market, it will make your business plan stronger. Your market research should cover everything from your business, to local business as well as popular businesses within your industry, your target audience, and your product as well as similar products in the market.
Create an effective marketing strategy
How successful your business will be is largely dependent on your marketing strategy. For that reason, you should use the data you gathered while doing market research to conceptualize a marketing strategy that can take your business higher. Using the information you have gathered, you should do a market analysis, a competitive analysis, as well as future forecasts for your business.
A successful marketing strategy relies heavily on how well you understand your target audience, and how effectively you can market your product to them by building a brand story that resonates with customers.
Write only what is needed
Even though you have gathered a lot of data while doing market research, you only have to put a fraction of that in the actual business plan. The reason behind this is that your audience, which usually consists of investors or banks, may not have the time to go through a larger business plan. Readers would most likely skim a long business plan.
You want your reader to focus on everything you have to say in your business plan. In order to do this, you should only add what is necessary. Mention the important details about your business while leaving out fluff and any extra information that could distract your reader from what the business plan is intended for – showcasing a brand that has the potential to reach new heights of success.
Set a purpose for your business plan
Every business needs financial investment. Scaling a business requires financial capital, and the first thing any investor will ask for when you approach them is your business plan. Even if you do not need a financial investor, a business plan is still a crucial tool for long term success. Your business plan gathers all the relevant data about your product, company, employees and your business, it explains where you stand in the industry currently, where you expect to go, and how you expect to get there.
By setting a deliberate purpose behind why you are writing your business plan, whether that be to attract investors, or whether that be to showcase your business and build an essential guidebook for success, your purpose will help you determine the information you will write out in the business plan.
Build a plan that can grow with your business
The marketplace is always changing, and what is popular today will most likely not be popular in the future. Businesses have to continue to adapt to changing circumstances and lifestyles, as well as newer consumer demands. In light of this reality, a good business plan is frequently updated. Ideally, these updates will be in response to what you find while conducting market research at least two to three times a year. By updating your business plan with new trends and changes within your industry and the marketplace, you will be able to make smarter decisions that can help you scale your business.