Are they teens with pocket money, affluent young professionals, or those on low income looking to maximise value? Media — What newspapers, magazines and TV shows do they watch? What websites do they regularly visit? Are they fans of Guardian thinkpieces, regular watchers of Coronation Street, big Facebook fans?
Interests — Think about what your customers like to do in their spare time. Do they prefer video games to getting outside? Finally, when you create your Management section, focus on credentials but pay extra attention to what each person actually will do.
Experience and reputation are great, but action is everything. Financial projections and estimates help entrepreneurs, lenders, and investors or lenders objectively evaluate a company's potential for success.
If a business seeks outside funding, providing comprehensive financial reports and analysis is critical. But most important, financial projections tell you whether your business has a chance of being viable--and if not let you know you have more work to do. It's easy to find examples of all of the above. Even the most basic accounting software packages include templates and samples.
You can also find templates in Excel and Google Docs. A quick search like "google docs profit and loss statement" yields plenty of examples. Or you can work with an accountant to create the necessary financial projections and documents. Certainly feel free to do so, but first play around with the reports yourself.
While you don't need to be an accountant to run a business, you do need to understand your numbers, and the best way to understand your numbers is usually to actually work with your numbers. But ultimately the tools you use to develop your numbers are not as important as whether those numbers are as accurate as possible--and whether those numbers help you decide whether to take the next step and put your business plan into action.
Then Financial Analysis can help you answer the most important business question: "Can we make a profit? Some business plans include less essential but potentially important information in an Appendix section.
You may decide to include, as backup or additional information:. Keep in mind creating an Appendix is usually only necessary if you're seeking financing or hoping to bring in partners or investors. Initially the people reading your business plan don't wish to plow through reams and reams of charts, numbers, and backup information.
If one does want to dig deeper, fine--he or she can check out the documents in the Appendix. While you may use your business plan to attract investors, partners, suppliers, etc. Because ultimately it's your time, your money, and your effort on the line. Top Stories. Top Videos. So first let's gain a little perspective on why you need a business plan. Be as objective and logical as possible. What may have seemed like a good idea for a business can, after some thought and analysis, prove not viable because of heavy competition, insufficient funding, or a nonexistent market.
Sometimes even the best ideas are simply ahead of their time. Serve as a guide to the business's operations for the first months and sometimes years, creating a blueprint for company leaders to follow.
Communicate the company's purpose and vision, describe management responsibilities, detail personnel requirements, provide an overview of marketing plans, and evaluate current and future competition in the marketplace.
Create the foundation of a financing proposal for investors and lenders to use to evaluate the company. Who must your business plan convince? And if you're not convinced, fine: Take a step back and refine your ideas and your plans.
Who can your business plan convince? As you map out your plan, you may discover issues or challenges you had not anticipated. Now let's look at the first section of your business plan: The Executive Summary. A brief description of products and services A summary of objectives A solid description of the market A high-level justification for viability including a quick look at your competition and your competitive advantage A snapshot of growth potential An overview of funding requirements.
Your Summary can serve as a guide to writing the rest of your plan. The following is how an Executive Summary for a bicycle rental store might read. The economic outlook indicates fewer VA, WV, NC, and MD cycling enthusiasts will travel outside the region The park has added a camping and lodging facilities that should attract an increased number of visitors The park has opened up additional areas for trail exploration and construction, ensuring a greater number of single-track options and therefore a greater number of visitors.
Initial growth will be moderate as we establish awareness in the market Initial equipment purchases will stay in service for an average of three to four years; after two years we will begin investing in "new" equipment to replace damaged or obsolete equipment Marketing costs will not exceed 14 percent of sales Residual profits will be reinvested in expanding the product and service line.
What you will provide What you need to run your business Who will service your customers, and Who your customers are.
Identify your industry. Retail, wholesale, service, manufacturing, etc. Clearly define your type of business. Identify your customer.
You cannot market and sell to customers until you know who they are. Explain the problem you solve. Successful businesses create customer value by solving problems. In our rental example, one problem is cycling enthusiasts who don't--or can't--travel with bikes.
Another problem is casual cyclists who can't--or choose not to--spend significant sums on their own bikes. The rental shop will solve that problem by offering a lower-cost and convenient alternative. Show how you will solve that problem. Our rental shop will offer better prices and enhanced services like remote deliveries, off-hours equipment returns, and online reservations.
If you are still stuck, try answering these questions. Some may pertain to you; others may not. Who is my average customer? Who am I targeting? Unless you plan to open a grocery store, you should be unlikely to answer, "Everyone! How will I overcome that paint point?
Where will I fail to solve a customer problem, and what can I do to overcome that issue? In our rental example, one problem is a potential lack of convenience; we will overcome that issue by offering online reservations, on-resort deliveries, and drive-up equipment returns. Where will I locate my business? What products, services, and equipment do I need to run my business? What skills do my employees need, and how many do I need?
How will I beat my competition? How can I differentiate myself from my competition in the eyes of my customers? You can have a great plan to beat your competition, but you also must win the perception battle among your customers.
If customers don't feel you are different, then you aren't truly different. Perception is critical. Provide high-quality equipment, sourcing that equipment as inexpensively as possible through existing relationships with equipment manufacturers and other cycling shops Use signage to attract visitors traveling to the national forest, highlighting our cost and service advantage Create additional customer convenience factors to overcome a perceived lack of convenience for customers planning to ride roads and trails some distance away from our shop Develop customer incentive and loyalty programs to leverage customer relationships and create positive word of mouth.
Are products or services in development or existing and on the market? What is the timeline for bringing new products and services to market? What makes your products or services different? Are there competitive advantages compared with offerings from other competitors? Are there competitive disadvantages you will need to overcome? And if so, how? Is price an issue? Will your operating costs be low enough to allow a reasonable profit margin?
How will you acquire your products? Are you the manufacturer? Do you assemble products using components provided by others? Do you purchase products from suppliers or wholesalers? If your business takes off, is a steady supply of products available? The following is a breakdown of anticipated rental price points, per day and per week:. Customers can extend the rental term online without visiting the store.
A grace period of two hours will be applied to all rentals; customers who return equipment within that two-hour period will not be charged an additional fee. Newer equipment inventory with higher perceived quality Price points 15 percent below the competition Online renewals offering greater convenience A liberal return grace period that will reinforce our reputation as a customer-friendly rental experience.
What is the size of the market? Is it growing, stable, or in decline? Is the overall industry growing, stable, or in decline? What segment of the market do I plan to target? What demographics and behaviors make up the market I plan to target? Is demand for my specific products and services rising or falling? Can I differentiate myself from the competition in a way customers will find meaningful?
If so, can I differentiate myself in a cost-effective manner? What do customers expect to pay for my products and services? Are they considered to be a commodity or to be custom and individualized? Your potential customers. In general terms, potential customers are the people in the market segment you plan to target. Say you sell jet skis; anyone under the age of 16 and over the age of 60 or so is unlikely to be a customer. Plus, again in general terms, women make up a relatively small percentage of jet ski purchasers.
Determining the total population for the market is not particularly helpful if your product or service does not serve a need for the entire population. Most products and services do not. Total households. In some cases determining the number of total households is important depending on your business. For example, if you sell heating and air conditioning systems, knowing the number of households is more important than simply knowing the total population in your area.
While people purchase HVAC systems, "households" consume those systems. Median income. Spending ability is important. Does your market area have sufficient spending power to purchase enough of your products and services to enable you to make a profit? Some areas are more affluent than others. Don't assume every city or locality is the same in terms of spending power. A service that is viable in New York City may not be viable in your town. Income by demographics. You can also determine income levels by age group, by ethnic group, and by gender.
Again, potential spending power is an important number to quantify. Senior citizens could very well have a lower income level than males or females age 45 to 55 in the prime of their careers. Or say you plan to sell services to local businesses; in that case, try to determine the amount they currently spend on similar services. Always remember it's much easier to serve a market you can define and quantify.
What is your market? Include geographic descriptions, target demographics, and company profiles if you're B2B. In short: Who are your customers? What segment of your market will you focus on? What niche will you attempt to carve out? What percentage of that market do you hope to penetrate and acquire? What is the size of your intended market?
What is the population and spending habits and levels? Why do customers need and why will they be willing to purchase your products and services? How will you price your products and services? Will you be the low cost provider or provide value-added services at higher prices? Is your market likely to grow? How much? How can you increase your market share over time? Recreational sports in general and both family-oriented and "extreme" sports continue to gain in exposure and popularity.
Western VA and eastern WV have experienced population growth rates nearly double that of the country as a whole.
Industry trends show cycling has risen at a more rapid rate than most other recreational activities. You may want to add other categories to this section based on your particular industry. The key is to define your market--and then show how you will serve your market.
Here are some of the basic steps involved in creating your marketing plan:. Focus on your target market. Who are your customers? Who will you target? Who makes the decisions? Determine how you can best reach potential customers. Evaluate your competition. Your marketing plan must set you apart from your competition, and you can't stand out unless you know your competition.
It's hard to stand out from a crowd if you don't know where the crowd stands. Know your competitors by gathering information about their products, service, quality, pricing, and advertising campaigns. Including fields such as Company Description, Required Funding, and Implementation Timeline, this one-page business plan gives businesses a framework for how to build their brand and what tasks to keep track of as they grow.
Then, as the business matures, it can expand on its original business plan with a new iteration of the above document. We created a business plan template for entrepreneurs. Strong game plans help coaches win games and help businesses rocket to the top of their industries. They created a fictional company called Acme Management Technology and wrote an entire business plan for them. Using their sample business plan as a guide while filling out your own will help you catch and include small yet important details in your business plan that you otherwise might not have noticed.
After filling this business plan out, your company will truly understand its financial health and the steps you need to take to maintain or improve it.
Most sample business plans teach you what to include in your business plan, but this Harvard Business Review article will take your business plan to the next level -- it teaches you the why and how behind writing a business plan. With the guidance of Stanley Rich and Richard Gumpert, co-authors of Business Plans That Win: Lessons From the MIT Enterprise Forum , you'll learn how to write a convincing business plan that emphasizes the market demand for your product or service and the financial benefits investors can reap from putting money into your venture, rather than trying to sell them on how great your product or service is.
The guide also fleshes out an entire sample business plan for you. If you need further guidance on starting a business, HubSpot's guide can teach you how to make your business legal, choose and register your business name, fund your business, gives information about small business tax, and provides marketing, sales, and service tips. It describes what you should include in each of its sections, so you don't have to come up with everything from scratch. The Small Business Administration offers several free business plan templates that can be used to inspire your own plan.
Before you get started, you can decide what type of business plan you need -- a traditional or lean start-up plan. Then, you can review the format for both of those plans and view examples of what they might look like.
Culina's sample business plan is a great template to use if you just want to fill in your information. You can also use this template as a guide while you're gathering important details. After looking at this sample, you'll have a better understanding of the data and research you need to do for your own business plan. This is one of my favorite sample business plans, because you can see how implementing visuals can help tell the story of your brand. The images in this template are cutting edge, which makes sense for an innovative company like Plum.
When you create your own business plan, make sure that the pictures and design you use make sense for your branding. Additionally, the financial charts included are incredibly helpful if you're not sure what financial information to include.
With this business plan, the focus is the investment opportunity. This is an excellent template to use if you're going to use your business plan as a means to receive funding. The investment opportunity section is placed right up front and is several pages long.
Then, the plan goes into more detail about the company synopsis industry analysis. When you're first getting starting on your business plan, it can be daunting. That's why it's important to make sure you understand the format and information you'll want to include. Then, you can use a template to guide your process. Article Sources. Investopedia requires writers to use primary sources to support their work.
These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate.
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This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. Related Terms Marketing Plan A marketing plan is an operational document that demonstrates how an organization is planning to use advertising and outreach to target a specific market.
Considering a New Venture? Consider a Feasibility Study A feasibility study analyzes all relevant factors of a project to determine the possibility and probability of completing it successfully. Scope Scope is a project management term for the objectives necessary to complete a project, allowing managers to estimate costs and time required.
What Is a Startup? A startup is a company in the first stage of its operations, often being financed by its entrepreneurial founders during the initial starting period. What Is a Business? A business is an individual or group engaged in financial transactions.
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