Starting a new business is more than just writing an idea down on a piece of paper and going for it. For your new venture to be successful, it’s important to not only know what your business is going to do, but to establish a big-picture view of your company’s values and identify any potential strengths, opportunities, weaknesses, and threats to your business goal.
A Business Plan helps you plan out your company, and demonstrates to investors and customers that you’ve done your research and your business is something they should be interested in.
In this post, we identify three essential elements to include in your Business Plan.
1. SWOT Analysis
Before you can get your business off the ground, you’ll need to prove that it’s worth starting. By using a SWOT (Strengths, Weaknesses, Opportunities, Threats) Analysis, you can determine if your business idea is viable, if it needs to be adjusted, and how you are going to deal with roadblocks and other issues that could affect its success.
As an example, if you’re planning on opening a coffee shop downtown where you know there are a lot of restaurants and retail stores, you could include in your analysis that you considered the strengths of opening a store in that location (lots of foot traffic, business people looking for a place to buy a quick coffee, etc.) as well as the potential threats (competitors taking potential business away).
Writing down your analysis in your Business Plan shows that you’ve put in the time and effort to showcase all possible scenarios for your business. It also helps prove to any investors you may present to that you’ve done all the necessary research before proposing your business idea.
2. Mission Statement
Your mission statement should showcase the purpose of your business clearly and concisely in one or two sentences. Since your mission statement could also be viewed as a selling point to customers, investors, or anyone else that might be interested in your business, it’s important to use effective and bold verbs in your statement so it can double as a pitch.
3. Executive Summary
Your Business Plan should include an executive summary on the first page, which is essentially an elevator pitch for your business as well as an organized and detailed list of each of the sections in your plan.
An executive summary should be divided into headings that explain each section of your Business Plan in a few short sentences.
For instance, if the main purpose of your business is to sell a particular product, you’ll probably have a wealth of information explaining your product in your Business Plan, such as what it does, how it fulfils a need or serves specific a purpose, etc. In your executive summary, you would want to condense all that information down to just a few sentences and only discuss the most important points.
Essentially, the goal of your executive summary is to present the content in your plan in an easily readable format that highlights key points of your business and gets investors interested in learning more.
Writing Your Business Plan
The purpose of your Business Plan is to give a high-level overview of your company that can be presented to investors, or even just to have a document to refer to so you can keep your business on track. Taking the time to write a detailed and well-structured Business Plan will help you showcase your business in the best possible way.