As a Business Development Consultant, I am often asked questions and advice regarding writing a Business Plan. In this article, I share answers to common questions.

What is a business plan?

A Business Plan is a strategy for successfully starting and operating a business based on management, environmental, economic, industry, marketing, operational and financial information. It is a map taking an idea from a concept to a revenue generating business. Developing a business plan for a business idea is a way to for entrepreneurs to assess the requirements, challenges and advantages of their business.

What information should a business plan contain?

The content and length of a business plan will vary based on the business, however at a minimum a business plan should be 30+ pages and contain the following sections: (note film projects and non-profit organizations will use a different format which are not discussed in this article)

1. Management – Biographies of management team and board of directors.
2. Business Profile – Vision and mission statement, business registration, business model and company history.
3. Product and Services – Description of products and services being offered.
4. Business Operations – A detailed explanation of how the business will be operated.
5. Industry Analysis – Industry research proving viability – national/regional trends, regulatory requirements, stakeholders, SWAT and competition analysis, risk, success factors, required due diligence.
6. Marketing Plan – 3 year Marketing Plan, including a detailed monthly first year plan.
7. Financial Plan – Detailed financial plan that includes income/revenue, monthly cash flow, break-even analysis and annual balance sheet statements.
8. Implementation Plan – Work plan with measurable, time bound milestones, plus a synopsis of future goals.
9. Funder/Investor/Lender – Offer and proposed return.

In addition to these sections a social enterprise will also include the following sections in their business plan:

10. Organizational Purpose – Description of population served and cause being addressed.
11. Community Impact – Short/long term economic, social, technological and environmental benefits.
12. Organizational Support – Identification of target supporters, donors with a connection with the organizational mission (grassroots and high net worth individuals), development of a fundraising portfolio using both new and current diversified fundraising channels such as government funding sources, corporate partnerships, grants, web 2.0 fundraising, third party events and memberships.
13. Acknowledgement – How the social enterprise will acknowledge supporters.

How should information be presented?

Given the detail required in a business plan, it is reasonable for a business plan to quickly become a lengthy document. However, lengthy documents can be overwhelming to read; therefore it is important that a Business Plan present information clearly and creatively in a way that captures the reader’s attention. To the business manager a Business Plan is a guide, but to lenders, investors, or other stakeholders a business plan is an advertisement that must inspire. Designing a business plan with a creative look, using graphics and diagrams to explain concepts is a must.

Who should develop a Business Plan?

Given the importance of a Business Plan, it should be developed by a business professional. A business plan writer should not be just a writer; rather they should be a business professional with a strong background in finance, marketing, operations, management, research and proposal writing. Their service should not be limited to developing the plan, instead their added value should involving coaching and advice with implementation.

At the least, it is important that a business plan be reviewed and critiqued from an unbiased third person point of view; that is another key service that a business development consultant provides. A Business Plan provides a reality check. For example, it is easy for an entrepreneur to become so excited about their idea that they develop an unrealistic belief in the success of their idea. Business history is full of innovative products that failed because they did not have a clear path to market or insufficient business resources. A Business Development Consultant can also educate a business owner on how to prepare and adapt to the future. I have sometimes been contacted by business owners in a bad financial situation because they did not have a business plan that properly predicted future cash flow needs.

Can a Business Plan help me raise capital for my business?

There are many exciting opportunities for financing including private investors, bank loans, government backed loans, grants, subsidies, hiring incentives and business incubators. All types of funding require presenting a business plan that clearly explains your business concept in away others can understand; it should clearly state what you want to achieve, where you want your business to go and how you plan to get there. However, not all businesses are eligible for funding.

Conclusion

A persuasive, detailed and creatively designed business plan is the first step towards starting a business. The difference between simply having dream and making it real, is the decision to start implementing the dream and remaining dedicated. That is exactly what separates dreamers from entrepreneurs. A Business Plan is the first step in turning imagination to income.

Questions about business plans? Please feel free to contact me at jorge@jorgeleclair.ca

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