Business Plans are a key to any business idea before its implementation. A wise entrepreneur would always invest in a good business plan before deep-diving into the business.
Below are the important elements of a good Business Plan:
- Industry Overview (The Problem)
- Product or Service (The Solution)
- Competitive Analysis (SWOT Analysis)
- Sales & Marketing Plan
- Target Market, POC, Expansion Plan
- Operations, R&D & Technology
- Management Team, Organization Chart
- Financial Projections (Exit Strategy)
- Risk Analysis
- Executive Summary
A Business Plan is an important tool to help build a better business. Hence, it’s important that it’s written/developed by experienced professionals who understand the requirements of an investor. They ensure to highlight the impact of the above key elements on the business, thereby making it a very important tool to attract investors and obtain financing to kick-start the project.
Research is an integral part of a good Business Plan and researching on Market Analysis, Competitor Analysis, etc. makes preparation of Business Plans a time-taking task.
A very important element of a good Business Plan is not only the Financial Projections, but also the key financial performance indicators in the form of ratios, for example, Payback Period, Rate of Return, Cash Conversion Cycle, Days Sales Outstanding, etc. These ratios are very helpful for investors to determine their Exit Strategy.
Lastly, Business Plans should be treated as a bible and entrepreneurs should adhere to the assumptions underlying the Business Plan, unless market conditions demand otherwise.