Planning phase of a business always gives us a chance to learn how to achieve great things by thinking out of the box. One way or another, obeying something to push us makes things harder than we think. But rather than to spill out all circumstances that lie down in the course of the subject, thoughtful details always benefit us and eliminate the damages that may occur during the growth phase.
Remember that ‘’An idiot with a plan can beat a genius without a plan’’.
How to Create a Business Plan?
Mohab Ayoub is an entrepreneur that has impacted many youth with his inspirational speech as a public figure, and viral videos on Youtube where he shares his ideas and experience about how to establish a business or challenges that we face during starting a new chapter in our life.
At a young age, he has founded many companies and ran them successfully, which still he has great and original plans to put into practice.
So we couldn’t find a better person to get inspired by his unique description of the great planning phase.
Here, you will find everything you might wonder about how to create a great business plan;
Preparing a business plan is a must for entrepreneurs who want to start their own business to be successful during and after the business establishment process.
A clear and convincing business plan guides you in achieving certain goals in defined periods. It is also a document that will help you convince all investors, including banks, to invest in your business if you need capital to start a business. Even if there are many types of businesses, the basics of the business plan are standard.
Analyzing the Market
Analyze potential markets. Who uses your products or services? The answer to this question is not just based on guesswork. For this, a proper research should be done.
- Do your research first. Is there a suitable market for your products or services you want to sell? People like family and friends are a good starting point in the beginning. Ask them to be honest with you.
- Write down the demographics of the people who will use your products or services to decide your target audience. How old are they? How do they get along? Do women use your services the most? Does your product or service attract people from certain ethnic or economic groups? Can only wealthy people benefit from your product or service? Do your ideal customers live in a certain area? Answering these questions about the demographics of your main market will help you predict the characteristics of the people you need to reach.
Estimate the size of the potential market. It will be easier to make predictions after the demographic analysis is complete. Then you need to research the numbers: how many children are under eight years old? How much soap do they use monthly or annually? How big are your potential competitors? And where will you find the answers to all these questions? Defining the market is the best place to start.
Take the Matter in all its Details
Put yourself in the investors’ shoes. You want to receive reliable and useful information about the product or service. Depending on your product, you have to do long and demanding research. More importantly, if you find positive information, statistics and graphics about the product, your courage will increase. Your hard work pays off when the potential investor turns into a real investor.
- Likewise, don’t be discouraged if you discover that all or some of your ideas are on the market. Do not ignore this fact. Are you doing a better job or offering better parts than your competitors? In many cases, know the market better and add values that your competitors do not.
Take advantage of your competitors’ business plans. There are many well-defined and achieved archives of online business plans that show how to successfully penetrate the market. Spend time analyzing the market and think about how you would differentiate your products or services. Think about the issues that will give you a competitive advantage.
Build İnfrastructure Before you Start Writing the Plan
Define your company. If you’re not completely sure why your company exists, the business plan won’t work either. What will you do for the others? What products and services will you manufacture or provide?
- Write down all the needs your company will satisfy. Potential investors want to know if your products or services are marketable. So concentrate on the external requirements your business has to meet.
- What opportunities does your product or service offer people? Is it cheaper, safer or more efficient? Will your restaurant offer new flavors to suit people’s taste? Will your new mousetrap help people catch mice before they get sick? Will your new gum scented soaps revolutionize kids’ night baths?
Consider all the benefits your company will offer. Write them all down. Scratch your mind. Believe them. These benefits will be a major source of motivation and will also ensure that readers of your business plan respect and care.
Choose a successful strategy. After determining the factors that will provide competitive advantage, you should choose a strategy that will enable you to reach your goals. How will you differentiate your products or services? While there are millions of types of businesses, there are only a few basic strategies that can make any venture successful. The first step in choosing an effective strategy is to define the competitive advantage of your product or service.
- Is your product or service better, cheaper, tastier or more useful?
- How can your company be more remarkable than your competitors? What limits your business or industry?
- Your competitive advantage may be in other features not found in competing products. You may have outstanding service features such as faster shipping, low price, or attentive sales staff. These are not features to be taken lightly.
- Does your product or service give users a certain status? Is it more profitable or more beneficial for customers? Since the manufacturing costs of your mouse trap are very high and the design is titanium, you may want to position your product in the upper market. So only rich people can get your mousetrap. You need a reason for your business to be successful. This is the competitive advantage of your product or service.
Establish your company. Decide how to recruit and organize your workforce. By the way, you need to think about your possible business concept while coming to this stage. Keep in mind that startup plans will undoubtedly change as the business grows. You will need to hire managers to set up new departments to manage staff or meet customer demands. The targeted growth and expansion of the firm should be mentioned in the business plan, but this is not our priority. Right now you need to find help to raise funds to help you earn money.
- Investors want to make sure you can get this job done. Need to hire experienced managers? Will you continue with your pre-existing staff or will you create a new staff? And where would you find these potential personnel?
- Investing resources also want to find out if your partners will be working with you or whether their obligations are just financial. You should describe key management tasks and roles in your business plan. Positions such as president, vice president, finance and finance manager, and department directorates should be defined, along with who will report to whom.
- You may want to manage your company like a big and happy family, but organizations must have formal structures and investors want to see all of these issues on the plan.
Consider your role as leader or boss. As you will ultimately recruit staff and organize your workforce, you need to combine your desires with your abilities to be a good boss. If you haven’t thought of your responsibilities to be the boss of your own business before, now is the time to seriously think about it. What kind of leader will you be?
Define the priority needs of your company. What do you need to get started? You can either hire a company with 300 employees or connect an extra line to your home phone and work from home. After all, you need to make a list of the ingredients you need. Some items may be material, such as five hundred binders and large cabinets. There will be other abstract requirements such as designing a product or conducting market research to identify potential customers.
- You may need to hire an assistant to develop a reversible filing system or a consultant to set up a computer system. In some cases, it may be more economical to hire a virtual assistant than to have someone seated at the table.
- Let’s say you built a mousetrap prototype from bent paper clips and unused toothpaste tubes in your home. No matter how good your mousetrap is, you cannot show this model to potential investors. What exactly should a mousetrap look like? What kind of materials will you need? Do you need money for the research and development required to develop an original toothpaste tube and paper clips? Do you need an engineer to prepare the production designs? Will you patent your invention?
- Then do your homework. Call a real estate agent and search for rentals around you. Chart the most expensive and cheapest places by location and square meter. Then determine how much space you need and how much you can pay for the rent.
- Make a list of all the resources, both abstract and concrete, that are necessary for your work to continue. Whether you buy high-end computers or connect a phone line to your desk, the estimated total price of all of these will be your initial costs. If an item on your list is too expensive, look for other alternatives. However, it is best to estimate the cost of each item realistically. So you will not be broke or you can pay off your loans. Be honest and conservative when making predictions, but remember to be optimistic.
- In the beginning, everything doesn’t have to be the best. You have to forego expensive accessories that will make your office look more stylish and that will force you in the beginning. Get what you need and reasonably. Stay away from pretentiousness.
Target funding sources. Banks and other sources of finance do not lend money to people who do not have good ideas. Banks usually look at the firm’s capital, capacity, collateral, conditions, and character before granting a loan to secure the loan. Before seeking resources, you must fulfill all these requirements.
- Where will you find the financing? If your business concept is starting to take shape, you can start focusing on the best sources of finance. Matters such as the size of the business, the industry you are in, whether you are starting a new business or acquiring an existing business, whether you have coverage, are among the things you should consider when preparing a target financing source list.
- Your credit, credit assessment, and business history are key factors in loan applications.
- You can increase your money by leveraging your personal networks, such as friends, family and professional contacts.
- If your investors are family and friends, you should consider how this will affect your relationships. If they believe in you enough to endanger their home, you should keep in mind that you need to be careful in accepting this generosity. Perhaps you need to prove yourself first.
- After completing the phase of your business plan that identifies potential funding sources and answers investors’ needs and questions, it’s time to increase the likelihood of getting the funding you need.
Disclose your financial data. How will you persuade others to invest? You can persuade investors if you have clear, transparent and realistic financial information that explains exactly what you want and shows that you are not hiding anything.
Introduce yourself in the best way possible. Show your skills, experience and enthusiasm that make you a unique entrepreneur. Remember, investors invest in people, not ideas. While your potential business has a lot of competitors, the qualities and promises you show in your plan will help you persuade investors.
- What are your qualifications that will finalize your plan? Your resume should be included in the appendix behind the plan.
- Your CV should be where your qualifying skills are highlighted. Do not ignore your experiences that seem unrelated to your new venture. For example, having piloting experience can show that you can coordinate how to safely lead a team.
Marketing and Sales
Prepare a strong marketing plan. Entrepreneurs, especially inventors, feel that business concepts are great and that promoting their products or services is unnecessary. The biggest mistake made by entrepreneurs who prepare plans is the part of how to reach customers and how to present products to customers. Potential investors, staff and partners; they won’t be persuaded until your idea is successful. Marketing defines how you will position the product or service in the target market and how your potential customers will be aware of your company. Positioning your company means concentrating on the competitive advantages you define: will your product or service differentiate itself with its high quality, revolutionary features, or capabilities to delight customers? Marketing helps you focus on your competitive advantage so you can position your product or service. It also determines how you will reach your potential customers and what you will say to them. If you have the right marketing campaign, you will gain market share, generate income and turn your financial forecasts into reality.
- Consider how to reach your customers. What will you say and persuade them to buy your product or service? Is it more useful, faster or more valuable than competing products or services?
- Marketing should serve customers intelligently. Never insult a consumer or assume that consumers are not researching for more information. Be open and honest.
Develop dynamic sales efforts. The word sales includes all the contacts you will establish with your current customers. To be concise, this part of your business plan talks about how you will affect customers with your product or service.
- How will you train the sales staff? Are you going to divide your sales staff into segments?
- What kind of advertising and promotion activities will you implement? For example, are you going to have one free campaign for two buyers?
- You should also answer a number of questions while planning your sales activities. Will you be the only one selling in the early days of the company? When will you recruit sales staff? How will you convince your customers that your sales team is as careful as you are?
- What will your basic sales philosophy be? Will you build long-term relationships with a few clients or short-term relationships with a lot of clients?
- You also need to decide how to pay your salespeople. Will they work with salary plus commission? How will you motivate salespeople to make good sales?
Consider the most convincing product or service quality for your prospective customers. Knowing your competitive advantage is essential not only to develop dynamic sales efforts, but also to develop an efficient marketing plan.
Plan a persuasive conversation that salespeople can use when talking to customers.
How to Write a Business Plan?
Bring together all the pending information to write the business plan. You have completed the difficult part of the research, decided what your business is about, targeted correctly and sold. It’s time to put together the business plan.
Prepare the draft of the business plan. Don’t get stuck with capitalization, punctuation, and grammar at first. The only thing you have to worry about should be getting the ideas right on paper.
Write down everything that should be in an effective and efficient business plan.
Arrange the business plan. Write the chapter titles and put the appropriate information under the appropriate headings.
- Title page
- Executive summary – should be written in the last section
- General company introduction
- Products and services
- Marketing plan
- Action plan
- Management and organization
- Important milestones – the most important events the company has done to date
- Business structure and capital value
- Financial plan
Recheck your business plan for mistakes. Make adjustments to the plan. Correct any errors you find. A well-written document is always better than a document with logic errors and a lot of spelling mistakes. Ask someone whose comments you care about to read and evaluate the plan.