When it is time to write a business plan, entrepreneurs are faced with their first…
Basic Rules for Writing a Business Plan
It is safe to say that every successful business has a business plan because of its importance in planning for growth and finding investors. However, understanding the need for developing a business plan is not the same as writing a business plan. It is the proverbial point where the rubber meets the road.
Before a single word is written, it is important to understand the basic rules of development.
These are guidelines that apply to every business plan.
1. Be Concise but do not Sacrifice Quality – There are companies trying to sell the idea that a two-page business plan is ideal. That is not true. There is no way to fit all the information about starting or growing a business in a one or two-page document. A business plan is not the elevator pitch. However, the business plan should be concise and only cover relevant information. One of the reasons many business owners use business consultants to develop their business plans is because the owners do not know how to be concise. They are excited about the new business but lack writing skills. Busy investors and bankers do not have time to wade through an excessively long business plan.
2. Use Language the Reader can Understand – You would not write a business plan in Spanish for English readers. Why would you write a business plan that uses technical terminology that has no meaning to the typical reader? Use terminology that people can understand. It is more important to get the business model and concept conveyed than to try and impress readers with technical specifications and jargon.
3. Include all the Standard Sections as a Minimum – All quality business plans include the executive summary, company description, products and services, target market, marketing and sales plan, management team, operating plan, and financial plan. There is also supporting documentation like graphs, charts, legal forms, and so on. Each business plan should be customized. Minimum information is required, but it takes knowledge and expertise to understand the additional information that should be included to make a complete, quality document. For example, if a business is building a small manufacturing plant, a section on design and construction might be needed.
Each business plan should be customized to fit business needs. Experienced business plan writers can simplify the process because they have the knowledge needed to make a decision about the information that should or should not be included. They can also provide invaluable assistance with financial statement preparation, one of the most difficult sections for many people. The end result should be a professional, high-quality document that reflects the true nature of the business.
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