Business plan in simple terms
Binom Кraft's leading consultants explain in simple terms what a business plan is and how to create one.
Why you need a business plan
Starting a business without a plan is a bad idea. Without a business plan, you'll lose money and your competitors will eat you for lunch. So it's better to have one. A business plan will definitely come in handy, and not just once.
You will need it to
- Get funding. Every investor wants to know what will be done with their money.
- Estimate the amount of work to be done. You may decide afterwards that you don't need it.
- Turn your idea into a clear course of action.
The business plan describes all the components of the business. For example, what goods the company will sell or what services it will provide, where it will get money and what expenses it will incur, what risks it may face and how it will avoid them, what the profit will be, and so on.
Business plans are developed not only at the start of a business but also when the business is already in operation. BinomCraft Ukraine has a clear and structured business plan that helps to keep the pace and achieve results. This is necessary in order to see the current state of affairs and to update the data if necessary.
How to write a business plan
Step 1: Market analysis
The first step is to understand whether the market needs your product. Draw up a portrait of your potential customer: who they are, what they like, how much money they spend now on the same or similar products, and what they are willing to pay more for.
You should also analyse your competitors. Find out as much as you can about them: products, prices, advertising, reviews, etc. You should have a clear understanding of your competitors' advantages. This will help you decide what you need to do to beat them. You should also analyse your own project in detail. A SWOT analysis will help you to do this. Identify strengths and weaknesses, opportunities for development and threats that could destroy your business model.
Use the information you have gained from your market analysis to benefit your product.
A good marketing strategy will include sections such as
- Target audience: gender, age, marital status, income level, etc.
- Channels and methods for attracting customers.
- Pricing strategy: how much the product or service costs, what the price depends on, when it can be increased and by how much.
- Indicative sales plan.
In this step you need to calculate your income and expenditure. How much money will you need to get the business up and running? How much will you spend each month? Include all fixed and variable costs. Don't forget taxes. Include your projected turnover, net profit, sources of finance, break-even point, profitability. You can calculate indicators for different scenarios of the company's development.
The financial plan must be constantly adapted to changes in the market situation, exchange rates, etc. Your financial plan should be ready for any unforeseen circumstances and remain viable even in the worst-case scenario. BinomCraft LLC has a main financial plan and several auxiliary ones.
In this section you need to briefly and clearly describe the idea of your business. What it does, what it specialises in, what its growth prospects are and whether it will be able to make a profit. This is like a 'trailer' for the business. If they are interested, they will watch the "film", i.e. the main part of your business plan. Learn to explain your idea in a few minutes. Keep it short and to the point. This is often the only part of a business plan that people read. They make a decision based on it: whether they need to delve further into the document, or whether it's not worth wasting their time. Although the executive summary comes last, it is first in the business plan, both in order and in importance. If you are new to business or are reforming an existing company and do not know how to create a business plan, contact Binom Craft professionals and we will help you!