2024 is here, and you are 100% sure (finally!) that it’s time to bring your business idea to life. You’ve considered all the pros and cons, and now you need a business plan that will outline a step-by-step pathway to success: operations to do, alternative options to consider, and profit to count.
But wait:
Some steps are still a must to take for a business owner before they sit and start writing a plan. We’ve put them together to ensure you do everything right on your way to stellar entrepreneurship.
1) Make sure you’re ready
First, see if you understand all the inner workings of an entrepreneur. How do they live? What problems do they meet? How do they organize business processes, and how do they deal with inevitable stresses?
Talk to some experts in your niche. Listen to their ups and downs or the challenges they meet and overcome daily. Visit several seminars or workshops from successful entrepreneurs. All they will help you understand if this path is right for you.
Second, check if your financial health is okay. It stands to reason you need a start-up budget, so you’ll probably consider loans or crowdfunding on some platforms like Kickstarter, GoFundMe, etc. Note that banks and investors will check your personal credit story, so repair it if necessary.
And third, get real. We all know that 90% of startups fail, so you need a backup plan even if you are sure you do everything right for business success. How long will you be able to stretch a dollar with no revenue? Will you have a chance to go back to your full-time job (if you have any)? Will your relatives, spouse, or friends support you?
2) Do research
Back in 2010, a study from J. Brinckmann and others proved that business planning improved its performance. That was also when A. Burke found out that it made a business grow by 30% faster. More than that, Small Business Economics stated that entrepreneurs who took the time to write a plan were 152% more likely to bring their ideas to life.
That’s all fine, but you can’t just sit and create a document with a detailed business plan. To succeed here, you’ll need the following information, so make sure you’ve researched and gathered it.
- Analyze the niche. Is it heavy? Who are your top competitors? What is your unique selling point or, in other words, what makes you different from competitors?
- Analyze the client. Who is your target audience? Create a buyer persona: their demographics, education, goals, challenges, shopping preferences, etc. The more you know about your ideal consumer, the better.
- Analyze your marketing strategy. What channels will you use to reach the audience? Do you have a website, a blog, business accounts on social media? Who will manage them? Will you do it alone? You might need a team to help you.
- Analyze your prospects. What are your aimed business results for a year? What do you plan to achieve in three or five years? Consider the SMART model of goal setting.
These are among the aspects you’ll need to mention in a plan when writing it for a bank or any other contributors, ready to invest in your future business.
3) Create a pitch
Taking into account all the above, you might think that business plans take tons of time to write. You got that right:
Traditional plans are about 15-30 pages, full of analyses and other details. To make the process easier, write a pitch aka your plan’s outline. It will allow you to move from abstract ideas to the core of your business strategy.
Writing a pitch reminds a thesis statement:
- You describe a business idea.
- You explain why it might be promising.
- You prove it.
In this pitch, give a short sketch of the following: the focus of your business, the problem it will solve, how it will do that, your customers and competitors, sales channels, your business model, and milestones. Don’t forget about partners, if you need any: manufacturers, suppliers, distributors, marketers, customer support team, etc.
Such a pitch will help to craft a more detailed business plan and get a clear picture of your business strategy. Feel free to read business plans from companies in your niche and use them as samples. Also, consider specific software and services that can guide you through writing.
It’s your turn
Okay, now you are ready to write a plan. There will be several drafts, you’ll revise and update it, and you’ll rethink the business model and strategy, but it’s perfectly fine. Your plan will grow with your business, so go for it!