Business plan

Why you need a business plan

Your business’s roadmap to a successful future 

As Warren Buffet famously once said: “An idiot with a plan can beat a genius without a plan”; a business plan together with accurate and a realistic financial forecast will set you on a path to success. These are essential tools in helping you to grow your business.

Avoid or limit potential risks

You should be able to use your business plan to continuously evaluate whether your business goals are being achieved and whether you are on course to hit your targets. It will also allow you to identify any potential weaknesses and risks.

Help in raising funds

Many businesses require funding at some point and a business plan will allow you to demonstrate that your idea is profitable as well as allowing the lender to better understand your business, vital in securing the funds you need. 

The main elements of a business plan 

The content of your business plan will be unique, and tailored to the individual needs of your business. But structurally, business plans will often include the following components:

Executive summary

This part of your business plan sets the scene, gives context to the rest of the plan, and enables you to capture your audience’s attention. The executive summary should highlight the strengths of your plan and explain why the company’s strategy will be successful. Ideally it will also showcase how the new business idea differentiates you from competitors. 

Business description

Here you can provide much more in-depth information about your company, describing its competitive advantages and what makes it unique. 

Market analysis

In order to become successful in your chosen sector you must know who your competitors are and how you are positioned in the market. You also should be able to describe your target market, and the characteristics of your ideal customers. For the market analysis, you might also want to carry out a SWOT analysis to identify potential strengths, weaknesses, opportunities and threats affecting your business. 

Organisation and management

This is where you will describe the structure of the company. Where relevant, you might also cover your team and how they will contribute to the success of the company. 

Goods and services

Here you should provide a thorough description of the products or services you intend to be selling. It is another opportunity to showcase the uniqueness of your product and how it differs from what competitors’ offerings. 

Marketing and sales strategies

This section will describe your strategy for growth. You should also include a discussion on price point and promotional strategies.

Financial projections

This is where a detailed and realistic financial forecast comes into play. This section is where you ‘marry’ your market analysis with the company goals and translate these into money. You will need to demonstrate that the company is capable of making a profit, and the forecast should be based on realistic numbers.