Top 9 Elements of Business Plan that Every Entrepreneur should Know

While 20% of newly started businesses fail in their first year of opening, only 30% of businesses celebrate their 10th anniversary. One of the top reasons why these businesses fail is “No Market Needs.”

The takeaway here is, 64% (499 out of 995 participants) of startups with a business plan made their business successful; only 43% (501 out of 1,556 participants) with no business plan achieved business success.

So, the most common reason entrepreneurs or startups do not achieve business success is “they don’t have a proper business plan.” Even those with plans either are not the researched one or not implement what they plan.

If you fail to implement your business plan, none can help you with it. Suppose you don’t have any plan or have no idea how to prepare the best plan and what elements should be included. In that case, this article can bring fortune to your business.

In this article, we shall help create an effective business plan which will include a mobile app business plan that will help you make your startups successful. At the same time, it will also help woo angel investors, get loans from banks, and adhere to fundings from lenders.

So, sit with your partners with peace of mind start jotting down the following points;

● Executive Summary — that includes the overall outline of your business plan

● Business Description — describe what you do, industry, present condition & scope

● Market Analysis/Strategies — industry research, market, and competitor analysis

● Organization and management — structure for your business & management

● Products & Services — what you want to sell

● Marketing and Promotions — describe sales strategies,

● Request Funding — capital requirements for the next 3 to 5 years

● Financial Projections — write your anticipated revenue

● Appendix — attach all supporting documents, including resume, credit histories

#1. Executive summary

Your business plan should start with the overall outline of your business. Briefly describe to your readers what you plan and how you will achieve success. Write a brief mission statement, your product, and service. Ensure that you have given brief information about company leadership, team, location, and growth plans.

#2. Business description

Provide every single detail of your company, including what problems your company will solve and whom you will serve (specify consumers, industry/organization, business, and company). Don’t just write about your business success and write your strengths that will enable you to achieve your goals. Is there any expert on your team, the right location, or something else? Mention all your strengths.

#3. Market Analysis/Business Strategies

Before you start your business, you will be required to know your industry, its outlook, and the target market. You can get through by initiating competitive research. You should know what other businesses from your industry are doing, their market positions & strengths. Explore what makes them successful, what works in their favor, and how you can do better than them.

Find these answers and start answering them.

#4. Organization and management

This section will help your readers understand how your business will function, its structure, and proprietorship — whether it will be a limited partnership, sole proprietorship, or LLC.

That means you need to describe the legal structure of your business. Show leadership, team, and employee structure — layout who’s in charge of using the organizational chart. Write detailed descriptions of every individual with an area of expertise and responsibilities. If possible, attach resumes and CVs or all members in the plan.

#5. Products & Services

If you are selling products, explain what it is and how it will help your target market. Describe its lifecycle and how it will persuade customers to buy it. If it is service, then describe how it will better serve your target market. You can also jot down your plans for intellectual property, be it copyright, patent files, or others. Explain if you are doing any research and development, such as creating, building any website, exploring potentials of any business software, or making any mobile app business plan.

#6. Marketing and Promotions

In this section, you will be writing about your marketing strategies, citing how you plan to attract and retain customers. Do not show any single way to approach a marketing strategy as there is no such way. It should be evolving and changed over time to fit your rising needs.

Describe the conversion strategy — how you will sell products and services. Keep it brief as you need to describe it in detail in later sections.

#7. Request Funding

This section is going to be very important. Outline how much funding you will require over the next five years. Don’t just mention funding requirements but also show how the organization will use those funding.

More than that, you can also specify if you are looking for debt funding or equity, whether you need funding to buy equipment or for operational expenses. At the end, show how you are planning to pay off the debts — it should be convincing enough.

#8. Financial Projections

To convince your angel investors and lenders, you need to show financial projections, letting them know that your business is stable and that their money will be paid off. In case you are already established, then don’t forget to attach balance sheets, income statements, cash flow statements, and whatever else you think will help you convince the lenders.

You can also include your business forecast — the data you have gathered during market research can help you show it. Attach forecast income statement and describe the future financial outlook for the next five years. Be clear, show projection monthly or quarterly with clear explanations of everything you want to say. You can use graphs and charts to make them more specific and comprehensive.

#9. Appendix

Finally, this section will help readers understand things clearly with supporting documents, such as credit histories, CVs, business documents, research reports, products and services photos, permits, licenses, and more. Attach everything to leave no stone unturned.

These are the elements that you need to include in your business plan. This is a traditionally inspired business plan; you can change to make it suitable for your business-specific needs. Now, we shall explore ways to write a perfect business plan.

Bonus: Things to do for writing a perfect business plan

There are many things to you need to do to prepare a perfect business plan, they are;

● Intense research

● Defining the purpose of your business plan

● Create a strong company profile

● Gather and document all aspects of your business

● Research the market, your target audience, create a customer persona

Having created a business plan, go through it, think from the lender and buyers perspective, and dig out if there is any lacking. Once you are done with everything, your business plan is ready, creates a pitch, and reaches your angel investors.