3 Questions to Help Create a Smart Business Plan
Do you have an amazing idea for starting your own business? If you’re like many entrepreneurs out there, the business plan in your mind might look something like imagining what you’re going to sell, when you’re going to leave your 9-5 to get started, and how you might find ideal consumers or clients for your business. Tracing all the possibilities in the back of your mind can be exhilarating, but so many business owners end up getting lost in the details without a clear, well-structured business plan to set them on a path to success.
You see, these big picture ideas of what your business could be are just the beginning. In order to create long term success, you’ll need to put together a comprehensive business plan that includes a roadmap for the next three to five years, an in-depth understanding of your target market, and a strong financial foundation based on sound financial data and forecasting. Sounds a little tedious, eh? Don’t worry! We can help!
Writing a smart business plan can be a daunting task, but asking yourself these three key questions will help you get on the right track!
What does your business do?
The first step in creating a solid business plan is to spell out what exactly your business does and the value it provides to your consumers. In your business plan, you’ll need to include an executive summary, a company description, and a section on organization and management. Let us explain some ways to think about these sections.
The executive summary should be a brief introduction - no longer than a few sentences - describing your company’s mission, products and services, and leadership structure. Your company description provides even more detail. Here, you will explain the problems your business solves, who your customers or clients will be, what your competition looks like, and the long term financial goals of your business. The section on organization and management is even more in-depth. This is the type of information you might provide if you are considering bringing investors into the mix. This section should include the legal structure of your business, the fine details of who is on your leadership team and why, and how your company is organized internally.
How will you sell your product or services?
Once you’ve established what your business does and how it will be set up, it’s time to consider how your business is going to generate revenue. A smart business plan includes detailed information about your services or product line, demonstrates a clear understanding of your target market, and provides a strategic marketing plan to target that audience.
While writing this part of your business plan, you will need to consider how your product or service benefits your consumers and be able to explain any research and development you’ve done or plans for copyrights or patents. You’ll also want to provide a snapshot of your competitors, what makes them successful, and how your business stands out from the rest. Lastly, you’ll propose a marketing strategy that is designed to grow and evolve with your business over time.
How much cash do you need to start your business?
When it comes to running a successful business, cash flow is king! This last question proves to be the most difficult for many new business owners, simply because projecting business finances can be really hard work. In fact, we recommend working with experts to generate reports that will give a well-rounded and realistic forecast of your business’s current or future success.
Whether or not your business plan includes a funding request for others, starting a business costs money. So, it’s helpful to do this step even if it feels like you’re making a funding request to yourself. If your business is already established, include income statements, balance sheets, and cash flow statements for the last three to five years. If you’re just starting out, you’ll need to forecast using market data instead. Here at Fireside Bookkeeping, we can help you generate these documents and forecast for the future! Then, we can help you stay on track with great bookkeeping practices that boost your profits in the long run.
Want to learn more about how the experts at Fireside Bookkeeping can help you develop your plan and work toward your business goals?
or Schedule a free Discovery Call here: https://bookus.page/Fireside/judahkosky/discovery-call