Creating a business plan is an important phase in any business because it serves as a guide for your future plans and your strategies to achieve them. It’s also the document you show to investors and business partners. Make your business credible by understanding a business plan’s purpose, learn how to use it to achieve your goals, and who should be part of preparing the whole document.
What is a business plan?
A business plan is a formal document, usually 5-10 pages long, that includes details about your business or business idea. It is not as simple as putting everything your business does and what it sells, but it’s more of an overview of how your business works. That is why there are one-page business plans.
To be exact, it should include your products, your marketing strategies, and most especially, your financial projections. It also includes milestones and goals (whether short-term or long-term) and plans to reach those goals. Even if these seem a handful, you should not end up writing a term paper or a thesis report.
The goal of a business plan is to serve as a guide for everyone in your company. Since it contains the vision, it should remind your employees of what the company stands for and at the same time, it has concrete plans on how you achieve that vision. However, it is not limited to being a roadmap. Depending on how you write it, a business plan can help sell your products to suppliers and buyers, or it can help you get the attention of investors and possibly, get business partners in the future.
Who should be involved in writing a business plan?
Before you delve into the actual writing of a business plan, you first have to brainstorm about the strategies that you will take. The simple answer to who should be involved in the people who will be accountable for executing the strategies in it. If there are a lot of managers in your company, it would be best to just involve the heads of departments to avoid overcrowding and overcomplication. These are the people that should be in your business plan meeting.
There are many reasons why the CEO is an important member of the business plan preparation. First of all, he knows the business more than anyone. The direction, the vision, the product, would have come from him and this makes him more knowledgeable than anyone else. Second, he would know how to better command his whole team. Because he’ll be thinking of the whole strategy, the CEO will also know in advance if his idea is feasible and realistic.
Chief Finance Officer
A business plan always has financial projections. If you are presenting to investors, it’s important that it includes the return on investment (ROI) and the timeline for the company to generate profits. The CFO will be the head of all the computations and he can provide computations based on best- to worst-case scenarios.
Chief Operations Officer
The COO should take part in the business plan preparation because he will be providing input regarding the overall operations. The supply chain can make or break a business because it manufactures and delivers the product you will be selling. He will also give ideas on how to maximize resources to ensure that costs remain low.
Aside from the finances and the operations, another important part of your business plan is the marketing strategy. How do you plan to get sales? How will you be branding your product? In this way, you have an idea of the direction of your product in terms of reaching out to customers. This can also serve as your guide to checking how much marketing has been done over a certain period.
Some businesses prefer having a consultant when they prepare a business plan. This is because consultants can give unbiased opinions where they do not defend or put their department in a good light. A good consultant can give valuable input regarding the feasibility of your idea based on the market, financial projections, and strategies.
These people are vital when it comes to creating your business plan. There will be some who encourage that the CEO should do it himself; however, a good set of brains is a good way to see the whole picture. It gives input from different points of view, and it ensures that people holding high positions understand the direction the company is taking.