Business Plans Help You to Run Your Business

Business Plans Help You to Run Your Business

A good business plan guides you through each stage of starting and managing your business. You’ll use your business plan as a roadmap for how to structure, run, and grow your new business. It’s a way to think through the key elements of your business.

Business plans can help you get funding or bring on new business partners. Investors want to feel confident they’ll see a return on their investment. Your business plan is the tool you’ll use to convince people that working with you — or investing in your company — is a smart choice.

Pick a business plan format that works for you

There’s no right or wrong way to write a business plan. What’s important is that your plan meets your needs.

Most business plans fall into one of two common categories: traditional or lean startup.

Traditional business plans are more common, use a standard structure, and encourage you to go into detail in each section. They tend to require more work upfront and can be dozens of pages long.

Lean startup business plans are less common but still use a standard structure. They focus on summarizing only the most important points of the key elements of your plan. They can take as little as one hour to make and are typically only one page.

Traditional business plan format
You might prefer a traditional business plan format if you’re very detail-oriented, want a comprehensive plan, or plan to request financing from traditional sources.

When you write your business plan, you don’t have to stick to the exact business plan outline. Instead, use the sections that make the most sense for your business and your needs.

Traditional business plans use some combination of these nine sections:
•Executive summary
•Company description
•Market analysis
•Organization and management
•Service or product line
•Marketing and sales
•Funding request
•Financial projections
•Appendix

Lean startup format
You might prefer a lean startup format if you want to explain or start your business quickly, your business is relatively simple, or you plan to regularly change and refine your business plan.

Lean startup formats are charts that use only a handful of elements to describe your company’s value proposition, infrastructure, customers, and finances. They’re useful for visualizing tradeoffs and fundamental facts about your company.

There are many versions of lean startup templates, but one of the oldest and most well-known is the Business Model Canvas, developed by Alex Osterwalder. You can search the web to find free templates of the Business Model Canvas, or other versions, to build your business plan. Here are the nine components of the Business Model Canvas:

•Key partnerships
•Key activities
•Key resources
•Value proposition
•Customer relationships
•Customer segments
•Channels
•Costs structure
•Revenue Streams

Source: www.sba.gov

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