If you came to the conclusion, the proposal to improve labor productivity to obtain a better salary from the previous section is not your cup of tea, maybe plan B is more your style.
You still have to work hard first, but you might have a greater influence on your own salary – by starting your own company. Thereby you need a plan B – B for ‘Business plan‘. I asked an acquaintance of mine who sits regularly on the other side of the table, when young entrepreneurs present their business-ideas to obtain a start-up funding.
I started asking him “regardless of the type of business, what do you expect from a business plan?”
First, even the best business plan is no guarantee for success. But a good plan can make the difference between success and failure.
Many business plans are a little over the top, since entrepreneurs see a business plan more as a marketing tool with strategies and projections they hope to convince investors the business makes sense. This is a mistake.
A business plan should convince the entrepreneur himself. (after all it’s time, efforts and money that’s on the line).
So, at a minimum, a business plan should be as objective and rational as possible. A good idea can still lead to failure because of competition, insufficient funding, or a nonexistent market.
The business plan should serve as a guide to the business’s operations for the first months or years and give answers to the following questions.
- what’s the company’s purpose
- the management responsibilities
- personnel requirements
- marketing plans
- current and future competition
No fantasies please, a business plan should be convincing and provide concrete evidence that the business idea is reasonable.
“How long should a business plan be?”
Less is more. A good idea can be explained in a few sentences.
“If you can’t fund your business yourself and approach investors. How does a business plan have to be structured?”
A comprehensive business plan have 3 sections
- business concept
- financial information
These sections are broken down into 7 components
- summary of the plan
- description of the business
- market strategies
- competition analysis
- design and development
- operations and management
- financial information.
After the title page, investors expect a ‘summary’ that should tell clearly, what the entrepreneur wants. No investor will read the whole plan to find what the business owner desires on a footnote on page 34.
After the ‘summary and the table of contents, a business description should follow with the respective Industry: Present situation, near term outlook and possibilities in the future. Next step should be an in-depth market analysis followed by a convincing research of competitors with their strengths and weaknesses. Investors like to read, how you plan to exploit a weakness of a competitor to your advantage.
A business plan should close with an operations- and management plan to describe how the business is working on a continuing basis and a financial forecast that proofs, a business owner know how to project and running a business.
Last but not least – a business plan is a professional document; it should look like one. Concise language, correct figures, no typos and quality paper is a must.