5 Tips to Help You Write an Effective Business Plan

By Valentine Okolo

Deciding to start your own business can be one of the most exciting and rewarding decisions you make in your life. A good percentage of new businesses fail today. This is largely due to mismanagement, poor planning and knowledge gap.  In today’s business world, succeeding in a new venture can be quite challenging and demands adequate business planning.

You need a plan in order to make your business idea a reality. If you intend to seek financial support from an investor or financial institution, then bear in mind that a formal written business plan is compulsory. Even if you don't anticipate seeking financial support, a business plan is a tool that can give you clarity about what you hope to achieve and how you plan to do it.

The planning phase is the most critical of all phases to a new business. That is because your business will either blossom or fail due to adequate or poor planning. Researching will also help you in preparing a formidable business plan.

A simple business plan will primarily include:

·         Your business structure,

·         An executive summary,

·         Products and services,

·         Market analysis,

·         Marketing strategy,

·         Management summary,

·         Insurance/Contingency plan and

·         Financial analysis. 

Writing a proper business plan should contain at least the points listed above. Please note that the points listed below are not exhaustive. They are tips considered necessary to help you with sections of your business plan.

So here are 5 basic tips to help you write an effective business plan:

1.      Decide what your goals and objectives in business are: A goal check list will help you identify objectives that need to be met in other for your goals to be achieved.

2.      Invest in proper research: The research you conduct in your small business start-up process will help you immediately figure out questions your business plan has to answer to be successful. For instance, a properly researched business plan will answer these questions amongst other questions: is there a need for your anticipated products/services? Who needs it and where are they located? Are there other companies offering similar products/services now? How much funding will you need and where will you get it? Etc.

3.       Identify what business structure works for what you intend to achieve: Your business can be a sole proprietorship, a partnership, a limited liability company (LLC) or a corporation. Your business structure will largely depend on the type of business you want to venture into, the type of audience you intend to reach, the kind of funding you require etc.

4.      Outline your marketing strategy: This section outlines where your business fits into the market and how you will price, promote and sell your product or service.

5.      Include a market analysis: The market analysis section of your business plan should provide a detailed overview of the industry you intend to sell your product or service in.

Article By Valentine Okolo