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Important Tips In Writing A Business Plan

Jun 16, 2008
Creating business plans is one of the first skills a budding entrepreneur/businessman must learn. It can be a hard skill to learn but this is a fundamental skill to acquire if you want your business to succeed. To ease your way into learning how to write a business plan, remember these following tips:

Write from the point of view of your audience. Your audience's perspective is what you should use when writing a plan. It should be able to answer questions about the plan's purpose, avenues for funding, etc.

Make a detailed market research. Prospective entrepreneurs must know all the facets of their market. This can only be done by doing a thorough research to find the relevant information you need.

Be aware of your competition. Understanding the competition is one of the most important aspects of accurately getting a feel for the business environment. Try to determine the level of competition in the market you want to enter as well as in which specific areas of your market you want to compete in. But most importantly you should be able to answer in your business plan is: Can I compete with the players in my market?

Pay close attention to detail. A good business plan is a concise plan. But don't be concise at the expense of leaving out important details. Be sure to leave enough sufficient information so that anyone who reads your plan can still make informed decisions. A good business plan is also a professional-looking plan. Your business plan reflects on you so make sure that there are no spelling errors, make credible predictions and realistic assumptions.

Highlight the opportunity. If you are going to use your business plan in order to get funding you must be able to clearly point out the investment opportunity. The plan should be able to answer an investor's question of "why should investing in your business be a better choice than investing others?" Describe the Unique Selling Proposition (USP) of your business.

Cover all the important sections in a business plan. Research on what sections a business plan should contain. A good business plan should be able to address all of the various data viewing iterations that a reader may ask for. Don't be afraid to show charts and spreadsheets to help illustrate your point.

Ensure the accuracy of your data predictions. Make sure that your financial data is accurate, realistic and conservative. If you are not that math-savvy ask for the help of someone who is. A simple cash flow and break even chart can be a big help to readers, especially prospective investors.

Don't forget the executive summary. The Executive Summary is the most important part of the business plan. This section basically summarizes the entire plan and is a great aid for investors and/or readers who are pressed for time and want a "synopsis" of the plan. As a corollary to the Executive Summary, you should also prepare an "elevator pitch" which is a short overview of your product/service's key benefits.

Review the plan. After having completed the business plan, have someone independently review your work. This check and balance process ensures that the end product is of a high quality and will pass muster when given to people, especially investors. That review doesn't end with the end-product though. Periodically revisit your plan and update as necessary to reflect the realities of your business.
About the Author
Stella Stevens has created and overseen many Business and comments on a Online Company Formation service called Dolphin Formations.
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