A business plan is a roadmap of how you will execute your business strategy. Therefore a business plan is the fundamental strategic document which will guide each and every member of an organization to focus on the most important tasks the organization has to perform to meet its intended target or vision.
Each business plan starts with a brief summary of the micro and macro environment the company operates in. It can also borrow aspects of market and profitability projections from the feasibility study as well.
Major Elements of a Business Plan
The core of the business plan talks about the three most important functions of the business – the operations, finance and marketing.
- Operational Plan
The operational plan lists all the policies and tasks that will need to be performed on a daily basis to create a product or a service. It will deal with the resources needed including machinery, raw materials, labor, etc in order to manufacture the product or provide a certain experience to its customers.
The operational plan revolves around delivering the key success factors (KSF) needed for the business to succeed. Sometime, because of the operational plan or an operational capability, the company might also have a Unique Selling point (USP) which is detailed in the plan as well.
The operational plan will also include a detailed human resource plan with an ideal organizational structure complete with hiring, training and development plan of the employee as well.
- Financial Plan
The financial plan deals with the three major financial functions that the company has to perform. The first one being how to finance its operations. To operate, the business will have to invest in certain fixed costs and will have to bear periodic costs.
The financial plan will direct the executive team on how to finance such resources. Will it be through 100% equity or will there be a debt component included. It will also talk about how the company plans to raise the debt of the needed equity.
The financial plan will also include a projection of income and expenses. For this projection the market size and average ticket size (amount spent per purchase by a single customer) is assumed based on feasibility study or other secondary data that may be available.
Another aspect of a financial plan is to allocate budget for different company functions or objectives. Do we allocate a budget for growth? Do we allocate extra budget this year for marketing?
This leads to the last part of the business plan component – the marketing plan.
- Marketing Plan
The feasibility study would have provided the company with some insights on who is the ideal customer segment. Based on this a marketing plan would detail how the company would reach the target market so that they can sell their product and services to the company.
This is where the Unique Selling Point (USP) of the product / brand or company is discussed in detail. The plan will also direct on which media platform to focus on to reach to the company’s target audience.
Apart from the above major elements, a business plan can also have the following components:
- Business Model
- Revenue Modeling
- Cost Structure
- Key Financial Indicators
- Marketing and Competition Research
- Financial Projections and Risks
- Human Resource Plan
- Capital Structure Plan
- Management Plan
Who needs a Business plan?
Likewise, Business plan needs may be totally different when you are a startup or when you are a mid-level corporate. Therefore a business plan is needed to every kind of business as mentioned below:
- Early stage Entrepreneurs
- Small Business Owners
- Medium to Large companies
- Non-profit organizations or Governments
Whatever your objective or the stage of your business, Nabil Investment corporate advisory services taps into its pool of experts to help you create a custom Business Plan to execute your business strategy.
Contact us Today.