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Writing business plans


writing business plans

consider options to bring in additional cash. Investors put an enormous amount of weight on the teameven more than on the ideabecause even a great idea needs great execution in order to become a reality. If you need to send a bill to your customer and then your customer takes 30 or 60 days to pay the bill, you dont have the cash from the sale right away. 9) Appendices and Exhibits In addition to the sections outlined above, at the end of your business plan you will also want to include any additional information that will help establish the credibility of your business idea, such as marketing studies, photographs of your product, and/or contracts. Sales forecast Your sales forecast is just thatyour projections of how much you are going to sell over the next few years. Business financials for most startups are less complicated than you think, and a business degree is certainly not required to build a solid financial forecast. Its when you publish useful information, tips, and adviceusually made available for freeso that your target market can get to know your company through the expertise that you deliver. If you lack the ability to perform a key function, include this in your business plan. After all, this section is a summary of everything else, so start writing the Opportunity section first and come back here last. For example, if you are marketing lawn care to busy professionals, you may be saving your customers 1 hour/week. For example, a restaurant may pay special attention to the number of table turns they have on an average night and the ratio of drink sales to food sales. For service businesses, this can also be called Cost of Sales or Direct age of faith middle ages essay Costs.

To ensure that you are solving a real problem for your potential customers, a great step in the business planning process is to get away from your computer and actually go out and talk to potential customers. The classic example is a shoe company. This will then leave you with your total cash flow (cash in minus cash out) and your ending cash starting cash cash in cash out ending cash). Dont fall into the trap, though, of defining the market as everyone. Cover the key highlights of your business, but dont into too much detail. Investors will want to see that you understand what needs to happen to make your plans a reality and that you are working on a realistic schedule. The management team chapter of your business plan is where you make your best case that you have the right team in place to execute on your idea.

Remember, your goal is to keep your business plan as short as possible, so too much detail here could easily make your plan much too long. Structurally, it is the first chapter of your business plan. Some investors even go as far as to say that they would rather invest in a mediocre idea with a great team behind it than a blockbuster idea with a mediocre team. This is where you will describe in detail the problem that youre solving, your solution, who you plan to sell to, and how your product or service fits into the existing competitive landscape. These details are especially important to investors as theyll want to know whos behind the company and if they can convert a good idea into a great business. (In the case of a new business, this last document will be a cash flow projection.) The instructions on writing the Financial Plan section will show you how to prepare all of these documents.

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