A formal business plan is required when it is necessary to formally assess the future of the business. for example: to secure financing; attract an equity partner or investor; embark on a major change to the business; or when starting a new business venture.
The plan specifically details the direction and goals of the business and the strategies and tactics that will be used to achieve them. Essentially it become a flight plan for the business stating how the business intends to get from A (where it is now) to B (where the owners want it to be).
The plan should summarise the due diligence performed in developing the plan, highlighting what is known about the current situation, assumptions being made, and who/what/how/why action plans.
A formal business plan may be short document consisting of just a handful of pages through to a document the length of a book – it all depends on nature of the size and nature of the business. Regardless of size the typical formal business plan will cover such topics as:
- Assessment of the environment in which the business will be operating (including but not limited to: market; competition; customers; regulations)
- Assessment of the current business (including: business structure; team; performance; strengths; weaknesses)
- Description of the products and services that will be offered to the various segments of the market and methods of distribition
- Vision and goals
- The strategies and tactics that will be used to achieve these goals (including: marketing; sales; production; design and development; service and support)
- The financial projections (including profit forecast, balance sheet projections, cash flow projections)
- The risks that might threaten the plan, together with appropriate mitigation.
Business Clarity has worked with many clients to develop formal business that have assisted our clients in attaining finance, partners and chart their way through major expansions.
Should you and your business require a formal business plan then please call to find out how we can assist.