A business plan describes short and long-term goals for a business with strategies to achieve them. Some basic components of a good plan include an executive summary, documentation, and well-researched plan of action. Jack Welch significantly grew General Electric in the two decades he was CEO. After retirement, he began a successful business school. His business trajectory reveals the necessity of a solid business plan.
Here are five tips for a good business plan:
1. Precise Business Summary
The key element of a business plan is a clear summary. The first two pages should have basic details required for the business such as the type of company, monetization method and reasons for customers to pick the product or service on offer.
2. Set up Market Expectations
After the summary, tackle the following questions:
- Market size of targeted customers
- Chance and pace of growth
Understanding the company’s value-added services/products and preparing for unforeseen situations is a must.
3. Address Business Rivals
While setting up a business, be aware of competition in the same space and study how they run their business. This will help strengthen the product on offer so it can succeed and dominate the market.
4. Business Execution
Once the plan is set, it is necessary to determine how the business will be run. This includes picking a team with the right qualities to work on the product and capable of handling strengths and weaknesses.
5. Estimate Possible Revenue
Address the earning capacity for a start-up business and if it is an established business, then try to understand the financial situation of the company.
A well thought out business plan requires time, effort and money. Always keep in mind, potential investors may not have time to read lengthy documents and prefer crisp analysis. A good plan is the first step to business success.
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