You’ve got an idea for a business and you want to make it happen. But, before you open the door and welcome your customers, you’ll need a plan. Creating an official business plan is the first step to making your business come to life.
A business plan is a strategic document that gives your business a path to success. It includes the concepts and ideas your company is being built on, the goals you have for its future, and the tools you’ll use to get there. Having a well-prepared business plan can help you get investors, hire employees, and stay on track. But, before you get writing, there are a few approaches to consider that will help you build a document that will support building your business.
Know what you need from your business plan
It’s important to identify what you’ll be using this document for because, for successful businesses, this plan is what your company will live by. Your business plan is what will hold you accountable for the milestones you’re hoping to hit.
Identifying what you’ll use your business plan for, will help you determine what information you’ll need. If you’ll be using this document to attract investors, be sure you’re prepared to expand upon sections that talk about your financial plan, value proposition or marketing strategy. If you’re using this document as a business roadmap, then be sure to think through your one, three, and five-year goals for the company.
Set yourself up for success
Whatever goals you put in your business plan, be prepared to follow through. Don’t set yourself up to fail with aspirations that are too lofty. Be honest about what you can achieve and document your steps to get there.
Business plans should be simple, easy to read and to the point
Don’t dance around your ideas; people want to get a sense of your business right off the bat, so be direct. Use simple language and make sure your ideas are expressed clearly.
It doesn’t have to be a book
This document doesn’t need to be long and drawn out. Shorter statements, lists and bullet points can help you make the information you’re providing digestible and accessible.
Think about the money you’ll need, and how you’ll get it
It’s no secret that starting a business is expensive. In order to get off the ground, you need to be ready to spend. That starts with identifying how much you’ll need. The more specific you can be with how much you’ll need to get started, the easier it will be to determine what sources will make the most sense.
And, once you’re strapped for cash, it will be too late to strategically think about where your funding will come from, so a business plan should document the channels you’re prepared to use. Are you willing to take on a partner if it means he or she will have a hand in how the business is run? Are you comfortable with investors who ask for board of directors’ membership in exchange for their buy-in? Will you only use traditional, bank lending options? Be sure you think through your financing as much as possible so that when you start to feel the pressure, your business plan will help you keep a level head.
Let your business plan tell you if it’s meant to be
Above all else, this document will help you determine if your business has a fighting chance and, when all is said and done, if you actually want it to. Putting in the preliminary work helps you see if your plan has the potential for economic success. Does this idea have the solid foundation to come to life? Will this business become profitable?
But, it also allows you to ask yourself: Will you be on board for this to be your life? Your business plan lets you reflect on what kind of expectations you’ll have for yourself as a business owner. Running your own business can blend your personal life with your professional, so a good business plan should also let you imagine what your future as an entrepreneur might look like. Do you like what you see?
Running a business is a challenge. That’s why Wintrust is proud to offer a variety of tools and services to help support you.