Tuesday, April 15, 2008 Cayading: Business plan, the fundamentals By Trinidad Cayading D'Biz News
IN MY last week's column, I discussed with you the importance of business planning before investing your money to a business you wish to venture in.
Business plans can vary significantly in shape and form, although there are a few common elements you must not omit: a vision statement; a profile of your business, your products and key people; a description of the economic environment and how you intend to steer your operations through possible turbulence; a marketing plan and evaluation of competition; and a budget, including a cash flow assessment.
After completing your business plan, you will need to summarize its key points in an executive summary that will guide whoever will be looking at the documents. There are fundamentals which you will consider in business planning.
First, you must the MISSION STATEMENT, a brief statement of the purpose of your business and its goals, including the business concept you plan to adopt. Try to keep the goals realistic so as not to put the document under a cloud of doubt with the reader, who could be a potential investor or lender.
Next is the EXECUTIVE SUMMARY portion. A concise/brief of the plan's crucial contents. This section encapsulates your entire business plan and is designated for people who may not have the time to go over the entire documents, but are most likely the ones who should be informed about business. The executive summary is usually written last, after the entire document is completed.
The Business and its Management Team is also needed. It is a clear and complete description of the business you intend to set up and how you plan to go about it. It is important to state the rationale behind the businesses establishment, along with a listing of key people who will invest in or manage the business and a brief look at their prior experiences, educational attainment, leadership skills, and personal resources. The section's objective is to convince the reader that your management team is capable of leading the business and steer it towards your profit goals.
Include in this section an overview of the general economic environment in which the business will operate along with an explanation of how the management team plans to perform under these conditions. Needless to say, economic indicators will be needed for an accurate depiction of this overview.
