Click here to read part 1 of "Writing a Business Plan"
This should include an in-depth description of your company's sales, pricing and marketing strategies, and the benefits of your products and services. As you begin to develop your Marketing Plan, refer to the market research you undertook when writing your Competitive Analysis.
The Products and Services portion of your Marketing Plan must focus on what you consider to be unique and how your clients will benefit from your products or services. Consider these questions while reviewing these facets of your plan:
- What are the main attributes of your product or service and how will they differentiate themselves from your competitors?
- How will your clients gain most from your product/service—include tangible and intangible advantages.
- What sets your products/services apart from all others? The uniqueness of your product/service is really the heart and soul of your marketing plan and you must communicate this information to your clients.
This section should describe the physical requirements of your operation—the location, including equipment and facilities. It could also include information on inventory, suppliers and a brief description of your manufacturing process, but all that would be contingent upon the business type. If you remain focused on the bottom line, then it will be easier to coordinate this section of your business plan. This section should be looked as an outline of the capital and expense requirements needed to conduct business on a daily basis.
It’s best to split this section in two parts—Stage of Development and Production Process.
Under the Stage of Development, discuss how your product will be made and identify any possible production issues. Indicate that you are aware of industry standards and actions you have taken to comply with applicable regulations. Also, provide information about your suppliers and any alternatives should your supplier of choice become unavailable. Detail what quality control measures you plan to establish.
In the Production Process section, describe details of the day-to-day operations of your business, plus the size of your location and type of premises. If applicable, detail any necessary equipment (plus worth and costs) and list your assets—buildings, equipment, furniture and inventory, etc.—including their worth. List any special requirements, production and inventory costs, materials, plus detailed product cost estimates.
Although the Financial Plan falls at the end of your business plan, it communicates whether or not you have a viable business idea. It is also a key factor in establishing whether your business plan is likely to attract investors for your business objective. The financial plan should include three financial statements—income, cash flow projections and a balance sheet—along with a brief analysis of each.
Break down your business expenses into two categories, start up and operating expenses. Any costs needed to start your business are expenses and should include at least: business registration, licensing and permits, inventory, down-payments of property or equipment and utility set-up fees.
Operating expenses that keep your business running should minimally include: salaries, rent/mortgage, utilities, telecommunications, storage, distribution, loan payments, promotion, office supplies and maintenance.
Your income statement should indicate your revenues, expenses and profit for a certain period. You will need to be guided on a template to explain how you should set up the income statement
The cash flow projection will show the amount of cash anticipated to be generated or spent over a specific period of time. It also indicates how you plan to manage your cash flow and will help you understand the amount of capital investment you need for your business idea.
The cash flow projection includes three parts—cash revenues: submit your estimated monthly sales figures; cash disbursements: list the per-month cash expenses you have estimated; and reconciliation of cash revenues to cash disbursements: add the current month revenues to the previous month’s balance and deduct disbursements from the current month. The adjusted balance will be deferred to the following month.
Finally, the balance sheet will indicate the net worth of your business at any given time. It will also summarize the financial data and divide it into assets, liabilities and equity. In effect, you will create a balance sheet aimed at summarizing all information included in the income statement and cash flow projections. In reality, a balance sheet should be prepared once per year.