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Outlays of a Business Plan

ArticleID 130  
Writer Isaac Thuku
Category Personal Article

In some ways, a business plan is a collection of plans. Not all business plans are the same. What is in a business plan depends on the type of business. It also depends on whether it is a new business or one that has been going for some time. A business plan should contain details about the business, management, the market, marketing plan, resources, financial report and business prospects.

A business plan should start with the name and address of the business. For new, businesses, there should be an explanation of the idea and why the business is being started. An existing business should provide a short history of the business and an account of its past performance. This should also show a statement of the business objectives.

The business plan should explain ownership of the business, whether it is of a sole trader, partnership, public or private limited company. A firm’s management structure should comprise of the main shareholders. It is important to state the amount of experience the owners or senior managers have.

A good business plan needs to show what market research has been done, the customers and where they are located, either local, national or international. It should show the competition, if any-how strong it is and where it is located. The products should be shown and explained why they are different from the competition. The plan must include the potential for growth and how it can be achieved.

An analysis of the strengths, weaknesses, opportunities and threats (SWOT) of the business should be illustrated. The marketing strategy should show how the product is to be sold, the marketing mix and the cost of each part of the marketing plan.

A business plan should show the size and kind of premises needed, the number of employees and the kinds of skills that are needed. For a manufacturing business, the plan needs to show the production methods used. An outline of growth and estimates of probable future resource needs is important.

The business plan entails start-up costs for new businesses and detailed estimates of running costs. A financial report shows main sources of revenues, the amount of capital and who owns it. It lists details of existing loans and how they are being repaid. A business plan gives an estimate of future revenues and costs, also capital needs including new loans and how they can be repaid. There is also a cash flow forecast and the most recent trading profit and loss account and balance sheet for the firm. A break-even analysis may also be included.

Business prospects give an estimate of the firm’s prospects over three to five years. The estimate must be based on facts as evidence that the prospects are realistic. Potential investors need to see a well designed and accurate business plan for them to be interested in funding your business enterprise. Your budget should be logical and your reason for calling in investors should be radically strong.

Outlays of a Business Plan
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