Before we embark on the sample small business plan, let me emphasize that a good business plan consists of an explanation of what your business will entail and several financial worksheets of the prospective business. Your business plan can take any form or shape according to your preference provided it gives a clear picture of a well researched plan of future activities of your business.
Remember the real intention of a business plan is not to have your finished product at hand but rather is to enable you to do an extensive research, critical thinking and planning on your business idea before it becomes a business. Such a process will help you avoid some very costly mistakes you might have overlooked.
Never make the mistake of sitting down with a paper and a pen and start drawing your business plan and you are through in two hours. A good and comprehensive business plan may take you several weeks or months to complete where writing the plan on a paper takes less than 25% of the time.
So, where is most of the time spent? Answer is on both research and critical thinking. Why on both? Because, as you do your research on the idea, you will realize that the reality out there in the market is different from what you initially planned whether be it marketing plan or financing plans etc. These will force you to rethink and improve your strategies and assumptions. This effort is worth taking as it could save you a mistake worth millions. Always keep notes of your rough draft business plan whenever an eventuality rises up. You will need that in your final copy.
I am going to give a step by step general outlay of a business plan suitable for any type of business but you can modify the plan according to your business type. It is worth noting that a business plan should be presentable to the many stakeholders who will be interested in your business plan especially the financiers.
Sample small Business Plan-Executive Summary
The Executive summary summarizes the fundamentals of the proposed business. What will your product be? Who will your customers be? Who are the owners? What do you think the future holds for your business and your industry?
State how the business will be funded and if funding will be from borrowed money, state briefly the repayment plan and capacity of the business.
This should be brief, concise, written in non-technical language, and professional looking. A page or two is enough for this description. This is what most stakeholders are keen to look at and it gives a clear picture of how you view your business.
Sample small Business Plan-Business Description
This will describe the type of business you will be doing. This is what companies call a mission statement. Be brief in describing what the business will be doing, state the goals and objectives your business wants to achieve, and maybe state a forecast of timeframe of achieving your goals.Also state the guiding principles of your business and what it stands for example upholding the dignity of customers. State whether your business is a sole proprietorship, a partnership or a limited liability company.Briefly state you target market/niche. There is no need to expound a lot on this as you will do that on the marketing plan. State the uniqueness of your business compared to other competitor businesses in your industry. This is simply what people call competitive edge/strengths for example pricing, quality of service etc.
Sample small Business Plan-Products and Services
A detailed description of the product you will be offering is required so as to give a clear picture of what you are offering. Expound on the uniqueness of the features of this product as compared to those of your competitor. Examples of such features can be, easy to operate, durability, etc.Another important thing to state about your product is the benefit it will bring to your customer for example health improvement etc.Also, State the pricing of this product and the after-sale services you will give. Some examples are free delivery, warranty, service contracts, support, follow-up, and refund policy.
Sample small Business Plan-Marketing Plan
Remember as I told you, market research takes most of the time in your business plan. To begin with, take a critical look at the product you intend to bring into the market. Do an analysis of the product and how much a unit of the product will cost you to produce. This will help you know the minimum price you can tag your price. In return, this helps decide which target market/niche is willing to pay that price for the product.
Now, after deciding on the target market, the next most important thing is to do a thorough research of your target market. Search for all the information you can get about this target market in newspapers, magazines, trade journals, government agencies etc.
Identify your targeted customers, their characteristics, and their geographic locations, otherwise known as their demographics such as Age, Gender, Income level, Social class and occupation, Education etc.
Such information helps you to understand the lifestyles of this niche especially taste and preferences hence enabling you to plan on how you will package and present your product to them.
The other important thing that this research will help you understand is the location and size of the target market. This helps you set realistic goals and strategically locate your business near your target market.
Remember to also do an exhaustive research on your market competition. What products and companies you will be competing with. It is advisable to list your major competitors and state their competitive edge over you.
After an exhaustive market research, state clearly the marketing mix you will be using to capture this target market.
Sample small Business Plan-Industry analysis
Gather all the Facts about your industry
What is the overall size of your market?
Current demand in the target market.
Current trends and developments in target market-growth trends, trends in consumer preferences, and trends in product development.
The Growth potential business of your business
The entry barriers for a new business into this industry.
High initial capital requirement
Tariff barriers and quotas
high level of training and skills required
High production costs
High marketing costs
How will you overcome the barriers?
The risks facing this industry and how they will affect your business.
Change in technology
Change in government regulations
Change in the economy
Change in your industry
Sample small Business Plan-Financial plan
The financial plan will act as the budget plan/forecast. This plan allocates future income estimates to various types of expenses, such as rent or utilities, and also reserves some income for short-term and long-term savings. There are three primary financial statements in a financial plan: The balance sheet, income statement, and cash flow statement.
Sample small Business Plan-Financing plan
While a financial plan refers to estimating future income, expenses and assets, a financing plan or finance plan usually refers to the means by which your business will be funded will be acquired to cover future expenses, for instance through earning, borrowing or using saved cash.