Starting and building your own business can be overwhelming. And while many business owners cringe at the mere mention of drafting a business plan, it is a great exercise to get your business back on track and to plan for future growth. More specifically, it forces you to map out where you are now, where you need to go and most importantly how you plan to get there. If you are a first time business owner, or have never written a business plan, you may not know where to start. Our friends at Corporate Tax Network have helped thousands of business owners meet their goals through financial and business planning strategies. Below is their list of the Top 10 Questions Every Business Plan Should Answer.
1) What is the need that your business exists to satisfy?
- Every business exists because of some noticeable opportunity that you have discovered within the market. So you must clearly define the need and/or problem you are solving with this business.
2) How will your business satisfy the need?
- Introduce and describe the business itself. Consider including a mission or vision statement with objectives detailing how the business satisfies the need in the market.
3) How does your company differentiate itself?
- Describe your business model and competitive advantage. This will help you to outline how the business will sustain its position within the market.
4) Who will be the key players in the business?
- Name the management team, board and advisers to the business. Highlight their expertise and experiences.
5) How big is the market you are entering?
- Only after understanding the industry you are entering – its size, attractiveness and profit potential – can you truly justify the opportunity.
6) Who will you be targeting as customers?
- Narrowing down your target customer will help enhance and define your marketing strategy.
7) What will be your most effective marketing and promotional strategies?
- Once you’ve identified your target client, you’ll need to develop and implement a strategy on how best to reach them (e.g. PPC, television, radio, social, etc). And this in large part will be influenced by where your target client consumes information.
8) What are the economics of your business?
- Define your revenue streams including pricing structure, costs, margins and expenses.
9) How much money is required to get your business started and generating revenue?
- Identify needed capital requirements by determining where your business stands today, and what is needed in order to move forward. Also, if you are in need of outside funding, what will be the sources and uses of funds requested.
10) What needs to happen to break-even?
- Play around with financial projections and forecasts to determine the volume of sales needed to cover your expenses and to become profitable. Include monthly breakdowns for the first two years.
Whether your objective is to find an investor, get a business loan or just improve the way you run your business, your business plan must answer these key questions. Remember, there is no right or wrong answer, but addressing these questions will help you build a roadmap for your business. And, of course, the better the map, the greater the likelihood that you’ll reach your destination!
For more information on financial strategies, contact our partners at Corporate Tax Network today. They have a team of business consultants and tax advisors standing by to help you. You can also follow them on Twitter for daily business information.
Top 10 Questions Every Business Plan Should Answer – Forbes