Business Plan Outline & Checklist

Who needs a Business Plan?

Every business needs one. It’s not just for start-ups or new product launches or business expansion initiatives.

Why? And what should be in one?

Documenting a Business Plan is an extremely useful process to focus management and owners on their business concept, strategies, and operating plans. It forces consensus and decision making that might otherwise be neglected. It requires issues to be resolved and the decisions to be reflected in financial projections.

A well-documented business plan will help you communicate the most important elements of your strategy and plans to the people who need to know them. Including you.

Already in business for years and never needed a business plan? It’s still a good idea for all the same reasons. And now is a good time.

Ready to exit your business? Even better. A solid business plan will be the most important document in supporting the valuation of your business.

The greatest value of a business plan, however, is likely to be in the process – involving your management team in a thorough examination of your business – its purpose, its strategies and its plans to ensure success. When completed, all the key players will be more knowledgeable of the issues, the opportunities, the risks, and the alternative paths considered, before committing to the final plan.

Following is a suggested guideline of the layout and content for developing an effective Business Plan. It is a consolidation of best practices, based on our consulting and management experience with many different clients under a variety of circumstances.

COVER PAGE:
Includes title, date, purpose, prepared by whom, confidentiality statement, issued to whom, and a document control number.

PURPOSE:
Objectives of the Business Plan – attract financing, key executives, customers, or strategic partners? Document strategy and action plan for all participants? Set financial objectives and timetable?

CONTENTS:

1. Executive Summary (Max. 2 pages, written last as a stand-alone document, may be offered for review prior to full disclosure of the business plan, convinces reader to go further, or not.)

o Business Concept, Plan and Objectives

o Current status relative to the market opportunity

o Key success factors, risks, expected results

o Financial situation and needs

o Reference to the complete Business Plan (sections below) for more detail

2. Concept and Business Opportunity (Describe the need being addressed, how this approach is different, and why it is likely to succeed.)

o Market need and current solutions available

o Business concept and product/service differentiation

o Initial market feedback

3. Mission statement (Generate missionaries!, why others should join the cause – have fun, make money, make a difference?)

o Clear, attractive objectives – who and what do you want to be?

o Statement of values and priorities

o Milestones and timetable

4. Market Analysis (Provide relevant, pertinent information to demonstrate your knowledge and competence in this industry.)

o The overall market, recent changes

o Market segments

o Target market and customers

o Customer characteristics

o Customer needs

o Buying and selling process

5. Competition (Demonstrate an awareness of competitors and your ability to compete successfully.)

o Industry overview, recent changes

o Nature of competition, inside and outside the industry

o Primary competitors

o Competitive products/services, relative pricing, advantages, disadvantages

o Opportunities, protection by patents, copyrights, barriers to entry

o Threats and risks, ability of competitors to respond, imitate or copy.

6. Strategic Plan (Describe your starting point, direction, and plan to get there.)

o Company history & background – experience, resources

o Key competitive strengths & current weaknesses

o Business plan and strategy to leverage strengths, reduce weaknesses

o Action plan for implementing strategy

7. Management team (Usually the most important factor in determining your success and in attracting staff and financing. Emphasize current strengths and plan to fill in the gaps.)

o Key personnel, experience & credentials

o Staffing plan

o Organizational structure

8. Product & Service Offering (Consider the reader’s familiarity with the industry, avoid technical jargon, relate to the market and competition.)

o Product/service description

o Positioning of products/services

o Competitive evaluation of products/services

o Future products/services

9. Marketing and sales plan (Another key to success, too often neglected by owner/managers with strong product, technical, or operations backgrounds. Prove you have a plan that will be affordable and effective.)

o Marketing strategy, positioning, presentation

o Sales tactics

o Advertising, Promotions/incentives

o Publicity, public relations, press releases

o Trade shows, industry events

o Web marketing

10. Operations plan (Describe the important issues and factors that will affect customer service perceptions and the costs related to capital investment and operations.)

o Processes for product/service delivery

o Customer service and support

o Facilities and staff required

11. Risk analysis (What can go wrong, what will you do about it?)

o Market factors – economic cycle, interest rates, currency, government regulations, trade restrictions.
o Business risks – key customer & supplier dependence, labour availability, staff turnover, new competitors, new technology, changing demand.

12. Financial plan (Convert all the preceding words into numbers, next year by month, then three-to-five years annually.)

o Summary paragraph, Assumptions and Comments, followed by analysis

o Starting Balance Sheet

o Profit and Loss Projection

o Cash Flow Projection

o Balance Sheet Projection

o Ratio’s and Analysis, value of equity

o Financial needs

o Sources of funds

APPENDICES:
Add some personalisation and realism with biographies and photos of key executives, product photos, marketing literature, sample packaging, facility plans, press releases, customer testimonials, relevant research documents, etc.

Following these guidelines will ensure that you have considered all the issues and can defend your strategies and action plans against all inquisitors.

Looking to Become a Business Analyst?

Think back to your days at school or university, to those heady days when the future was wide open. You could be whatever you wanted to be: an economist, an accountant, an IT developer, a marketing consultant, an astronaut! All you had to do was study the right subjects and start on the right path. If you had decided that you’d wanted to be a business analyst, it would have been unlikely that you would have chosen to study music, drama, medicine, or any other seemingly unrelated subjects.

The Business Analysis seminar at the Institute of Directors last June raised an interesting point: analysis is very much about applying structured thought to the interpretation of data, and the argument held that those from more creative backgrounds could apply a different way of thinking to arrive at uniquely valuable insights.

For many companies, the entry point for most business analysts is the graduate trainee program. The exposure to different business areas over a course of about 2 years would give the individual a thorough all-round understanding of the business. By structuring the development program, a robust career path can be mapped out in advance, allowing the graduate to clearly define what they want to achieve.

This leads us nicely to the immortal BA question: what do business analysts do exactly? The list below is by no means comprehensive, but should give you some idea:

  • analyse the general performance of a business, i.e. the financial performance, the return on employed capital, and other data to be able to provide performance advice on investments and business activities
  • review internal planning, e.g. marketing and internal communications, process flows, procurement plans, administration and facilities
  • analyse and test systems, suppoort and systems development
  • project management or change management, managing the necessary training and rollout
  • analyse project financials, helping stakeholders to make the initial business case, gain support for projects, and measure benefits
  • strategic planning for business needs
  • additional problem solving

The answer to our question is that business analysts can do all of the above, combinations therein or even additional items that might not be included on the list. The role of a business analyst can be particular to the company worked for, meaning that defining the role clearly is very difficult. The role is different for each analyst. Business analysis comes in many different flavours, from financial and administrative through to technical and marketing. It very much depends upon the specific needs of the business. The core elements, though, are a logical and structured application of information and data to assess the performance, or potential performance, of a set of activities.

Many in-house business analysts are actually under-utilised, being seen as needing to deliver evaluation projects only. A true business analyst should be used as an in-house consultant, able to evaluate the potential impact of all ideas and proposal within their speciality, and then to assist or even lead in the delivery of the proposed solution where appropriate. Business analysts, in particular, should be able to work on an individual and team basis as well as being able to work with external consultancies.

The need for business analysis is currently largely governed by company size, with large companies possibly having dedicated analysis teams and smaller businesses possibly having only one resource, or partial resource. As markets continue to change and evolve, possible faster since the recession, the need for intelligent data analysis is more important than ever. There is a strong need for all businesses to have all management trained in business analysis fundamentals, ideally supported by a dedicated business analyst resource.

So, advice for job seekers in the business analysis field is to check on a company’s market, how well they have performed recently, what the job description requires and how your career will be developed by joining that company. From this analysis you’ll be able to ascertain whether that highly attractive job ad will help you get to where you want to be.

Before you jump into business analysis as a career, apply your innate sense of logic to your opportunity analysis and ensure that you take the right amount of time to properly weigh up your career objectives with the offer in front of you.