A perfect and comprehensive business plan is the blueprint that guides you on the road to business success. Venturing into entrepreneurship requires a solid business plan to clearly define the idea, the opportunity to be tapped, location, target market segment, competitive environment, viability of the idea as well as entrepreneurial experience and commitment.
At the very least, a basic business plan should contain the following elements:
- Business idea title
- Business opportunity
- Competitive Landscape
- Viability of the business idea
- Distribution channels
- Financial projections
- Sales projections
- Financial requirements
- Source of finance
- Entrepreneurial experience and commitment
- Education level and experience
- Commitment level
- Current occupation
- Product availability
A comprehensive business plan will usually include the following:
1. An Executive summary – a brief and concise outline of the plan in its entirety. Should normally take no more than one page in your comprehensive business plan.
2. Business description
a. Definition of the business concept – Hit it with your audience by introducing your Unique Selling Proposition (USP) and if applicable, proof of concept. Selling your idea this early will reinforce the next sections.
b. Investment cost and financing plan – Do your research and ensure you’ve got real-world sources to back up your numbers.
c. Collateral arrangements – How do you plan to secure the investment costs?
3. Company description
a. The vision, mission statement, legal status and profiles of key principles
4. Industry analysis
a. Industry overview – analysis of the landscape in the country or region.
b. Product/service description
c. Business environment scanning (SWOT Analysis) – a look at the strengths, weaknesses, opportunities and threats to your business.
d. Business positioning – what you want the market to perceive you as doing.
5. Market and Marketing
a. The market definition
b. Market size and trends – Again, the key aspect here is thorough research and up-to-date statistics.
c. The competition – More research, consider paid sources of data but ensure you can validate the results before committing to pay or hire third parties to do your research.
d. Marketing strategy and plan – the 4Ps (Product, Place, Price and Promotion)
e. Estimated sales – projections for the next 3-5 years
6. Technical aspects
a. Development status – how far along the business development process has gone.
b. Production and operational process
c. Business location and infrastructure
d. Labor and skills requirements
e. Utilities availability and reliability
f. Capital requirements
g. Implementation schedule
7. Management and organization
a. Management description and responsibilities
b. Organization structure
c. Company ownership and board of directors
d. Support services – auxiliary structures to aid the plan e.g. law, transport etc.
8. Financial analysis
a. Basic assumptions – the norm for any accounting statement projections.
b. Capital investment and cost schedule
c. Depreciation schedule
d. Sources of funds and financing plan
e. Financial risks
f. Analysis of financial results
9. Supporting documents / annexes
a. Funding requirements
b. Statement of cash flows
c. Statement of financial position (Balance sheet)
d. Statement of comprehensive income (Income statement)
e. Statement of changes in equity
f. Notes to the financial statements
10. Corporate Data – usually a legal summary of the business, location, ownership, activities and capital.
Business planning is one of the keys to strengthening the culture of entrepreneurship in Tanzania. Most businesses fail even before the hit the ground running mostly because no road map was charted beforehand. Ships, airplanes and cars all have navigational controls and charted routes and in this way destinations can be reached and disasters avoided. It’s also best to have a contingency plan for every possible scenario en route to executing your plan.
Hopefully, this guide to writing an effective and comprehensive business plan will help you jump-start your ambitious business ideas into effective and actionable business plans. Furthermore, I’ve written two comprehensive business plans based on my own personal experience and entrepreneurial journey. One focuses on building a recycling plant for plastics and another is on the establishment of a soy milk processing plant. If you’re interested in software to simplify your needs, try LivePlan for a comprehensive business plan with performance tracking.