Graduates of the University of West Florida’s online MBA with an emphasis in Entrepreneurship are prepared to develop and manage a business, from initial planning to market rollout. In the New Ventures course, students learn how to start a new business with a business plan. They develop a list of potential opportunities, evaluate the opportunities and learn how to seek seed capital with an eye toward the profitability horizon.
A business plan is an essential strategic foundation of a business’s future. It is the roadmap from where you are today to your destination in three to five years, at which time you will hopefully have expanded resources and capabilities. In the near future, your business plan can help you to raise funds and secure capital for investment, expertise from potential advisors, and even a business partner if you choose.
Just how critical is a well-constructed business plan to the success of a new venture? According to Intuit Quickbooks, 64 percent of companies with a plan grew their businesses, compared to 43 percent of companies without a plan.
Here are the seven elements of a solid business plan:
- Executive Summary: This is the synopsis of the business plan — the elevator pitch to potential lenders, partners or advisors. It is advisable to write this summary once the other elements are complete. This page briefly details the business concept, financial features and requirements, current business position, and any major achievements to date like established facilities, products in development and results from test marketing.
- Business Description: This begins with a description of the industry, why your business was formed and its mission statement. It answers all the fundamental questions anyone wishing to get involved with your business would ask before diving into the details, including your leadership team, location, legal structure, products and services, competitive advantages, market opportunities, and projected growth.
- Market Analysis: Presumably, your business concept was the end result of a market analysis — your understanding of the industry, your target market and further details about your ideal customers. This component reveals the results of your analysis and the larger trends in the industry and geographic area. It also describes your expected market position and the advantages you will have over direct competitors, as well as how these can be exploited to grow your business.
- Company Organization: Just as important as what your business sells is who is doing the selling. This section, which is especially important to lenders, describes your organization, including the qualifications, experience, accomplishments and expertise of each member of your management team. It describes whether you are organized as a corporation, LLC, partnership or sole proprietorship. If your company will have a Board of Directors, these individuals’ roles, expertise and experience will also be provided.
- Sales and Marketing Strategies: What are your revenue streams? How will you make profits? This section will explain your promotional and pricing strategies, and describe your rationale for your decisions. It will detail your go-to market strategies, including sales personnel and the regions or market niches they will cover, plus the details of their responsibilities. It will cover marketing strategies, from the Search Engine Optimization (SEO) of your website and how you will target online prospects to social media and email marketing campaigns.
How will you drive brand awareness and bring in new customers? Will you use “loss leaders” to generate first-time sales, or will you use coupons and other special offers? Will you send out press releases and promote your brand in television and radio commercials, or will you use Google or Facebook ads to drive awareness and interest? All of these details will be explained here. - Funding Requirements: No business can get the funding it needs until its creator can demonstrate that he or she understands what it needs, why and how it can grow revenues and eventually sustain profits while investing these funds. Often, this section includes a timeline for when additional funding will be required.
- Financials: Your management team and board’s expertise all funnel into this final and most important section. Given your products and services, competitive advantages, market opportunities, and sales and marketing strategies, what is your projected revenue growth? What will be the impact of new infusions of cash? If your business has a prior history, this section will also include company income statements, balance sheets and cash flows for up to the past three to five years.
As you put together your business plan, you will find that the process is just as valuable as the output. In the course of constructing each of these elements, you and your management team will identify problems, find solutions, refine plans and become even more ready for the road ahead.
Learn more about UWF’s online MBA with an emphasis in Entrepreneurship program.
Sources:
Entrepreneur: Business Plans: A Step-by-Step Guide
Entrepreneur: Elements of a Business Plan
