You have the expertise to grow a business. You’ve identified an unmet need in the market and come up with a great idea for meeting that demand. You’ve found investors who may be willing to fund your product or service’s development, production and distribution. Now all you need is a business proposal.
A detailed business proposal is where you start turning your idea into a successful business. If you are familiar with TV shows where entrepreneurs pitch to venture capitalists, you’ll know many more fail to get buy-in than succeed. Many of these entrepreneurs have good ideas, but the winners have a thorough plan to realize theirs.
What Is a Business Plan?
The U.S. Small Business Administration (SBA) says there’s no end to the elements you’ll need to launch your business: registering its name, completing tax documents, getting permits and licenses and so on. Your business plan is the blueprint for turning your idea into a thriving, viable business. Among other things, the SBA says your plan should:
- Project three to five years of sales and marketing, pricing and sales growth
- Include milestones that measure progress toward your ultimate goal of building a successful business and adjust as needed
- Invite lenders, VCs, prospective partners and other funding sources, providing them with reasonable expectations of the return on their investment
“There is no right or wrong way to write a business plan. You can pick a plan format that works best for you. What’s important is that your business plan meets your needs,” the SBA advises.
What Does a Successful Business Proposal Include?
According to Entrepreneur, preparing a strategically accurate and compelling business plan takes time and thought. Begin with an executive summary that clearly states what you’re asking of investors, vendors and other stakeholders and explains why they should support you. A good executive summary should:
- Describe how the product or service will succeed in your market
- Identify the funding requirements and projected returns on investment
- Explain how your business is structured (if you are established and trying to expand)
- Name the patents, prototypes and contracts your business holds (if already established)
“Don’t waste words,” the publication suggests. “Make it easy for the reader to realize at first glance both your needs and capabilities.”
Beyond the executive summary, Success magazine explores the details of a successful business plan. “Writing a business plan forces you into disciplined thinking if you do an intellectually honest job,” says Robert Price of the Global Entrepreneur Institute. “An idea may sound great in your mind, but when you put down the details and numbers, it may fall apart.” So, to test whether your idea will become a winning business, your business plan should objectively analyze:
- The company’s key differentiators, such as projected competitive advantages, targeted major customers and personnel recruitment strategies
- The market you’ll play in, including competitor finance and technology analytics, seasonal customer spending and overall spending patterns and growth potential
- The ownership and stakeholder structure, potential investment sources and formation (sole proprietor, partnership or corporation)
- The product or service your company will deliver and how it will serve a market need
- The marketing and sales initiatives that will put your business in front of prospective customers and the channels you will use — digital, print and point of sale, for instance — to meet your prospects’ wants
- The investment needs over the next five years and how you will repay creditors and generate returns for investors
- The financials based on cost, sales and revenue and profit projections beyond the start-up period
“A further advantage of your roadmap is that, ideally, it changes with your business. It’s considered a living document,” the magazine notes.
How Do Business Professionals Acquire and Refine Business-Planning Skills?
A Master of Business Administration (MBA) program, such as the AACSB International-accredited program offered online by the University of West Florida, equips graduates with business-planning expertise through a curriculum that explores:
- Investment and financing strategies and decision making
- Organizational and individual behavior, group dynamics and conflict resolution
- Insights needed to combine practical skills and specific concepts to solve complex, integrated business problems
- Quantitative and analytical skills to model data and drive managerial decision making
- Building and strengthening customer relationships through comprehensive, integrated marketing strategies
To build a successful business, start by earning your MBA and learning how to design an effective business plan.
Learn more about the University of West Florida’s online MBA program.