How to Conceptualize a Business Plan

Conceptualizing a business plan is the first step to putting your thoughts in a format that investors or bankers can visualize. It might take time to organize your thoughts, but knowing the right things to focus on will expedite the process. This article will help you turn good ideas into actionable steps in the business plan writing process. It will help you organize the most relevant data stakeholders need to understand about your business such as the funding need, the return, the payback period, your USP and management's track record.

Instructions

Organizing Your Thoughts

1. Define your vision and write a mission statement. Take a few minutes to write down all thoughts, either through stream of consciousness or brainstorm. Then focus on what you want your business to be five or 10 years out. Outline five goals your organization will focus on to achieve this. Finally, develop three or four sentences that can be used as a mission statement (see Resources).

2. Decide on your audience and funding type. Ideally, your business plan will be geared toward any audience from investor to employee; however, you will need to decide what degree of detail and technical language to include. A venture capitalist will be interested in a percentage of profits, whereas family will be interested in payoff period. Investors will want in-depth analytics and full details on facts and figures. Most will perform a due diligence check for accuracy.

3. Decide on key management. This can be a deal breaker for some bankers and/or investors. For start-ups, a track record of success can be established through management bios.

4. Research and collect information. You will need to do industry research. This can be obtained from the library, Internet and other databases that give information on the market. Market growth will be a key consideration, along with customer profiles. Conducting a SWOT (strengths, weaknesses, opportunities and threats) analysis can help to simplify this step (see Resources).

5. Analyze the data. Understand where your business stands in the competition. Conducting a thorough risk assessment will be critical. Also develop a unique selling proposition (USP). What distinguishes you from the competition?

6. Write an Executive Summary. It should succinctly explain the investment opportunity for anyone who might be interested. From a conceptual perspective, this will bring all relevant data to the forefront. Relevant data is the funding need, the return, the payback period, your USP and management track record. If the USP does not touch on it, it might also include a brief synopsis of industry growth prospects.

7. Take action. Pull all of these steps together and you have a business plan. Whether in concept phase or actively seeking funding, taking action on your ideas is the only way to make them happen.

Resources

• Small Business Administration step by step planner.
• Tips on business plan writing, financial models, and setting up proper financial controls.
• Help on writing a mission statement.
• Help on doing a SWOT analysis.