📋 What is a business plan?
Big Idea: A business plan is a formal written document that outlines a business's goals, strategies and how it will achieve them. Think of it as a blueprint for success — essential for start-ups and growing businesses! 🏗️
Why write a business plan?
- Attract investors and secure finance (banks want to see a plan!)
- Forces the entrepreneur to think through the idea carefully
- Sets clear goals and milestones
- Identifies potential problems before they happen
- Guides decision-making as the business grows
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📄 Key elements
- Executive summary — brief overview of the whole plan
- Business description — what the business does, its mission and objectives
- Market analysis — target market, competitors, demand
- Marketing strategy — how you'll attract and keep customers (the Ps)
- Operations plan — how the product/service will be delivered
- Human resources plan — staffing needs, roles, skills
- Financial forecasts — cash flow forecast, projected profit and loss, break-even
- Sources of finance — how the business will be funded
If asked to 'state two elements of a business plan', pick from this list and give a brief explanation of each.
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⚠️ Limitations
- Based on predictions — the future is uncertain
- Can become outdated quickly in fast-changing markets
- Time-consuming to create properly
- May give false confidence if based on optimistic assumptions
- Some entrepreneurs succeed without a formal plan