A solid plan will provide your business with inspiration, direction and targets to track your success and keep you accountable. This Legal Kitz blog will provide you with a guide to creating an awesome business plan!
What is a business plan?
A business plan is a document that describes the critical aspects of your business and the important strategies and structures you have in place to achieve them. Your business plan should document how you plan to manage your business overall, including your products, services, operations and finances, etc, and should evolve and change with time and business growth. Do note that a business plan takes a lot of preparation, research and time to complete. Do not leave your business plan to the last minute.
Why do you need a business plan?
A business plan is essential for any business owner in Australia who wants to start or grow a company. Here are some of the reasons why a business plan is beneficial:
- It helps you to clarify your business idea and identify your target audience, competition, and unique selling proposition.
- A well-written business plan provides a roadmap for success, allowing business owners to make informed decisions and manage their resources effectively.
- A business plan is a tool that investors and lenders use to evaluate the potential of a company. It should include detailed financial projections and an analysis of the market opportunity.
- A business plan can help you secure funding from investors or lenders.
- A business plan is a living document that should be updated regularly as your business evolves.
What elements should I include in a business plan?
You need to ensure that you have a clear idea of your business’ concept, structure, processes and how it will make money, and then register your business’ name.
The general elements that a business plan consists of the following, depending on your business size, structure, industry and phase.
- Business details – including the business name, registration date, business address, Australian Business Number (ABN), Australian Company Number (ACN), Tax file number (TFN), owners, contact details, website details, social media details, etc.
- Executive summary – provide a brief overview of the business idea, distinctive features, operations, financial projections, short term and long terms goals, etc. This section ideally should be written last after all other sections have been filled.
- Business profile – an outline of your business and covering your vision, details relating to product and services, place of operations, and industry and competitor analysis. You can also add in any research done regarding the industry you plan to enter into and the respective market trends. Adding a SWOT Analysis (strengths, weaknesses, opportunities, threats) in this section is also recommended.
- Marketing and sales strategy – should highlight your detailed market research and analysis. It should also state your objectives, forecasts, target market, customer profiles, marketing tactics, setting KPIs, competitiveness / positioning, customer management, and how you will be measuring your marketing effectiveness.
- Operating plan, including legal and financial matters – covering standard operating procedures, quality assurance, performance management, production, location, stock and inventory management. It should also document all the legal and risk management considerations you will be taking up. For example, structure, contracts, lisences, intellectual property, etc. You should also be outlining the possible consequences and solutions to overcome the risks stated. With financial matters, it is important to include details relating to start-up costs, profit and loss forecast, cash flow forecast, financial ratios, break even point, funding arrangements, payment plans, etc.
- Action plan – highlighting a set of actions to be taken to check your progress before you review and update your business goals and plan. This should be done regularly to assess which actions have been completed, which one needs to be updated and so on.
Final tips
Seek professional help if required to look over your draft and for personalised advice if you are not confident to complete it yourself. There are also government services like workshops, seminars, networking events, that can help you get started with your plan and to establish and grow your business. You can also start off with a smaller one page business plan that covers high-level information about your business value proposition to then structure your fully detailed business plan.
Legal advice
A business plan systematically describes what your business is all about and helps in building and creating value for your customers and team. Knowing what direction to follow, what your pricing strategy will be, who to partner with, along with many other decisions are extremely critical and fundamental in terms of how your business will be achieving goals and generating value.
If you are unsure about how to best protect yourself and your future business, Legal Kitz can assist you. To arrange a FREE consultation with one of our highly experienced team members, click here today, or contact us at [email protected] or 1300 988 954.
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