December is National Write a Business Plan Month! So it’s appropriate that we offer an article on how to write a business plan for success.
The real purpose of a business plan is to create a well thought-out document that states, in detail, your business dream and how you plan to develop and finance this business. Your business plan is, in fact, the roadmap to your future.
Additionally, investors and lenders usually require a written business plan. Just as important, stakeholders such as suppliers, customers and potential key employees want to know who you are and what you are all about.
A Written Business Plan also Serves as a Guide for You and Your Team.
The Real Value of Business Planning lies in the Process Itself.
This focuses your thinking and keeps you on track. In other words, the key to success is going through the process. Thus, it’s the process itself that leads you to issues that are required for their resolution and your ultimate success. Planning is the structure by which you determine the key steps needed to find the information required to develop your successful business. In fact, for many situations, the planning process is actually more important then actually writing the plan.
Currently, leading experts in business planning such as Alexander Osterwalder and Steve Blank suggest the development of the Business Model Canvas (BMC) as the key to the process. From their point of view a BMC is actually a prelude, a precursor to the creation of your Business Plan.
Here is an example of a simplified BMC:
Fully understanding each of these questions and developing appropriate responses will lead you to a clearer, better understanding of all of the elements essential for the success of your enterprise. Note the importance of starting with the value proposition and matching this with the customer segment. Once that benefit fit has been established all else follows.
As an example, let’s create answers for a hypothetical BMC for MacDonald’s as developed by Manasota Score:
- Value proposition -> quick, inexpensive meal
- Customer segment -> public / seniors / families
- Customer relationship -> personal face to face service
- Distribution channels (paths to customers) -> in store / drive through
- Revenue stream -> company store sales / royalties / franchise fees
- Key activities -> training staff / marketing
- Key resources -> employees / locations
- Key partners -> franchisees
- Cost structure -> staff / locations / supplies /marketing
In conclusion, the BMC guides you to focus on all the key factors necessary to create the roadmap to the attainment your dream.
Note, developing a BMC is not something done all at once. It is an iterative process by which you are systematically testing out your ideas.
A SCORE mentor can help your through this process FREE! Click here to schedule a mentoring session.
Greater Phoenix SCORE also has classes and workshops on how to write a business plan. Click here for the schedule.
About the Author:
Roger Robinson, PhD has been a SCORE mentor for over 16 years. His specialties include non-profits, business planning, specifically in restaurants and hospitality, recreational and arts and Entertainment verticals. Read more about Roger here. Click here to schedule a free mentoring session with Roger or another SCORE mentor.