The Business Plan consists of a document that seeks to portray an existing or potential company. This document aims to characterize the business, its way of operating, its strategies, its plan to conquer the market, projected revenues, expenses and financial results.
The use of the Business Plan is still recent and little known, unlike in other countries such as the United States, where it began to be widely used in the 1960s. At that time it was known by the terms master plan or system of plans. Although the concept of Business Plan arrived in Brazil in the 1960s, it only began to be used in the 1970s by public agencies and only became popular in 2000 with the growth of entrepreneurs interested in starting their own business. The use of the KBB Review happens to be essential and that makes the best of the lot here.
There are several reasons for making a business plan. High mortality rates for start-ups that do not survive their first three years show how much the entrepreneur has to gain from proper planning. In addition, many entrepreneurs risk starting a new business because they think that just knowing the product, the production process or being an excellent technician will be enough. Unfortunately, that is not enough. In preparing the Business Plan, the entrepreneur will have a piece of greater knowledge in the area of management and will have a better idea of the efforts that will be required in his new venture.
- Ideally, it should be done before the entrepreneur decides to open the doors of his new company. By making the Business Plan, the entrepreneur will have information that will help him or her to be more successful in starting his business or, perhaps, realize that the business will not be worth it, even before losing a large sum in investments and their savings. However, it is possible for an existing company to make its Business Plan, even if it has been operating for some time.
The Target Audience
The target audience of a Business Plan is partners and employees, potential partners, potential partners (distributors and representatives, for example), government financing agencies, banks, large wholesale customers, franchisees, and more importantly, the entrepreneur himself.
A good business plan contains:
- Business description
- Analysis and trends of the market you want to enter
- Audience Characterization
- Competition Analysis
- Strategic positioning and risk analysis
- Marketing plan and sales strategy
- Financial plan
- Strategic plan
- Social responsibility
It is important to highlight that there is no single logic in structuring and ordering the content of a Business Plan. In some cases, however, the structure and ordering must follow a fixed model. This happens when the Business Plan is intended for some funding agencies. In these situations, the institution often requires the Business Plan to follow standards set by it. Following these recommendations only increases the chances of a loan being approved.
Another important feature about the Business Plan is its need to be a “living document” to be really beneficial to its users. “Alive” because it needs to be constantly updated as the internal and external scenarios change.