Define the word business plan
The analysis of the balance sheet should be kept short and cover key points. Do the necessary research so you can provide information on all the various markets within the industry, including references to new products or developments that could benefit or hinder your business.
When you describe your product or service, make sure your reader has a clear idea of what you’re talking about. Next, list the business’ principals and state what they bring to the business. The following 17 items are listed in the order they need to appear on your cash flow statement. The first step in a competitor analysis is to identify both direct and indirect competition for your business, both now and in the future.
Would you like to find a partner to whom you’d sell 25 percent of the business? It tells the reader what you want and why, right up front. Then explain how your business will gain a competitive edge and why your business will be profitable. Examples of plans[ edit ]. When describing the industry, discuss what’s going on now as well as the outlook for the future. A business plan lays out a written plan from a marketing, financial and operational viewpoint.
By combining these elements, the income statement illustrates just how much your company makes or loses during the year by subtracting cost of goods and expenses from revenue to arrive at a net result, which is either a profit or loss. Usually, banks and venture capital firms make the existence of a viable business plan a prerequisite to the investment of funds in a business.
Planning[ edit ] The term planning implies the working out of sub-components in some degree of elaborate detail. When describing your business, say which sector it falls into wholesale, retail, food service, manufacturing, hospitality and so on , and whether the business is new or established. You don’t have to spend a lot of money on a fancy binder or cover.
Your readers want a plan that looks professional, is easy to read and is well-put-together. This glossary is a virtual storehouse of treasure: Planning can refer to the planned use of any and all resources, as in the succession of Five-Year Plans through which the government of the Soviet Union sought to develop the country.
Your CPA can help you craft this. A business plan won’t automatically make you a success, but it will help you avoid some common causes of business failure, such as under-capitalization or lack of an adequate market.
A written document describing the nature of the business, the sales and marketing strategy, and the financial background, and containing a projected profit and loss statement. UK-English spellings of many words ending in ‘ise’, such as organise, realise, etc.
And usually also contains pro-forma balance sheet , income statement , and cash flow statement , to illustrate how the financing being sought will affect the firm’s financial position. Concepts such as top-down planning as opposed to bottom-up planning reveal similarities with the systems thinking behind the top-down model. Make sure to analyze your competitors’ distribution channels before deciding whether to use the same type of channel or an alternative that may provide you with a strategic advantage.
If your plan isn’t too complicated, keep your business description short, describing the industry in one paragraph, the product in another, and the business and its success factors in two or three more paragraphs. The products or services section details what you’re offering. If there are crucial elements of the business plan that take up a lot of space, such as applications for patents, they should be referenced in the main plan and included as appendices.
This was last updated in December Continue Reading About business plan. The specific methods used to create and refine plans depends on who is to make it, who is to put it to use, and what resources are available for the task. She was rather staggered, however, when she found what Hester’s plan for the intruders was.
But a business plan is more than a pitch for financing; it’s a guide to help you define and meet your business goals. However, the term is most frequently used in relation to planning for the use of land and related resources, for example in urban planning , transportation planning , etc.
Generally this thesaurus lists the most common business and work meanings of the words listed. Cost-plus pricing is used mainly by manufacturers to assure that all costs, both fixed and variable, are covered and the desired profit percentage is attained.