Writing a business plan can be daunting at the best of times, but with so many uncertainties, planning can seem especially difficult. The key is to create a plan that is realistic and achievable, but also to factor in the impact of potential threats and opportunities.
Both the business plan itself and the process of writing it down will help you define your long-term objectives, identify challenges and opportunities, provide a blueprint for running the business and a series of benchmarks to check your progress against.
By reviewing all the key elements of a successful business at once: your value proposition, marketing assumptions, operations plan, financial plan and staffing plan, you'll be in a strong position to 'sell' your business into potential backers or employees.
The details will be unique to your business, but the key aspects you need to consider are:
Make business planning an ongoing priority
Your business plan should be seen as a process not just a document to be completed. Set out clear responsibilities and schedules, define your ultimate objectives and commit to reviewing your plan as regularly as possible, particularly as the environment around you changes.
The basics of business planning
Good business planning is about turning your strategic goals into financially viable business activities. It will start with the big picture and then work towards the details.
Develop and refine your business strategy
Consider internal and external factors to shape your strategy. You need to assess the market and sector your business is entering, taking into account potential customers and competitors. Be honest about the strengths and weaknesses of your business, what it does and where you want to take it.
With Brexit on the agenda and uncertainty around funding, immigration and market access, making sure your strategy plays out in different scenarios is vital. What will happen to your strategy if a particular source of funding dried up or a potential market is inaccessible?
Set out your marketing plan
This is about positioning your business to respond to the needs of potential customers. The marketing plan should analyse your intended customer base, forecast demand for your goods and services, and understand how markets usually develop and which phase your particular sector is in.
Develop an operational plan
Set out clearly what resources your business will need and how you intend to use them. Detail is important as your operational plan will form the basis of the costs that feed into your financial forecasts. It should cover aspects such as getting the right people in place, getting your structure right and looking at the premises and other infrastructure that you will need.
Scenario planning is important, particularly when there are many variable factors, such as the impact of Brexit. For example, what happens if there's disruption to your supply chain and how will you mitigate that risk?
Generate your finance forecasts
You need to understand your business in financial terms and make use of essential management tools such as profit and loss and cashflow forecasts. Using software allows you to automatically feed your projected revenues and costs into the relevant fields on your key financial statements for the forecast period. This allows you to look at the possible financial effects of different market scenarios. You may well require help to make sure your financial forecasting is accurate.
Use your information to evaluate options
Business planning is about deciding how to use your available resources to maximise profits. The information from your financial forecasts gives you a regular basis on which to make these decisions. You should, though, be wary of basing decisions purely on your figures. Your financial statements are only as good as the business model that created them and they only provide historic information. In rapidly changing times, taking account of other factors in your forecasts is also important.
Draw up budgets to implement your plan
Budgets translate your financial forecasts into operational action plans. They set the revenue and cost targets that you will have to meet in order to achieve your projected profit margins and returns. It is important that your budgets are sufficiently detailed and that you review your progress on a monthly basis. Of course, things do not always go to plan so you need to be prepared to review your budgets and the planning behind them.