How to write a business plan
A good business plan is essential when thinking about starting a new venture. It will help you apply for business finance and keep your vision on track once things are up and running. Here are four steps to help you create and implement an effective business plan.
1. Set out your strategic vision
Ask yourself what your company stands for. Think of everything you'd want a potential investor, partner, employee or customer to know about it. This includes:
- Vision statement: Should be brief and aspirational, yet achievable. Take the time to get it right. Try to sum up in one sentence what your business is all about, where you want it to go and how you'll get there
- Unique selling proposition (USP): Sets out why you believe customers will come to you rather than a competitor. What makes your business unique?
- Target market identification: While you don't want to limit your customer base, the clearer picture you have of your target market, the easier it will be to communicate with them. You may initially have to assume who you think your customers are, but once your business is live you should be able to update this using real sales data
- Explanation of products and services: Should be designed in line with your USP and meet the needs of your target market
- Key goals: Must be measurable, achievable and consistent with the financial plan
- Capital requirements: How much will you need to start and run the business and where will you get the funding? Amounts should be supported by calculations in the financial plan
2. Set out the details
Now it's time to see how your vision will work. Who will help you bring it to life? What business structure are you considering? Here are some other things to include:
3. Make necessary changes
Writing your business plan may bring up questions about your business, and once you reach the end you may not be happy with certain parts of your plan or your prospective day-to-day operations. Before finishing, ask yourself:
- How can I counter the strengths of my competitors?
- How can I overcome the weak points in my business plan?
- Do the assumptions I’ve made based on various financial projections make sense?
Also, you might consider sharing your plan with others to sense check it.
4. Put the plan to work
Once it's ready, treat your business plan as a guide to running your business. Remember that it's a working document, so if your goals and circumstances change, update the plan. The business.govt.nz website has some great tools and templates to help get your business started.
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This page is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and should not be relied on. This information has been prepared without considering your objectives, financial situation or needs. We recommend you seek independent professional advice and contact Inland Revenue before acting on this information.