The whole business plan document is very important but there are key components of a business plan that can summarize what the business plan is all about. If you can identify these documents in a business plan, then you can pay more attention to them when writing your business plan.
The whole essence of writing a business plan is not just to have a business document in place, but to come out with a blueprint that will help you chart the course of your business. A good business plan will help you focus on the steps necessary to make the business succeed.
Having said that, here are the two most important documents that summarize the business plan of a company.
Two Documents That Summarize the Business Plan of a Company
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A Financial Summary for Potential Investors
One of the most important documents that summarize the business plan of a company is the financial summary for potential investors. This is because the financial summary gives insight into the profitability of the business, aspects of debt and equity, estimated operating expenses, financial statement forecasts, future growth projections, and business financing. The financial data that are contained in this section is quite structured and in-depth.
Business plan financials are very important to a business because they allow you to budget for existing or future expenses, as well as forecast your business’s future finances. A strongly written finance section also helps you obtain necessary funding from investors, and of course, allows you to grow your business.
The most important initial element in financial planning is Budgeting. No doubt, setting a budget for your business is relatively easy; it is more difficult to stick to it! Having the discipline to record and reconcile your expenditure is what counts.
Please note that a good financial summary document contains the following seven key components:
- Budgeting and taxes.
- Managing liquidity, or ready access to cash.
- Financing large purchases.
- Managing your risk.
- Investing your money.
- Planning for retirement and the transfer of your wealth.
- Communication and record-keeping
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A Business Road-Map Describing Your Plans for The Company
A business roadmap describing your plans for the company is also a very important document for investors and banks. This is because every investor and even banks will want to see how you plan to use their money to grow the business.
A business roadmap outlines the direction you will take to achieve your business plan and successfully meet long-term strategic goals. It is useful for communicating your vision and plans at every growth stage, from early-stage startup to established enterprise company.
Under this document, you write about your strategic roadmap and strategic product roadmap.
A strategy roadmap is a visualization of your strategic plan. It captures activities you will complete within a given time frame. It communicates upcoming work in one view. You can use a roadmap to drive conversations. It can be your guide for prioritizing work, allocating resources, and tracking dependencies.
A strategic product roadmap typically includes the following key points: Product vision — what you want your product to become in the future. Strategy — an execution plan detailing what your company is going to do to meet the vision. Goal — a time-bound objective that can be measured by a specific metric.
In Conclusion,
Preparing a comprehensive document that summarizes these aspects of your business plan will place you in an advantageous position when sourcing investors or loans from your bank to expand your business. Please note that making use of a free business plan template may not give you the professionalism you need hence we advise that you engage the services of a business consultant that specializes in writing business plans.