Writing a winning business plan is crucial to help ensure the success of your business. A well researched and carefully structured business plan is the single most important component in the development and continuation of any venture. It is a detailed map that shows where you’re going and allows you to identify potential problems long before they arrive. Poor planning is often cited as a major cause of business failure so it is essential to plan what you are doing and where your business is going.

Whether you run an established business or are contemplating a new start-up venture, a business plan will convey your company’s plans and illustrate how they can be achieved. You need it to measure performance, monitor progress, make future plans and raise additional finance.

Although business plans are used for a number of different reasons, there is a variety of generic information that should always be included:

• The Executive Summary. This is a brief yet concise statement, which is designed to give your reader an overview about your business by summarising the key points.
• The Nature of Your Business. This should give your reader an understanding about who you are, what you do and how you do it.
• Your Market and Competitors. This should describe the market you are in. You should highlight who your clients will be, explain what they will expect from your products or services, and provide details of who and where your competitors are.
• Your Marketing Plan. This will describe how you will promote and sell your products.
• Operations. This is the nuts and bolts of your business. It will illustrate to your reader the steps you will take to make sure that your business will operate both successfully and profitably.
• Financial Forecasts. This is the most difficult part of compiling a business plan. Obviously you will feel optimistic, but it is essential to be realistic. Any bank manager who knows their job will be able to see through any proposal based on inflated projections which only serve to make the balance sheet look good. The only person you will be fooling is yourself. Your market research can be used to provide you with an accurate sales forecast.
• Financial Analysis. This written analysis will go hand in hand with your sales forecast which is presented in the form of a cash flow forecast. Cash flow forecasts are used to devise profit and loss and balance sheet forecasts.
• Appendices. You should include any information which will support and verify any statements and assumptions you have made in other areas of your business plan.

By Matthew Record, author of Writing a Winning Business Plan, see www.writingawinningbusinessplan.co.uk