A business plan is not just a document that can be used to build a business. It is a skill to be possessed by entrepreneurs and business owners. Is writing an impeccable business plan the only way to succeed in running an online business? Sometimes not.
With some business-based common sense, a futuristic idea, some motivational drive, and luck, it could give you an expected output. Sometimes even more.
Acquiring funds to start your business is a task. That is when you’ll be needing a solid business plan. To budding entrepreneurs, you’ll need a clear understanding of a business plan and how it can be leveraged to get any business up and running successfully.
Let’s get started!
What is a business plan for?
A business plan is a meticulously planned and crafted document that can be used to convince yourself and your stakeholders to invest their time and money into your business. Even today, it is said to be one of the strong foundations of finding the caliber of any business prospect.
When it comes to starting an online business, it is even more important to strategize your moves (like a chess player). The online business has too many components to consider than a brick-and-mortar store.
As an online business owner, you won’t be using traditional methods to market your product or service. You’ll be reaching out to your customers virtually. It is important to include all these factors in your business plan to proceed further.
Who are the people to convince with your online business plan?
Firstly, your business plan must convince your online business objectives, mission, and vision statement. Your online business plan must work towards achieving those growth statements.
Secondly, you have to convince the stakeholders. Generally, stakeholders of any business involve whoever you owe an explanation regarding the performance of your online business.
Stakeholders could include the customers, investors, your employees, the platforms you use to market your product or service, government, and other external factors that affect the business.
5 things to include in your business plan:
1. Executive summary: Know-How
The executive summary is the critical part of your business plan. Why do you ask? It has an overview as to what to expect in the whole of the business plan. These are the list of things that you should be including in any business plan.
- Your business objectives (long and short term), vision, and a mission statement.
- What will be your target market and audience?
- What products or services that your business will be selling? (a short description)
- How will you acquire the funding and on what basis? (quarterly, half-yearly, or annually)
- And finally, the growth potential of your business model. (in stats and charts)
If you have considered these five points majorly, you are good to go.
2. Scope of your online business idea:
Let’s take an example to make it easier. If your online business plan is about owning a car rental marketplace, your idea is to connect the car owners and the person who needs a car to rent through your platform – that would be the objective to which you’ll be writing a scope.
The scope would be finding the geographic location where your online car rental business can flourish. And that would be the tourist spots where people love to go on a long drive or in a place where every other populated city is just a couple of hours away.
3. Hierarchical diffusion:
The investors and other stakeholders would always like to know the hierarchy of your online business. The key managerial personnel could include:
- The Founder / Managing Director
- CEO – Chief Executive Officer
- CFO – Chief Financial Officer
- CTO – Chief Technology Officer
Why are these details needed in a business plan? The investors would like to know who is answerable in the said organization for the funds allocated and other growth perspectives discussion.
4. Marketing plan of the online business:
When it comes to writing marketing strategies for your online business plan you have to narrow down a few things:
- What kind of medium are you using to communicate with your customers? (Example: LinkedIn, Twitter, Instagram, Pinterest, Facebook, Whatsapp, Email, Website etc)
- Narrowing down the marketing tactics in the chosen social media platform or others.
- Does your target audience fit into the chosen social media platform or other forms of marketing (like running an ad, groundwork marketing, door-to-door marketing)?
- How much can you allocate for the market team and the campaigns from the budget? (long term and short term)
5. Financial and budgeting plan for the online business:
The financial plan of the online business has to include all the commencing expenses and also for the first quarter of the business (short term)
Commencing expenses include:
- Website/App development cost.
- Initial equipment purchases (the devices – computers, smartphones, tablets, laptops, etc)
- Acquiring software to manage your business.
- Other direct and indirect expenses.
The long term could be formulated however you plan on proceeding with the business plan. But the major detail to include in long-term financial planning is the percentage of the profit that will be reinvested into the online business in the next financial year.
Finally, you could include the growth stats – of the industry, your projected contribution towards the industry, and other stats that you worked on.
5 tools that’ll help you write an online business plan:
There are always chances to go wrong while formulating a business plan. Therefore, it is important to use these 5 small business tools out of many you can find online to develop a potential plan.
SlideBean has templates of pitch decks of various startups that could be utilized to your fullest extent. Investors nowadays don’t want a very comprehensive document of a business plan. Therefore, SlideBean can be used as a single deck template to develop a business plan of your need.
LivePlan is a paid tool ($20 per month) that can be utilized to fix budgets, brainstorm goals and key performance indicators in a business plan. This tool is very efficient for any small-scale business owner.
3. SME toolkit:
This business plan toolkit is offered by IBM (International Business Machines) and IFC (International Financial Corporation) which gives out a simple two-page business plan with 10 broad sections from executive business summary to marketing strategies.
It has numerous templates and designs. It is a paid tool ($200) that has been supplied with working and proven business model samples that can be designed and presented for your investors.
MindMup is an effective tool for brainstorming and mind mapping business ideas and formulating business plans. This is even a very creative platform for content creation and marketing plans for your business.
The core purpose of formulating a business plan is to avail funding for operating the business. Therefore, the idea initiation and other core details in the plan have to include the revenue model to show the potential of your business.
These are some of the details that should be included in any business planning activity that could help you run a smooth and planned business.