Having a strong business plan in place is essential to the success of any growing company, but many organisations fail to understand exactly how a business plan can have an effect on day-to-day operations. A strong business plan can be a key driver in reaching strategic goals.
Below are the main types of business plan and the various ways they can be effective. It’s always important to choose your business plan carefully, as they can vary significantly depending on the goals of the company.
Presentational Business Plans
These plans are highly specialised, and designed to present a business – as well as the core ideas and philosophies of the business – to a third party (such as a bank) for consideration.
The primary goal of a presentational business plan is to provide these third parties with the necessary information to make a judgement about the business, prior to an investment.
Commonly, they’re used for bank finance, investor funding, Tatts Lotto Applications or Business partnership proposals. They’re also invaluable for tradesmen seeking builder’s registration and similar types of certification.
Development Business Plans
Development plans are another potential consideration for businesses. However, unlike presentational plans, development business plans are designed to be used internally.
Often, development plans go into far greater detail and can be used to map the future direction of a company. They’re also used to outline various potential ways to achieve necessary company objectives.
If a company is currently performing passably, but not reaching its full potential, it could be time to invest in a development business plan.
Strategic Business Plans
A strategic business plan is often the best course of action when planning long-term. This plan details the core beliefs and values of the business, and outlines why exactly the company exists within the market place.
These plans also detail the type of customer the business aims to serve, and the core vision utilised throughout operations. By detailing these specific objectives, the plan can serve as a guide for the business over many years.
Following the creation of this initial foundation, the company can assess competitors, the state of the market and any long-term threats. Plans can subsequently be put in place accordingly.
The direction set in this plan dictates the short-term objectives of the business. Commonly, this encompasses a period of 12 months.
Annual Business Plans
When it comes time to create a shorter, annual (or short-term) business plan, the strategic plan provides the guidance. As an annual business plan is primarily designed to achieve a specific objective, it’s important to establish exactly what needs to be achieved within the pre-determined period.
This plan is linked to the strategic direction of the business and determines the short-term direction of the company. These plans should be prepared with objectives in mind such as increasing revenue and profits, entering new markets, and preparing the company for sale.
Beginning one of these business plans with a defined objective establishes a clear focus regarding how the business will grow and be managed over a set period.
A decision making framework is also provided, detailing exactly how resources will be allocated as well as which opportunities should be pursued. This vision ensures the business stays focused on a particular direction.
Business Plans to Increase Revenue
Increasing revenue is often linked directly to an increase in sales or prices. As such, any business plan designed to boost revenue and income needs to have a strong focus on marketing.
Business plans of this variety place special attention on which markets the company currently operates in, and the marketing activities being employed across these areas.
Buyer motivations also receive a special focus here, alongside the relationships that have been established within the various markets. In most cases, there are a multitude of channels which can be investigated and exploited to delve deeper into a market.
Business Plans to Increase Profits
Ensured profits are the lifeblood of a business, and profits are increased primarily through either maintaining revenue or increasing sales.
The key differentiator between a plan to increase profits and one designed to increase revenue is a focus on the efficiency of the organisation.
While marketing and increasing sales is still a factor, analysing the business cost structure takes precedence. Focusing on efficiency can place a business in the best possible position for the future, when growing sales numbers moves to the top of the priority list.
Business Plans to Enter New Markets
Business plans are essential when entering new markets, and this can often be accomplished in a variety of ways. Most companies choose to expand by either opening new stores in other regions or even via new offices in other states.
Throughout any new market endeavour or expansion, it’s highly important that funding remains the key focus, in addition to resource utilisation.
This type of business plan is designed to detail how a business will handle the new market introduction, and where resources and funding will be utilised. Clear milestones and cash flow forecasts are of the utmost importance here.
Business Plans to Sell the Business
When it comes time to eventually sell a company – either for the funds to ensure a stable retirement or the finances for a new venture – the value of the business often isn’t available in assets alone.
In a number of cases, the value of the company is in the key staff and owners of the company, who have developed the relationships and networks required to ensure the success of the business.
This type of plan is designed to separate the owner from the business and make the company a viable undertaking for possible buyers.
A heavy focus is placed on the operational aspects of the business, in order to establish what makes it successful within the market place. The primary goal is to identify the various systems and processes already existing within the business, or to identify where such systems should be developed.
Following the conclusion of this plan, a manual is created that effectively enables anyone to operate the company.
We have been developing business plans for more than a decade. Over this time we have worked on over 1,000 business plans and have developed an intimate knowledge of tailoring plans to suit the specific needs of a business.
We have also worked closely with banks and investors in order to ensure client projects are accepted.