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BusinessPlanNigeria – How To Write A Business Plan Sample Template In Nigeria / Feasibility Report & Proposal.
How To Write A Business Plan -Blackvvell (2004) was dead right when he pointed out that starting a new business venture is like going into a tropical forest on a treasure hunt; with rewards to be won, both in material wealth and in personal satisfaction, but there are dangers lurking and you can easily lose your way.
To avoid losing and possibly facing the dire consequences associated with losing, a lot of precaution ought to be taken before dabbling into enterprise setting. One of such precautionary measures is to prepare a business plan. There is this popular saying – look before you leap, in setting up a business, preparing a business plan helps to serve the purpose of looking before leaping.
The business plan helps answer many questions about a proposed business project. According to Abrams (2009), a business plan is expected to answers the following question:
- What is your business idea or what is your existing business?
- Who are your existing and /or potential customers and what motivate them to buy from you?
- How will you let your customer know about your business?
- Who are your competitors and how are you different from them?
- How will you carry out the basic functions of your business?
- Is your management team capable of guiding your business to success?
- What is the long – range future of your business?
- What is your company’s financial picture?
- How much money will it cost to set and run your business and how much money will you make?
How To Write A Business Plan – Sample Template In Nigeria
Meaning of a Business Plan
There are several definitions of a business plan as there are several scholars in entrepreneurship. For instance, Holt (2006) defined a business plan as a comprehensive set of guidelines for a new venture. In the same vein, Hisrich & Peters (2002) stated that “the business plan is a written document prepared by the entrepreneur, which describes all the relevant external and internal elements involved in starting a new venture. Timmons & Spinelli (2007) consider the business plan as the culmination of a usually lengthy, arduous, creative, and iterative process that transforms a raw idea into a magnificent opportunity by carefully articulating the merits, requirements, risks, and potential rewards of the opportunity and how it will be seized. Abrams (2009) sees a business plan as a powerful document telling the story of your company, while Lambing & Kuehl (2007) defined a business plan as a comprehensive document that helps an entrepreneur analyze the market and plan a business strategy.
Thus we can define a business plan as a detailed document of intent by an entrepreneur showing the existence of business opportunities and the ideas developed to exploit them with details of all the relevant external and internal elements involved, and the merits, risks and the potential rewards inherent in exploiting the opportunities. Some other definitions of a business plan are shown below:
- A document that comprehensively describes the goals and objectives of a business, and equally shows in details how and when they will be achieved.
- A structured guideline on how to accomplish a business goal.
- A proposal that explains a business opportunity for financing agencies or investors.
- An action programme that outlines in detail all the necessary aspect of a proposed business.
1.2 Who needs the business plan?
Businesses and Start-ups all need to plan how to utilize their resources in growing and establishing their businesses respectively. Existing businesses use business plans to show the current position, where the businesses want to be in the future, and what it will take the business to be there. On the other hand, the Start – ups want to know what resources are required to establish the business and where it would be in the nearest possible future. It could be inferred from the foregoing that all individuals involved in setting up a business, growing a business, and even sustaining a business all need business plans.
1.3 Desirable attributes of a business plan.
It is common to write a business plan with a view of using it to secure from banks, and or other interested investors. It is therefore to bear in mind that your plan must be presented in such a way as to the approval of these potential investors. To do so, the business plan ought to have the following desirable attributes:
- Simple and clear
- Concise but precise
- Sequential and logical
- Models reality
- Use figures where necessary
- Simplicity and clarity.
It is usual for the person who has the authority to approve your business plan for funding assistance to have a very busy schedule; also it is equally possible that business plans from other entrepreneurs are competing with your plan for funding. As such, your business plan needs to be simple and clear. This can be done by: ensuring that your language is simple; clear; avoiding cramming many ideas into one sentence; and using tables where it can help to bring out information more clearly and sharply.
- Concise but precise.
Where the business plan is bulky, the person reading it may get tired even before forming opinion about the business proposal. This might rub a business plan the due consideration it deserves. To avoid this, all unnecessary details are removed from the business plan. In fact, only essential information necessary for the reader to form opinion and take decisions should be left.
- Sequential and logical.
The business plan should have its ideas and facts presented sequentially and logically. This makes it easier for people to read and understand the plan. Efforts should be made to ensure that what is written in one section of the plan fits together with what is written in other sections. In fact, all the sections should add up to make up the whole businesss plan.
- Models reality.
For a business plan to be a valid document it ought to be as real as possible. That is to say that it should be as close to reality as possible.
Operations, market analysis, estimates of sales and expenses should reflect what is happening in real life. Where a business plan models what obtains in real world situation, it becomes an instrument on which decisions could be based.
- Use figures where necessary.
Most bankers or investors that would read the plan are highly numerate, mainly thinking in terms of numbers. Experience has shown that most banker and investors are impressed when ideas are backed with figures. In order words, it is advantageous to quantify wherever it is possible.
The Business Plan and Intellectual Property Protection
Developing a business from the scratch requires a lot of intellectual capital that ought to be protected. During the process of documenting a business plan, some of the intellectual capital that form the basis of a good business might need to be disclosed especially where the plan is used to attract investors and lenders. In this instance, wide circulation becomes potentially dangerous. Where the business plan is discussing a business idea that have not been patented or copyrighted, it becomes very wise to include a strong non-disclosure statement on the cover page that states that information in the plan is not to be disclosed. In some instances, the cover page of the plan, in addition to signing the non-disclosure documents, may carry the ISBN number showing that it is copyrighted.
1.4 Why write a business plan?
Business plans could be written for any of the following reasons (ICT of the ILO, 2005):
- To have an integrated view of your business – it discusses all aspects of the business.
- To keep you focused on your goals and strategies – the plan serves to remind you of the goals and objectives of the business.
- For the purpose of obtaining finance from outside sources – the plan can be used as a persuasive instrument to convince outside fund sources to contribute in financing the business.
- It guides the opinion of a business – the plan gives highly valuable information on all aspects of the business and as such helps to guide opinion of the business.
- It also helps to guide the managing of a business – the plan creates performance benchmark against which the running of the business can be compared.
- It is an instrument that helps to communicate clearly with all interested parties – a business may have many stakeholders with varied interests, the plan serves as a document the stakeholders can consult to see if their interest is covered in the proposed business.
- It helps to evaluate before hand it there are chances of success for the business – the business plan projects into the future and shows with facts what is likely to happen in the future.
- It helps to convince other parties that you can manage the business.
- It also shows the available market for the business’s product/service.
1. 5 What type of business requires a business plan?
As already stated, the business plan is a document that marshals out the what, when, how, why and where of a business. As such, it is required by all businesses not minding the mode of business operation. Note that there are two modes of business operation namely: the mode that is service based -which delivers services of various kinds; and the mode that is production/manufacturing based – which focuses on businesses that are into production.
What information is contained in a business plan?
Information in a business plan must necessarily be about:
- Customers: who are they? What do they want? What are their other attributes?
- Competitors: Who are they? What is their market share? How does the business compare with them in terms of pricing, quality and branding?
- Suppliers: Are located far or near? Are there many sources of supplies and do the supplies configure an advantage or disadvantage to the business?
- Financing: What is the financial structure? How does the equity compare with the borrowed funds? Who are the lenders? Etc.
- Employees: What type of individuals will work in the business
- Products: What makes the products unique? What are the competitive edges of the products?
- Location: Why is the business located where it is? What are the reasons for locating the business where it is?
- Equipment: What technology is embedded in the equipment? Is the equipment complex and from where is it sourced?