A well thought out carefully prepared at home based business plan can mean the difference between a business that prospers and one that flounders. A good dynamite business plan portrays accuracy and credibility, and generates excitement for your top home business. Your plan must be thorough, professional, and based-on-reality.
Even if you're beginning as a part-time business with an initial goal to earn extra money from home, a well designed plan can be your road map toward a full time future .
Basic Practices
Here are a few critical items to remember when sitting down to pen your plan:
- Your plan should be concise (30 to 40 single-spaced pages at most, not counting appendices).
- Your plan must be easy to read and comprehend, without typos or grammatical errors.
- Your plan must portray large and profitable market opportunities for your home based small business.
- Your plan must transmit the strength and depth of your work from home company management team, even if it begins with only you?
Avoid the Following while Constructing Your Business Plan
The following are some items on what not to do while drafting your top home based business plan:
- Do NOT make unrealistic assumptions.
- Don't underrate the difficulties in growing a business.
- Do NOT underrate competitors.
- Don't assume that the reviewer knows industry technological jargon.
- Don't let in long, windy or overly complicated information.
- Do NOT include highly private or proprietary information.
- Do NOT avoid discussing the risks to the business. This may take away from the plan's credibility.
Usual Business Plan Format.
The design of every well conceived business plan, although not set in stone, tends to run along the same general lines, integrating the succeeding key pieces:
Cover Page. The introductory page should be professional and instructive and should contain an appropriate confidentiality caption.
Professional Summary. The professional summary is the prelude prefaceto your at home based business plan and the most vital essential section. Although it comes first, you usually write it last because it summarizes the complete plan. Effective summaries generally include:
- The company's beginnings .
- The product or service and its original or competitive advantage.
- The businesses' aspirations.
- The market outlook for the product and/or service.
- A three to 5 year summary of most important financial forecasts, especially sales and profit/loss.
For new businesses, do some market research investigation and make realistic assumptions projections about how your company can compete contend.
- The management team and its success record.
- The funding required to enlarge the business.
- The "I'm out of here" strategy.
The Work From Home Company Description. This must express a sense of the background of the company, as well as its aspirations. You should also include a summation of the company's main objectives — both long-term and realistic short-term goals.
Management. The operations section area of the plan identifies the most important members of the management team, describes their individual responsibilities and establishes their pertinent experience and achievements. Include resumes that stress accomplishments and relevant track records in an appendix. This applies even if it is just you as a one member mangement team.
The Product and/or Service. If the business is selling a product and/or service, this section describes what the product and/or service is or will be and shows why it can penetrate the existing or developing market. If the product and/or service is still under construction, discuss in detail where the project and/or service is at and what remains to bring it to market.
Investors are typically not interested in a one product business. You should thus talk about logical extensions of the company's product diversity and future enhancements in the product section.
The Market. You have to convince prospective investors that the company's market is large, growing, and receptive to your products or services. If the market is little or declining, investors are less likely to invest. Appendices may include more in-depth market details.
Rivalry. The competition area of the plan is focused on how you will be competing with your competition? How will your product and/or service price or caliber be different? What will make it successful attractive?
Marketing.The marketing section of the business plan should talk about the company's marketing plan and strategy in as great a detail as you are able.
Financial Statements and Assumptions. This area of the plan should incorporate a summary of the major aspects of the financial projections, which appear in more depth in appendices. These could include total cash requirements, the time frame for positive cash flow and the projected growth in sales and profits.
The financial projections appendices should be in more depth: balance sheets, income statements, and cash flow projections for a 3 to 5 year period, with the information presented every month for the 1st year and quarterly in following years. The projected income statement is probably the most important forecast.
The most significant part of the projections is the set of projections that are the basis of your assumptions — they must be "down to earth", make sense, and achievable.
If you're not a financial statement guru "geek", get help. Credible Logical financial projections are so important — if you're not familiar "up-to-speed" with financial statements, you should find assistance from an CPA or other experienced source.
Reality Check. After you complete your draft business plan, distribute it for comment to friends, professionals, and other keyadvisors. Ask for their blunt "tough love" assessments. Better still, ask them to give you a "markup" of the plan with particular recommended alterations .
Write a Mini Business Plan
A 2 or three page business plan can also be useful at times. This abbreviated plan helps preface the home based small business to prospective investors, lenders, or associates. If the party is interested, you may present them with the complete business plan.
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