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Business Plan

The business plan is a document that proposes a new commercial project focused on a good, a service or a company as a whole.

Through the content of the business plan, the company tries to evaluate the characteristics of this project for its subsequent presentation.

In the business plan the environment of the company is studied, analyzing and evaluating the possible results if the objectives set in the project were achieved. For this, it's important that the business plan contains in its pages the various variables that make up its objectives and the resources that'll be necessary to devote to them to start its operation and to achieve those objectives.

Therefore, this document is written before an investment is made or at the beginning of a business. It collects the successive steps or stages necessary for its development and achievement of the defined goals. In that sense, it's common for entrepreneurs to develop one in order to set out their line to follow in the future.

Components of a business plan

If we refer to the composition of the plan, the following points of analysis can generally be found:

- Company Overview
- Products or services and how they are produced.
- Description of the business model.
- Cash flow statements. Detailing all possible income and expenses.
- Projections and financial estimates of these revenues and expenses and other factors.
- Identification of the executive management and the management team.

Within the guidelines that are marked within the plan, you can find the different alternatives that the business to start up entails. All with the idea of ​​studying its economic or technical feasibility. That is, it's posed if the achievement of objectives is possible from a financial point of view, if this work will translate into benefits in a given time and if the company has sufficient means to implement it.

The development of a business plan is essential when a new product or service is launched or when new business goals are sought. This is because it's the information that's disclosed to seek external financing or to have the necessary approval of the company's executives when starting the project. For this reason, the plan must offer a solid and well detailed picture of what is proposed in it.

Business plan structure

A good business plan must be complete and fully cover the main aspects and factors that make up the project to be analyzed in detail. It must also be properly organized for quick and easy consultation. It includes the operation of several areas of the company that we can summarize in:

- Structure of the administration of the company: Statutes, administrators of the company and their functions.
- Legal and commercial structure: Constitution of the company, commercial and fiscal procedures.
- Economic structure of the company: Environment, market, object of the activity and competition.
- Marketing plan: Indicates how they intend to achieve their marketing objectives and thus facilitates and manages marketing efforts.
- Sales planning: Estimates, sales systems and payment and collection policies.
- Human resources management: Selection, training, coordination and salary policies.
- Financial and accounting plan: Valuation of investments and projects, cash flow management, social capital management and liabilities.

We must not confuse it with the marketing plan

A frequent mistake when defining the business plan is to confuse it with the marketing plan. However, the marketing plan is only one aspect of the business plan. Basically, the business plan is the global planning document of the company on its operation in a period of time or in a particular job or service.

For its part, the marketing plan is one of the parts that make up the total, or business plan. While the business plan shows a broader or more general vision, the marketing plan focuses on strategies and efforts to generate sales and revenue.

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