A business plan is your road map to profitability and success. A well-conceived plan describes the vision you have for the business and the path you will take to achieve that vision. It also serves as a communication vehicle for employees, customers and potential financial resources. An effective business plan has nine key elements.

1. Executive summary. The executive summary outlines the plan’s key sections such as the company’s mission and goals, target markets, products and services, primary competitors, marketing strategy and financials. The summary should be one to two pages long and should convince the reader to review the entire business plan.

2. Company description. The company description provides a clear idea of what your company is all about, what it does, and how it will operate. In other words, it articulates your company’s mission statement, which is a brief, formal declaration that describes the specific purpose for your business.

3. Market niche. This section of the plan describes your target customers, the larger environment in which your business will operate and why this environment is viable. The key is to identify your desired niche and to explain why you can be successful. To do this, you must answer three questions:

• Who do I serve (who are my customers, who are the people I want to have as customers)?

• What value do I offer (what are my customers able to do because of me = value proposition)?

• How do I help customers achieve this value (what goods and services do I provide)?

4. Competition. This section of the plan describes your primary business competition, including their strengths and weaknesses. The most important factor is the identification of your competitive advantages. You can effectively develop this section by addressing the following questions:

• Who is my primary competition?

• How does what I provide differ from these competitors (think about your value proposition)?

• What are my competitive advantages and disadvantages?

5. Marketing strategy. The single most important step you can take as an entrepreneur is to effectively market your goods and services. You can have the best products in the world, but if no one knows about them, your business will fail. Creating a successful marketing strategy is all about addressing the 5 P’s:

• Product – What are you selling?

• Price – How much will you charge?

• Person – What is your target market (i.e., market niche)?

• Place – How will your goods and services be distributed?

• Promotion – How will you let potential customers know about your goods and services?

6. Operations. The operations section describes how the work will be done. This is not a particularly detailed section of your business plan, but it should describe your company’s typical business activities.

7. Management and organization. This section identifies the key business managers and the organizational structure. This is a very important section when you have a staff. It is also critical when you are seeking capital. Investors will thoroughly examine the backgrounds of the management team in charge of your business.

8. Long-term development. This section of the plan describes how your business will grow over time. You should provide a specific timetable for the company’s development, including identification of the potential risks your business faces. You can begin this process by addressing the following questions:

• Where do you want your business to be 1 year from now in terms of product, person and place?

• Where do you want your business to be 3 years from now in terms of product, person and place?

9. Financials. The last section of the business plan outlines your financial projections for the first several years of the business. Ideally, this includes the production of several forms including an income statement (describes anticipated profits over a specified timeframe), a cash-flow analysis (estimates the movement of cash into and out of the business), and a break-even analysis (estimates the point at which revenue received equals the cost of generating that revenue).

Once your company starts doing well, it is easy to relax your standards and return to your previous mistakes. A successful business turnaround plan depends on consistency and persistence. You must keep maintain your focus on efficiency, creditor prioritization, and cash flow rather than returning to basic sales.

Think Long-Term
Business turnaround plans may have quick results but you must adhere to them for the long-run; otherwise, you will return to poor cash flow, missed payments, and other problem areas you had faced prior to your business turnaround plan’s inception.

Within your forecasts, you should have a time-line of expected financial growth. You must maintain that forecast and make certain amends to repair any divergences. It doesn’t matter if you are less profitable than you intended – figure out where the plan went wrong and then amend it with precision so that you can reach your original forecasts.

The business turnaround can be flexible in this instance; however, if you ignore the fact that you are not hitting your targets, then you may wind up with other crises down the line. You must execute your plan closely but with the understanding that some flexibility may be required.

Be Realistic
A successful business owner needs to be realistic and practical and must be aware of when it is appropriate to keep the business, to expand it, or even to sell it. Should your business turnaround plan be successful, you will have likely learned from your previous mistakes and the financial picture will be brighter for you company’s finances.

It is possible your revenue will go down during the first few months of your turnaround plan, yet you will be more profitable due to your business’ reorganization. This positive cash flow will build on itself until a point where your revenue grows high enough for you to consider expanding or selling.

Be Prepared for Expansion
Should you consider expanding the company, it may behoove you to build another business turnaround plan, albeit different in nature. This time, you have a thriving practice; however, a smart business owner knows that expansion can be a logistical nightmare and must be done with a controlled and well-thought plan. You may have to talk to your creditors again and cut some of your debts. You may have to look into your company’s finances and once again flesh out any problem areas you may have.

This may be a different kind of business turnaround, one where you are already a profitable company, yet you still owe it to your firm to be as methodical and practical as you were before. Your business turnaround plan worked once, it should work again.

Finally, you may be ready to sell your company. In this situation, you need not burden yourself with another business turnaround plan, but rather investigate who would be an interested buyer and what would be a reasonable price. Of course, a business turnaround plan may still be in order so that your company is even more desirable to would-be buyers. It all depends on your present finances, your need to sell, and your willingness to once again go through this reorganization process.

It might be the best time to make your very own business plan to place things in order to be able to reach your business goals and objectives. There are ten different sections of a business plan and I will discuss briefly each of this to serve as a guide.

One of the very important things that you will have to include in your business plan is the Executive Summary. Although this section goes at the last part of your plan, it is very important not to miss this one since this summarizes all the key elements of your entire business plan and will give the reader a clearer picture of your business’ structure.

The next key element is the Company Analysis. This will help investors know a bit of your company’s past performance and this will serve as a portfolio of your company’s achievements and success. Include all your big accomplishments in this section and boast your company’s advantage compared to its competitors.

The next section of your business plan is the Industry Analysis. In this section, you will have to clearly identify which sector your business is currently playing in or plans to be part of. Show, in this section, how well you know your industry and give details as much as possible. You can also include a summary of how you picture your company’s place in the industry.

Next is the Market Analysis, also called the Customer Analysis. This section will show your target market for your products and services. Identify your customers and show that you understand your customers well. Show credible data if necessary to support your claims.

Another section of your business plan is the Competitive Analysis. Show in this section how well you know your competition. Include a summary of companies that offer similar services and products to yours. Alternatives of your products should also be included and show your advantages over your competition.

Management Analysis is also an important section of your business plan. This identifies your business’s legal structure and management. You can introduce your board of directors here. Important people that are in the management that have an impressive history should be mentioned here.

Another section to be included is your Operations Plan. This will show how you are currently running your business at the moment. Show a detailed plan of your next product release and how you will sell it, future hiring of additional employees and specific timelines for different actions. Show to your investors the possibility of a higher profit and raise their confidence of investing in your business.

Next important section is the Marketing Plan. This is where you will show how you intend to price, sell and promote your products. Show details of your products and services and how you plan to market it including advertising and promotional activities that are open to you.

To make your investors believe in the current state of your company, you will have to provide them with a financial report of your company. Financial statements and funding requirements for future projects should be delivered including a financial statement analysis. All of this will be included in the Financial Plan section of your business plan.

The rest of the data that needs to be presented and other materials that are not included in the above sections will be place in the Appendices and Exhibits sections of your business plan. All other information that will raise the credibility of your company, including legal document, studies and images shall be included here.