How to Prepare a Business Plan

You’ve now done a lot of the critical thinking that will lay the foundations for an initial business plan. While many business owners get started without a clear business plan, and while it is not imperative for every business, a business plan is critical when you require an initial injection of funding to get your business off the ground.

In this instance, both a bank and an investor are going to want to read a business plan which is designed to articulate what you’re creating, why you’re creating it, and how you’ll ensure it is a financially successful venture.

According to research published in 2019 by Small Business Trends: [1]

• A little more than half of all start-up businesses survive until their fourth year.
• After this, the start-up failure rate is approximately 44%.
• The main reason they fail, in 42% of cases, is because there is a lack of market needs, 29% fail due to a lack of funding, and 23% because they hired the wrong team. Other reasons include being beaten by competition or lack of a business model.

The best way to avoid these scenarios where your business becomes part of these statistics is thorough planning.

Let’s explore a basic overview of what to include in a business plan as a basis for you to begin formulating your own plan for launching or growing a business in wellness.

1. Company Information: Start with a simple cover page that includes your business name (or space for this if you need to come back to it), and add contact details for you and any other founding business owner/s.

2. Executive Summary: This is a brief explanation of the overall mission of your business, including what it is, what kind of impact it will have, and how it will achieve this. Usually, it’s easiest to complete this once all the other components are done as it acts as a form of summary for the reader.

3. Business Overview: This is where you go into depth about your proposed business with a focus on the value proposition.

4. Industry Analysis: Flesh out what you’ve learnt about the wellness industry, including the key trends, size, and other features that will ensure success. What does the future of this landscape look like as it pertains to your product or service?

5. Competitor Analysis: Provide an in-depth overview of the companies you’ll be competing with, directly and indirectly. You should be able to show your strengths and weaknesses and what sets you apart from them. What are you going to do to remain one step ahead of others?

6. Target Market Analysis: As we’ve explored, you can consolidate the findings of your key audience here, including answers to the questions we discussed their values, identity markers, where and why they shop, and validation that you’re solving a real problem for them.

7. Team: Who do you currently have in your team and who will you need? Outline this in detail so that you can show you have a clear understanding of your own skills and where you need to plug the holes.

8. Operations Plan: Show how the business is going to launch and grow, including the strategies that will support this plan. Include everything from the equipment or materials you’ll need, to how much it will cost to create your product or service.

9. Marketing Plan: Here you’ll address the 4 P’s which are: Product (how the product/service looks and works), Place (where you’ll sell it), Price (how much your customer will pay and why), Promotion (what you’ll do to advertise, sell, promote and publicise your product or service). You might also include the process by which you’ll get your product or service to your customer.

10. Financial Plan: Finally, you need to provide an in-depth overview of how your business will spend and make money. It will demonstrate how much money you need to start your business, project how much you’ll need to manufacture (if applicable), project sales and profit margins, and look at cash flow for a future period of 3-5 years. You might seek help from an accountant for this section.

What have you learnt here?

Which of these sections of a business plan do you think you would find easiest and most challenging to structure based on your current knowledge of building a business?

Who could you approach for advice and support to make this easier?

References

[1] Annie Pilon (2019) One-third of Small Businesses Start with Less Than $5,000