Creating a Business Plan for Your Manufacturing Business
A business plan is an important document that details the planning of your business, as well as the qualities and background information that lenders will wish to know before giving out finance.
A good plan will help you obtain finance, as well as providing you with a solid document showing you where your business should be progressing.
A good business plan needs to cover eight key areas:
1. Summary of the Business Plan – An introduction to the business and yourself, the product (or service), and a brief look at how the finances will work.
2. Management – A look at your business and management experience and that of your business partners.
3. Product or Service – Details of the product(s) or service(s) you will be offering.
4. Marketing – Details of your sales capability, and the typical profile of your competitors and target customers.
5. Sales – Details of the unique selling points of your product, information on pricing, as well as possible stockists. You should also mention possible areas of advertising you may wish to use in the future.
6. Operational – Information on the location of your business, how close it is to potential customers and employees. What equipment you will be using, and whether you will be buying extra equipment in the foreseeable future.
7. Short Term Trading – The short term objectives (or targets) of the business, with information on contingency plans if things do not go as well as expected.
8. Financial Documents – Forecasted Profit and Loss accounts, balance sheets and cash flow forecasts. Give brief explanation of why you chose predicted figures.
A business plan is not a one-off document, for example; an updated version can be used to help gain expansion finance.
Every business plan is different, and must take into account the details and situation of the business or project. The amount of pages and detail will vary, but the more risky the business, and the higher the finance required; the more information will be expected.
“A good business plan shows you are prepared to deal with both success and failure.”
Whatever the business, a good plan will show that you have thought about every aspect of the business, and are prepared to deal with both success and failure. This will make you appear less of a risk; and therefore increase your chances of obtaining finance.
5. The Business PlanOutsourcing Manufacturing and Competing on Price
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