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SCORE Explains How to Start Planning Now for Your Own Business in 2024 

Posted on: December 20, 2023 - 3:10pm

Half of new businesses fail within the first five years, and poor business planning is a contributing factor, according to the U.S. Chamber of Commerce. Those first few years are crucial, which is why SCORE – mentors to America’s small businesses – recommends entrepreneurs build their business on the foundation of a strong business plan.

“Creating a business plan is essential for small business owners as it helps outline and set clear goals and objectives for the business,” explains SCORE mentor LaRita South. “It enables owners to anticipate potential challenges and develop strategies to overcome them. Additionally, a well-crafted business plan can attract investors, secure funding, and provide a roadmap for long-term success.”

A business plan typically has four sections: the executive summary, business details, financial forecasts and supporting data.

The Executive Summary

The summary does just what the name implies: sums up all the information in the business plan. It works as a short sales pitch for your business. If you need funding, this is often the most important (or only) section potential lenders will read, so include all major information here. You might want to write this last after you’ve finished the other sections.

Business Details

In this section, explain your business model, what your business does and how you will make money.

  • Description: What are you offering and why? Be specific.
  • Need: Explain why the world needs your product or service. What’s special about it?
  • Marketing: Who is your target customer, and how will you market to them? Where do you plan on finding them?
  • Sales: How do you plan on selling your product or service?
  • Competition: Who are your competitors, and what sets you apart? How can you compete and win?
  • Experience: List your experience and background and that of any co-founders.

The Financial Forecast

Another necessary section in your business plan is the financial forecast. Here you’ll detail how much it will cost to start the business, where the money will come from and how you will spend it. You’ll also include financial projections for growth.

  • Equipment: What do you need to buy to start?
  • Startup money: Where will the money come from? Personal savings? Friends or family?
  • Other funding options: Do you have other ideas of where you can get financing if needed? Perhaps outside investors?
  • Projections: Forecast your income and expenses for your first year. Estimate how long it will take to break even.

Supporting Data

This critical part of the business plan provides backup evidence for everything you added so far. For example, the supporting data might include the size of the market for your product or service.

Ask for Feedback

Creating a solid business plan will help you focus on what’s necessary to succeed, but you don’t have to go on this journey alone. Connect with an expert business mentor at SCORE for free guidance and support.

“SCORE helped me identify the steps that I needed to take on to get this business to transition from an idea to inventory,” said SCORE client Don Tobul, owner and operator of OD Greens in Eastlake, OH. “Working with SCORE helped me create the business. If it wasn’t for SCORE, I wouldn’t have a business – I firmly believe that.”

Ready to seek valuable feedback on your plan? Connect with a SCORE mentor today and get started.

About SCORE:

Since 1964, SCORE has helped more than 11 million entrepreneurs start, grow or successfully exit a business. SCORE's 10,000 volunteers provide free, expert mentoring, resources and education in all 50 U.S. states and territories. Visit SCORE at www.score.org.

SOURCE:

https://www.chamberofcommerce.org/small-business-statistics/