New companies need a clear, detailed business plan that can attract investors and help secure funding. A solid business plan can also serve as a guide, helping entrepreneurs get back on track when they derail from their original intentions. Sometimes, this alteration is strategic and will encourage growth toward a more profitable goal. With a business plan, entrepreneurs can compare where they thought they would go with where they are to create a strategy for the future.
Unfortunately, entrepreneurs around the world often struggle to understand how to write a great business plan. This problem is become especially pronounced in the Middle East, where opportunities for basic business education can be hard to find.
The following tips are designed to help Middle Eastern entrepreneurs ask the right questions as they craft their business plans:
Do the necessary market research first.
To write a really great business plan, you need to be an expert on the sector that you are looking to enter. You should have a clear idea of the competition, how you will likely develop in the future, and the potential consumer base for your product.
Your business plan should clearly outline any potential hurdles caused by competition and explain how the company will overcome these challenges. Likewise, the business plan should describe the most likely customer populations for the envisioned product, how marketing and advertising initiatives will appeal to those people, and the real value customers gain from the product.
In today’s Middle Eastern business climate, you need to demonstrate how your company’s products meet a need that goes unmet or how they meet it better than other products on the market. You should consider audiences around the entire region, not just in your own nation because you may want to eventually sell your products in other parts of the world. Your business plan should therefore take into account how your product or marketing efforts will need to change across cultural boundaries.
Make realistic estimates about time, money, and resources.
It is perfectly acceptable to make claims about potential market share and other metrics in a business plan, provided that you support them with hard facts. However, when it comes to estimates of money, time, and other resources, it is best to remain rather conservative. A realistic, thoughtful business plan will impress investors much more than one that makes outlandish and unbelievable claims. Because it often takes companies up to several years to become profitable, business plans that estimate profitability in a matter of weeks or months will not be taken seriously.
Realistic estimates will also help you as your company matures. For example, if you tie your firm’s success to impossible-to-achieve income figures, you might despair when these goals aren’t met. However, if you create a more conservative business plan, you will receive a confidence boost when the company actually meets or even surpasses your specified targets.
A good rule of thumb is to estimate that everything will take 15 to 20 percent more time than you think. Business development can prove aggravatingly slow, especially in the Middle East. Thus, it’s a good idea to build in some amount of buffer. Not only will this reduce stress, but it will also help you maintain credibility with your investors.
Back up all statements with proof.
You need faith in your ideas to realize success, but faith, by itself, will not sway investors. In your business plan, you need to prove that your idea will be profitable. Success depends upon you understanding the market, knowing how to attract customers, and allocating resources in a way that encourages continued growth and development.
All claims in your business plan should be supported by research that backs up your assertions. If possible, you should compare any data from research you have conducted on a similar product with a prototype or early customer feedback on your product. You will need to account for all the variables that may affect your success and show the measures you have taken to track those variables and deal with any issues that may arise in relation to them.
What Not to Include in a Business Plan
Understanding what not to put in a business plan is just as important as knowing which components to include. In general, you should stay clear of superlatives and remove anything that it not vital to your message. A business plan demands concise language as investors must be able to read through it in a reasonable amount of time.
It is also vital to avoid incorporating any information derived from rumor, especially in regard to your competition. Investors will quickly see through unsavory gimmicks or unreliable research. It is paramount that you maintain your credibility.