Before you start your business plan
Do not start working through this section until you have tested your idea by completing a feasibility study. If you haven’t, you can do so in the testing your co-operative idea section. Once you know your idea is viable, only then should you proceed to writing a business plan.
Writing your business plan
The business plan covers areas that are very similar to the feasibility study – but you must complete a feasibility study before you start on your business plan.
- A feasibility study is your chance to work through and test different aspects of your business, to fix any issues – it can also be the time where you realise you need to go back to the drawing board.
- A business plan will be your document to say how you will do it. A lot of the information will come from your feasibility study. Once it’s ready, and everyone is on board, you can move onto setting up your co-operative by acquiring resources and establishing your legal form.
It’s important to remember why a business plan is important:
- It helps identify where you need help - use it to identify areas where you need to find external help and to specify exactly what support you require.
- It is a work in progress – once you’ve completed your business plan, it will be something you refer back to as your co-operative progresses, and something you develop over time to respond to your co-operative’s needs and aspirations.
More about a business plan
What is a business plan?
At the risk of sounding obvious, it is the plan of how an enterprise is to be established and developed. It describes how it will work and explains why it will work.
The business plan is a written, detailed description of what your enterprise is: who is in it, what it does, why it exists, how it will run, how it generates an income, who buys its product or service, why it is a social business, etc. Anyone reading it should be able to answer any question they may have in relation to your business.
There is no right or wrong format. These templates are designed to help you cover the key areas – you may wish to edit or re-order them, but be careful not to omit anything.
What is in a business plan?
Business plans should be meaningful documents. They should be constructed to describe an actual business, not just to follow a business plan template, though sometimes it is necessary to translate your business plan into the format of an outside organisation, such as a bank.
Why have a business plan?
It is often assumed that the business plan writing is a tiresome necessity entered into only to convince someone to put up a loan or an overdraft. Though this may be a part of the story it should come a long way down the list.
- To provide a structure within which to establish what needs to be looked into.
- To provide the questions to drive that research.
- To establish in your own mind(s) whether the investment of your own time and energy is appropriate:
- What do you think about it? It’s your life we are talking about here!
- Construct the business plan
- Read the business plan
- Do you believe it?
- To be a blueprint to follow during start-up. Very few businesses can get into full production and sales immediately. The more that can be worked out up front, the faster things get up to speed. Many, many businesses fail before they truly get going, often having done enough to prove that it would have done well if it had got up to speed faster.
- To be a benchmark. A business plan should not be written and then thrown into the back of a filing cabinet. It is the yardstick by which actual performance can be measured. Are sales up to projection? Are the costs on target? What is going right and what is going wrong?
- To establish common purpose. To make sure that everybody involved in the enterprise knows what it is all about and what they are committing themselves to. Those who are going to take the responsibility for it, workers, associates, key suppliers, marketing people, possibly key customers, family, friends, auditor, accountant, solicitor, landlord and the people who put up the money.
How do I go about it?
- Knock up a first version immediately. Getting past the blank piece of paper is the most difficult part of the whole process and the sooner it is done the better. It really does not matter how poor draft 1 is. It is not where you start it is where you finish.
- Don't get fixated on using a template. There are pros and cons to using a template.
- Get advice from everybody. You do not have to take it, but every question raised in seriousness is either something you can answer or something you will have to get an answer to.
- Every time you find something worth putting in the business plan do so.
- Ask the business plan questions. What ever it cannot answer is something you need to know and put in it.
How much detail?
- The actual plan should say only what it has to say. Seventy page business plans look impressive but nobody actually reads them so they are of no use at all. Say what you know and why you know it.
- For each part of the business plan have a resource folder which contains the back up information on how you know it, e.g. the detail of desk research, market research, quotes, work flow diagrams, etc. You can refer to these at will.
Let’s get startedUpdated: 26/03/2019