Creating a realistic business plan

Many times business owners and entrepreneurs are anxious to write up a business plan and see immediate profits and business growth.It is, however, important to keep in mind that with any successful business plan both short term and long term plans are vital.There are typically two broad categories or sections that most business plans contain.The first is a visionary plan and the second is a strategic plan.A visionary plan is conceptual while a strategic plan is tactical, focused, and able to be implemented and measured.Although visionary plans are important for the inspiration and motivation of creating and following through with a business plan, a realistic business plan contains researched data, planned courses of action, and a timeline. A strategic plan can provide the foundation for a business plan.

Creating a realistic business plan must begin with a substantial amount of information gathering.You must have a clear framework for your business plan before you can ever sit down and actually write it out.

Here are some examples of the research that you need to do:
- Why are you starting a business?
- What are your objectives and goals, professionally and personally?
- What return do you expect from your business in both time and money?
- Clearly define the target audience
- When do you plan to get it started?
- How will you decide how successful your business is (i.e., gross income, net profit, percentage of local market obtained, number of employees, etc.)?
- What is the time frame for measuring success (i.e., where do I want to be in 3 months, 9 months, 2 years, etc.)?
- What is the target date? Sometime in the future is not specific enough. June 1, 1995, gives you a deadline to strive for.

A business realistic business plan should be the result of careful consideration and response to the above points.It is unwise to simply expect that unresolved issues will resolve themselves with time.You have to work out the major details now.

Create a strategy from your analysis of the market
Market analysis questions are the first questions asked by an individual contemplating starting a business.Some examples of questions that need to be asked are: "Is there a need for my product or service?" and "Who are my potential customers?"Often times inability to correctly answer these questions will mean the difference between success and failure in the market.Make sure that you not only know who can benefit from your product but more specific details about them like where they live, what their age is, are they male or female, are they old or young, etc.

After you have an idea of what your target audience include in your business plan how you will not only reach those target customers but how you will grow and expand your reach to include more customers and make your business grow.In your business plan you should in include your plans to promote your product.Will you use word-of-mouth, advertising, direct mail, personal contacts, sponsoring events, or other some other means?Be sure that you can describe why you think that the method you chose is the best for your business.

Money talk
As accurately as possible, list all of your costs.This includes all of the costs that you will have as you start up your business.Will you have fees for a building lease, equipment, fixtures, rentals, etc.?The financial section of your business proposal will be closely scrutinized.You need to include your projected statement of operations including cash flow projections (monthly income and expenses), balance sheet, break-even analysis, and contingency fund.

Of course there are more areas such as management and operations that you will need to bring up as part of your business plan.The above examples are simply areas where business people have the most difficulty keeping their business plans realistic.