College is the perfect time to start a business. You have access to resources, experts, and a supportive community that can help you bring your ideas to life. But how do you go from conception of the idea to actualization?
This is where a business plan comes into the picture.
A business plan is a detailed roadmap that outlines your goals and objectives, strategies, target market, and financial projections. Not only does it help you clarify your ideas, but it also communicates to potential investors and partners that you are serious about the business.
What are the 3 Cs of a business plan?
The 3 Cs of a business plan are concept, customer, and cash flow.
The concept is the business idea, including the products and services you want to offer. The customer is the target audience or the market to which you intend to sell your products and services, while the cash flow involves an effective financial plan and budget for your business.
Why is a business plan an important document for entrepreneurs?
A business plan is an essential document for entrepreneurs because it helps you refine your business idea, assess market opportunities, and provide a roadmap for your business. A well-crafted business plan can help you secure funding from investors, establish your credibility as a business owner, and track your progress against your goals.
Let’s take a look at the elements of a successful business plan for college entrepreneurs to help you start your business with a clear vision.
1. Executive summary
The executive summary is the first and most crucial part of a business plan. This should be a brief, one-page overview of your entire business plan.
The executive summary should provide a clear and concise summary of your business, including its purpose, the products or services, the target market, and the financial projection. Keep in mind that this section is the first thing a potential investor or partner will read, so make it grab attention and highlight what makes your business special.
It’s always best to write it last as it summarizes the entire business plan. Be sure to keep the summary clear, concise, and no more than one page.
2. Business description
In this section, you need to describe the products or services your business offers and how they solve a problem or fulfill a need in the market.
Include information on the features and benefits of your products/services and why the target market will be interested in buying from you.
Break down the features and discuss how they differ from your competitors. Remember, this section is where you should show off the unique aspects of your business, so be specific and avoid vague language.
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3. Business goals and objectives
Every business needs a clear set of goals and objectives to work towards. Outline your short-term and long-term goals and objectives and explain why they are important.
Your goals should be focused on generating revenue, customer acquisition, market share, and profitability. Make sure they are specific, measurable, achievable, relevant, and time-bound (SMART).
Let’s say you’re starting a gourmet coffee business. An example of a business goal can be to capture 30% of the local market share for gourmet coffee within the first three years of operation.
Objectives are the specific actions that you will take to achieve your goals. They will help you and your team stay focused and on track toward achieving the set goals. Remember, you’ll need to track your progress regularly and adjust your objectives and goals accordingly.
4. Mission and vision
Your business's mission and vision statements communicate its purpose and values. Mission statements describe what you do, who you do it for, and how you do it, while vision statements describe the future you are working towards.
Here are examples of the vision and mission statements for your gourmet coffee business:
Vision: To become the premier destination for coffee enthusiasts, known for our exceptional quality and innovative flavors, inspiring a deep appreciation for the art and craft of gourmet coffee.
Mission: Our mission is to delight our customers with the finest quality gourmet coffee, carefully sourced from around the world and expertly crafted to perfection.
These statements are important for communicating your business's core values and beliefs. They also help you create a sense of purpose and direction and attract employees and customers who share your vision.
Both your mission and vision statements should be concise and inspirational and align with your business goals.
5. Organization and management
This section outlines the structure and management of your company. It should include information on the legal structure (e.g., whether your business is a sole proprietorship, a partnership, an LLC, or a corporation).
Here is also where you outline the key personnel that will be involved in managing the business and their roles and responsibilities. This section should also detail the company's operations, including sales, marketing, production, and logistics.
Briefly discuss your management style and the policies you have in place to ensure that your business runs smoothly.
6. SWOT analysis
Before you even think about creating a business, you must identify your unique selling point (USP), differentiating factor, or what sets your product or service apart.
Conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) to identify what makes your product or service unique and highlight the underlying strengths and weaknesses. This SWOT analysis is what will inform all of your marketing, branding, and growth strategies down the line.
Knowing what sets your product or service apart can also make it easier to reach your target audience.
7. Description of the target market
Understanding your target audience, where they’re located, and what they want is another critical element of a business plan.
Here, you should create your buyer personas (or profiles) that identify key demographic information (e.g., age, gender, location), interests, likes, pain points, behavior, and preferred communication channels.
Describing your target market in detail will help you understand which demographics are more likely to purchase your product or service and help you develop a targeted marketing strategy.
8. Competitive analysis and industry trends
Knowing who your competitors are and what they offer is a crucial step in creating a successful business plan. When conducting a competitive analysis, identify who else in your industry is offering similar products and services, their pricing, and their marketing strategies.
This information will help you differentiate your product or service, find gaps in the market, and give you an edge over your competitors. Alongside a competitive analysis, research key trends in your industry to create a business strategy that caters to the ever-changing demands of customers.
9. Detailed financial plan
Financial planning provides insight into the future of the business.
Start by creating a detailed budget outlining all the startup expenses and ongoing costs, including raw materials, labor, rent, licensing fees, equipment, and more.
Next, determine the funding sources of these costs. For e.g., personal savings, investors, loans, and crowdfunding.
Creating a detailed budget will give you an idea of the expected costs, cash flow, and forecasted revenue and create accountability for how you’ll be spending money. It will also help you create projections to show potential investors, banks, or loan officers to help you get financing for your business.
10. Marketing strategy
Your business plan can never be complete without a comprehensive marketing strategy.
This element is essential to help you find and retain your target customers. Make sure you develop a complete marketing strategy that includes both digital and traditional outreach methods.
Social media, websites, email lists, and SEO tactics are some digital marketing strategies that can significantly improve visibility and brand positioning.
You can also implement traditional methods like print media (e.g., fliers and banners), in-person, or product-based advertising.
11. Legal implications
Before starting your business, you need to determine the legal requirements for operating in your jurisdiction.
This includes your business structure, tax requirements, licenses, permits, and insurance. You may need to register your business with the government, obtain permits or licenses, and apply for an Employer Identification Number (EIN).
Knowing the legal requirements for your business will help you avoid costly fines and any legal problems down the road.
12. Sales forecast
Finally, your business plan should include a sales forecast with specific timelines. A sales forecast predicts the revenue you expect your business to generate in a given period, say for the first year.
Depending on your business goals, you can create a daily, weekly, monthly, or annual sales forecast. When creating your sales forecast, consider the following questions:
How much revenue will you generate from each product/service?
How many units do you expect to sell in the specified period?
How much will it cost to produce your product or deliver your service?
A sales forecast will help you plan marketing and advertising campaigns and develop financial projections for your business. It will also help you to track your progress and make informed decisions to achieve your goals.
Starting a business is one of the best ways for college entrepreneurs to supplement their income and meet their needs in college. Whether you’re planning to start a business after college or just starting a part-time venture while still studying, never skip the critical step of writing a business plan.
Through your business plan, you’ll get a clear understanding of the feasibility of your business idea and plan how your business will operate and succeed. Moreover, you can always present it to potential partners or investors who can help you scale up and grow your business faster!
Last edit at Jun 04 2023