As an early stage business, proper planning is critical for success but it is often hard to ascertain when to draw a plan and how detailed it should be. This makes the task daunting for many founders. In this blog, we will outline best practices for business planning, drawing on insights from our work with East African businesses.
Define Your Business Purpose and Vision
Your purpose is the reason why your business exists, while your vision is your long-term goal. Your purpose and vision should guide your decision-making and provide direction for your business. It should also not change according to the wind. Set time to really reflect on the business and separate it from your personal interests. You will find that as you grow, your changing interest often leads to a lot of confusion for your team.
Conduct a Thorough Market Analysis
Many entrepreneurs skip this and rely on intuition or shallow observations. Make sure you properly identify your target market, understanding your competition, and determine the demand for your product or service. This analysis will help you make informed decisions about your business strategy, pricing, and marketing. It will also come in handy when you start raising funds.
Set SMART business goals
SMART goals are Specific, Measurable, Attainable, Relevant, and Time-bound. Setting SMART goals helps you focus on what you want to achieve and provides a clear roadmap for achieving those goals. As you might already suspect, business goals should be aligned with your business purpose and vision.
Develop a Comprehensive Marketing Plan
Your marketing plan should detail how you will reach your target audience, build brand awareness, and drive sales. It should include a mix of online and offline marketing strategies, such as social media marketing, content marketing, email marketing, and events.
Build a Strong Financial Plan
Your financial plan may be accompanied by a financial model or consist of basic budget projections. It should outline your revenue projections, expenses, cash flow, and funding needs. It should also include contingency plans for unexpected events that may impact your finances. Building a strong financial plan is essential for securing funding and ensuring the long-term sustainability of your business. For more on financial modelling, read our other article on the topic.
Establish a Strong Organizational Structure
Talent planning is critical for managing your team and people related costs. You can start by defining job roles, setting clear expectations, and establishing communication channels. In the early stages, it is better to have a small team of competent and committed founders than a large staff team which requires a lot of upskilling.
Continuously Evaluate and Refine Your Plan
Your business plan should not be set in stone. It should be continuously evaluated and refined as your business evolves. This involves regularly tracking your progress towards your goals and making adjustments based on new information or changing market conditions. By following these best practices, you can achieve your business objectives and drive growth in your industry.
Enea Advisors has helped start ups draw up business plans in agriculture, manufacturing and technology. Take advantage of our 1 hour free review session and improve your strategy document today.