After understanding the importance of a business plan, the question to ask is how to do it correctly? In this article we will describe the phases of the business plan writing process when adjustments need to be made according to the demands of the industry where your project will operate.

Research

Market research will help us better understanding of the market the product is in and help us survey the market’s size & growth rate. In the market research process we will search for trends that help us gain an understanding of our product’s potential in the market. For example, if you have an idea for a navigation app; we want to explore what means people are currently using to navigate from place to place, how much revenue this market yields and if it is growing. The second phase of the process is performing research & analysis of competing products/service that satisfy a similar need to our product. At this stage we utilize benchmarking as a way to compare your idea to what already exists in the market, which methods are currently in use to generate profit and what is the size of your competitor’s user base. After we have the market research and competitor analysis completed, we then go on to build the SWOT that outlines your strengths, weaknesses, in addition to the opportunities and threats that exist out in the market.

Product

In this section we will describe the problem that your product solves and how the need is currently being addressed by exiting solutions. In the next phase we describe the product you are offering in great detail such as how the product works and defining how your solutions solves the problem in the market. After concluding the product description, we then go on to break down the value proposition your product offers its consumers. This section requires a great deal of thought and utilization of the aforementioned research in order to answer the following essential questions. What unique value does your product have to offer its users, and how does it stands out from existing solutions in the market in both the eyes of the consumer & potential investors? We complete this section by outlining the product’s potential timeline–broken down into quarters for the first two years and annually for the remaining years. This timeline incorporates the all the relevant steps for launching a business such as development, marketing, and any important milestones to hit.

Business Model

Since you have limited resources, it is necessary to focus the initial efforts. After exploring the market, you understand who the main players are and how you differ from them (the value proposition); we will examine who the target market is; which countries are ideal to begin our marketing efforts and why should you choose this market; it is important to show proof of your choices. From there, let’s take a look at our target audience – which segment in the target market is most ideal to be your core users (motherhood, adult audience, children, etc.). It is important to remember that the project’s efforts at the beginning are required to be very focused on preventing the waste of resources. At the end of the business model definition process we examine what our revenue model will be, which channels will be the primary streams of generating revenue (Commission from sale, sales, freemium and more), based on the product definition.

Go to Market

This is the plan for penetrating the market, answering the question of which actions should we undertake in order to reach the target audience in the market we’ve chosen. Let’s start with the strategy; this is an overview of the process by dividing it to large stages. You should continue with the writing of tactics: detailed steps to implement every part of the strategy we outlined. For example, in our strategy we wrote that the first step will be user acquisition, therefore we should explain which tactics should be used in order to achieve them. (e.g. by marketing). The last part is building a marketing plan, which explains the marketing channels that should be utilized.

Financial Plan

This section of the plan includes two essential parts regarding the money required for the project. The first part is the financial model made in a seperate Excel and its parts that are outlined in the body of the business plan document itself, such as revenues, expenditures and profits according to the forecasts and all related costs. From the financial model we can figure out the sum of investment required and which year the venture will start turning a profit. If an external investment is required, we will move on to the second part which presents the required investment amount, the required funds needed from external investors, and which milestones is the investment needed for.

Appendices (If Required)

Patents, regulations and other information that is not included in the information shown above and is important to display as well. Now that you know how to write a business plan, it is important to remember- less is more. The business plan should be clear and straightforward, with no need to “inflate” the plan by only addressing the main concepts needed for a correct and working strategy. For more detailed understanding of each part, you are invited to examine a number of business programs for example on our site.