How to Make a Business Plan – The Information
How to Start in an Online Business
Phase 2 – Step 13
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This is Part 2 of a 3 part Post on How to Make a Business Plan:
- Part 1 is: How to Make a Business Plan for an Online Business
- Part 2 is: How to Make a Business Plan – The Information
- Part 3 is: How to Make a Business Plan – The Financials
How to Make a Business Plan – The Information is not that difficult, but I believe that it is a necessary task if you really want to be successful. Creating a proper Business Plan will force you to examine your proposed or existing business very carefully, causing you to plan your business in a way that will produce success.
Remember the old adage: ‘If you fail to plan, you plan to fail.’
A Business Plan is a written description of your business’s future, and generally projects 3-5 years ahead, outlining the route your company intends to take to reach its yearly milestones, including revenue projections. In short, it is a document that describes what you plan to do and how you plan to do it. You may refer to it often, sometimes even update it, but it will always come in handy as a reference to keep you on the right track.
For my intent and purpose here, I will be showing you how to create a Business Plan for your new or existing Online Affiliate Marketing Business. If you are not exactly sure what Affiliate Marketing is, I urge you to check out the following site: Wealthy Affiliate
Wealthy Affiliate is FREE to join, and has an enormous amount of Training that will guide you through the process of building a FREE Website, offers you FREE Hosting, and a whole lot of other features. They will supply all of the Training that you will need to become hugely successful in the field of Affiliate Marketing.
Wealthy Affiliate is, by no means, a get-rich-quick scheme. It is the Real Deal, requiring some hard work on your part, as well as consistency, but if offers you all of the Training and Tools that you need to successfully create your own Website and earn some decent Income. However, in order to be truly successful, you need to approach your venture much like a contractor building a house. If you start with a good foundation, and then build from there, your home will stand for a long time. After you check out Wealthy Affiliate be sure to come back here and begin building your foundation by completing your Business Plan. It will get you started on the right foot.
The Business Plan
The type of Business Plan needed for an Online Affiliate Marketing Business does not need to be as extensive or as formal as the type of Plan that would be needed for someone who would be looking for investors or bank loans to start their business. However, it will contain all of the basic elements that will be needed to get your business started correctly.
Since the type of Business Plan that you will need is basically for your eyes only, it will be created in a much simpler fashion, paying more attention to the core elements than to formality and writing style. The version of Business Plan that we will be creating is called: The Miniplan.
A Miniplan usually consists of one to fifteen pages and will include the following areas:
- The Business Concept – This is where you discuss the Industry, your Business Structure, your particular Product or Service, and how you plan to make your business a Success.
- The Marketplace Section – Here you will describe and analyze your potential Customers: who and where they are, what makes them buy and so on. You will also describe the Competition and how you will position yourself to beat it.
- The Financial Section – These areas will contain your Income and Cash Flow Statement, Balance Sheet and other Financial Ratios, such as a Break-Even Analysis. This section can be a little more complicated and challenging to complete. However, with a little patience, some good information, and some Projections, you can competently complete this necessary Section.
These three major Sections are broken down into six Key Components:
- Executive Summary
- Business Description
- Market Research
- Product/Service Line
- Marketing & Sales Management
- Financial Projections
So exactly what is included in a Business Plan, and how do you put one together?
Well let’s take it step-by-step…
Your Business Plan will be created using two main Document types:
- Word Processing Documents
Word Processing Documents will be used to create the text portion of the Plan – The Information. They will provide the information on your Goals, provide your Business Description, show the focus for your Target Audience, and many other bits of information.
Spreadsheets will you be used to create The Financials portion, and will show all of your Financial Projections using Figures and Calculations. You will be creating the following Spreadsheets in the Financial Projections Section of your Business Plan:
- Profit & Loss Projections
- Cash Flow Projections
- Projected Balance Sheet
- Break-Even Analysis
You may use any programs of your choice for creating the Documents required. Regardless of which programs you choose to use, be sure to Save your information often as you create your Plan.
You can create your Business Plan in one of two ways:
- Entirely from scratch, setting up and creating all of your Documents from scratch using the Word Processing and Spreadsheet programs of your choice, which will allow you to completely customize your Plan to your specific business.
- Or, if you prefer, you can use the Templates for creating a Business Plan created by the SBA, but they will include items that you probably will not need. If you want to view this Template, click the following link: SBA Business Plan
I personally prefer to combine the two options. I use the SBA Business Plan for creating the Word Processing Documents, and use the Spreadsheets Templates that they provide as a guide for creating my own Spreadsheets, thereby, allowing me to customize them to my specific needs. The choice is obviously yours.
If you have been following my posts, step-by-step, then you have already learned how to Format and Create Spreadsheets. This will benefit you greatly when creating the Spreadsheets needed for your Business Plan.
If, for some reason, you have not been following my posts, step-by-step, and you are not familiar with creating Spreadsheets, then I would go ahead and use the SBA Business Plan for your entire Business Plan for now. If you use certain categories for something different than what is listed, you can always note these changes in the Word Processing part of a particular Section. When there are categories that are not needed, you can simply enter a 0 for the result. Eventually, when you learn how to create your own Spreadsheets, you can go ahead and do so, replacing the Template versions with your newly created ones for your Plan.
My instructions here are based on the SBA Business Plan Template, yet they include more information that you will receive there. They also eliminate the areas that I feel are not needed in most cases. This post is designed in such a way that you can follow those Templates, yet refer here for more information.
When all of the required Documents have been completed, they will be arranged in the proper order and combined to present an easy to follow, and complete Business Plan.
OK. Let’s begin…..
Creating Your Business Plan
First: Create a ‘Cover Page’ (Center all Information on the ‘Cover Page’, Bold all, use 14 pt. Font). Include the following:
- Line 1: BUSINESS PLAN
- (then, leave 2 blank line spaces)
- Line 4: Company Name (your website Domain Name)
- (2 blank line spaces)
- Company Logo (optional)
- (1 blank line spaces)
- (Your Name), Owner (no parentheses)
- (2 blank line spaces)
- Date (write out month)
OK. Nice start! That was easy! If you do not have a Company Logo yet, I would start thinking about creating one. You will benefit by using it in several ways, such as: a Header Image on your website, a Favicon (an Icon Image that shows before your website name when your site is opened up), a Desktop Shortcut Icon (which your visitors can use to create quick and often access to your site), as well as on Business Cards, Magnetic Signs, or any other type of Advertising that you intend to use to promote your site.
Once we have completed the entire Business Plan, we will create a ‘Table of Contents‘ page. That page will follow the ‘Cover Page‘, but can not be created until we know what the page numbers will be.
Important Note: Do not include the areas titled: ‘Section‘ in your Business Plan. They are here simply to provide you with additional information. If you are not using the SBA Templates, you can simply Copy & Paste all of the Headings and Sub-Headings (in Bold) into your Business Plan, and then follow the instructions given in each Section in order to complete them.
So, on to the rest of the Business Plan ….
From now on, all pages will ‘Align Left’, with Headings and Sub-Headings in Bold. Each page will begin with a number of the Section and that Section’s Title, followed with 2 blank line spaces, then numbered Sub-Headings for each Sub-Section on that page, followed with 1 blank line space between the Sub-Heading and the 1st Paragraph. Each paragraph will be followed by 1 blank line space, with 2 blank line spaces separating the last paragraph in a Sub-Heading Section from the next Sub-Heading. Main Header Font should be 16 pt., Sub-Headings – 14 pt., Paragraphs – 12 pt. Each area should include from 1 to 3 Paragraphs.
Before each Section, will be a brief explanation of what is to be included. Then, each Sub-Section has specific directions for completion. Create Section 1 as follows:
Section 1: Create Your Executive Summary
An Executive Summary is an introduction to your business. This Section should be clear, concise and to the point. It does not need to be lengthy.
It is recommended that you revisit this Section to review your work after completing the other Sections of the Business Plan to assure consistency and maintain accuracy.
1. EXECUTIVE SUMMARY
Simply describe what your website will be about. Describe the types of Products or Services you will be going to offer and promote.
Describe the traits of your Target Visitors. This can include: geographic locations, rough ages, gender, income, interests, etc.
1.3 What Drives Me
List your purpose for creating your website. Also, mention your general Goals (not only Financial).
Your Goals in this area can be generalized into something like: ‘My main Goal is to be able to spend more quality time with my family. I intend to make enough money working from home, so that by the end of my first year, I will be able to solely financially support my family, and then to be able to earn enough in the following years, for us to also do some of the more enjoyable things in life, like travel, purchase new cars, remodel our home, etc.’
Complete this Section in your own words. Do not Copy & Paste my suggestion.
Section 2: Create Your Company Description
Elaborate on your Company Description for each of the following Sections:
2. COMPANY DESCRIPTION
2.1 Mission Statement
Explain exactly what you will do with your website and what you hope to achieve.
2.2 Principal Members
If you are the only member of your company at this time, simply state that you are the Sole Owner and Proprietor.
2.3 Legal Structure
Chances are, you will be a Sole-Proprietor at this time, but if you have decided to create an S-Corp or an LLC, then you will list that here.
Section 3: Explain Your Market Research
In this Section, you will provide detailed information to show that you have a solid understanding of the industry within which your business will operate., who your competition is, and how you will do better than them.
3. MARKET RESEARCH
Describe briefly what Affiliate Marketing is.
Describe who will be your Target Customers/Visitors. If possible, embellish on the explanation that you gave on the Executive Summary page.
This may take a bit of research, searching out your Competition on the Internet. Search out the sites that are related to the Niche you have chosen.
3.4 Competitive Advantage
List the things that you will do better than your Competitors are now doing, and what knowledge that you possess, that may offer you an edge on your Competition.
This can be things like: Business Licenses that might be needed in your particular city, and using pictures and videos that are in the public domain in order to avoid copyright infringements.
Section 4: Discuss the Types of Products/Services That You Will Promote
Explain what types of Products and/or Services that your Website will promote. If they include any of your own products, include your pricing structure.
4. PRODUCT/SERVICE LINE
4.1 Product or Service
Describe in detail what your Product or Service is and how it will meet the needs of your Customers. Explain the benefits of your product or service and the advantages it has over the Competition, presenting the information from the Customer‘s point of view.
4.2 Pricing Structure
You can put something like: ‘My pricing structure is set by the Affiliate Programs that I will be promoting.’
4.3 Product/Service Life Cycle
If your website is new, you can put something like: ‘My website is in the infant stages, but will continuously evolve over time, yet the products that I am promoting have been around for (x) years and have been tried and tested with absolute great results.
4.4 Intellectual Property Rights
If you have products of your own that you will promoting, you can include any patents pending or issued here. If you do not have products of your own, you can put something like: ‘I have no intellectual property rights to the products that I am promoting, but I have certain copyright protection over my own content.’
4.5 Research & Development
If you have products of your own that you will be promoting, you can enter any R&D information that is planned here. If not, you can eliminate this section.
Section 5: Marketing & Sales
In this section, you will describe how your company will focus on its Customers through its marketing and sales strategies.
5. MARKETING & SALES
5.1 Growth Strategy
Describe your plans on how you intend to grow your Company. Describe how you will drive more Traffic to your site. These can be things like, regular posting with good low QSR Keywords, Social Media promotions, etc.
Describe how you will communicate with your Customers. Will it be strictly through Email? Will it also include phone contact? Will it only be through Comment responses? Fully explain all of your strategies.
Explain how you will offer or sell your Products to your Customers. Will you be selling your own products, providing Links in informative posts or Reviews, or a combination of all?
Once this portion of your Business Plan has been completed, Save all of your work, and place it in a Folder marked: ‘Business Plan for (name of your business)’.
The final component of your Business Plan is: 6. Financial Projections. Since that is a more complex section, requiring you to create and complete several Spreadsheets, I will cover that in a separate post. Please see my Post: How to Make a Business Plan – The Financials – Phase 2 – Step 14.
When putting your Business Plan together, those Spreadsheets will follow the work that you have completed so far.
6. Financial Projections will include the following Spreadsheets:
- 6.1 Profit & Loss Projections
- 6.2 Cash Flow Projections
- 6.3 Projected Balance Sheet
- 6.4 Break-Even Analysis
Those Spreadsheets will be followed by the following Section: 6.5 Financial Assumptions, and will include the Assumptions that you will use in order to complete each of your Spreadsheets. You can complete the applicable Section here simultaneously, as you complete your individual Spreadsheets, so as not to forget the Assumptions that you will use in order to complete each of them.
Section 6: Financial Assumptions
In this Section, you will explain any Documents, Forecasts, and other Assumptions that you relied upon to formulate the Projections and Figures for each of your Spreadsheets.
6.5 FINANCIAL ASSUMPTIONS
6.5.1 Assumptions for Profit and Loss Projections
Explain any Documents, Forecasts, and other Assumptions that you relied upon to formulate your Profit & Loss Projections. This may include Assumptions about: Gross Profit, Operating Expenses, Taxes, etc. Remember, you can always go back and make changes when you find out that certain Assumptions were inaccurate.
For now, some items will simply be an educated guess, but explain what information you relied upon to formulate these guesses. If the information is fact, state it as such. If it is a prediction, state how you arrived at that prediction. Also, if your 1st year figures are based on a year that is less than 12 months, include that information in your Assumptions.
6.5.2 Assumptions for Cash Flow Analysis
Explain any Documents, Forecasts, and other Assumptions that you relied upon to formulate your Cash Flow Analysis Spreadsheet. This may include Assumptions about: Cash Receipts, Cash Paid Out, and Borrowing Costs.
At the end of this Section, List a Start Date for your website, as well as an Ending Date for your 3 year Cash Flow Analysis.
- Start Date:
- End Date:
6.5.3 Assumptions for Balance Sheet
Explain any Documents, Forecasts, and other Assumptions that you relied upon to formulate your Balance Sheet Statement. This may include Assumptions about: the Value of your Assets, your Liabilities, Debt, and Equity.
At the end of this Section, List your Start Date for your website, as well as an Ending Date for your Balance Sheet. These should be the same Dates as in your Cash Flow Analysis Area.
- Start Date:
- End Date:
6.5.4 Assumptions for Break-Even Analysis
Explain any Documents, Forecasts, and other Assumptions that you relied upon to formulate your Break-Even Analysis. This may include Assumptions about your Current and Future Costs of: Raw Materials, Labor and Operating Expenses if you are offering any products of your own creation.
Number All Pages & Create Your ‘Table of Contents‘
After you complete your entire Business Plan, number all of your pages in both the upper right corner and centered at the bottom of each page. You can simply place the appropriate page number in parentheses, or mark each one as ‘page ( # )’, whichever you prefer. Do not number your ‘Cover Page’.
Once all of your pages have been numbered, create a ‘Table of Contents’ page, listing each Section, along with the appropriate starting page number for that Section, as well as page numbers for each of your Spreadsheets. The ‘Table of Contents’ page will also not be numbered, and will be placed right after your ‘Cover Page’.
The Format for your ‘Table of Contents’ might look something like this:
Table of Contents
1. EXECUTIVE SUMMARY …………………………………………… page (1)
2. COMPANY DESCRIPTION ………………………………………… page (2)
You are off and running in your quest for financial freedom!
Best of Luck in All That You Do!
Please leave a Comment or ask a Question in the Comments section below.
If you run into a problem or have any Questions related to this Training, and prefer to contact me in private, please feel free to Email me and I will attempt to walk you through to a solution. You may contact me at: firstname.lastname@example.org
When ready, continue to my next Post: How to Make a Business Plan – The Financials – Phase 2 – Step 14