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Why you Need a Business Plan
A business plan is essential if you've decided to manufacture and sell your invention on your own or if you're using your invention to set up a business. The business plan will be vital in helping you raise capital for your venture. Banks and lending institutions, in particular, will require a business plan if you're seeking financing.
What is a Business Plan?
A business plan is a document that clearly describes the goals of your business and provides an outline on how you plan to achieve them. It acts as a blueprint for every part of your business venture from start-up right up through your entire business venture.
It also should explain how your business will function, be managed and marketed. Expected expenses and assets you expect in your business should also be on the business plan. A business plan should also have financial projections, an executive summary and any supporting documents you need.
If you have specific dollar amounts, you need to show how you arrived at those figures. It's a good idea to start your business plan as soon as you file for your patent. A business plan is invaluable in showing you how it stands in the market as well as how competitive it may be.
What Should Be on the Business Plan
Writing up your business plan shouldn't be something you rush through as an afterthought. It's a very important part of your invention and your business venture. The body of the business plan may consist of four parts:
- Description of your business
- Marketing plan
- Financial management plan
- Management plan
Your business plan will also consist of important details such as a description of your invention as well as it's functions, manufacturing plans or procedure, costs and profits, the potential size of the markets, description of markets, distribution plans, competition comparisons, patent status, timelines of developments, amount of money required and more.
Business Plan Even With No Plans to Start a Business
Many new inventors find their big on ideas and short on cash. Therefore, as much as they may want to start a business, it's just not in their budget. However, you still need to do up a business plan for two very important reasons. First, you may decide later that you're in a position to start a business. Second, a business plan will help you to sell your invention to any interested parties. It will definitely make you look more professional as well.
If the time comes where you do want to start a business, your business plan will make a great resume for your business. It will not only tell anyone everything they need to know about your invention but will also identify your goals, define your business and help allocate resources to the right places. Because it will be required if your request financing it's better to have it done now.
Remember that your business plan is a professional document and should be written up as such. This simple document may play a large part in ensuring your future success. Many inventors write up a marketing plan to include with their business plans. Here are two excellent sites to help you with your business plan and marketing plan:
- Creating a Marketing Plan
- The Business Plan for Independent Inventors