Writing an Ebiz Plan

Friday, December 09, 2005

Developing your ebiz's business plan is something you should defiantly do. If you hope to grow and be around for the long haul, a business plan is essential. When you write a business plan, it is not something you write and then put away but an ongoing process. This is because it will allow you to go back and review different aspects of your business.

There are two types of business plans that you will develop over time. The first type is one that is for yourself and your employees. The other type is the one you will use when trying to obtain funding and will show to prospective investors or a banker. We will be working on the first type today as I think it is more important than finding investors.

The Executive Summary
The first section in a business plan after the table of contents and such is the executive summary. This section contains a summary of what your business will do. If you are showing the business plan to investors, this is the most important part. However, since you are just using the business plan for internal needs this part is not quite as important.

Business Description
This section of your business plan describes the generic parts of the business. It covers the industry, mission statement, business model, goals, what needs the site fulfills. Research the industry a bit for your business plan. This will help you get an understanding of what works and what does not. Then write your mission statement and figure out what customer needs your site will fulfill. This is important as it shows why a customer would visit your site. Next you describe your business model, how will you make money, what will the cash flow look like, etc.

Market Analysis
This is where you look at your competitors and try to discover their strengths and weaknesses. Then you figure out why your product is better than theirs. This section is not all that useful if you are operating a portfolio business. The best part for an e-business is going to be your projections of what the market looks like.

Operations
This section covers the daily activities of the business. It discusses the management team and other key employees. This is where you will talk about your customer service and how day to day relations with the world will be organized within your company.

Financial Statements
This is the part where you cover what types of financing are required to meet your business' goals. You will cover how you plan on achieving that financing. This is where you can get creative with an ebiz. Since an ebiz does not require much capital to run, you can make a plan where you will start a small version of the company while you maintain another job. You can use consulting money to fund the business, there are tons of ways to get initial capital to grow your ebusiness.

The financial statements also covers the profitability of the business. It shows how the cashflow of the business works. For instance if you plan on a domain purchase to have x return on principal per year, it shows how fast your money moves or the velocity of capital within your business.

Conclusion
After reading this article you should have a good idea of what you want to put in your business plan. You can find many sample business plans by searching for them online. Make sure you do not create your business plan as a one-time project but an ongoing part of your business.