A business plan is a management tool that helps you to monitor, evaluate, and track your progress. Your business plan can be modified as your project progresses. You can track your progress by using your business plan to set milestones and timelines. This will allow you to compare your projections with actual achievements.
A business plan serves three main purposes: communication, management, and planning. It guides you through each phase of your business. A well-thought-out plan will help you identify and avoid roadblocks and obstacles and provide alternatives.
Even more importantly, a business plan is essential for attracting investors to finance your business project. If investors cannot see the potential for recoupment and, more importantly, a profit from your project, they won't invest in it. Anyone looking to finance anything should have a business plan.
What information should be included in a business plan?
Your business plan should be easy to understand. Do not waste time creating a 40-page document that nobody will ever read. It should be between 10 and 15 pages. The following are generally included in every plan:
- Executive Summary: A cover sheet listing the credits of the director, producers, and talent. It also describes the budget and start date in concise paragraphs.
- A Synopsis: The storyline is briefly summarized, followed by the section on "investment merits," which highlights all the positive aspects of the project. It does not include the end (if they want to read the script). These elements could be established talent, distribution guarantees, or large potential audiences.
- Environment: This brief summary will inform your reader about the industry and the opportunities within it. It is also possible to describe your potential customers and mention some projects that may be similar to yours.
- Operations: Describe how you will structure your internal operations from the top to produce the project. Please indicate what support services, castings, equipment, facilities, and locations you will need. To complete the project, you will need to provide support services such as casting, equipment, facilities, locations, and legal advisory services. List all capital requirements that are necessary to complete your project. Describe funding sources and terms. Indicate the source of financing and the amount required.
- Marketing: Your company's strategy for pursuing markets to distribute your products. Summarize your distribution channels.
- Financial Projections: Include a breakdown of the cost of producing the product, including total funds needed, sources of funds, and balance. A budget summary should include projected costs above and below the line. Make sure that your sales projections and financial projections (AR) are listed and briefly describe how they were derived.
- Financial Statements: Prepare a cash flow statement that shows cash inflows and cash outflows from one month to the next. Prepare a balance sheet that shows the assets and liabilities for the project. Prepare an income statement that shows the income, expenses, and profitability of the project.
Cash is difficult to find in these times of recession. It is no longer enough just to have a great pitch and a compelling idea. People who have the money to operate industries want to see projections of recoupment, marketing plans, internal rates, and other revenue streams. An informative and well-written business plan can help you get the financing you need. A business plan can be a great way to make sure your project is done on time.
Conclusion
A business plan is used as a communication tool to attract investment capital, secure loans, convince workers to stay on and help in attracting strategic business partners. A comprehensive business plan is a way to determine if a business can make a profit. This requires that you take a realistic view of every stage of your business project, including the distribution and revenue streams required to recoup your investment. It also shows that you have solved all of the problems in your project. That's the reason you should prepare it accordingly.
