You can write a compelling software business plan in less time than you think you can. Planning is critical to successfully starting and building your software company. Without a business plan you are shooting in the dark. Whether you are looking for financial capital or to better target your market segment and drive sales, this article will help you write and implement your software business plan.

Is a Software Business Plan Really Necessary?

Yes, absolutely! Planning is critical to successfully starting a software company or building a business. Without a business plan you are shooting in the dark.

Strategic planning is critically important for both big businesses and small companies alike. Strategic planning is matching the strengths of your business to available market opportunities.

To do this effectively, you need to collect, screen, and analyze information about the business environment. You also need to have a clear understanding of your software business – its strengths and weaknesses – and develop a clear mission, goals, and objectives. Acquiring this understanding can take work, but in many ways it is the process of strategic planning that you go through in creating your software business plan that is the most valuable step of all.

Strategic planning has become more important as increased rate of change of technology and competition have made the business environment less stable and less predictable. There are also many changes underway in the software industry with the move to Software as a Service or SaaS.

If your software company is to survive and prosper, it is important to take the time to identify the niches where your software provides the highest value with the least competition. Your software business plan will encourage financial investment, promote growth, and provide a map to follow to drive sales.

Outline of the Software Business Plan

This is an outline of the essential elements of a good business plan:

Farm strategic planning is easier today than ever before, which is a good thing because strategic planning is an important part of planning for succession. Software tools and easy to use templates, containing detailed framework and sample texts, will help even the novice farmer along with their advisors create professional looking plans with tables and charts.

It is possible that you have never considered writing a sales plan before; you are not alone. Most organizational leaders are not even aware that they need to create such a document. So that leaves the question hovering in the air: what is a sales plan? The answer is quite simple and extremely relevant to the modern company. A sales plan is an important piece of your marketing plan; it is the actionable portion. While marketing becomes increasingly important, getting the attention of your prospective consumer is only step one of many in the buying processes. Another very important component is actually getting customers to make a purchase or place an order for the product or service that has been so cleverly marketed. And that is what the sales plan outlines: sales goals and how to achieve them.

Some strategic planners choose to make the sales plan part of the overall business plan; sometimes tucked away in the operations section of the business plan. However, in order for the document to be effective, it needs to be very well thought out and easily attained by the person responsible for sales– most likely, the Sales Manager.

Like all well thought out strategic planning documents, the sales plan needs to have a summary that is written last but serves as an overall statement of the purpose and vision for the document and organization’s goals regarding sales. It should sight the company’s philosophy about sales and discuss the culture of the sales department.

The next section needs to include quantifiable objectives, outline any and all success factors as well as discuss sales avenues. This brief and typically bulleted overview serves as the overall sales plan & strategy.

Since customer relationship management [C.R.M.] is becoming a vital part of organizations, it is important to have a section outlining feasible customer retention & loyalty programs to track such interaction. This section does not outline the C.R.M. package itself but rather the programs that drive repeat and referral traffic.

The sales force organization section of the sales plan is as equally as important as discussing the customers, as this section discusses sales personnel. This portion answers such questions as: 1) How will the sales department be managed? 2) What territories will each sales person cover? 3) How will sales people be compensated and rewarded?

Prospect management & lead systems is the opportunity for companies to think about exactly what C.R.M. packages will be utilized and the best way to track leads and manage conversion rates. In this section, strategic planners can clearly outline the processes that new and prospect customers will go through and what sort of technology [if needed] will manage the transition.

Use the next section to create a detailed list of annual sales activity; called a sales activities timetable. A chart format or spreadsheet layout is easiest to maintain and update. The information should clearly identify the ROI as well as the overall expense of each activity.

When each sales effort, as recorded in the sales activity timetable, is complete it will become important to develop a sales effectiveness summary that monitors the success of each sales campaign. This can be a simple review by management or team members.

Create a tracking system for the sales plan as a final portion of the sales plan. This allows managers to meaningfully forecast business levels and allows for accountability among sales representatives.

The sales plan should be between approximately five to ten pages. The detailed plan will add action items to your marketing plan and give Sales Managers clear direction on how to lead the sales team. Such a document should be given as much time and attention as the marketing plan itself.

Small business owners mistakenly believe that the size of their business negates the need for strategic planning but the opposite is actually true. Its inherent size is actually what makes strategic planning more important because it can be means for a small business to gradually evolve into a huge and thriving multinational corporation.

What Small Business Owners Need to Know about Strategic Planning

Planning is one of the five important functions of management, but it’s arguably the most important of all because it’s the first function that any manager or business owners should focus on. Planning sets the goals, mission-vision, and direction for the company. Without it, the other functions may be impossible to achieve.

A business can’t, however, benefit from just any kind of planning. It must be strategic in essence to be effective. Strategic planning is a methodical process of deciding where you want your company to be in a given time frame and what you propose to do to get there.

There are different ways to let your company benefit from strategic planning so don’t worry about following the so-called rules. Whatever works for your company is good enough.

Elements of Strategic Planning

Internal and External Assessment of Strategic Planning – A coach of a basketball team won’t be able to map out an effective play if it doesn’t know its players well, which team it will be playing against, and other related factors. The same can be said for any business manager. Before you can start working on the details of your strategic plan, you must first focus on compiling data about the external and internal environment of your company.

Outside your business, politico-legal, economic, and socio-cultural factors can affect how your business will fare in the next few years. Inside, factors such as management style and the type of workforce you have can also help or hinder your company from attaining your goal.

Setting Your Company’s Goals – Small or big, the important thing is for your business to have goals. If you’ can be satisfied with small and short-term goals then that’s good; if you secretly desire for bigger goals then that’s even better. To know if the goals you plan to work on are indeed workable, determine if they adhere to the SMART rule – specific, measurable, attainable, realistic, and time-bound.

Rule of Majority – Of course, as owner or manager of a business, you reserve your right to approve or naysay any suggestion but as much as possible, allow the rule of majority to stick. Plans can only come to fruition if everyone in the company works together and you can assure yourself of their cooperation by showing them that you care about what they think.

Devising an Action Plan – Finally, it’s time to concentrate on the nitty-gritty of your strategic plan. List down possible and specific courses of action then choose what all of you deem as most suitable. Make sure that you set a definite schedule or timetable for everything but give allowances for unexpected delays and concerns. Set a budget as well.

The Ever-So-Popular Plan B – Last but not the least, devise a Plan B in the event that your first plan doesn’t work and list down indications to know when’s the right time to put Plan B to action.

Good luck on strategic planning for your business!

Whether you are starting up your business or expanding it you will need finance in order to do so. This is especially relevant to new businesses that are just starting up. There are numerous avenues that you can approach in order to gain this start up finance and there are many different forms of it open to you; choosing the right finance that will benefit your business most is the important thing.

There is a saying that states ‘it takes money to make money,’ this applies so much to new business ventures. For your business to become a success you will need a large amount of money to start off with that can be used to get your business set up. This money will be used to buy equipment, pay the rent on your business property, employ your staff and ensure that you have enough stock to get your business going as well as being used to pay the first few months of all your bills.

Two of the main reasons why many new businesses fail to get anywhere beyond the starting point are due to inadequate business capital and poor management skills, which is why raising money is so important in the early start-up stages of business.

Some ways in which people choose to fund their business idea is by using savings, but realistically not many of us have that sort of cash tucked away, which is why we require outside help. You could opt to borrow money from friends or family if they have the financial resources to help you or you could take out a credit card for the specific use of funding your business. All of the financial options that are open to you can be split into two sections, either debt finance or equity finance. Debt finance is classified as being money that is borrowed from varies different aspects. This is finance that is required to be paid back.

Some examples of debt finance include:

o Bank loans

o Credit cards

o Overdrafts

o Leasing

o Asset financing

All of these are the borrowing of money in one form or another and they will require monthly repayments that will have added interest. Most people however use their bank as the first call of gaining start up finance regardless of the fact they are going to end up paying more money back.

There are disadvantages and advantages of using a bank loan to fund a new business idea. However the disadvantages of having a bank loan to fund your business start up far out-weigh the advantages. The benefit of using a bank loan for business finance include being able to organise a repayment holiday meaning you only have to pay interest for a certain amount of time and you don’t have to turn over a share of your profit. The disadvantages however are that bank loans have strict terms and conditions and can cause cash flow problems if you are unable to keep up with your monthly repayments. Also bank loans are often secured against assets and you may be charged if you decide you want to repay your loan before the end of your loan term.
The other form of finance; equity finance, is often more overlooked than it should be when in fact equity finance could be just the answer that your business is looking for. The main forms of equity finance come from business angels and venture capitalists. Equity finance is money that is invested into your business in return for a share of the business. With equity finance the advantages out-weight the disadvantages and equity finance is a lot more helpful to small businesses than bank loans are.

Some of the advantages of equity finance include your investor being committed to your business and intended projects, they can bring valuable skills, contracts and experience to your business and they can assist you with strategy and decision making as well as often being prepared to follow up funding as your business grows. Two disadvantages of equity funding are your business may suffer as you are spending time securing your investor deal and the investor will own a share of your business.

The one thing that you must do when choosing your business start up finance is to use a finance option that is most suited to your business needs.