What kind of competition do you have for your donut business? How does your business and your product measure up to theirs? Evaluate what your competition does so you can copy what works for them and discard what does not. In other words, learn from those who are trying to get your customers. How do competitors define the product (donuts) in your area? How much market share does each have?

In the competitive analysis of your business plan you will want to look at donut businesses similar to yours including national chains that also operate storefront businesses. If you operate a trailer and move between fairs and festivals your competition is not necessarily other donut businesses (although those count too) but those next to you selling other vending items. Granted, it will be difficult to research these other businesses on wheels before hand. When you get to a fair and set up observe everything the other vendors do that attracts customers and everything they do that has no effect.

Also consider how likely other competitors may enter the market at a later date. Investors will want you to research how saturated the market is and what the barriers are to people who want to make donuts like you do. Do not let your emotion get in the way of your analysis. It is easy to assume that your product will be superior to everybody else’s, but there is much more to consider. Taste, size, price, and service are all important things to look at but are only part of the picture. Try to learn the internal business practices behind the scenes to gage the strength of your competition. Are they creative, motivated, and financially secure? Do they have high employee turnover? These are keys to success as well.

Investors do not want to know why you are a little bit better than the competition. They want to know why you are way better then the competition. Try to view your donut business through the eyes of a customer and if possible be a customer of other donut businesses to gather your information.

Look at your business. Now look at your business planning. Do you have concrete plans in place to ensure continued success? What sets mediocre businesses apart from great businesses is the ability to properly plan their business. Business planning exceeds what you are going to do that particular day. What are your goals are for the entire year and beyond?

Business planning involves an exemplary attention to setting goals. Your goals need to be specific to your business or your organization. Use the following formula to be successful when you’re setting goals during your business planning. Your plans should consist of goals which are specific, measurable, realized, true, and timely.

Specific
Now is not a time to use generalities. You must state the purpose behind your goals. Instead of a goal being, “my business will make money this year for the company”, try “my business will make $10 million this year by aligning profitability with corporate sales metrics.” You notice the specific purpose of the goal versus the vagueness of the goal? Once specifics are out of the way, move to the next step.

Measurable
How will you know if your business is succeeding or failing verses your set goals? Measuring your performance allows you to better align your goals if performance is lagging. Key indicators must be in place to visualize. Your goal is to make $10 million dollars, so an indicator would be financial monthly financial results. If your profitability is not aligned with corporate sales, then you must adjust your strategy.

Realized
During the business planning process you have to account for all external opportunities which may cause you not to achieve your goals. So when you are planning, don’t make goals too lofty as to not attain success. So instead of stating you will make $10 million in a year, try making $833,333 per month. The end result will be the same, but more manageable.

True
Do you want to be known as a leader who can execute plans and deliver results, or a leader who is incompetent and cannot meet company expectation? If you are the leader who values success, then during your business planning you will take into account whether or not your goals are realistic. Seek guidance from peers as well as supervisors if you are unclear of the goals setting process.

Timely
Can you deliver results in the time frame you set up during your business planning? If not, you need to realign your plans. The best laid plans are plans which have a beginning, middle, and an end. Be careful during your business planning not to give too much or too little time to a goal. Both are detrimental to goal achievement. Too much time shows lack of commitment. Not enough time shows you may be conceited.

Business planning is the cornerstone to a successful business. Without planning, you can expect poor performance. Lower than expected performance leaders to you being replaced with someone who will be able to deliver results.

When it comes to buying a business, a good business plan is crucial. It’s an invaluable guide to listing your objectives and aims in detail. It’s a good source for information and analysis of your aims, targets, customers and prospects. All in all, it’s a great resource to refer back to time and time again. By setting up the business plan, you will have a better chance of success because you have listed everything down in your head on paper.

The vendor of the available business will need to see this in order to ascertain whether you are right to buy. It will demonstrate whether you have the correct business acumen required and whether you are serious about the business. It will also be useful when it comes to the financial side of things, but more on this in a minute.

By making a business plan, you can pick out any potential flaws that might hinder you. It’s a good chance to find any problems or issues that may arise, and then deal with them accordingly before you get caught up in the business. Also, outside parties can cast a fresh eye over the plan, and may pick out something that you may not have spotted.

It’s also important to show the business plan to the vendor or bank manager. If your business needs financing at the beginning, then you need to turn to one of these sources for financial assistance. With that in mind, you need to produce a detailed business plan that shows that your business is credible and also has potential for making money. Not only does the plan prove that you are serious about the business, it also shows that you have a sound business mind and a good grasp of what needs to be done in order to achieve good profits.

So what should you include in your business plan? Well, at the start, it should list the concept of the business. What is the business all about? What are its aims? What sort of returns do you aim to get?

With regard to the aims, you should set these out in bullet point form and alongside these, list sound, realistic ways of achieving them. It’s also worth noting any potential problems that may come your way, and producing effective solutions to combat these. Not only will you be prepared for these problems, the vendor or bank manager will see that you can deal with any pitfalls.

On the subject of finance, you need to produce realistic financial details. How much money will the business require? What are the expenses required? How much tax will you need to pay? What are the profit margins? Do you stand a good chance of achieving these sums, and how? Finance plans should include income statements, cash-flow statements, balance sheets and profit analysis. This should form a big part of your business plan, in order to convince the vendor or bank manager of your credibility.

You should also be aware of what NOT to put in your business plan. The issue of future forecasts is a contentious one. While it’s all very well attempting to make future forecasts, it’s difficult to predict too far ahead. What you need is to look to the short-term future and then produce your plan accordingly. As the business plan then continues, you can modify the content as and when it’s necessary. Long-term planning, however, will only prove to be a pointless exercise.

Another point of contention is how optimistic you should make your business plan. The problem with making over-optimistic predictions and plans is that these plans could well go wrong. Unforeseen circumstances can always put a spanner in the works. Therefore, it’s wise to err on the side of caution when it comes to devising your business plan. Indeed, it’s wise to predict conservatively and prudently when it comes to assessing the possibilities of future targets, sales and profits. A worst-case scenario will always prove to be less of a shock than one that raises expectations too high.

Another point to bear in mind is that you need to keep the business plan relatively simple. Don’t use fancy business jargon or clichés, since this will only cloud the important issues. In particular, if you are presenting the plan to a vendor or bank manager, you will need to keep the plan on point and free of over-fussy language and business speak. Present the facts in a concise, straightforward manner, and this will result in a plan that’s both accessible and plausible.

On average, a good business plan will be about 15 to 20 pages. Keep it concise but detailed. A good business plan will pay dividends both in the short and long terms. An investor and/or bank manager will see this and if the plan holds up well, then this will bring you the business that you seek. And from a personal point of view, a great business plan is something that you can return to time and again as a good reference point – something that you can draw upon in the future.