How to Write a Business PlanAs we approach the new year, it's time to recap 2012 and plan for 2013. As a Montgomery County, MD real estate investor, you're probably well aware that you are a small business owner. However, even as a small business owner it's critical that you take the time to write or revisit (whichever is applicable) your business plan.
The Small Business Administration (SBA) recommends creating a document that projects 3-5 years in advance, but this can be hard to do if you're new to world of real estate investing. It can also be nearly impossible given the current state of the real estate market, since abrupt changes happen in a very short amount of time. For this reason, it is important to create a "living" plan that can be updated and/or modified at any time. Don't make the mistake of thinking that you can never make changes to your business plan. In fact, quite the opposite is true - you should make changes to your plan in an effort to make it more focused, attainable, and accurately geared towards your business.
Generally speaking, a business plan should have the following structure:
- Executive Summary
Just as it sounds, this is a broad overview of your company profile and goals.
- Company Description
Objectively view yourself as a business entity and describe what sets you apart from your competition.
- Market Analysis
Before you can really understand your business, you have to fully understand your consumer. What is your target market? Who is your competition? Who are your affiliates? What are locality demographics? The more you know, the better you can plan.
- Organization and Management
If you're a one-person entity, this isn't really necessary. However, you may want to expand into business affiliates and contractors you work with to create a general business map.
- Service or Product Line
You are selling a service - housing - but what kind of housing? To whom? Where? And what is your motto as it relates to tenant relations (customer service)?
- Marketing and Sales
This should be more elaborate than simply listing in the MLS. Team up with your Montgomery County, MD Realtor to devise a strategic marketing plan.
- Funding
Where do you plan to get funds from? Are you seeking to partner with other investors?
- Financial Projections
This is the most challenging part - and the part that many inexperienced real estate investors tend to overestimate. When crunching numbers in this portion of the plan, I strongly advise you to err on the conservative side.
- Appendix
This is where you include information as it relates to licensing, permitting, etc.
Still not sure where to start or what to write? Get help writing a business plan here.
If you would like to invest in Montgomery County, MD real estate - contact Emcee Arah of EMA Real Estate online or call 301.452.5252. Emcee is both a Certified Investor Agent Specialist (CIAS) and a Certified Distressed Property Expert (CDPE).
A CIAS is uniquely qualified to find, create, and close with residential real estate investors using the knowledge and innovative tools earned through comprehensive education and experience. CIAS-designated agents can streamline the process of real estate investment to increase returns for investor clients by helping real estate investors navigate:
- Investment Strategies
- Self-directed IRAs
- 1031 Exchange
- Leverage Options
- Key Calculations
- Return-on-Investment
- Capitalization Rate
- Average Returns
- Cash Flow
- And much more
RE/MAX Excellence Realty
10230 New Hampshire Ave, Suite 100
Silver Spring, MD 20903
(301) 452-5252
http://www.DeeCeeRealEstate.com
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