A business plan is a roadmap for your business, what you plan to do and how you plan to succeed. Every organization needs a business plan, even ones that aren’t trying to procure funding. It is a tool for building a better business, helping organize your business and to keep yourself on track. If you haven’t written a business plan before, it can seem like a daunting task as you imagine a novel-sized document detailing out every paperclip sized piece of your business. However, business plans can (and should be) smaller works that are easy to digest. They should include the big picture and the main elements of the organization. If you’re still not sold on writing a business plan, know that businesses with a plan have a 30% higher growth rate and owners with business plans are twice as likely to grow, get investments and secure loans.
Here are the key elements of a good business plan:
- Executive Summary
Describe who your company is, what it does and why it will be successful. Include your audience, what problem your business is hoping to solve and how your business is able to achieve that. Include basic information about your company’s founders. If this proposal will be used to ask for funding, include high-level financial information. Keep in mind that this is just supposed to be a summary and give the reader a preview of what the larger plan will detail.
- Company Description
Open up by detailing the history of the company, sharing when was the company founded and how long the company has been around. Share any major milestones that the company has achieved, the number of employees and locations as well as listing the major products and services. This is also where to include the mission statement of the organization and your overall objectives. If you have things about your company culture that you would like to include they would go in this section as well.
- Market/Competitive Analysis
This section should contain a researched description of the current state of the market. Describe the industry that you are in as well as any trends, themes or changes within the industry. Explain the audience that you’re selling to in detail, the size of the market and any projections for how that market will change. This is also the section where you will get into your competitors, explain who they are and what their strengths and weaknesses are, and areas where you may have a competitive edge.
- Organizational and Management Structure
Detail the legal structure of your organization as well as any planned acquisitions or subsidiaries. Describe how your company is structured and how it will be run, an organizational chart is a useful item to add to this section. You can add your key leader’s resumes into this section or attach them as an appendix item.
- Products and Services
Include all of the products and services that you currently offer or plan to offer. Describe any unique features and what benefits your products or services offer your customers. Share any intellectual property rights or patents that your products have that will keep it unique in the market.
- Marketing and Sales Strategy
Outline what you plan to do to promote and grow your business. This section can vary widely by business type but should explain how you will be able to attract and retain customers. Describe any third parties involved like agents or retail store placements that will be needed for your product or services. Detail out how a sale happens, what the sales cycle is and how you plan to grow sales.
- Funding Request
If this business plan is being developed to request funding then include this section, otherwise, it may not be needed for your plan. Be clear about how much funding you are asking for, what kind of funding and the length of time that funding will be used across. Give details of exactly how the funds will be used.
- Financial Projections
Share charts, graphs, and information about your current and anticipated financial state for the next five years. If your business is already established, cover the last three to five years of your organization’s financial history as well. This section is what shows readers that your business is a sound investment.
