how to develop a solid business plan

How to Write a Business Plan: Step-by-Step Guide + Examples

Noah Parsons

24 min. read

Updated March 18, 2024

Writing a business plan doesn’t have to be complicated. 

In this step-by-step guide, you’ll learn how to write a business plan that’s detailed enough to impress bankers and potential investors, while giving you the tools to start, run, and grow a successful business.

• The basics of business planning

If you’re reading this guide, then you already know why you need a business plan . 

You understand that planning helps you: 

• Raise money
• Grow strategically
• Keep your business on the right track 

As you start to write your plan, it’s useful to zoom out and remember what a business plan is .

At its core, a business plan is an overview of the products and services you sell, and the customers that you sell to. It explains your business strategy: how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

Most business plans also include financial forecasts for the future. These set sales goals, budget for expenses, and predict profits and cash flow. 

A good business plan is much more than just a document that you write once and forget about. It’s also a guide that helps you outline and achieve your goals. 

After completing your plan, you can use it as a management tool to track your progress toward your goals. Updating and adjusting your forecasts and budgets as you go is one of the most important steps you can take to run a healthier, smarter business. 

We’ll dive into how to use your plan later in this article.

There are many different types of plans , but we’ll go over the most common type here, which includes everything you need for an investor-ready plan. However, if you’re just starting out and are looking for something simpler—I recommend starting with a one-page business plan . It’s faster and easier to create. 

It’s also the perfect place to start if you’re just figuring out your idea, or need a simple strategic plan to use inside your business.

Dig deeper : How to write a one-page business plan

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• What to include in your business plan

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally just one to two pages. Most people write it last because it’s a summary of the complete business plan.

Ideally, the executive summary can act as a stand-alone document that covers the highlights of your detailed plan. 

In fact, it’s common for investors to ask only for the executive summary when evaluating your business. If they like what they see in the executive summary, they’ll often follow up with a request for a complete plan, a pitch presentation , or more in-depth financial forecasts .

Your executive summary should include:

• A summary of the problem you are solving
• A description of your product or service
• An overview of your target market
• A brief description of your team
• A summary of your financials
• Your funding requirements (if you are raising money)

Dig Deeper: How to write an effective executive summary

Products and services description

This is where you describe exactly what you’re selling, and how it solves a problem for your target market. The best way to organize this part of your plan is to start by describing the problem that exists for your customers. After that, you can describe how you plan to solve that problem with your product or service. 

This is usually called a problem and solution statement .

To truly showcase the value of your products and services, you need to craft a compelling narrative around your offerings. How will your product or service transform your customers’ lives or jobs? A strong narrative will draw in your readers.

This is also the part of the business plan to discuss any competitive advantages you may have, like specific intellectual property or patents that protect your product. If you have any initial sales, contracts, or other evidence that your product or service is likely to sell, include that information as well. It will show that your idea has traction , which can help convince readers that your plan has a high chance of success.

Market analysis

Your target market is a description of the type of people that you plan to sell to. You might even have multiple target markets, depending on your business. 

A market analysis is the part of your plan where you bring together all of the information you know about your target market. Basically, it’s a thorough description of who your customers are and why they need what you’re selling. You’ll also include information about the growth of your market and your industry .

Try to be as specific as possible when you describe your market. 

Include information such as age, income level, and location—these are what’s called “demographics.” If you can, also describe your market’s interests and habits as they relate to your business—these are “psychographics.” 

Related: Target market examples

Essentially, you want to include any knowledge you have about your customers that is relevant to how your product or service is right for them. With a solid target market, it will be easier to create a sales and marketing plan that will reach your customers. That’s because you know who they are, what they like to do, and the best ways to reach them.

Next, provide any additional information you have about your market. 

What is the size of your market ? Is the market growing or shrinking? Ideally, you’ll want to demonstrate that your market is growing over time, and also explain how your business is positioned to take advantage of any expected changes in your industry.

Dig Deeper: Learn how to write a market analysis

Competitive analysis

Part of defining your business opportunity is determining what your competitive advantage is. To do this effectively, you need to know as much about your competitors as your target customers. 

Every business has some form of competition. If you don’t think you have competitors, then explore what alternatives there are in the market for your product or service. 

For example: In the early years of cars, their main competition was horses. For social media, the early competition was reading books, watching TV, and talking on the phone.

A good competitive analysis fully lays out the competitive landscape and then explains how your business is different. Maybe your products are better made, or cheaper, or your customer service is superior. Maybe your competitive advantage is your location – a wide variety of factors can ultimately give you an advantage.

Dig Deeper: How to write a competitive analysis for your business plan

Marketing and sales plan

The marketing and sales plan covers how you will position your product or service in the market, the marketing channels and messaging you will use, and your sales tactics. 

The best place to start with a marketing plan is with a positioning statement . 

This explains how your business fits into the overall market, and how you will explain the advantages of your product or service to customers. You’ll use the information from your competitive analysis to help you with your positioning. 

For example: You might position your company as the premium, most expensive but the highest quality option in the market. Or your positioning might focus on being locally owned and that shoppers support the local economy by buying your products.

Once you understand your positioning, you’ll bring this together with the information about your target market to create your marketing strategy . 

This is how you plan to communicate your message to potential customers. Depending on who your customers are and how they purchase products like yours, you might use many different strategies, from social media advertising to creating a podcast. Your marketing plan is all about how your customers discover who you are and why they should consider your products and services. 

While your marketing plan is about reaching your customers—your sales plan will describe the actual sales process once a customer has decided that they’re interested in what you have to offer. 

If your business requires salespeople and a long sales process, describe that in this section. If your customers can “self-serve” and just make purchases quickly on your website, describe that process. 

A good sales plan picks up where your marketing plan leaves off. The marketing plan brings customers in the door and the sales plan is how you close the deal.

Together, these specific plans paint a picture of how you will connect with your target audience, and how you will turn them into paying customers.

Dig deeper: What to include in your sales and marketing plan

Business operations

The operations section describes the necessary requirements for your business to run smoothly. It’s where you talk about how your business works and what day-to-day operations look like. 

Depending on how your business is structured, your operations plan may include elements of the business like:

• Supply chain management
• Manufacturing processes
• Equipment and technology
• Distribution

Some businesses distribute their products and reach their customers through large retailers like Amazon.com, Walmart, Target, and grocery store chains. 

These businesses should review how this part of their business works. The plan should discuss the logistics and costs of getting products onto store shelves and any potential hurdles the business may have to overcome.

If your business is much simpler than this, that’s OK. This section of your business plan can be either extremely short or more detailed, depending on the type of business you are building.

For businesses selling services, such as physical therapy or online software, you can use this section to describe the technology you’ll leverage, what goes into your service, and who you will partner with to deliver your services.

Dig Deeper: Learn how to write the operations chapter of your plan

Key milestones and metrics

Although it’s not required to complete your business plan, mapping out key business milestones and the metrics can be incredibly useful for measuring your success.

Good milestones clearly lay out the parameters of the task and set expectations for their execution. You’ll want to include:

• A description of each task
• The proposed due date
• Who is responsible for each task

If you have a budget, you can include projected costs to hit each milestone. You don’t need extensive project planning in this section—just list key milestones you want to hit and when you plan to hit them. This is your overall business roadmap. 

Possible milestones might be:

• Website launch date
• Store or office opening date
• First significant sales
• Break even date
• Business licenses and approvals

You should also discuss the key numbers you will track to determine your success. Some common metrics worth tracking include:

• Conversion rates
• Customer acquisition costs
• Profit per customer
• Repeat purchases

It’s perfectly fine to start with just a few metrics and grow the number you are tracking over time. You also may find that some metrics simply aren’t relevant to your business and can narrow down what you’re tracking.

Dig Deeper: How to use milestones in your business plan

Organization and management team

Investors don’t just look for great ideas—they want to find great teams. Use this chapter to describe your current team and who you need to hire . You should also provide a quick overview of your location and history if you’re already up and running.

Briefly highlight the relevant experiences of each key team member in the company. It’s important to make the case for why yours is the right team to turn an idea into a reality. 

Do they have the right industry experience and background? Have members of the team had entrepreneurial successes before? 

If you still need to hire key team members, that’s OK. Just note those gaps in this section.

Your company overview should also include a summary of your company’s current business structure . The most common business structures include:

• Sole proprietor
• Partnership

Be sure to provide an overview of how the business is owned as well. Does each business partner own an equal portion of the business? How is ownership divided? 

Potential lenders and investors will want to know the structure of the business before they will consider a loan or investment.

Dig Deeper: How to write about your company structure and team

Financial plan

Last, but certainly not least, is your financial plan chapter. 

Entrepreneurs often find this section the most daunting. But, business financials for most startups are less complicated than you think, and a business degree is certainly not required to build a solid financial forecast. 

A typical financial forecast in a business plan includes the following:

• Sales forecast : An estimate of the sales expected over a given period. You’ll break down your forecast into the key revenue streams that you expect to have.
• Expense budget : Your planned spending such as personnel costs , marketing expenses, and taxes.
• Profit & Loss : Brings together your sales and expenses and helps you calculate planned profits.
• Cash Flow : Shows how cash moves into and out of your business. It can predict how much cash you’ll have on hand at any given point in the future.
• Balance Sheet : A list of the assets, liabilities, and equity in your company. In short, it provides an overview of the financial health of your business. 

A strong business plan will include a description of assumptions about the future, and potential risks that could impact the financial plan. Including those will be especially important if you’re writing a business plan to pursue a loan or other investment.

Dig Deeper: How to create financial forecasts and budgets

This is the place for additional data, charts, or other information that supports your plan.

Including an appendix can significantly enhance the credibility of your plan by showing readers that you’ve thoroughly considered the details of your business idea, and are backing your ideas up with solid data.

Just remember that the information in the appendix is meant to be supplementary. Your business plan should stand on its own, even if the reader skips this section.

Dig Deeper : What to include in your business plan appendix

Optional: Business plan cover page

Adding a business plan cover page can make your plan, and by extension your business, seem more professional in the eyes of potential investors, lenders, and partners. It serves as the introduction to your document and provides necessary contact information for stakeholders to reference.

Your cover page should be simple and include:

• Company logo
• Business name
• Value proposition (optional)
• Business plan title
• Completion and/or update date
• Address and contact information
• Confidentiality statement

Just remember, the cover page is optional. If you decide to include it, keep it very simple and only spend a short amount of time putting it together.

Dig Deeper: How to create a business plan cover page

How to use AI to help write your business plan

Generative AI tools such as ChatGPT can speed up the business plan writing process and help you think through concepts like market segmentation and competition. These tools are especially useful for taking ideas that you provide and converting them into polished text for your business plan.

The best way to use AI for your business plan is to leverage it as a collaborator , not a replacement for human creative thinking and ingenuity. 

AI can come up with lots of ideas and act as a brainstorming partner. It’s up to you to filter through those ideas and figure out which ones are realistic enough to resonate with your customers. 

There are pros and cons of using AI to help with your business plan . So, spend some time understanding how it can be most helpful before just outsourcing the job to AI.

Learn more: 10 AI prompts you need to write a business plan

• Writing tips and strategies

To help streamline the business plan writing process, here are a few tips and key questions to answer to make sure you get the most out of your plan and avoid common mistakes .  

Determine why you are writing a business plan

Knowing why you are writing a business plan will determine your approach to your planning project. 

For example: If you are writing a business plan for yourself, or just to use inside your own business , you can probably skip the section about your team and organizational structure. 

If you’re raising money, you’ll want to spend more time explaining why you’re looking to raise the funds and exactly how you will use them.

Regardless of how you intend to use your business plan , think about why you are writing and what you’re trying to get out of the process before you begin.

Keep things concise

Probably the most important tip is to keep your business plan short and simple. There are no prizes for long business plans . The longer your plan is, the less likely people are to read it. 

So focus on trimming things down to the essentials your readers need to know. Skip the extended, wordy descriptions and instead focus on creating a plan that is easy to read —using bullets and short sentences whenever possible.

Have someone review your business plan

Writing a business plan in a vacuum is never a good idea. Sometimes it’s helpful to zoom out and check if your plan makes sense to someone else. You also want to make sure that it’s easy to read and understand.

Don’t wait until your plan is “done” to get a second look. Start sharing your plan early, and find out from readers what questions your plan leaves unanswered. This early review cycle will help you spot shortcomings in your plan and address them quickly, rather than finding out about them right before you present your plan to a lender or investor.

If you need a more detailed review, you may want to explore hiring a professional plan writer to thoroughly examine it.

Use a free business plan template and business plan examples to get started

Knowing what information you need to cover in a business plan sometimes isn’t quite enough. If you’re struggling to get started or need additional guidance, it may be worth using a business plan template. 

If you’re looking for a free downloadable business plan template to get you started, download the template used by more than 1 million businesses. 

Or, if you just want to see what a completed business plan looks like, check out our library of over 550 free business plan examples . 

We even have a growing list of industry business planning guides with tips for what to focus on depending on your business type.

Common pitfalls and how to avoid them

It’s easy to make mistakes when you’re writing your business plan. Some entrepreneurs get sucked into the writing and research process, and don’t focus enough on actually getting their business started. 

Here are a few common mistakes and how to avoid them:

Not talking to your customers : This is one of the most common mistakes. It’s easy to assume that your product or service is something that people want. Before you invest too much in your business and too much in the planning process, make sure you talk to your prospective customers and have a good understanding of their needs.

• Overly optimistic sales and profit forecasts: By nature, entrepreneurs are optimistic about the future. But it’s good to temper that optimism a little when you’re planning, and make sure your forecasts are grounded in reality. 
• Spending too much time planning: Yes, planning is crucial. But you also need to get out and talk to customers, build prototypes of your product and figure out if there’s a market for your idea. Make sure to balance planning with building.
• Not revising the plan: Planning is useful, but nothing ever goes exactly as planned. As you learn more about what’s working and what’s not—revise your plan, your budgets, and your revenue forecast. Doing so will provide a more realistic picture of where your business is going, and what your financial needs will be moving forward.
• Not using the plan to manage your business: A good business plan is a management tool. Don’t just write it and put it on the shelf to collect dust – use it to track your progress and help you reach your goals.
• Presenting your business plan

The planning process forces you to think through every aspect of your business and answer questions that you may not have thought of. That’s the real benefit of writing a business plan – the knowledge you gain about your business that you may not have been able to discover otherwise.

With all of this knowledge, you’re well prepared to convert your business plan into a pitch presentation to present your ideas. 

A pitch presentation is a summary of your plan, just hitting the highlights and key points. It’s the best way to present your business plan to investors and team members.

Dig Deeper: Learn what key slides should be included in your pitch deck

Use your business plan to manage your business

One of the biggest benefits of planning is that it gives you a tool to manage your business better. With a revenue forecast, expense budget, and projected cash flow, you know your targets and where you are headed.

And yet, nothing ever goes exactly as planned – it’s the nature of business.

That’s where using your plan as a management tool comes in. The key to leveraging it for your business is to review it periodically and compare your forecasts and projections to your actual results.

Start by setting up a regular time to review the plan – a monthly review is a good starting point. During this review, answer questions like:

• Did you meet your sales goals?
• Is spending following your budget?
• Has anything gone differently than what you expected?

Now that you see whether you’re meeting your goals or are off track, you can make adjustments and set new targets. 

Maybe you’re exceeding your sales goals and should set new, more aggressive goals. In that case, maybe you should also explore more spending or hiring more employees. 

Or maybe expenses are rising faster than you projected. If that’s the case, you would need to look at where you can cut costs.

A plan, and a method for comparing your plan to your actual results , is the tool you need to steer your business toward success.

Learn More: How to run a regular plan review

Free business plan templates and examples

Kickstart your business plan writing with one of our free business plan templates or recommended tools.

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How to write a business plan FAQ

What is a business plan?

A document that describes your business , the products and services you sell, and the customers that you sell to. It explains your business strategy, how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

What are the benefits of a business plan?

A business plan helps you understand where you want to go with your business and what it will take to get there. It reduces your overall risk, helps you uncover your business’s potential, attracts investors, and identifies areas for growth.

Having a business plan ultimately makes you more confident as a business owner and more likely to succeed for a longer period of time.

What are the 7 steps of a business plan?

The seven steps to writing a business plan include:

• Write a brief executive summary
• Describe your products and services.
• Conduct market research and compile data into a cohesive market analysis.
• Describe your marketing and sales strategy.
• Outline your organizational structure and management team.
• Develop financial projections for sales, revenue, and cash flow.
• Add any additional documents to your appendix.

What are the 5 most common business plan mistakes?

There are plenty of mistakes that can be made when writing a business plan. However, these are the 5 most common that you should do your best to avoid:

• 1. Not taking the planning process seriously.
• Having unrealistic financial projections or incomplete financial information.
• Inconsistent information or simple mistakes.
• Failing to establish a sound business model.
• Not having a defined purpose for your business plan.

What questions should be answered in a business plan?

Writing a business plan is all about asking yourself questions about your business and being able to answer them through the planning process. You’ll likely be asking dozens and dozens of questions for each section of your plan.

However, these are the key questions you should ask and answer with your business plan:

• How will your business make money?
• Is there a need for your product or service?
• Who are your customers?
• How are you different from the competition?
• How will you reach your customers?
• How will you measure success?

How long should a business plan be?

The length of your business plan fully depends on what you intend to do with it. From the SBA and traditional lender point of view, a business plan needs to be whatever length necessary to fully explain your business. This means that you prove the viability of your business, show that you understand the market, and have a detailed strategy in place.

If you intend to use your business plan for internal management purposes, you don’t necessarily need a full 25-50 page business plan. Instead, you can start with a one-page plan to get all of the necessary information in place.

What are the different types of business plans?

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. Here are a few common business plan types worth considering.

Traditional business plan: The tried-and-true traditional business plan is a formal document meant to be used when applying for funding or pitching to investors. This type of business plan follows the outline above and can be anywhere from 10-50 pages depending on the amount of detail included, the complexity of your business, and what you include in your appendix.

Business model canvas: The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea.

One-page business plan: This format is a simplified version of the traditional plan that focuses on the core aspects of your business. You’ll typically stick with bullet points and single sentences. It’s most useful for those exploring ideas, needing to validate their business model, or who need an internal plan to help them run and manage their business.

Lean Plan: The Lean Plan is less of a specific document type and more of a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, test, review, refine, and take action based on performance. It’s faster, keeps your plan concise, and ensures that your plan is always up-to-date.

What’s the difference between a business plan and a strategic plan?

A business plan covers the “who” and “what” of your business. It explains what your business is doing right now and how it functions. The strategic plan explores long-term goals and explains “how” the business will get there. It encourages you to look more intently toward the future and how you will achieve your vision.

However, when approached correctly, your business plan can actually function as a strategic plan as well. If kept lean, you can define your business, outline strategic steps, and track ongoing operations all with a single plan.

See why 1.2 million entrepreneurs have written their business plans with LivePlan

Noah is the COO at Palo Alto Software, makers of the online business plan app LivePlan. He started his career at Yahoo! and then helped start the user review site Epinions.com. From there he started a software distribution business in the UK before coming to Palo Alto Software to run the marketing and product teams.

Table of Contents

• Use AI to help write your plan
• Common planning mistakes
• Manage with your business plan
• Templates and examples

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How to Build a Detailed Business Plan That Stands Out [Free Template]

Updated: March 29, 2022

Published: March 11, 2022

While starting a company may seem easier now than ever before, entrepreneurs have an uphill battle from the moment they start a business. And without a clear, actionable business plan for selling, marketing, finances, and operations, you're almost destined to face significant challenges.

This is why crafting a business plan is an essential step in the entrepreneurial process.

In this post, we'll walk you through the process of filling out your business plan template, like this free, editable version :

Download a free, editable one-page business plan template.

We know that when looking at a blank page on a laptop screen, the idea of writing your business plan can seem impossible. However, it's a mandatory step to take if you want to turn your business dreams into a reality.

That's why we've crafted a business plan template for you to download and use to build your new company. You can download it here for free . It contains prompts for all of the essential parts of a business plan, all of which are elaborated on, below.

This way, you'll be able to show them how organized and well-thought-out your business idea is, and provide them with answers to whatever questions they may have.

Free Business Plan Template

The essential document for starting a business -- custom built for your needs.

• Outline your idea.
• Pitch to investors.
• Secure funding.
• Get to work!

You're all set!

Click this link to access this resource at any time.

Building a Successful Business Plan

In the next section, we'll cover the components of a business plan , such as an executive summary and company description. But before we get to that, let's talk about key elements that should serve as building blocks for your plan.

For some entrepreneurs, the thought of writing a business plan sounds like a chore — a necessary means to an end. But that's a bad take.

A solid business plan is a blueprint for success . It's key to securing financing, presenting your business, outlining your financial projections, and turning that nugget of a business idea into a reality.

At the core, your business plan should answer two questions: why your business and why now?

Investors want to know why your business is entering the market, i.e. what problem it's solving and how it's different from what's currently out there. They also want to know why now is the right time for your type of product or service.

At a minimum, your plan should:

• Be more realistic than idealistic: Too often, business plans focus too much on how things could be instead of how they are. While having a vision is important, your plan needs to be rooted in research and data.
• Legitimize your business idea : If an idea fails on paper, it's a signal to go back to the drawing board. In doing so, you avoid losing precious time or money chasing an unrealistic idea.
• Position your business for funding: To get your business off the ground, chances are you'll need financial backing. Even with a solid business idea, investors, lenders, and banks still need convincing. An effective business plan will outline how much money you need, where it's going, what targets you will hit, and how you plan to repay any debts.
• Lay the foundation: Investors focus on risk – if anything looks shaky, it could be a dealbreaker. Ideally, your business plan will lay down the foundation for how you'll operate your business — from operational needs to financial projections and goals.
• Communicate your needs: It's nearly impossible to communicate your needs if you don't know what they are first. Of course, a business’ needs are always changing — but your plan should give you a well-rounded view of how your business will work in the short and long term.

So back to the question of why and why now – consider three things:

• Your industry – How does your product or service fit within your industry? Are you targeting a specific niche? Where do you see the industry going in the next five to 10 years?
• Your target audience – Who are you targeting? What challenges are they facing? How will your product or service help them in their daily lives?
• Your unique selling proposition (USP) – What sets you apart from your competitors? Is it your product/service features? Your company values? Price?

Once you know the answers to these questions, you'll be equipped to answer the question: why your business and why now.

How to Build a Business Plan

• Executive Summary
• Company and Business Description
• Product and Services Line
• Market Analysis
• Marketing Plan
• Legal Notes
• Financial Considerations

Featured Resource: Free Business Plan Template

1. cover page.

Your business plan should be prefaced with an eye-catching cover page. This means including a high-resolution image of your company logo, followed by your company's name, address, and phone number.

Since this business plan will likely change hands and be seen by multiple investors, you should also provide your own name, role in the business, and email address on the cover page.

At the bottom of this page, you can also add a confidentiality statement to protect against the disclosure of your business details.

The statement can read as follows: " This document contains confidential and proprietary information created by [your company name]. When receiving this document, you agree to keep its content confidential and may only reproduce and/or share it with express written permission of [your company name] ."

Remember to keep your cover page simple and concise — and save the important details for other sections.

Why it matters: First impressions are everything, and a clean cover page is the first step in the right direction.

Example of a Cover Page

2. Executive Summary

The executive summary of your business plan provides a one- to two-page overview of your business and highlights the most crucial pieces of your plan, such as your short-term and long-term goals.

The executive summary is essentially a boiled-down version of your entire business plan, so remember to keep this section to the point and filled only with essential information.

Typically, this brief section includes:

• A mission statement.
• The company's history and leadership model.
• An overview of competitive advantage(s).
• Financial projections.
• Company goals.
• An ask from potential investors.

Why it matters: The executive summary is known as the make-or-break section of a business plan. It influences whether investors turn the page or not — so effectively summarizing your business and the problem it hopes to solve is a must.

Think of the Summary as a written elevator pitch (with more detail). While your business plan provides the nitty-gritty details, your Summary describes — in a compelling but matter-of-fact language — the highlights of your plan. If it's too vague, complicated, or fuzzy, you may need to scrap it and start again.

Example of an Executive Summary Introduction

"The future looks bright for North Side Chicago, particularly the Rock Hill Neighborhood. A number of high-end commercial and residential developments are well on their way, along with two new condo developments in nearby neighborhoods.

While the completion of these developments will increase the population within the neighborhood and stimulate the economy, the area lacks an upscale restaurant where residents and visitors can enjoy fine food and drink. Jay Street Lounge and Restaurant will provide such a place."

3. Company & Business Description

In this section, provide a more thorough description of what your company is and why it exists.

The bulk of the writing in this section should be about your company's purpose – covering what the business will be selling, identifying the target market, and laying out a path to success.

In this portion of your business plan, you can also elaborate on your company's:

• Mission statement
• Core values
• Team and organizational structure

Why it matters: Investors look for great structures and teams in addition to great ideas. This section gives an overview of your businesses' ethos. It's the perfect opportunity to set your business apart from the competition — such as your team's expertise, your unique work culture, and your competitive advantage.

Example of a Values/Mission Statement

"Jay Street Lounge and Restaurant will be the go-to place for people to get a drink or bite in an elegant, upscale atmosphere. The mission is to be North Side's leading restaurant, with the best tasting food and the highest quality service."

3. Product & Services Line

Here's where you'll cover the makeup of your business's product and/or services line. You should provide each product or service's name, its purpose, and a description of how it works (if appropriate). If you own any patents, copyrights, or trademarks, it's essential to include this info too.

Next, add some color to your sales strategy by outlining your pricing model and mark-up amounts.

If you're selling tangible products, you should also explain production and costs, and how you expect these factors to change as you scale.

Why it matters: This section contains the real meat of your business plan. It sets the stage for the problem you hope to solve, your solution, and how your said solution fits in the market.

There's no one-size-fits-all formula for this section. For instance, one plan may delve into its ability to market in a more cost-effective way than the competition, whereas another plan focuses on its key products and their unique features and benefits.

Regardless of your angle, it's critical to convey how your offerings will differ from the competition.

Example of a Product/Service Offering

"The menu at Jay Street Lounge and Restaurant will focus on Moroccan cuisine. The stars of the menu (our specialties) are the Moroccan dishes, such as eggplant zaalouk, seafood bastilla, tagine, and chickpea stew. For those who enjoy American dishes, there will also be a variety of options, from burger sliders and flatbread pizza to grilled steak and salads.

The food at Jay Street will have premium pricing to match its upscale atmosphere. During the summer months, the restaurant will have extra seating on the patio where clients can enjoy a special summer menu. We will be open on all days of the week."

4. Market Analysis

It helps to reference your market research documentation in this section, like a Porter's Five Forces Analysis or a SWOT Analysis ( templates for those are available here ). You can also include them in your appendix.

If your company already has buyer personas, you should include them here as well. If not, you can create them right now using the Make My Persona Tool .

Why it matters: Having an awesome product is, well, awesome — but it isn't enough. Just as important, there must be a market for it.

This section allows you to dig deeper into your market, which segments you want to target, and why. The "why" here is important, since targeting the right segment is critical for the success and growth of your business.

It's easy to get lost (or overwhelmed) in a sea of endless data. For your business plan, narrow your focus by answering the following questions:

• What is my market? In other words, who are my customers?
• What segments of the market do I want to target?
• What's the size of my target market?
• Is my market likely to grow?
• How can I increase my market share over time?

Example of a Market Analysis

"Jay Street Lounge and Restaurant will target locals who live and work within the Rock Hill Neighborhood and the greater North Side Chicago area. We will also target the tourists who flock to the many tourist attractions and colleges on the North Side.

We will specifically focus on young to middle-aged adults with an income of $40,000 to $80,000 who are looking for an upscale experience. The general demographics of our target market are women between 20 to 50 years old.

A unique and varied Moroccan-American menu, along with our unique upscale atmosphere, differentiates us from competitors in the area. Jay Street will also set itself apart through its commitment to high-quality food, service, design, and atmosphere."

5. Marketing Plan

Unlike the market analysis section, your marketing plan section should be an explanation of the tactical approach to reaching your aforementioned target audience. List your advertising channels, organic marketing methods, messaging, budget, and any relevant promotional tactics.

If your company has a fully fleshed-out marketing plan, you can attach it in the appendix of your business plan. If not, download this free marketing plan template to outline your strategy.

Free Marketing Plan Template

Outline your company's marketing strategy in one simple, coherent plan.

• Pre-Sectioned Template
• Completely Customizable
• Example Prompts
• Professionally Designed

Why it matters: Marketing is what puts your product in front of your customers. It's not just advertising — it's an investment in your business.

Throwing money into random marketing channels is a haphazard approach, which is why it's essential to do the legwork to create a solid marketing plan.

Here's some good news — by this point, you should have a solid understanding of your target market. Now, it's time to determine how you'll reach them.

Example of a Marketing Plan Overview

"Our marketing strategy will focus on three main initiatives:

• Social media marketing. We will grow and expand our Facebook and Instagram following through targeted social media ads.
• Website initiatives. Our website will attract potential visitors by offering updated menus and a calendar of events.
• Promotional events. Jay Street will have one special theme night per week to attract new clients."

6. Sales Plan

It doesn't matter if your sales department is an office full of business development representatives (BDR) or a dozen stores with your products on their shelves.

The point is: All sales plans are different, so you should clearly outline yours here. Common talking points include your:

• Sales team structure, and why this structure was chosen.
• Sales channels.
• Sales tools, software, and resources.
• Prospecting strategy.
• Sales goals and budget.

Like with your marketing plan, it might make sense to attach your completed sales plan to the appendix of your business plan. You can download a template for building your sales plan here .

Why it matters: Among other things, investors are interested in the scalability of your business — which is why growth strategies are a critical part of your business plan.

Your sales plan should describe your plan to attract customers, retain them (if applicable), and, ultimately, grow your business. Be sure to outline what you plan to do given your existing resources and what results you expect from your work.

Example of a Sales Plan Overview

"The most important goal is to ensure financial success for Jay Street Lounge and Restaurant. We believe we can achieve this by offering excellent food, entertainment, and service to our clients.

We are not a low-cost dining option in the area. Instead, the food will have premium pricing to match its upscale feel. The strategy is to give Jay Street a perception of elegance through its food, entertainment, and excellent service."

7. Legal Notes

Your investors may want to know the legal structure of your business, as that could directly impact the risk of their investments. For example, if you're looking for business partners to engage in a non-corporation or LLC partnership, this means they could be on the line for more than their actual investment.

Because this clarification is often needed, explain if you are and/or plan to become a sole proprietor, partnership, corporation, LLC, or other.

You should also outline the steps you have taken (or will need to take) to operate legally. This includes licenses, permits, registrations, and insurance.

The last thing your investor wants to hear after they've sent you a big chunk of change is that you're operating without proper approval from the local, state, or federal government.

Why it matters: The last thing your investor wants to hear after they've sent you a big chunk of change is that you're operating without proper approval from the local, state, or federal government.

Example of Legal Notes

"Jay Street Lounge and Restaurant is up-to-date on all restaurant licenses and health permits. Our business name and logo are registered trademarks, presenting the possibility of expanding locally."

8. Financial Considerations

Ultimately, investors want to know two things:

• When they will earn their money back.
• When they will start seeing returns on their initial investment.

That said, be clear, calculated, and convincing in this section. It should cover:

• Startup costs.
• Sales forecasts for the next several months/quarters.
• Break-even analysis for time and dollars.
• Projected profit and loss (P&L) statement.

Facts and figures are key here, so be as specific as possible with each line item and projection. In addition, explain the "why" behind each of these sections.

However, keep in mind that information overload is a risk, especially when it comes to data. So, if you have pages upon pages of charts and spreadsheets for this section, distill them into a page or two and include the rest of the sheets in the appendix. This section should only focus on key data points.

Why it matters: One of the most important aspects of becoming "investor ready" is knowing your numbers. More importantly, you need to understand how those numbers will enhance your business.

While it's easy to write a number down on paper, it's more important to understand (and communicate) why you need capital, where it's going, and that your evaluation makes sense.

Example of Financial Projections

"Based on our knowledge and experience in the restaurant industry, we have come up with projections for the business.

Starting with an expenditure of $400,000 in year 1, we forecast sales of $1,500,000 and $2,800,000 for years two and three. We expect to achieve a net profit of 15% by year three."

9. Appendix

A detailed and well-developed business plan can range anywhere from 20 to 50 pages, with some even reaching upward of 80.

In many cases, the appendix is the longest section. Why? Because it includes the supportive materials mentioned in previous sections. To avoid disrupting the flow of the business plan with visuals, charts, and spreadsheets, business owners usually add them in the last section, i.e. the appendix.

Aside from what we've already mentioned – marketing plan, sales plan, department budgets, financial documents – you may also want to attach the following in the appendix:

• Marketing materials
• Market research data
• Licensing documentation
• Branding assets
• Floor plans for your location
• Mockups of your product
• Renderings of your office space or location design

Adding these pieces to the appendix enriches the reader's understanding of your business and proves you've put the work into your business plan without distracting from the main points throughout the plan.

Why it matters: An appendix helps the reader do their due diligence. It contains everything they need to support your business plan.

Keep in mind, however, that an appendix is typically necessary only if you're seeking financing or looking to attract business partners.

Use a Business Plan Template to Get Started

Writing a business plan shouldn't be an insurmountable roadblock to starting a business. Unfortunately, for all too many, it is.

That's why we recommend using our free business plan template. Pre-filled with detailed section prompts for all of the topics in this blog post, we're confident this template will get your business plan started in the right direction.

Editor's note: This post was originally published in June 2017 and has been updated for comprehensiveness.

Don't forget to share this post!

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How to make a business plan

Table of Contents

How to make a good business plan: step-by-step guide.

A business plan is a strategic roadmap used to navigate the challenging journey of entrepreneurship. It's the foundation upon which you build a successful business.

A well-crafted business plan can help you define your vision, clarify your goals, and identify potential problems before they arise.

But where do you start? How do you create a business plan that sets you up for success?

This article will explore the step-by-step process of creating a comprehensive business plan.

What is a business plan?

A business plan is a formal document that outlines a business's objectives, strategies, and operational procedures. It typically includes the following information about a company:

Products or services

Target market

Competitors

Marketing and sales strategies

Financial plan

Management team

A business plan serves as a roadmap for a company's success and provides a blueprint for its growth and development. It helps entrepreneurs and business owners organize their ideas, evaluate the feasibility, and identify potential challenges and opportunities.

As well as serving as a guide for business owners, a business plan can attract investors and secure funding. It demonstrates the company's understanding of the market, its ability to generate revenue and profits, and its strategy for managing risks and achieving success.

Business plan vs. business model canvas

A business plan may seem similar to a business model canvas, but each document serves a different purpose.

A business model canvas is a high-level overview that helps entrepreneurs and business owners quickly test and iterate their ideas. It is often a one-page document that briefly outlines the following:

Key partnerships

Key activities

Key propositions

Customer relationships

Customer segments

Key resources

Cost structure

Revenue streams

On the other hand, a Business Plan Template provides a more in-depth analysis of a company's strategy and operations. It is typically a lengthy document and requires significant time and effort to develop.

A business model shouldn’t replace a business plan, and vice versa. Business owners should lay the foundations and visually capture the most important information with a Business Model Canvas Template . Because this is a fast and efficient way to communicate a business idea, a business model canvas is a good starting point before developing a more comprehensive business plan.

A business plan can aim to secure funding from investors or lenders, while a business model canvas communicates a business idea to potential customers or partners.

Why is a business plan important?

A business plan is crucial for any entrepreneur or business owner wanting to increase their chances of success.

Here are some of the many benefits of having a thorough business plan.

Helps to define the business goals and objectives

A business plan encourages you to think critically about your goals and objectives. Doing so lets you clearly understand what you want to achieve and how you plan to get there.

A well-defined set of goals, objectives, and key results also provides a sense of direction and purpose, which helps keep business owners focused and motivated.

Guides decision-making

A business plan requires you to consider different scenarios and potential problems that may arise in your business. This awareness allows you to devise strategies to deal with these issues and avoid pitfalls.

With a clear plan, entrepreneurs can make informed decisions aligning with their overall business goals and objectives. This helps reduce the risk of making costly mistakes and ensures they make decisions with long-term success in mind.

Attracts investors and secures funding

Investors and lenders often require a business plan before considering investing in your business. A document that outlines the company's goals, objectives, and financial forecasts can help instill confidence in potential investors and lenders.

A well-written business plan demonstrates that you have thoroughly thought through your business idea and have a solid plan for success.

Identifies potential challenges and risks

A business plan requires entrepreneurs to consider potential challenges and risks that could impact their business. For example:

Is there enough demand for my product or service?

Will I have enough capital to start my business?

Is the market oversaturated with too many competitors?

What will happen if my marketing strategy is ineffective?

By identifying these potential challenges, entrepreneurs can develop strategies to mitigate risks and overcome challenges. This can reduce the likelihood of costly mistakes and ensure the business is well-positioned to take on any challenges.

Provides a basis for measuring success

A business plan serves as a framework for measuring success by providing clear goals and financial projections . Entrepreneurs can regularly refer to the original business plan as a benchmark to measure progress. By comparing the current business position to initial forecasts, business owners can answer questions such as:

Are we where we want to be at this point?

Did we achieve our goals?

If not, why not, and what do we need to do?

After assessing whether the business is meeting its objectives or falling short, business owners can adjust their strategies as needed.

How to make a business plan step by step

The steps below will guide you through the process of creating a business plan and what key components you need to include.

1. Create an executive summary

Start with a brief overview of your entire plan. The executive summary should cover your business plan's main points and key takeaways.

Keep your executive summary concise and clear with the Executive Summary Template . The simple design helps readers understand the crux of your business plan without reading the entire document.

2. Write your company description

Provide a detailed explanation of your company. Include information on what your company does, the mission statement, and your vision for the future.

Provide additional background information on the history of your company, the founders, and any notable achievements or milestones.

3. Conduct a market analysis

Conduct an in-depth analysis of your industry, competitors, and target market. This is best done with a SWOT analysis to identify your strengths, weaknesses, opportunities, and threats. Next, identify your target market's needs, demographics, and behaviors.

Use the Competitive Analysis Template to brainstorm answers to simple questions like:

What does the current market look like?

Who are your competitors?

What are they offering?

What will give you a competitive advantage?

Who is your target market?

What are they looking for and why?

How will your product or service satisfy a need?

These questions should give you valuable insights into the current market and where your business stands.

4. Describe your products and services

Provide detailed information about your products and services. This includes pricing information, product features, and any unique selling points.

Use the Product/Market Fit Template to explain how your products meet the needs of your target market. Describe what sets them apart from the competition.

5. Design a marketing and sales strategy

Outline how you plan to promote and sell your products. Your marketing strategy and sales strategy should include information about your:

Pricing strategy

Advertising and promotional tactics

Sales channels

The Go to Market Strategy Template is a great way to visually map how you plan to launch your product or service in a new or existing market.

6. Determine budget and financial projections

Document detailed information on your business’ finances. Describe the current financial position of the company and how you expect the finances to play out.

Some details to include in this section are:

Startup costs

Revenue projections

Profit and loss statement

Funding you have received or plan to receive

Strategy for raising funds

7. Set the organization and management structure

Define how your company is structured and who will be responsible for each aspect of the business. Use the Business Organizational Chart Template to visually map the company’s teams, roles, and hierarchy.

As well as the organization and management structure, discuss the legal structure of your business. Clarify whether your business is a corporation, partnership, sole proprietorship, or LLC.

8. Make an action plan

At this point in your business plan, you’ve described what you’re aiming for. But how are you going to get there? The Action Plan Template describes the following steps to move your business plan forward. Outline the next steps you plan to take to bring your business plan to fruition.

Types of business plans

Several types of business plans cater to different purposes and stages of a company's lifecycle. Here are some of the most common types of business plans.

Startup business plan

A startup business plan is typically an entrepreneur's first business plan. This document helps entrepreneurs articulate their business idea when starting a new business.

Not sure how to make a business plan for a startup? It’s pretty similar to a regular business plan, except the primary purpose of a startup business plan is to convince investors to provide funding for the business. A startup business plan also outlines the potential target market, product/service offering, marketing plan, and financial projections.

Strategic business plan

A strategic business plan is a long-term plan that outlines a company's overall strategy, objectives, and tactics. This type of strategic plan focuses on the big picture and helps business owners set goals and priorities and measure progress.

The primary purpose of a strategic business plan is to provide direction and guidance to the company's management team and stakeholders. The plan typically covers a period of three to five years.

Operational business plan

An operational business plan is a detailed document that outlines the day-to-day operations of a business. It focuses on the specific activities and processes required to run the business, such as:

Organizational structure

Staffing plan

Production plan

Quality control

Inventory management

Supply chain

The primary purpose of an operational business plan is to ensure that the business runs efficiently and effectively. It helps business owners manage their resources, track their performance, and identify areas for improvement.

Growth-business plan

A growth-business plan is a strategic plan that outlines how a company plans to expand its business. It helps business owners identify new market opportunities and increase revenue and profitability. The primary purpose of a growth-business plan is to provide a roadmap for the company's expansion and growth.

The 3 Horizons of Growth Template is a great tool to identify new areas of growth. This framework categorizes growth opportunities into three categories: Horizon 1 (core business), Horizon 2 (emerging business), and Horizon 3 (potential business).

One-page business plan

A one-page business plan is a condensed version of a full business plan that focuses on the most critical aspects of a business. It’s a great tool for entrepreneurs who want to quickly communicate their business idea to potential investors, partners, or employees.

A one-page business plan typically includes sections such as business concept, value proposition, revenue streams, and cost structure.

Best practices for how to make a good business plan

Here are some additional tips for creating a business plan:

Use a template

A template can help you organize your thoughts and effectively communicate your business ideas and strategies. Starting with a template can also save you time and effort when formatting your plan.

Miro’s extensive library of customizable templates includes all the necessary sections for a comprehensive business plan. With our templates, you can confidently present your business plans to stakeholders and investors.

Be practical

Avoid overestimating revenue projections or underestimating expenses. Your business plan should be grounded in practical realities like your budget, resources, and capabilities.

Be specific

Provide as much detail as possible in your business plan. A specific plan is easier to execute because it provides clear guidance on what needs to be done and how. Without specific details, your plan may be too broad or vague, making it difficult to know where to start or how to measure success.

Be thorough with your research

Conduct thorough research to fully understand the market, your competitors, and your target audience . By conducting thorough research, you can identify potential risks and challenges your business may face and develop strategies to mitigate them.

Get input from others

It can be easy to become overly focused on your vision and ideas, leading to tunnel vision and a lack of objectivity. By seeking input from others, you can identify potential opportunities you may have overlooked.

Review and revise regularly

A business plan is a living document. You should update it regularly to reflect market, industry, and business changes. Set aside time for regular reviews and revisions to ensure your plan remains relevant and effective.

Create a winning business plan to chart your path to success

Starting or growing a business can be challenging, but it doesn't have to be. Whether you're a seasoned entrepreneur or just starting, a well-written business plan can make or break your business’ success.

The purpose of a business plan is more than just to secure funding and attract investors. It also serves as a roadmap for achieving your business goals and realizing your vision. With the right mindset, tools, and strategies, you can develop a visually appealing, persuasive business plan.

Ready to make an effective business plan that works for you? Check out our library of ready-made strategy and planning templates and chart your path to success.

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How to Write a Business Plan, Step by Step

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What is a business plan?

1. write an executive summary, 2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. summarize how your company operates, 10. add any additional information to an appendix, business plan tips and resources.

A business plan outlines your business’s financial goals and explains how you’ll achieve them over the next three to five years. Here’s a step-by-step guide to writing a business plan that will offer a strong, detailed road map for your business.

ZenBusiness

A business plan is a document that explains what your business does, how it makes money and who its customers are. Internally, writing a business plan should help you clarify your vision and organize your operations. Externally, you can share it with potential lenders and investors to show them you’re on the right track.

Business plans are living documents; it’s OK for them to change over time. Startups may update their business plans often as they figure out who their customers are and what products and services fit them best. Mature companies might only revisit their business plan every few years. Regardless of your business’s age, brush up this document before you apply for a business loan .

» Need help writing? Learn about the best business plan software .

This is your elevator pitch. It should include a mission statement, a brief description of the products or services your business offers and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description. This should contain basic information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, write a little about the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out what you’d like to accomplish, both in the near term and over the coming years.

If you’re looking for a business loan or outside investment, you can use this section to explain how the financing will help your business grow and how you plan to achieve those growth targets. The key is to provide a clear explanation of the opportunity your business presents to the lender.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch that new product and how much you think sales will increase over the next three years as a result.

» MORE: How to write a successful business plan for a loan

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

Include details about your sales and distribution strategies, including the costs involved in selling each product .

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

Accounting software may be able to generate these reports for you. It may also help you calculate metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

Before the end of your business plan, summarize how your business is structured and outline each team’s responsibilities. This will help your readers understand who performs each of the functions you’ve described above — making and selling your products or services — and how much each of those functions cost.

If any of your employees have exceptional skills, you may want to include their resumes to help explain the competitive advantage they give you.

Finally, attach any supporting information or additional materials that you couldn’t fit in elsewhere. That might include:

Licenses and permits.

Equipment leases.

Bank statements.

Details of your personal and business credit history, if you’re seeking financing.

If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are some tips to write a detailed, convincing business plan:

Avoid over-optimism: If you’re applying for a business bank loan or professional investment, someone will be reading your business plan closely. Providing unreasonable sales estimates can hurt your chances of approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

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Writing a Solid Business Plan: Fundamentals and Principles

I’ve worked as a business plan writer since 2006, and it’s been a remarkably fun and fulfilling career for me. I get to see entrepreneurs of all sorts, from all over the world, live out their dreams.

When I’m out and about meeting people in the real world, I don’t dread the question, “What do you do for a living,” like some people do, because I love talking about what I do for a living. 

But what I am quite used to is the blank stare that I tend to get, and the follow-up question, “What does that mean?” Other people nod their heads knowingly, especially if they have some experience with business or finance, but once they ask subsequent questions I realize they’re thinking of something completely different. So, I thought it might be helpful to talk about the top questions the Masterplans team gets about business plan writing and what happens when you hire a business plan writer.

What even is a business plan? 

The most basic possible question, and what people really mean when they ask me what my job title really means. I love to answer this question, except when I’m trying to explain it to relatives in Greece, or my Spanish-speaking friends! My second- and third-language skills are not strong enough to begin to explain what a business plan is. But, when I try to explain it to them, I break it down into the simplest terms, so maybe that’s the best place to start here. I do this with a series of questions and statements that go like this:

• Have you ever thought about starting your own business? (Inevitably, the answer is yes)
• Well, when you want to start your own business, you will probably need to apply for a loan, or ask an investor for funding. (People nod at this one…  I’ve still got their comprehension). 
• When you do that, you need to present a document that tells all about the business you’re starting. I write that document. 

And bingo, we have a basic level of understanding of what I do. But of course, it’s so much more complicated than that . A traditional business plan is made up of a complete outline of topics and sub-topics that any entrepreneur needs to be able to answer. It’s not always about funding either, even though that’s how I present it to friends. The truth is that every entrepreneur needs a business plan, even if they’re bootstrapping the project out of their own pocket. 

In actuality, a business plan is a comprehensive document that explains the details about your business, sets goals and objectives, and guides you going forward. That said, if you are pursuing funding like most entrepreneurs, your document needs to cover a range of required topics. 

Let’s take a look at the SBA requirements for the sections that need to be in a business plan:

• Executive Summary
• Company Description
• Market Analysis
• Organization and Management
• Service or Product line
• Marketing and Sales
• Funding request
• Financial projections
• Appendix (optional)

However, this is an overly broad listing, which doesn’t include many of the sub-sections that are involved. For example, at Masterplans, our Market Analysis covers a variety of sub-sections like Market Segmentation, Market Need, Industry Analysis, Competitive Comparison, and Competitive Edge. 

Part of being a good business plan writer means understanding what goes within each section and keeping the content organized into the appropriate area. Some customers have a hard time keeping straight the difference between the "Competitive Comparison" and the "Competitive Edge" sections, but they are quite distinct. Or, it can be tempting to talk about who your customers are in the "Market Analysis" instead of the "Market Segmentation." I’ve even had people mix up marketing tactics with products or services. It takes an experienced hand to keep the content organized.

What is the purpose of a business plan? 

A business plan’s highest purpose is to guide entrepreneurs in operating their business on the day-to-day level. It is a foundational document that I think of as the constitution of your business. It tells you everything you need to know about your idea, your goals, your strategy, and the financial picture of a business. 

Here at Masterplans, we strongly believe that entrepreneurs need to understand that a business plan is not a one-time use product, like applying for a business loan. Instead, we want our clients to use their business plan all the time, for years into the future, as long as the business exists. It should guide board meetings and management decisions. Your employees should read it so that they understand what your mission is, what steps you need to take to achieve success, and what their role is within your company.

But we admit that there are those one-time, single-serving uses for a business plan that will likely come up for you. You need it to apply for a bank loan. You need it to ask for investment. You need it when applying for a lease on a location. You often need it when applying for certain permits, especially those dealing with compliance issues. And for those of you who are foreign investors seeking a visa , you need it to include in your application packet to USCIS. 

Thus, a comprehensive business plan needs to be able to not just guide you in your daily decision-making, but it also needs to answer all the questions that an outside party might ask you when deciding whether to fund your idea or let you lease their space.

Who should write a business plan? 

Why, the entrepreneurial team should take the helm in writing a business plan, of course. Did you expect a different answer from a professional business plan writer? At Masterplans, we don’t shy away from delivering honest truth to our clients, because we thrive when they thrive. 

The truth is that an entrepreneur who isn’t intimately involved in the writing of their business plan from the start will never fully understand it, and that can hamper them on their path to achieving their goals. It’s imperative that an entrepreneur have a deep understanding of their business plan, or else they won’t be able to follow it! 

But, writing a business plan is an intense endeavor that requires a better-than-average command of English writing and style, as well as business theory and financial modeling. Very few people represent the total package, which is why at Masterplans, we work in teams of specialists who together have those skills. 

I can write a beautiful market analysis summary, analyze your competitive landscape in-depth, and wrap it all up with an attention-grabbing executive summary, but don’t ask me to explain a complex financial concept like Internal Rate of Return. (I’m being modest; I can tell you all about it, but I’ll leave that to our brilliant financial modelers who understand it in more depth than I do.)

While some entrepreneurs may somehow possess the bare minimum of skills that are required to create a decent business plan, they most certainly don’t have the time.  Starting a business involves numerous steps, and entrepreneurs are often pursuing each of those steps while juggling a full-time career and sometimes a family. It’s a lot. 

But a key quality shared by the best leaders is knowing when and what to delegate. If you have a dual major in English and Business, and you’ve done this a few times before, then sure, you could probably write a stellar business plan from scratch. 

But if you have virtually any other combination of experience, you could benefit greatly from delegating it to a company like ours that can counsel you every step of the way, scheduling out the project into meetings and discrete tasks so that you can be as involved as you should be in the process while still freeing up your time to handle the many other to-dos on your plate. (This benefit still holds true for the dual major, as well!)

Remember, the most important thing is that the business plan actually gets done so that you can use it to start your business, but like any long writing project, it can fall to the wayside when life’s pressures get in the way. Working with a deadline-driven consultancy like ours can help you reach the finish line.

Now that you have a basic introduction to the traditional business plan document, you probably have plenty of questions that go deeper. We’ve done our best to address those with our frequently asked questions about writing business plans . 

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Written by Jesse Sumrak | May 14, 2023

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Business plans might seem like an old-school stiff-collared practice, but they deserve a place in the startup realm, too. It’s probably not going to be the frame-worthy document you hang in the office—yet, it may one day be deserving of the privilege.

Whether you’re looking to win the heart of an angel investor or convince a bank to lend you money, you’ll need a business plan. And not just any ol’ notes and scribble on the back of a pizza box or napkin—you’ll need a professional, standardized report.

Bah. Sounds like homework, right?

Yes. Yes, it does.

However, just like bookkeeping, loan applications, and 404 redirects, business plans are an essential step in cementing your business foundation.

Don’t worry. We’ll show you how to write a business plan without boring you to tears. We’ve jam-packed this article with all the business plan examples, templates, and tips you need to take your non-existent proposal from concept to completion.

Table of Contents

What Is a Business Plan?

Tips to Make Your Small Business Plan Ironclad

How to Write a Business Plan in 6 Steps

Startup Business Plan Template

Business Plan Examples

Work on Making Your Business Plan

How to Write a Business Plan FAQs

What is a business plan why do you desperately need one.

A business plan is a roadmap that outlines:

• Who your business is, what it does, and who it serves
• Where your business is now
• Where you want it to go
• How you’re going to make it happen
• What might stop you from taking your business from Point A to Point B
• How you’ll overcome the predicted obstacles

While it’s not required when starting a business, having a business plan is helpful for a few reasons:

• Secure a Bank Loan: Before approving you for a business loan, banks will want to see that your business is legitimate and can repay the loan. They want to know how you’re going to use the loan and how you’ll make monthly payments on your debt. Lenders want to see a sound business strategy that doesn’t end in loan default.
• Win Over Investors: Like lenders, investors want to know they’re going to make a return on their investment. They need to see your business plan to have the confidence to hand you money.
• Stay Focused: It’s easy to get lost chasing the next big thing. Your business plan keeps you on track and focused on the big picture. Your business plan can prevent you from wasting time and resources on something that isn’t aligned with your business goals.

Beyond the reasoning, let’s look at what the data says:

• Simply writing a business plan can boost your average annual growth by 30%
• Entrepreneurs who create a formal business plan are 16% more likely to succeed than those who don’t
• A study looking at 65 fast-growth companies found that 71% had small business plans
• The process and output of creating a business plan have shown to improve business performance

Convinced yet? If those numbers and reasons don’t have you scrambling for pen and paper, who knows what will.

Don’t Skip: Business Startup Costs Checklist

Before we get into the nitty-gritty steps of how to write a business plan, let’s look at some high-level tips to get you started in the right direction:

Be Professional and Legit

You might be tempted to get cutesy or revolutionary with your business plan—resist the urge. While you should let your brand and creativity shine with everything you produce, business plans fall more into the realm of professional documents.

Think of your business plan the same way as your terms and conditions, employee contracts, or financial statements. You want your plan to be as uniform as possible so investors, lenders, partners, and prospective employees can find the information they need to make important decisions.

If you want to create a fun summary business plan for internal consumption, then, by all means, go right ahead. However, for the purpose of writing this external-facing document, keep it legit.

Know Your Audience

Your official business plan document is for lenders, investors, partners, and big-time prospective employees. Keep these names and faces in your mind as you draft your plan.

Think about what they might be interested in seeing, what questions they’ll ask, and what might convince (or scare) them. Cut the jargon and tailor your language so these individuals can understand.

Remember, these are busy people. They’re likely looking at hundreds of applicants and startup investments every month. Keep your business plan succinct and to the point. Include the most pertinent information and omit the sections that won’t impact their decision-making.

Invest Time Researching

You might not have answers to all the sections you should include in your business plan. Don’t skip over these!

Your audience will want:

• Detailed information about your customers
• Numbers and solid math to back up your financial claims and estimates
• Deep insights about your competitors and potential threats
• Data to support market opportunities and strategy

Your answers can’t be hypothetical or opinionated. You need research to back up your claims. If you don’t have that data yet, then invest time and money in collecting it. That information isn’t just critical for your business plan—it’s essential for owning, operating, and growing your company.

Stay Realistic

Your business may be ambitious, but reign in the enthusiasm just a teeny-tiny bit. The last thing you want to do is have an angel investor call BS and say “I’m out” before even giving you a chance.

The folks looking at your business and evaluating your plan have been around the block—they know a thing or two about fact and fiction. Your plan should be a blueprint for success. It should be the step-by-step roadmap for how you’re going from Point A to Point B.

How to Write a Business Plan—6 Essential Elements

Not every business plan looks the same, but most share a few common elements. Here’s what they typically include:

• Executive Summary
• Business Overview
• Products and Services
• Market Analysis
• Competitive Analysis
• Financial Strategy

Below, we’ll break down each of these sections in more detail.

1. Executive Summary

While your executive summary is the first page of your business plan, it’s the section you’ll write last. That’s because it summarizes your entire business plan into a succinct one-pager.

Begin with an executive summary that introduces the reader to your business and gives them an overview of what’s inside the business plan.

Your executive summary highlights key points of your plan. Consider this your elevator pitch. You want to put all your juiciest strengths and opportunities strategically in this section.

2. Business Overview

In this section, you can dive deeper into the elements of your business, including answering:

• What’s your business structure? Sole proprietorship, LLC, corporation, etc.
• Where is it located?
• Who owns the business? Does it have employees?
• What problem does it solve, and how?
• What’s your mission statement? Your mission statement briefly describes why you are in business. To write a proper mission statement, brainstorm your business’s core values and who you serve.

Don’t overlook your mission statement. This powerful sentence or paragraph could be the inspiration that drives an investor to take an interest in your business. Here are a few examples of powerful mission statements that just might give you the goosebumps:

• Patagonia: Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.
• Tesla: To accelerate the world’s transition to sustainable energy.
• InvisionApp : Question Assumptions. Think Deeply. Iterate as a Lifestyle. Details, Details. Design is Everywhere. Integrity.
• TED : Spread ideas.
• Warby Parker : To offer designer eyewear at a revolutionary price while leading the way for socially conscious businesses.

3. Products and Services

As the owner, you know your business and the industry inside and out. However, whoever’s reading your document might not. You’re going to need to break down your products and services in minute detail.

For example, if you own a SaaS business, you’re going to need to explain how this business model works and what you’re selling.

You’ll need to include:

• What services you sell: Describe the services you provide and how these will help your target audience.
• What products you sell: Describe your products (and types if applicable) and how they will solve a need for your target and provide value.
• How much you charge: If you’re selling services, will you charge hourly, per project, retainer, or a mixture of all of these? If you’re selling products, what are the price ranges?

4. Market Analysis

Your market analysis essentially explains how your products and services address customer concerns and pain points. This section will include research and data on the state and direction of your industry and target market.

This research should reveal lucrative opportunities and how your business is uniquely positioned to seize the advantage. You’ll also want to touch on your marketing strategy and how it will (or does) work for your audience.

Include a detailed analysis of your target customers. This describes the people you serve and sell your product to. Be careful not to go too broad here—you don’t want to fall into the common entrepreneurial trap of trying to sell to everyone and thereby not differentiating yourself enough to survive the competition.

The market analysis section will include your unique value proposition. Your unique value proposition (UVP) is the thing that makes you stand out from your competitors. This is your key to success.

If you don’t have a UVP, you don’t have a way to take on competitors who are already in this space. Here’s an example of an ecommerce internet business plan outlining their competitive edge:

FireStarters’ competitive advantage is offering product lines that make a statement but won’t leave you broke. The major brands are expensive and not distinctive enough to satisfy the changing taste of our target customers. FireStarters offers products that are just ahead of the curve and so affordable that our customers will return to the website often to check out what’s new.

5. Competitive Analysis

Your competitive analysis examines the strengths and weaknesses of competing businesses in your market or industry. This will include direct and indirect competitors. It can also include threats and opportunities, like economic concerns or legal restraints.

The best way to sum up this section is with a classic SWOT analysis. This will explain your company’s position in relation to your competitors.

6. Financial Strategy

Your financial strategy will sum up your revenue, expenses, profit (or loss), and financial plan for the future. It’ll explain how you make money, where your cash flow goes, and how you’ll become profitable or stay profitable.

This is one of the most important sections for lenders and investors. Have you ever watched Shark Tank? They always ask about the company’s financial situation. How has it performed in the past? What’s the ongoing outlook moving forward? How does the business plan to make it happen?

Answer all of these questions in your financial strategy so that your audience doesn’t have to ask. Go ahead and include forecasts and graphs in your plan, too:

• Balance sheet: This includes your assets, liabilities, and equity.
• Profit & Loss (P&L) statement: This details your income and expenses over a given period.
• Cash flow statement: Similar to the P&L, this one will show all cash flowing into and out of the business each month.

It takes cash to change the world—lenders and investors get it. If you’re short on funding, explain how much money you’ll need and how you’ll use the capital. Where are you looking for financing? Are you looking to take out a business loan, or would you rather trade equity for capital instead?

Read More: 16 Financial Concepts Every Entrepreneur Needs to Know

Startup Business Plan Template (Copy/Paste Outline)

Ready to write your own business plan? Copy/paste the startup business plan template below and fill in the blanks.

Executive Summary Remember, do this last. Summarize who you are and your business plan in one page.

Business Overview Describe your business. What’s it do? Who owns it? How’s it structured? What’s the mission statement?

Products and Services Detail the products and services you offer. How do they work? What do you charge?

Market Analysis Write about the state of the market and opportunities. Use date. Describe your customers. Include your UVP.

Competitive Analysis Outline the competitors in your market and industry. Include threats and opportunities. Add a SWOT analysis of your business.

Financial Strategy Sum up your revenue, expenses, profit (or loss), and financial plan for the future. If you’re applying for a loan, include how you’ll use the funding to progress the business.

5 Frame-Worthy Business Plan Examples

Want to explore other templates and examples? We got you covered. Check out these 5 business plan examples you can use as inspiration when writing your plan:

• SBA Wooden Grain Toy Company
• SBA We Can Do It Consulting
• OrcaSmart Business Plan Sample
• Plum Business Plan Template
• PandaDoc Free Business Plan Templates

Get to Work on Making Your Business Plan

If you find you’re getting stuck on perfecting your document, opt for a simple one-page business plan —and then get to work. You can always polish up your official plan later as you learn more about your business and the industry.

Remember, business plans are not a requirement for starting a business—they’re only truly essential if a bank or investor is asking for it.

Ask others to review your business plan. Get feedback from other startups and successful business owners. They’ll likely be able to see holes in your planning or undetected opportunities—just make sure these individuals aren’t your competitors (or potential competitors).

Your business plan isn’t a one-and-done report—it’s a living, breathing document. You’ll make changes to it as you grow and evolve. When the market or your customers change, your plan will need to change to adapt.

That means when you’re finished with this exercise, it’s not time to print your plan out and stuff it in a file cabinet somewhere. No, it should sit on your desk as a day-to-day reference. Use it (and update it) as you make decisions about your product, customers, and financial plan.

Review your business plan frequently, update it routinely, and follow the path you’ve developed to the future you’re building.

Keep Learning: New Product Development Process in 8 Easy Steps

What financial information should be included in a business plan?

Be as detailed as you can without assuming too much. For example, include your expected revenue, expenses, profit, and growth for the future.

What are some common mistakes to avoid when writing a business plan?

The most common mistake is turning your business plan into a textbook. A business plan is an internal guide and an external pitching tool. Cut the fat and only include the most relevant information to start and run your business.

Who should review my business plan before I submit it?

Co-founders, investors, or a board of advisors. Otherwise, reach out to a trusted mentor, your local chamber of commerce, or someone you know that runs a business.

Ready to Write Your Business Plan?

Don’t let creating a business plan hold you back from starting your business. Writing documents might not be your thing—that doesn’t mean your business is a bad idea.

Let us help you get started.

Join our free training to learn how to start an online side hustle in 30 days or less. We’ll provide you with a proven roadmap for how to find, validate, and pursue a profitable business idea (even if you have zero entrepreneurial experience).

Stuck on the ideas part? No problem. When you attend the masterclass, we’ll send you a free ebook with 100 of the hottest side hustle trends right now. It’s chock full of brilliant business ideas to get you up and running in the right direction.

About Jesse Sumrak

Jesse Sumrak is a writing zealot focused on creating killer content. He’s spent almost a decade writing about startup, marketing, and entrepreneurship topics, having built and sold his own post-apocalyptic fitness bootstrapped business. A writer by day and a peak bagger by night (and early early morning), you can usually find Jesse preparing for the apocalypse on a precipitous peak somewhere in the Rocky Mountains of Colorado.

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What Is a Business Plan?

Understanding business plans, how to write a business plan, common elements of a business plan, how often should a business plan be updated, the bottom line, business plan: what it is, what's included, and how to write one.

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

A business plan is a document that details a company's goals and how it intends to achieve them. Business plans can be of benefit to both startups and well-established companies. For startups, a business plan can be essential for winning over potential lenders and investors. Established businesses can find one useful for staying on track and not losing sight of their goals. This article explains what an effective business plan needs to include and how to write one.

Key Takeaways

• A business plan is a document describing a company's business activities and how it plans to achieve its goals.
• Startup companies use business plans to get off the ground and attract outside investors.
• For established companies, a business plan can help keep the executive team focused on and working toward the company's short- and long-term objectives.
• There is no single format that a business plan must follow, but there are certain key elements that most companies will want to include.

Investopedia / Ryan Oakley

Any new business should have a business plan in place prior to beginning operations. In fact, banks and venture capital firms often want to see a business plan before they'll consider making a loan or providing capital to new businesses.

Even if a business isn't looking to raise additional money, a business plan can help it focus on its goals. A 2017 Harvard Business Review article reported that, "Entrepreneurs who write formal plans are 16% more likely to achieve viability than the otherwise identical nonplanning entrepreneurs."

Ideally, a business plan should be reviewed and updated periodically to reflect any goals that have been achieved or that may have changed. An established business that has decided to move in a new direction might create an entirely new business plan for itself.

There are numerous benefits to creating (and sticking to) a well-conceived business plan. These include being able to think through ideas before investing too much money in them and highlighting any potential obstacles to success. A company might also share its business plan with trusted outsiders to get their objective feedback. In addition, a business plan can help keep a company's executive team on the same page about strategic action items and priorities.

Business plans, even among competitors in the same industry, are rarely identical. However, they often have some of the same basic elements, as we describe below.

While it's a good idea to provide as much detail as necessary, it's also important that a business plan be concise enough to hold a reader's attention to the end.

While there are any number of templates that you can use to write a business plan, it's best to try to avoid producing a generic-looking one. Let your plan reflect the unique personality of your business.

Many business plans use some combination of the sections below, with varying levels of detail, depending on the company.

The length of a business plan can vary greatly from business to business. Regardless, it's best to fit the basic information into a 15- to 25-page document. Other crucial elements that take up a lot of space—such as applications for patents—can be referenced in the main document and attached as appendices.

These are some of the most common elements in many business plans:

• Executive summary: This section introduces the company and includes its mission statement along with relevant information about the company's leadership, employees, operations, and locations.
• Products and services: Here, the company should describe the products and services it offers or plans to introduce. That might include details on pricing, product lifespan, and unique benefits to the consumer. Other factors that could go into this section include production and manufacturing processes, any relevant patents the company may have, as well as proprietary technology . Information about research and development (R&D) can also be included here.
• Market analysis: A company needs to have a good handle on the current state of its industry and the existing competition. This section should explain where the company fits in, what types of customers it plans to target, and how easy or difficult it may be to take market share from incumbents.
• Marketing strategy: This section can describe how the company plans to attract and keep customers, including any anticipated advertising and marketing campaigns. It should also describe the distribution channel or channels it will use to get its products or services to consumers.
• Financial plans and projections: Established businesses can include financial statements, balance sheets, and other relevant financial information. New businesses can provide financial targets and estimates for the first few years. Your plan might also include any funding requests you're making.

The best business plans aren't generic ones created from easily accessed templates. A company should aim to entice readers with a plan that demonstrates its uniqueness and potential for success.

2 Types of Business Plans

Business plans can take many forms, but they are sometimes divided into two basic categories: traditional and lean startup. According to the U.S. Small Business Administration (SBA) , the traditional business plan is the more common of the two.

• Traditional business plans : These plans tend to be much longer than lean startup plans and contain considerably more detail. As a result they require more work on the part of the business, but they can also be more persuasive (and reassuring) to potential investors.
• Lean startup business plans : These use an abbreviated structure that highlights key elements. These business plans are short—as short as one page—and provide only the most basic detail. If a company wants to use this kind of plan, it should be prepared to provide more detail if an investor or a lender requests it.

Why Do Business Plans Fail?

A business plan is not a surefire recipe for success. The plan may have been unrealistic in its assumptions and projections to begin with. Markets and the overall economy might change in ways that couldn't have been foreseen. A competitor might introduce a revolutionary new product or service. All of this calls for building some flexibility into your plan, so you can pivot to a new course if needed.

How frequently a business plan needs to be revised will depend on the nature of the business. A well-established business might want to review its plan once a year and make changes if necessary. A new or fast-growing business in a fiercely competitive market might want to revise it more often, such as quarterly.

What Does a Lean Startup Business Plan Include?

The lean startup business plan is an option when a company prefers to give a quick explanation of its business. For example, a brand-new company may feel that it doesn't have a lot of information to provide yet.

Sections can include: a value proposition ; the company's major activities and advantages; resources such as staff, intellectual property, and capital; a list of partnerships; customer segments; and revenue sources.

A business plan can be useful to companies of all kinds. But as a company grows and the world around it changes, so too should its business plan. So don't think of your business plan as carved in granite but as a living document designed to evolve with your business.

Harvard Business Review. " Research: Writing a Business Plan Makes Your Startup More Likely to Succeed ."

U.S. Small Business Administration. " Write Your Business Plan ."

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• The Dos and Don’ts of Writing a Solid Business Plan

Business Plans 201: The dos and don’ts of writing a solid business plan

We get it. That new business or venture that you’ve been dreaming about can be nerve-racking, but it’s possible. 

Starting a new business starts with an idea which comes to life with a strong business plan. Your business plan is more than a piece of paper or a writing exercise. It’s a roadmap that will keep you focused and give you a baseline for measuring success and achieving your goals. 

It isn’t a fixed or final artifact. Instead, think of it as a living document that you’ll revisit, learn from and adjust as your business grows. 

Writing your plan at first may take a lot of effort and it’s normal to go through several drafts. Consult your advisory team as they can support your plan’s development. And your plan will develop as you get new ideas, make new decisions and learn about changing business developments. 

Your plan is also key to unlocking funding. Whether you finance your business or solicit investors, either party will want to learn more about your plan before they invest. Effective language is key to communicating your business plan successfully to potential investors.

Follow these guidelines to start writing a solid business plan that communicates your vision and speaks to your audience.

The “dos” for writing a solid business plan

Be professional yet simple.

Writing with a professional tone allows investors to appreciate your vision and understand your short- and long-term goals. At the same time, it’s best to write in a simple manner. Aim for your plan to be understood by a non-expert. Replace jargon with active verbs. You can always get your final draft edited by a professional.

Refer to your business in third person

Writing in third person allows objectivity which can be more convincing and accepted by audiences like banks and investors. Avoid using “we” or “I” throughout your business plan. Writing in first person may come across as too personal. Remember to keep it business, not personal.

Be direct throughout your plan. Avoid ambiguous or vague language. Being direct allows you to be convincing about the steps you’ll take to bring your idea to life.

Supply evidence 

Do your research and present data to support your case. Showing statistics about your business, competitors, customers and industry allows investors to get a bigger picture of the survival and growth of your business.

Be realistic 

Avoid adding assumptions in your business plan. Instead of over-promising, show solid data backed up by research on how your business can be successful.

Practice makes perfect

Read your business plan out loud. Ask yourself these questions: Does it sound effective? Does it have the tone of confidence? Is it easily understood by your audience? What are the strengths and opportunities to tackle in your plan? Have a friend read your plan and summarize it back to you .

Be optimistic

The language of your business plan should be assertive, yet optimistic. Allow your passion to shine through in your business plan and show your advisor that you’re serious about bringing your vision to life.

The “don’ts ” of writing your business plan

Avoid acronyms and abbreviations.

Use industry specific abbreviations and acronyms only if necessary and if they’re part of your business operations. 

Don’t assume the reader knows your industry

Investors and advisors are here to support you. Allow them to understand what industry your business lives in. Provide in-depth knowledge of your industry so they can understand your business functions.

Don’t turn it into an essay

When writing your business plan and conducting industry research, sometimes it’s easy to get sidetracked and turn your plan into an essay. Make sure your business plan has a solid focus and includes all the required information. 

Avoid extensive research

Use only credible sources and findings for your research and analysis. It’s a great practice to use government-issued statistics and data. Use this data in your own language for business projections and goals. Simplicity is key.

Don’t be repetitive

Avoid repeating yourself throughout the plan. You can do this by reading your plan out loud and removing duplicate ideas. Include the key points and messages you need to relay.

Don’t forget about it

Be proactive and don’t forget to follow up with your advisor within the right time frame. Communicate with your advisory team and take advantage of your relationships with your investors, business partners and CIBC business advisor. 

Updating your business plan on a quarterly basis is a great practice for staying on track of your business growth. Our team is here to support you as you develop your plan and assemble your team.

To create a tailored plan for your business needs and help you achieve your goals, meet with us opens in a new window. . We’re here to help. Talk to a CIBC Business Advisor today by calling 1-866-992-7223 . Opens your phone app.

Written By Lauren Rabindranath

Lauren Rabindranath is a copywriter and communications consultant based in Toronto, Ontario, who works with clients across industries. Working with CIBC Business Banking, Lauren supports content development for online platforms, relating her personal experience as an entrepreneur to CIBC’s tailored services.

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• Entrepreneurship

The Ultimate Guide to Developing a Solid Business Plan

Starting a business can be a daunting task, but developing a solid business plan can help you navigate the process with confidence. A business plan is essentially a roadmap that outlines your business goals, strategies, and financial projections. It’s a crucial document that can help you secure funding, attract investors, and stay on track as you grow your business. In this guide, we’ll walk you through the process of developing a solid business plan, step-by-step.

1. Executive Summary

The executive summary is the first section of your business plan and is often considered the most important. This section should provide a brief overview of your business, including its mission, products/services, target market, and financial projections. It should also highlight what makes your business unique and why it’s likely to succeed.

In this section, you should also include a summary of your management team and any key personnel, as well as information about your funding needs and how you plan to use the funds. Be sure to keep this section concise and engaging, as it’s often the first thing potential investors will read.

2. Company Description

The company description section provides a more detailed overview of your business and its history. This section should cover your company’s legal structure, location, and any key milestones you’ve achieved thus far.

You should also include information about your target market, including demographics, psychographics, and any relevant trends or market research. This section should also cover your products or services and how they meet the needs of your target market.

3. Market Analysis

The market analysis section should provide a detailed analysis of your industry and competitors. This section should cover the size of your industry, any relevant trends, and your target market’s needs and preferences.

You should also provide an overview of your competitors, including their strengths and weaknesses. This section should also detail any barriers to entry and potential threats to your business.

4. Products and Services

The products and services section should provide a detailed overview of what your business offers. This section should cover the features and benefits of your products or services, as well as any unique selling points.

You should also include information about your pricing strategy and how it compares to your competitors. Be sure to highlight any intellectual property or proprietary technology that sets your products or services apart.

5. Marketing and Sales Strategies

The marketing and sales strategies section should detail how you plan to reach and attract customers. This section should cover your advertising and promotional strategies, as well as your sales channels and tactics.

You should also include information about your sales team and any relevant training or support. Be sure to highlight any partnerships or collaborations that could help you reach your target market.

6. Management and Personnel

The management and personnel section should provide an overview of your team and their roles and responsibilities. This section should cover your management structure, any key personnel, and any relevant experience or qualifications.

You should also include information about your hiring and training processes, as well as any relevant policies or procedures. Be sure to highlight any key partnerships or collaborations that could help you attract and retain top talent.

7. Financial Projections

The financial projections section should provide a detailed overview of your business’s financials. This section should cover your revenue projections, expenses, and any relevant financial metrics.

You should also include information about your funding needs and how you plan to use the funds. Be sure to provide a detailed breakdown of your costs and revenue streams, as well as any potential risks or challenges.

8. Funding Needs

The funding needs section should provide a detailed overview of your funding needs and how you plan to secure funding. This section should cover your current funding sources, as well as any future funding needs.

You should also include information about any grants, loans, or other funding opportunities that may be available to your business. Be sure to highlight any key partnerships or collaborations that could help you secure funding.

9. Risk Assessment

The risk assessment section should detail any potential risks or challenges that your business may face. This section should cover both internal and external risks, including market trends, competition, and regulatory changes.

You should also include information about any contingency plans or risk mitigation strategies that you have in place. Be sure to highlight any key partnerships or collaborations that could help you mitigate risk.

10. Conclusion

The conclusion section should provide a summary of your business plan and reiterate your key points. This section should also provide a call to action, encouraging potential investors or partners to take action.

Be sure to highlight any key benefits or advantages of your business, as well as any potential challenges or risks. Finally, be sure to thank your readers for their time and consideration.

In conclusion, developing a solid business plan is a critical step in starting and growing a successful business. By following these steps and including relevant information in each section, you can create a professional and engaging business plan that can help you secure funding, attract investors, and stay on track as you grow your business.

Frequently Asked Questions

Why is a business plan important.

A business plan is important because it helps you to define your business idea, identify your target market, understand your competition, and determine your financial projections. It is a roadmap that guides you towards success and helps you make informed decisions.

In addition, having a solid business plan can also help you secure funding from investors or lenders. It shows that you have a clear vision for your business and have thought through the potential challenges and opportunities.

What are the key components of a business plan?

The key components of a business plan include an executive summary, company description, market analysis, organization and management, products and services, marketing and sales, and financial projections.

The executive summary is a brief overview of the entire plan, while the company description provides more detailed information about the company’s history, mission, and objectives. The market analysis helps you to understand your target market and competition, while the organization and management section outlines the structure of your company and the roles and responsibilities of team members. The products and services section describes what you will offer, while the marketing and sales section outlines your strategies for reaching and selling to your target market. Finally, the financial projections provide an estimate of your revenue, expenses, and profitability.

How do I create financial projections for my business plan?

Creating financial projections for your business plan involves estimating your revenue, expenses, and profitability over a specific period of time.

Start by researching similar businesses and industry trends to get a sense of what is realistic for your business. Then, estimate your revenue based on your pricing strategy and sales projections. Next, estimate your expenses, including fixed costs (such as rent and salaries) and variable costs (such as materials and inventory). Finally, calculate your profitability by subtracting your expenses from your revenue.

It is important to be realistic and conservative in your projections, as investors and lenders will want to see that you have thought through the potential risks and challenges.

How often should I update my business plan?

Your business plan should be a living document that is updated regularly to reflect changes in your business and industry.

At a minimum, you should update your business plan annually to ensure that it is current and relevant. However, you may need to update it more frequently if you experience significant changes in your business, such as entering a new market or introducing a new product or service.

Updating your business plan can help you stay on track and adjust your strategies as needed to achieve your goals.

What are some common mistakes to avoid when developing a business plan?

Some common mistakes to avoid when developing a business plan include failing to research your market and competition, being overly optimistic in your financial projections, and not having a clear understanding of your target market.

Other mistakes include not having a solid marketing and sales strategy, underestimating the importance of team and organizational structure, and not being realistic about the potential challenges and risks.

To avoid these mistakes, take the time to thoroughly research your market and competition, seek feedback from others, and be realistic in your projections and expectations.

The Ultimate Guide to Writing a Solid Business Plan: Navigating Business Days and More

Remember, a successful business plan requires careful research, analysis, and attention to detail. It’s important to conduct market research, identify your target audience, and develop a clear marketing strategy. By doing so, you can position your business for growth and profitability.

So, whether you’re starting a new business or looking to take your existing business to the next level, a solid business plan is the foundation for success. By investing the time and effort into developing a comprehensive plan, you’ll be well on your way to achieving your goals and building a thriving business.

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5 Steps to Developing a Solid Business Plan

You have a great business idea and want to jump right in. The one thing holding you back may be lack of a clear business plan . While some would say having a business plan is an absolute must, others would argue that you can get started and be successful without one.

I think the answer lies in how confident you are in your idea and how organized you are in terms of executing it. If you already have a clear plan in your head along with the steps you need to take and the means to take them, you may not see the need to create a 20-page business plan.

On the flip side, if your idea lacks clarity and you are considering seeking out funding from others sources, it would be best if you came up with a solid business plan. The good news, is that you can sit down and create a business plan in under a day. It doesn’t have to be super extensive so long as you hit all your main points and follow stick to outlining these steps.

Table of Contents

1. Executive Summary

The executive summary is the first part of your business plan. This is where you capture the reader’s attention be explaining the specifics of your business. What is the name? What will you be doing? What is the mission of your business and what are your goals?

Be sure to include what makes your business unique and summarize why you feel it will succeed.

2. Market Analysis

Next you want to analyze the market in order to prove that there is a need and target audience for your business. This is a great way to validate your business idea as well. If you can’t narrow down your target market or find that they aren’t interested in what you are offering, that could be a huge red flag.

Be sure to clarify who you wish to serve along with some detailed statistics that describe them, their interests, what products and services they buy, along with and their needs and wants.

3. Financial Projections

The financial projections section is where you get to have some fun with numbers. Map out the financial progress you plan to make with your business over the next 3-5 years. Include revenue goals and you might want to specify how much you’d need from an investor or a loan to bring those goals to fruition.

This is also a great place to mention various different start-up costs you’ll have so investors can know why you need money to support your business.

4. Organizational Structure

Have you ever thought about how your business will operate and be structured? Will you act as the CEO? Will you have a team or hire interns ? Will you eventually need to work with accounting, sales, and marketing experts? Or will you be more of a solopreneur.

This is a great section to answer all of those questions and map out how you might expect your business to grow in the future and which roles you’ll have and need.

5. Products or Services

Finally, in step 5 you want to go into more detail about your products and services. Most people start with this step (especially if they don’t consider making a business plan) but it’s best to end here after you’ve covered your bases in the previous steps.

Discuss what makes your product or service unique and how you plan to execute it in a competitive marketplace. If you’re going to be selling products include descriptions and images along with whether you’d need to trademark anything.

A business plan can be a crucial tool to help you get organized and perform neccessary research before moving forward with your new venture. If you’re considering asking for funding or financial assistance, a solid business plan is usually a requirement.

Even so, it’s a great way to get crystal clear on your goals and intentions so you can focus in on carrying out your plans and being successful.

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Small Business Owners: How to Write Your Business Plan [+ Editable Templates]

By Krystle Wong , Apr 03, 2023

As a small business owner, it can be tempting to jump right into launching your business and skip the step of creating a business plan. However, having a well-written business plan is essential to the success and growth of your business. 

A business plan serves as a roadmap for your business, outlining your goals, strategies, and action plans. It helps you stay on track and focused, ensuring that every decision you make is aligned with your overall business objectives.

While creating a business plan may seem daunting, it’s worth the time and effort to ensure the long-term success of your business. In this article, I’ll dive into the insights on how a business plan can help your small business thrive and how to create one that stands out. 

Ready to get started with creating a business plan to win over your investors? Pick from Venngage’s 10,000+ professional  templates  to customize your own for free!

Click to jump ahead:, why is having a business plan important for small businesses, what are the 3cs for writing a successful small business plan, what are the 7 steps of creating a winning business plan, how to make my small business plan stand out.

Nevertheless, you may be wondering – is it really necessary to go the extra mile and build a business plan even as a small business? 

For many business owners, it’s easy to get caught up in the day-to-day operations of running your business. However, it’s essential to take a step back and create a solid business plan – especially if you’re looking to:

1. Clarify your vision and goals

Whether you’re trying to start a new business or expand your existing business, it’s important to know what your goals are. The plan will serve as a blueprint for how you plan to grow and sustain your business over time. 

2. Secure Funding

Another reason for writing a business plan is to seek out investors for your business. A compelling business plan demonstrates the potential for growth and profitability of your business and increases your chances of securing funding. Partnering with a reliable invoice finance provider can offer a flexible solution to manage cash flow and support growth, especially when navigating the financial complexities of expanding a small business.

3. Identify potential challenges

From financial obstacles to operational and staffing challenges, having a business plan forces you to think critically about your business. From there, you can develop strategies to address these challenges more effectively.

4. Attract and retain customers

Having an exciting product or service is simply not enough. You need to think about how you can get customers to keep coming back to sustain in the long run. With a business plan, you can develop a strategy that resonates with your customers and stand out from the competition.

5. Measure performance

Your should include your financial projections and key performance indicators to measure your achievements. By regularly reviewing and updating your business plan, you can also ensure that your business is on track to meet its goals.

Ready to put your ideas down on paper? Here are  15+ business plan templates you can use for strategic planning .

As an entrepreneur, you’d know that running a successful business goes beyond just your day-to-day operations. Therefore, having a detailed business plan can help you take a closer look at your business — starting by analyzing your 3Cs. 

By focusing on these three key areas, you can develop a plan that effectively communicates your business concept, identifies your target customer, and positions your business to compete in the market.

The first ‘C’ refers to the concept of your business. Look for gaps in the market you’re in and how your product or service solves a problem for your target market. Focus on what is your competitive advantage and how it sets you apart from your competitors. 

Your business plan should also include information about your company’s history, business structure and mission statement. Having a solid understanding of your business will also come in handy when writing your company description and earn you extra first impression points.

2. Customers

The second ‘C’ is all about understanding your target markets and potential customers. Before you dive deep into your business plan, you should first conduct market research. This would help you identify your ideal customer profile, including their demographics, behaviors and preferences.

Additionally, you should explain how you plan to reach and acquire these customers with a detailed marketing and sales strategy plan. Creating a user persona guide helps you understand your target market and how they use your product or service. Here’s an example that you can use:

Visualize your customers with Venngage’s  User Persona Guide  tool today. It’s free and most importantly — no design experience is required.

3. competitors.

Your final “C” in writing an effective business plan is no other than your competitors. Competitor analysis is critical in positioning your business for success. You should definitely research and evaluate your competitors, analyzing their strengths and weaknesses, market position, and pricing strategy.

At the same time, you should also outline your strengths and weaknesses and explain how you plan to overcome them. You can always conduct a SWOT analysis on both your and your competitors’ business. This SWOT competitor analysis template is a good example of how it’s done: 

Check out this article to learn everything about  utilizing infographics to create an effective business plan . 

If you’ve read this blog on  how to create a business plan , you’d know that a professional plan typically has the following sections: 

• Table of Contents
• Executive summary
• Company description
• Market analysis
• Organization and management
• Service or product line
• Marketing and sales
• Funding request
• Financial projections
• An appendix

This may seem overwhelming for many small business owners and you’re probably thinking of backing out at this point. Therefore, creating your  bus i ness plan outline  before you go into the details can ensure that you don’t leave any essential information out of your plan. 

But let me assure you that you’ll be well on your way to creating a successful business plan that can help you achieve your goals by following these steps:

Step 1: Define your business idea

Every business idea should be born out of a problem that needs solving. To find a good business idea , start by identifying a problem or a need in the market that is not adequately addressed. For example, if you notice members in your community Facebook group are often looking for cleaners in the area with little success, that’s a market you can tap into by starting a cleaning business .

You also should clearly define your business idea and what you plan to offer. Don’t forget to also consider your business’s cost, feasibility, scalability, and profitability.

For example, this candle business highlights that handmade candles are made from 100% beeswax to ensure product safety and quality: 

Once you have that figured out, it’ll be easy as pie for you to come up with your company description. Your company description should include details such as your business location, business resources, management team and more. 

Step 2: Conduct your market research

Conducting thorough market research builds a strong foundation for your market analysis. What’s more, it provides insights into the viability of your business idea and helps you develop a winning strategy.

You can conduct primary market research with:

• Customer interviews
• Online surveys or questionnaires
• In-person focus groups
• Purchasing a competitor product to study packaging and delivery experience

Or secondary market research by:

• Reading company records
• Examining the current economic conditions
• Researching relevant technological developments

This market overview template will help you look into industry trends and your target audience and collect vital data for your marketing strategy:

Step 3: Analyze your competitors

A  competitive analysis  report outlines the strengths and weaknesses of your competitors compared to those of your own business. 

Start by creating a competitor profile for each of your competitors which typically includes:

• The company’s revenue and market share
• The company’s size and management team
• A SWOT analysis 
• An overview of how the brand is perceived by customers

In addition to specific product features, here are some attributes that you might want to look into:

• Product quality
• Number of features
• Ease of use
• Customer support
• Brand/style/image

Use this competitor analysis report template to dive deeper into your competitor data and inform your marketing and business strategies: 

Step 4: Develop a marketing strategy

Your marketing strategy can be brief, covering a single campaign, or it can be long-term, detailing your marketing plans for an entire year. 

An effective marketing plan revolves around your target market and finding ways to reach them effectively. This may include branding, advertising, and social media .

While different marketing tactics are used to achieve different goals, they should always be in sync with the overall goals of your business. 

Use a mindmap to organize your marketing goals and strategies to make sure that they are in line with your business goals. 

If you’re running a small business, you may have limited funds to allocate toward marketing efforts. Some commonly used marketing strategies for small businesses include:

• Social media marketing
• Content marketing
• Work with local influencers
• Word-of-mouth
• Customer referral programs
• Customer loyalty plans

This Japanese restaurant business plan details both their online and offline marketing strategies. They’re also keen to capitalize on the steady stream of tourists coming into the city by catering to groups with large orders.

You can also use a timeline infographic like this one here to keep you on track with your marketing goals:

Don’t know where to start? This article will give you a crash course on  how to make your marketing plan . 

Step 5: identify your key performance indicators (kpi).

With all those marketing strategies in line, the next step is to identify the key metrics you’ll use to measure your business’s success. So, what is your KPI going to be? Is it revenue, profit margin, customer acquisition cost or customer retention rate?

KPIs give you a clear understanding of how well your business is doing and provide valuable insights that help make informed decisions. Without identifying KPIs, it can be difficult to gauge the effectiveness of your efforts. 

Step 6: Develop a Financial Plan

We’ve finally reached the core of your business strategy, which is the section that your potential investors are most interested in – your financial plan.

Having your business plan lined out can help you understand the financial viability of your business and prepare for potential challenges. It can also persuade investors and get the funding you need.

Some of the important details that you’d want to include in your financial plan are your:

• Income statement
• Cash flow statement
• Balance sheet 
• Sales forecast
• Break-even analysis
• Financial health 
• Financial forecasts

Planning to start your own gym ? Use this template to project your revenues and expenses: 

Step 7: Determine your funding needs

Now that you have your financial plans worked out, you’ll have a clearer picture of how much funding you’ll need to start and grow your business . 

There are several types of funding options available for small businesses seeking financing, including:

• Self-funding or bootstrapping
• Family and friend loans
• Crowdfunding
• Angel investors
• Venture capital
• Business loans

For example, this non-profit business plan template details the fundraising activities they have to generate operational funds.

Start customizing your business plan with these  15+ templates that would help you win over your investors, lenders, or partners . 

As new business owners, having a strong business plan is essential for securing funding and laying the foundation for your company’s success. However, with so many business plans vying for investors’ attention, it can be challenging to make yours stand out. 

In summary, the following tips can help you write a business plan that captures the attention of investors:

Focus on your competitive advantages

Furthermore, show customers and investors why they should choose you over others. Highlight what sets your business apart from your competitors and how your product or service can serve as a solution. 

Show a deep understanding of your target market

Visualize your ideal customers and their needs with a user persona and analyze your competitors. This will help you explain how your business can meet those needs better than your competitors. 

Provide a clear and concise executive summary

Start with a short, punchy summary that gives investors or lenders an overview of your business. Your executive summary should also include your plans, its value proposition, and the opportunities it presents to attract funding.

Provide solid financial projections

Investors and lenders want to see that your business has a foreseeable future. Make sure to detail your business financials such as cash flow statement, income statement, break-even analysis and balance sheet.

Be specific about your goals and milestones

Lay out achievable goals and milestones that you aim to reach in the short and long term. This will give investors a clear sense of your vision and your commitment to achieving it.

Show your passion

Finally, don’t be afraid to let your passion for your business shine through. Investors and lenders want to see that you are committed to your business and that you believe in its potential for success.

Elevate your small business with an exceptional business plan that sets you apart from the competition

Having a well-thought-out business plan can really max out your business’s potential and win over your investors. But as an entrepreneur, growing a business requires a lot of time and effort and you might not have the extra time to spend on designing your business plan. 

But don’t you worry – Venngage has got it covered for you. Designing a business plan requires little to no effort with Venngage’s customizable professional templates. Most importantly, no design experience is required. 

Pick from one of the templates above or browse for more  Business Plan Templates  and start customizing your own today! 

How To Create A Winning Business Plan For Your Startup

When it comes to starting a business, having a solid business plan is absolutely crucial.  Consider this as a conversation between you and your business’s future. You’d need to start by clearly defining what your startup offers – this is your product or service. It needs to answer the question, “What problem are you solving for your customers?”

Next, delve into market analysis. Understand who your competitors are and pinpoint your target customers. Once you have that, consider your business strategy and the sales and marketing plans you’ll employ to achieve your goals.

It’s crucial not to forget the operational aspect – how will your business function daily? And lastly, the financial projections. They can be a little tricky, but they’re the crux of the plan, demonstrating the financial viability of your startup.

We have got a helpful guide that’ll dive deep into all the essential elements you need to craft a top-notch business plan, tailored specifically for your unique startup. A solid business plan will help you make smarter decisions, catch the eye of potential investors, and give yourself an edge over your competitors in the market.

Why Business Plan Is Important For A Startup

Just as you wouldn’t venture into unknown territory without a compass, initiating a startup without a business plan can lead to wandering aimlessly, wasting precious resources, or even getting lost in the market’s vast wilderness. Here are some reasons why a business plan is crucial for a startup.

Your Guide To Decision-Making

Entrepreneurship involves constant decision-making and crisis management. The luxury of pondering the possible ramifications of every choice isn’t always an option for a fledgling business. This is where a well-thought-out business plan proves its worth. Setting out your strategies, goals, and expected outcomes in advance, can guide you in making smart decisions, reducing the likelihood of costly mistakes. It’s like your startup’s crystal ball, helping you predict and navigate future challenges.

Smoothing Out The Road Ahead

Compiling a business plan requires you to dig deep, ask tough questions, and seek out insightful, well-researched answers. It’s about creating a realistic vision of your startup’s future, and it’s the process that matters. Even if you never look at the document again, the act of writing it down helps to refine your vision and identify potential gaps in your plan.

Avoiding Common Pitfalls

There’s a sobering statistic that approximately half of all small businesses don’t reach their fifth birthday. Many of these failures result from issues that a well-structured business plan can help to avoid.

According to data from  CB Insights , common reasons businesses fail include a lack of market need, cash flow problems, inadequate team structure, intense competition, and pricing errors. An effective business plan can help you avoid these pitfalls by foreseeing issues like cash flow forecasts, market analysis, and pricing strategy before they become problems. 

Proving Business Viability

Passion is an excellent motivator when launching a startup. However, passion alone does not guarantee success. Your plan is crucial in demonstrating your startup’s potential by outlining exactly how your vision translates into a profitable business.

For instance, the market research section of your plan can provide deep insights into your customers, competitors, and industry. This information can be pivotal in shaping strategies for marketing, product development, and scaling your business.

A Roadmap For Growth

Business plans play a crucial role in setting objectives and creating benchmarks. Without a business plan, goals can become arbitrary, losing their relevance over time. A well-documented plan keeps you accountable, aligns your team with your vision, and provides insights into the effectiveness of your strategies.

Facilitating Communication And Collaboration

A business plan isn’t just a guide for you, but also for your team. Whether you have a staff of two or two hundred, everyone needs to understand your business’s goals and how you plan to reach them. Your business plan can serve as a communication tool, spelling out the next steps when you’re unavailable for direct guidance. It aligns everyone with your vision, fostering a sense of shared purpose and commitment to the objectives outlined.

Navigating The Business Landscape

Running a successful business is about more than just managing what’s happening within your company’s four walls. It’s also about understanding the larger market environment. Crafting a business plan encourages you to study your competition, identify trends and preferences among consumers, anticipate potential disruptions, and garner insights that might not be apparent at first glance. Armed with this information, you’re better equipped to anticipate and respond to changes in your industry.

Leveraging External Support

Startups often depend on a range of external service providers for expertise in areas like accounting, marketing, and legal matters. Your business plan can serve as a reference point for these professionals, helping them understand your business better and align their services with your needs. By sharing relevant sections of your business plan, you can ensure everyone is on the same page, enhancing the effectiveness of their support.

Securing Investment

Here’s a fact to consider: you are 2.5 times more likely to secure funding if you have a business plan. Investors, banks , and potential partners want to know that their investment is in capable hands and that your business has a promising future. A well-crafted business plan is your opportunity to demonstrate this, making it a must-have document if you’re seeking external financing.

Mitigating Risks

All entrepreneurial ventures involve some level of risk, but a well-designed business plan can significantly mitigate these dangers. By considering revenue and expense projections, operational plans, and the competitive landscape, you’ll be equipped with a risk management tool that can guide your decision-making and limit the chances of unpleasant surprises.

Some Facts About A Successful Business Plan

• According to the  Small Business Administration , a successful business plan typically includes an executive summary , market analysis, competitive analysis, description of products and services offered, management overview, financial projections, and funding requirements.
• A  Harvard Business School survey  found that entrepreneurs who have written a business plan are 16% more likely to achieve success than those who have not.
• One  study  found that companies with a business plan grow 30% stronger than those without a plan.

Business Plan Formats

While there is no one-size-fits-all approach, there are common formats that cater to different needs and objectives. Understanding these formats will help you choose the most suitable one for your venture and tailor it to your specific needs.

Traditional Business Plan

The traditional business plan is the most comprehensive and widely used format. It typically spans multiple pages and contains detailed information about your company’s strategy, objectives, and financial projections. Venture capitalist firms and lenders often require these plans when seeking investment or loans. Key sections in a traditional business plan include:

• Executive Summary: A brief overview of your company, including its mission, goals, and key selling proposition.
• Company Description: Details about your company, history, and unique selling proposition (USP).
• Market Analysis: An examination of the industry, market, and competition.
• Marketing and Sales Strategies: Plans for promoting your products or services and generating sales.
• Organization and Management: An outline of your company’s organizational structure and management team.
• Product Line or Services: A description of your products or services and their benefits.
• Financial Projections: A forecast of your company’s financial performance, including income statements, balance sheets, and cash flow statements.

Download the Traditional Plan template from  here .

Lean Business Plan

A lean business plan is a condensed version of a traditional plan, focusing on the most critical information. This format is ideal for businesses that need a quick, accessible reference or for those looking to modify existing plans to target a specific market. A lean business plan will cover the same sections as a traditional plan but in a more concise manner.

Nonprofit Business Plan

A nonprofit business plan is tailored for organizations that operate for public or social benefit. This format incorporates all elements of a traditional business plan, with an additional section highlighting the organization’s intended impact.

This section may describe the social or environmental issues the organization aims to address and how its operations contribute to solving these problems. Donors and grant-makers often request nonprofit business plans to assess the organization’s mission, strategies, and potential impact.

Comparative Analysis Of The Common Business Plan Models

 how to write a business plan:.

Stats Source:  1 , 2

The business plan acts as the blueprint of your venture, outlining its mission, operational strategy, market analysis, financial needs, and more. It gives stakeholders a holistic view of your company, underpinning decisions and attracting potential investors. Let’s explore the key components of a business plan that will serve as the compass guiding your startup toward success.

1. Write An Executive Summary

The executive summary is at the forefront of your business plan, which introduces your plan to the world. It encapsulates everything your plan will detail but at a much higher level. As a pro tip, this summary is often more effective when written last, ensuring you fully grasp your plan.

In the executive summary, you’ll present your organization’s mission statement and the offerings you intend to bring to the market. If your venture is a new startup, including the reasons that inspired you to initiate this journey might be beneficial.

Here is how you can write an executive summary for your business plan.

• Your executive summary begins with the “Mission” – a clear and concise statement of your company’s purpose. Your mission is not merely what you do; it’s why you do it and how you want to impact your customers and the world.
• Next is the “Company History and Management” section. Provide a snapshot of your company’s location, the period of operation, and the people at the helm. A brief overview of their experience will also be valuable.
• A significant part of your executive summary will be the “Products or Services” your company offers. What problems does your product or service solve? How does it add value to the customer’s life? Providing succinct answers to these questions can pique the reader’s interest.
• In the “Market” section, you summarize the potential of your product or service or Total Addressable Market (TAM). Highlight key insights into the size and nature of your target market, indicating the business growth potential.
• The “Competitive Advantages” segment allows you to shine a light on what sets you apart from the competition. Make sure to highlight the unique strengths that will make customers choose your company.
• Finally, you must present your “Financial Projections” and “Startup Financing Requirements.” Provide an estimate of sales for the first few years and a clear outline of what it’ll cost to launch and run your company.

2. Add A Business Description

The business description paints a vivid picture of your venture, its goals, the industry it serves, and your target customers. This section allows you to share the passion behind your venture while detailing your industry, including prevalent trends and formidable competitors. Highlight your team’s industry experience and what sets your venture apart from competitors.

3. Market Research And Strategies

The purpose of the market analysis and strategy component of a business plan is to research and identify a company’s primary target audience and where to find this audience. Factors to cover in this section include:

• The geographic locations of your target markets
• The primary pain points experienced by your target customers
• The most prominent needs of your target market and how your products or services can meet these needs
• The demographics of your target audience
• Where your target market spends most of their time, such as particular social media platforms and physical locations
• This section aims to clearly define your target audience so that you can make strategic estimations about how your product or service might perform with this audience.

4. Marketing And Sales Plan

This part of your business plan covers the specifics of how you plan to market and sell your products and services. This section includes:

• Your anticipated marketing and promotion strategies
• Pricing plans for your company’s products and services
• Your strategies for making sales
• Reasons for your target audience to purchase from your company versus your competition
• Your organization’s unique selling proposal

5. Management And Organization Description

This section of your business plan explores the details of your business’s management and organization strategy. Introduce your company leaders and their qualifications and responsibilities within your business. You can also include human resources requirements and your company’s legal structure.

6. Products And Services Description

Use this section to further expand on the details of the products and services your company offers that you covered in the executive summary. Include all relevant information about your products and services. This includes how you plan to manufacture or develop them, how long they can last, what needs they may meet, and how much you project it might cost to create them.

7. Competitive Analysis

Add a detailed competitive analysis that clearly outlines a comparison of your organization to your competitors. Outline your competitors’ weaknesses and strengths and how you expect your company might compare to these. Include any advantages or distinctions your competition has in the marketplace. In addition, explore what makes your business different from other companies in the industry and any potential challenges you may face when entering the marketplace, if applicable.

8. Operating Plan

This part of your business plan describes how you plan to operate your company. Include information regarding how and where your company plans to operate, such as shipping logistics or patents for intellectual property. The operating plan also details personnel-related operations, like how many employees you hope to hire in various departments.

9. Financial Projection And Needs

The financial section of your business plan explains how you anticipate bringing in revenue. If you need funding for your business, this section also describes the sources and amounts for that funding. Include your financial statements, an analysis of these statements, and a cash flow projection.

10. Exhibits And Appendices

The last section of your business plan provides any extra information to support further the details outlined in your plan. You can also include exhibits and appendices to support the viability of your business plan and give investors a clear understanding of the research that backs your plan. Common information to put in this section includes:

• Resumes of company management and other stakeholders
• Marketing research
• Proposed or current marketing materials
• Relevant legal documentation
• Image Of your product (or demo)

Tips To Create A Small Business Plan

Know Your Audience

Knowing your audience is paramount when crafting your small business plan. It’s not just about offering a product or service, but understanding who will buy it and why. Start by defining your target market – age, gender, geographic location, income level, occupation, and lifestyle preferences are just a few factors to consider. Once you’ve identified your potential customers, dive deeper. What are their pain points? How can your product or service address these issues? Having this knowledge not only helps you tailor your offerings but also guides your marketing and sales strategies.

Have A Clear Goal

Your business plan must have a clear goal – a specific aim that you intend to achieve. This could be anything from reaching a certain revenue target, expanding to new locations, or securing a specific market share within a given period. Setting clear, measurable goals serves as a roadmap, guiding your actions and decisions. Remember, these goals should be SMART – Specific, Measurable, Achievable, Relevant, and Time-bound. Each goal should directly support your overall business objectives and provide a clear path to success.

Invest Time In Research

A successful business plan is built on solid research. Market trends, competitive landscape, and regulatory environment – these are all factors that could affect your business and, thus, must be considered in your business plan. Research can inform product development, pricing, and promotional strategies, as well as identify potential opportunities and threats. Conduct both primary (surveys, interviews) and secondary research (reports, articles) to gather comprehensive information. It’s an investment of time that pays off in the long run by guiding informed decision-making.

Keep It Short And To The Point

While your business plan should be comprehensive, resist the temptation to include every minor detail. Remember, the plan is a tool to communicate your business idea and strategy to stakeholders, including potential investors, partners, or employees. Therefore, it should be concise, focusing on key aspects such as your product or service, market analysis, business model, marketing and sales strategy, and financial projections. Avoid jargon and keep your language simple and straightforward. It makes the plan easier to read and understand, increasing its effectiveness.

Keep The Tone, Style, And Voice Consistent

Consistency is key in the tone, style, and voice of your business plan. It not only enhances readability but also reflects your brand identity. If your business is a modern tech startup, a casual, conversational tone might work well. For a law firm, a more formal tone would be appropriate. Choose a tone and style that aligns with your brand, and maintain it throughout the plan. This consistency helps build a strong brand image and makes a positive impression on readers.

Use A Business Plan Software

In the digital age, business plan software can simplify the planning process. These tools come with features like templates, step-by-step guides, and financial forecasting tools, making it easier to create a professional, comprehensive plan. Using such software can save time, increase accuracy, and ensure that your plan covers all essential aspects. Some popular options include LivePlan, Bizplan, and Upmetrics. Before choosing a tool, consider your needs, budget, and the software’s ease of use.

Mistakes To Avoid When Writing A Business Plan

1. not choosing a feasible business idea.

When it comes to selecting a business idea, there’s a fine line between ambitious and unrealistic. Too often, entrepreneurs get so enthralled by their passion project that they lose sight of its practicality in the market. They overlook crucial factors like the demand, the target audience, or the industry’s economic climate. In the business world, a great idea isn’t enough; it also has to be feasible. Validate your idea with market research, seek professional advice, and listen to potential customer feedback before making a commitment.

2. No Clear Exit Strategy

Although it might seem counterintuitive to plan your business’s end before it has even begun, a clear exit strategy is paramount. It guides your decisions, indicates your long-term goals, and reassures investors about the safety of their investments. Whether it’s selling the business, distributing dividends, or opting for an IPO, consider your exit strategy from the get-go.

3. Lack Of A Balanced Team

A start-up’s success isn’t a one-person show; it involves a balanced team with diverse skills and experiences. Without a robust team, you may be overwhelmed, attempting to manage all aspects of the business singlehandedly. When composing your team, look for complementary skill sets. A mix of leadership, financial acumen, marketing prowess, and technical skills ensures a well-rounded, capable team.

4. No Comprehensive Financial Projections

Many startups fall into the trap of undervaluing comprehensive financial projections. The figures you present in your business plan should be accurate and realistic and include projections for revenue, expenses, and cash flow. This detail is not only vital for you to understand the financial requirements and sustainability of your venture, but it is also crucial for securing funding from investors. Your business plan should include:

• Balance Sheet: A snapshot of your company’s financial position, including assets, liabilities, and equity.
• Cash Flow Statement: An overview of cash inflows and outflows, highlighting your ability to generate and manage cash.
• Profit and Loss (P&L) Statement: A summary of your company’s revenues, expenses, and net income over a specified period.

5. Spelling And Grammar Mistakes

Nothing undermines the credibility of a business plan like spelling and grammar mistakes. They give an impression of carelessness and lack of attention to detail. In the business world, these are attributes that no entrepreneur should embody. Always proofread your plan, use professional editing tools, or seek the help of an editor to ensure impeccable presentation.

6. Not Conducting A Proper Competitive Analysis

Understanding your competition is pivotal in carving your unique place in the market. An improper or superficial competitive analysis can lead to an ill-informed strategy and poor decision-making. Use methods like SWOT analysis to understand your competitors’ strengths, weaknesses, opportunities, and threats, and use this information to differentiate your offering.

7. A Proper Marketing And Sales Strategy

Without a well-defined marketing and sales strategy, even the most innovative product can get lost in the shuffle. Outline your strategy, detailing the mediums and  channels  you plan to use to reach your target audience. Be sure to include the  estimated costs  of these strategies to ensure alignment with your financial projections.

8. No Incorporating Scalable Business Model

A scalable business model is key to long-term success. It ensures that your business can adapt to increased demand without significantly increasing operational costs. If you neglect this aspect, you may struggle to grow or, worse, become overwhelmed by success.

9. Not Setting Realistic And Measurable Goals

Setting lofty, abstract goals may seem visionary, but in practice, they leave a business adrift. Your business plan should define realistic, measurable, and time-bound objectives. The idea here is to give your team a

10. No Presence Of A Risk Management Plan

All businesses face risks, whether they are financial, operational, strategic, or related to reputation. Ignoring these potential hazards won’t make them go away. On the contrary, it leaves you unprepared (i.e. SVB bank collapse). Incorporate a risk management plan into your business strategy, outlining potential challenges and your proactive steps to mitigate them.

11. Not Updating And Refining Your Business Plan

Remember, a business plan isn’t a static document you write once and forget. As your business evolves, so should your plan. Market dynamics change, customer preferences shift, and new competitors emerge. Regularly updating and refining your business plan ensures that it remains a useful tool for decision-making and a clear roadmap for your business’s future. An outdated plan will not reflect your current business status and may lead to misguided decisions.

Avoiding these common mistakes can set you on a successful path, enabling your startup to grow, thrive, and eventually, command a formidable presence in the market. It’s not an easy task, but with these guidelines in mind, you’re better equipped to navigate the challenges ahead.

1. Why Is A Traditional Business Plan Important For A New Business?

You know that feeling when you embark on a road trip without a map? It’s a blend of excitement and anxiety, right? Well, launching a new business without a traditional business plan is pretty much the same. It’s like sailing a ship with no compass or map.

The business plan serves as your guiding star, illuminating your path forward. It outlines your mission, vision, goals, and how you plan to achieve them. It’s your secret recipe for success, the blueprint for your entrepreneurial journey.

2. What Are The Key Elements Of A Traditional Business Plan?

Think of a business plan as a puzzle, made up of several key pieces that come together to create a complete picture. These pieces include the  executive summary  (think of it as your business’s elevator pitch), company description, market analysis (your business battlefield), organization and management structure (the captains of your ship), service or product line (the bread and butter of your venture), marketing and sales strategy (your business megaphone), and financial projections (the treasure you’re after). When these pieces fall into place, you get a clear image of your business’s future.

3. How Can I Make My Business Plan Stand Out?

You know the feeling when you’re trying to bake a cake for the first time? You can follow the recipe to the letter, but it might not turn out as you hoped. The same goes for a business plan. Using a  business plan template  can be helpful, but adding your unique flavor makes all the difference. Personalize it, and infuse it with your passion and vision. Use engaging anecdotes to highlight your experiences and lessons learned. It’s like telling a captivating story about your business, leaving everyone eager for the next chapter.

4. How Often Should I Update My Business Plan?

A business plan isn’t a “set it and forget it” type of deal. It’s a living document that evolves with your business. Like a gardener tending to his plants, you must regularly nurture and adjust your plan.  

Wrapping Up

In conclusion, crafting a comprehensive and effective business plan is crucial for any venture’s success. By outlining your vision, objectives, target market, competitive analysis, organizational structure, and financial projections, you can attract investors and provide a roadmap for growth.

Remember to keep the plan concise, realistic, and adaptable, as it will evolve with your business. Continually reviewing and updating your plan will serve as a dynamic tool, guiding your business toward its ultimate goals and long-term success.

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About the author: Oran Yehiel

Oran Yehiel is the founder of Startup Geek, with an MBA specializing in financial management and a background in Deloitte. As a Certified Public Accountant and Digital Marketing Professional, he writes about venture capital, marketing, entrepreneurship, and more, bringing a wealth of experience to businesses seeking growth and success.

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A Comprehensive Guide to Creating a Solid Business Plan

Business plans aren’t just helpful ways to get a loan. Start drafting yours now.

In order to create a successful company, you need a solid business plan. Some people try to skip this step and jump right into the nuts and bolts of starting a business. Others think that you only need a business plan if you’re applying for a loan. While that’s one valid reason to create a thorough business plan, it’s by no means the only one. A business plan clarifies your goals and helps you proceed in an organized manner.

Here’s how to get started, and what to include.

Why You Need a Business Plan

Before we discuss some tips for actually creating a workable business plan, let’s look at why you need one in the first place.

• Identify your goals and methods.  The main function of a business plan is to clarify the center purpose of your business and how you are going to run it. It will also cover issues such as your products, target markets and promotional strategies.
• Raise capital.  You definitely need a business plan if you plan to raise money or get a loan. This goes not only for borrowing from banks and other financial institutions, but for anyone who might lend you money.
• Create a unified strategy.  If you have partners, it’s important that everyone shares the same vision. When you start writing everything down, any differences of opinion become immediately clear and you can work them out.

What to Include in Your Business Plan

Too many business plans are vague or leave out essential information. This should be a concise document, not a meandering essay. There are certain characteristics that every business plan should include:

• Who, What, Where and How.  List who is involved in your business and where it’s located (if it has a physical location). Describe what the business will do on a day to day basis — e.g. make t-shirts, create content for websites, repair jewelry — as well as any equipment that will be used. Finally, discuss your main marketing strategy.
• Your Market.  Who is your target market? What is the current state of this industry and who is your main competition? These questions are vital for yourself as well as any possible investors.
• Financials.  How much capital do you need to get started? What are your expenses? What are your expected sales? What is your profit margin? Create a cash flow statement that is as realistic as possible.

These are fundamental points to include in your business plan. If you’ve never created one before, you should look over some existing business plan templates.

Remember to Be Realistic

One of the most important qualities of a good business plan is realism. There are millions of business plans written each year; some are highly accurate in terms of their projections, while others are more fanciful.

You have the challenge of writing a detailed description of something that does not yet exist. This can make it tempting to be overly optimistic in your predictions. You should avoid this temptation, as it will cause you to lose credibility with investors. Even worse, it will make it more difficult for you to succeed, as you might be ignoring practical considerations that are likely to limit your cash flow or profits.

When creating a business plan, be as conservative as possible. Although you don’t want to be pessimistic when starting a new business — if you weren’t optimistic about your endeavor you wouldn’t be starting it — you also have to be thorough and down to earth in your approach. Many new businesses underestimate things like expenses and the amount of time it takes to accomplish basic tasks (such as setting up a retail store, building a website, getting a new product ready for the market, etc.). They may also overestimate demand for their product or service.

Do Your Research

Researching your market and competition is one of the best ways to prepare for creating a viable business plan. This is what allows you to make realistic projections on sales and cash flow. It also informs you regarding your competition and what you need to do to capture your share of the market.

Your business plan is the blueprint of your business. Just as the blueprint for a building ensures that the structure will be stable, a business plan guides you through the early stages of your enterprise. This is equally essential for you and any prospective partners or investors.

Shawn Porat

CEO Scorely

Shawn Porat founded Scorely and Judgment Marketplace. Contributed to Forbes, Time and Money Magazine.

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Business Planning 101: How to Create a Solid Business Plan for Your Startup

Business planning is the process of creating and documenting a strategy designed to cultivate growth for your company. Most business planning techniques revolve around three primary objectives: maximizing profit, mitigating risks, and communicating a strategy to secure funding. Although there are different aspects of business planning, in most cases, business planning is centred on creating one specific document: the business plan.

No matter what industry you’re in or what products or services you’re selling, it would help if you had a business plan to guide you . Whether you’re launching an online digital marketing agency or opening a local coffee shop, your business plan is the foundation for your growth efforts. Ultimately, the time and effort you put into your business plan development can significantly impact the success or failure of your venture.

But why is a business plan so important? Couldn’t you use a website builder to launch a site within minutes or have a minimum viable product within a few days? While starting something is simple, solidifying it is not.

Startup founders don’t always see the value of a business plan, particularly when they don’t plan to raise money right away and are silk working out the cracks and kinks of their product. But regardless, think of a business plan as the bedrock for your company.

This detailed document is much more than a description of what your business does and how it does it. It can be used to secure loans and other forms of funding, solidify your milestones, help you better understand your market and competition, and outline your financial needs and feasibility. In short, it can prevent you from walking down a dead end.

Business Planning Tools

A myriad of tools and services exist to help entrepreneurs develop business plans of their own. Many companies offer their own version of a small business plan template to guide business owners through the process. However, numerous services are dedicated to helping business owners build out certain portions of their business plans. For example, business owners could outsource micro and macroeconomic research, financial planning and forecasting, and marketing agencies. Additionally, they can work alongside business plan writers to help them create a document that’s most likely to appeal to investors and lenders.

Business Plan Table of Contents

Understanding the benefits of a business plan is one thing, but writing it is entirely another. Start by checking out different industry-specific templates for inspiration. From there, follow the tried-and-true format using this table of contents.

Each section provides valuable insight into how you plan to build your business, both from a high-level overview and a detailed perspective. It’s important to note that business plans aren’t just for lenders and investors—it’s also for you. Many business owners have found that their business plans help foster accountability and guidance. With that in mind, here’s what you need to include in a winning business plan:

1. Executive Summary

2. Company Details

3. Market Analysis

4. Customer Analysis

5. Competitor Analysis

6. Marketing Plan

7. Operations & Logistics Plan

8. Management Team

9. Financial Plan

10.  Appendix

Executive Summary

Your executive summary is an overview of your startup. This section provides the reader with a quick synopsis of the overall business plan. The executive summary should be written last to properly convey and summarize the contents in the rest of the document.

For example, once you’ve written a thorough analysis of your target market, it’ll better equip you to include a short synopsis of it in your summary. This section highlights the key points you’ll cover in your business plan by defining your mission and strategy.

Your executive summary should:

• Include a captivating introduction to your business
• Describe the problem your business is trying to solve
• Explain how your company offers a solution to a problem
• Describe products and services you offer
• Address how you plan on reaching your customers with your marketing efforts
• Include your projected revenue
• Introduce the team

Company Description

The Company Description section of your business plan covers three key components: who you are, what you do, and why you do it. Begin by creating an elevator pitch and then expound upon it.

For example, let’s say you’re trying to raise money for your package delivery startup, ParcelPass. Your elevator pitch might be: “Think of ParcelPass as an Uber for package deliveries. When you need something delivered locally, request a GPS-enabled vehicle through the app. ParcelPass arrives, picks it up, and hand-delivers it to its recipient.” 

Remember, the company description is designed to sell. Not only does it help readers understand your mission and unique value proposition, but it can also help you practice pitching your company to others, both verbally and written.

Your company description should:

• Share your origin story
• Offer basic company history, such as location and start date
• Explain how you developed the business concept
• Include relevant industry information
• Describe your team in detail (including qualifications and background)
• Include a mission statement and vision statement

Here’s an example of a “Company Overview” introduction from Cady’s Cookies, a fictional cookie company developed by Planbuildr:

Market Analysis

Your market analysis is one of (if not the ) most important parts of your business plan because it tells the reader that you have a verifiable market. How your business performs in your industry depends on the market, and it’s crucial for you to present proof that the current (and foreseeable) market leans in your favour.

Your market/industry analysis shows how comparable businesses in your industry perform and highlights market demand. You can find plenty of free market research resources that offer relevant market data, or you can hire a market research firm to spearhead this section for you. In short, your market analysis will provide quantitative and qualitative assessments for your industry.

Your market analysis should:

• Describe customer segments in your market
• Highlight favourable buying patterns
• Explain how you intend to build brand loyalty and acquire repeat customers
• Provide an analysis of your competition
• Identify historical trends that have shaped your industry
• Include relevant statistics, including market size, market growth, and future growth estimates

Customer Analysis

Who are your customers? This is the question that the Customer Analysis section of your business plan aims to answer. This section dives deeper into your target market and addresses how you plan to solve their pain points.

These “pain points” can be versatile and multi-faceted. For example, if you own a long-distance moving company, a potential customer pain point might be finding a business that knows how to handle the fragile or expensive property. Another pain point might be finding vetted drivers with outstanding long-haul driving records.

As you write your customer analysis, consider buyer personas or ideal customers. Use this persona as a model for your written description. Describe their demographics, personality traits, buying patterns, income and education level, and hobbies.

Your customer analysis should:

• Offer a holistic overview of your ideal customer
• Describe your customers’ pain points
• Explain how you can solve your customers’ issues
• Assess customer buying patterns
• Acknowledge your proximity to your customers and how you plan to reach them

Competitor Analysis

Your competitive analysis should answer the question, “Why is my business better than other businesses that offer similar services and products?” This is where you’ll communicate how you plan to outperform your competition.

Competitor research is crucial because it explains what makes you different, helps you understand why they’re succeeding, and identifies gaps that you can leverage to build a better business .

Your competitor analysis should:

• Explain how your business differentiates itself from the competition
• Describe strengths your company offers that your competitors don’t
• Highlight key advantages in management or operations
• Illustrate issues your current competitors are having and explain how you plan to address them

Marketing Plan

Your marketing plan should explain how you intend to reach your target market. It should be determined by the specific needs of your target market, as described in your customer analysis. Overall, your marketing plan reveals how you intend to reach potential customers, build brand awareness, and educate your market.

Your marketing plan should include four key sections:

1. Products. What products or services do you offer, and what makes them better than similar offerings? Are there any particular features or benefits?

2. Promotions. How do you plan to promote your organization ? How will you spread the word and attract customers? Your promotion plan should include a detailed description of how you intend to position yourself in front of buyers. This could consist of advertising, product giveaways, influencer marketing , content, or content marketing.

3. Price. What’s the cost of your products? Justify higher prices when necessary and leverage lower prices if possible.

4. Place/Distribution. This section describes where you sell your products and how you sell them. Are you selling your product online, in a retail shop, or both? What are the benefits? If you plan to sell wholesale and direct, describe these channels as well.

Operations & Logistics Plan

Your Operations and Logistics section describes the workflows and processes you’ll implement to make your business plan come to life. Your operational objective covers several factors, including how each of your departments supports different operational goals. This section will also outline strong contingency plans in the event of unexpected circumstances. In this area, make it clear to the reader that you have a strong understanding of your supply chain.

Your operations and logistics analysis should:

• Describe who your suppliers are
• What your production process will look like
• Define key metrics and milestones
• List the necessary equipment and technology to keep your business running
• Describes your shipping and fulfilment needs
• Explain quality control measures

Management Team

The people behind your business can make or break its success. This section of your business plan describes the team in detail and explains why their qualifications and experience make them well-suited for success.

Investors aren’t just putting their dollars into products and services but the people building the brand. The calibre of your team plays a significant role in helping readers understand your business’s willingness and readiness. Lastly, this is where you’ll explain how each team member’s skill set contributes to the company’s bottom line.

Your management team section should:

• Provide biographies for key team members
• Highlight educational achievements, experience, and accomplishments
• Describe how your business ownership is structured
• List any external management resources, such as an advisory board

Financial Plan

No matter how much hard work you’ve put into growing an idea into a business, its financial welfare will be the ultimate determination of success. Your financial plan is designed to help financial investors understand what to expect now and in the foreseeable future. In short, it explains how you’ll generate income. It would be best to work with an accountant , bookkeeper , or third-party financial planner to shape this section of the business plan.

The financial plan is typically broken down into three parts:

1. Income statement. Income statements show revenue sources and expenses over a given period.

2. Balance sheet. A balance sheet reveals the equity you have in your business, considering the assets you own and the liabilities you owe.

3. Cash flow statement. The cash flow statement is what’s left when expenses are paid, and revenue is collected.

The Appendix closes out your business plan and provides supporting materials or documentation for previous sections, such as balance sheets and income statements. Essentially, this is where you put all the essential details that you didn’t include in prior areas. The appendix exists to keep the business plan concise early on so as not to bulk up the portions of the business plan where content matters most.

Your appendix should include:

• Detailed financial forecasts
• Business credit history if available
• Applicable patents or trademarks
• Management team resumes
• Market research

Writing a winning business plan is no walk in the park, but it’s important to put proper time and effort into building it out. Many great businesses fail to get funding because they miss the mark in terms of their business plan and fail to convey the viability of their company.

As you create your business plan, reference templates and actual, archived business plans. Use these as inspiration and guidance, but don’t forget to customize your plan as much as possible. You don’t want your business plan to be a copycat of everyone else’s template at the end of the day. Be original and thorough, and your plan will speak for itself.

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• Strategy & Planning

10 steps to a solid business plan

A business plan is a key tool that can set you up for business success. It helps you focus on your goals and provides the answers you need to make your financing and loan process easier. Here are 10 things you should include as well as some resources to get started.

Need a farm business plan? Our business plan bundle can make writing one easier.

1. One-page executive summary

Briefly explain your business vision. Include: who you are, what your business does, future business plans and how you will be successful. Also, summarize your current financial state and future needs.

Read: How to develop a successful farm vision

2. Goals and objectives

What’s the purpose of your business? Outline your key strategies and main goals for the next one to three years.

Learn: Setting achievable goals

Farmers with a written business plan average a return on assets five times higher than those without.*

3. Company background or history

Summarize your company’s achievements and plans for growth. Describe any company strengths and weaknesses, opportunities and any significant changes that could impact the operation.

Research: Industry, markets and trade (AAFC)

4. Ownership, management and human resources

Describe the ownership structure. Include each owner’s qualifications, history and your management reporting structure. You’ll also need to identify key employees, benefits, labour policy and a succession plan (if applicable).

Use: Agri HR Toolkit (Canadian Agricultural Resource Centre)

Read: Managing People

5. Financial position and projections

For existing businesses: include financial statements from the past five years and a monthly cash-flow forecast covering at least 12 months.

For start-ups: include projected financial statements for the first three years of operation and a monthly cash-flow forecast covering at least 24 months.

Get: Ag Expert Accounting

Use: FCC Money & Finance Basics guide and FCC Cash flow planning guide

6. Products and services

Describe your product or service and what makes it marketable. Is there an aspect that’s not available in the marketplace?

Listen: Cutting edge cattle: Balance and the business of ranching

Read: Know your cost of production for better decision making and Do you know your cost of production?

7. Industry analysis

Identify your industry and describe its overall size, growth stage and patterns.

Read:  FCC Economics sector and production reports

8. Target market

Describe the potential size of your market. It helps to include popular market trends and customer profiles.

Compare: Statistics and market information (AAFC)

Find: Market Prices and information

9. Competition

Identify primary competitors within your target market. List their strengths and weaknesses compared to yours.

Find: Canadian food supplier directories (AAFC)

10. Marketing and sales plan

Describe your marketing plan and distribution channels. Include the steps for attracting and retaining customers (if applicable).

Read: Marketing 101 (Ontario Ministry of Agriculture, Food and Rural Affairs) and Want a profit boost? Make sure you have a good marketing plan

*Source: Rob Hannam, Synthesis Agri-network

Scott Beaton didn’t come from the farm. But with help from friends and knack for diversification, he grew his small operation into a full-time farming career.

From cash flow planning to net worth statements, get the basics you need to prepare for a loan application.

We have a business plan bundle to set you up for success.

• Sun. Apr 7th, 2024

The Entrepreneur Today

News | Startups | Entrepreneurs | Events and more

How to Develop a Solid Business Plan

By Ankur Srivastava

• Set a clear vision and mission for your business.
• Conduct thorough market research to understand your target audience and competition.
• Define your products or services and highlight their unique value proposition.
• Develop a comprehensive marketing and sales strategy to reach your target customers effectively.
• Build a strong team and organizational structure that aligns with your business goals.
• Create a detailed financial plan, including revenue projections and expense forecasts.
• Regularly review and update your business plan as your business evolves.
• A well-developed business plan provides a roadmap for success and increases the likelihood of achieving your goals.

“Plans are nothing; planning is everything.” – Dwight D. Eisenhower

Welcome to our comprehensive guide on how to develop a solid business plan. Whether you’re starting a new venture or looking to grow an existing business, a well-crafted business plan is essential for success. In this article, we will walk you through the process of creating a comprehensive business plan that serves as a roadmap for your entrepreneurial journey. From defining your vision to conducting market research and financial planning, we’ll cover everything you need to know to develop a robust business plan that sets you up for long-term success.

1: Set Your Vision and Mission

“Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work.” – Steve Jobs

In the first step of developing a business plan, set your vision and mission. Define the purpose and core values of your business. Ask yourself what you aim to achieve and how you plan to make a difference in the market. Your vision and mission provide a guiding light for your business and serve as a foundation for your strategic decisions.

2: Conduct Thorough Market Research

“Know your enemy and know yourself, and you can fight a hundred battles without disaster.” – Sun Tzu

Market research is a crucial component of developing a solid business plan. Identify your target market, understand customer needs and preferences, and analyze industry trends and competition. Gather data and insights through surveys, interviews, and market reports. This research helps you validate your business idea, identify your unique selling points, and uncover opportunities and challenges in the market.

3: Define Your Products or Services

“Your most unhappy customers are your greatest source of learning.” – Bill Gates

Clearly define the products or services you will offer. Explain how they meet customer needs, differentiate from competitors, and provide value. Consider the features, pricing, and positioning of your offerings. Provide examples and case studies that demonstrate the benefits and impact of your products or services. Highlight any intellectual property, patents, or proprietary technology that gives your business a competitive advantage.

4: Develop a Marketing and Sales Strategy

“Marketing is no longer about the stuff you make, but about the stories you tell.” – Seth Godin

Craft a comprehensive marketing and sales strategy to effectively reach and engage your target audience. Identify your target customers, understand their behavior, and outline your marketing channels and tactics. Develop a pricing strategy that aligns with your value proposition and market positioning. Incorporate a sales strategy that outlines your sales process, distribution channels, and customer acquisition strategies. Provide data and examples to support the effectiveness of your marketing and sales approaches.

5: Build a Strong Team and Organizational Structure

“Great things in business are never done by one person. They’re done by a team of people.” – Steve Jobs

Outline the organizational structure and roles needed to execute your business plan effectively. Define the key positions, responsibilities, and reporting lines. Highlight the qualifications and expertise required for each role. If applicable, discuss any external partnerships or key advisors that will support your business. Emphasize the importance of building a strong team that complements your skills and shares your vision.

6: Financial Planning and Projections

“Money, if it does not bring you happiness, will at least help you be miserable in comfort.” – Hermann Hesse

Develop a comprehensive financial plan that includes revenue projections, expense forecasts, and cash flow analysis. Consider the costs associated with product development, marketing, operations, and staffing. Outline your funding needs and identify potential sources of capital. Provide financial projections for the next three to five years, including key performance indicators such as revenue growth, profitability, and return on investment.

Developing a solid business plan is a crucial step towards building a successful venture. By setting a clear vision, conducting market research, defining your offerings, crafting a marketing strategy, building a strong team, and planning your finances, you can lay a robust foundation for your business. Remember, a business plan is a living document that should be reviewed and updated regularly as your business evolves. With a well-developed business plan, you’ll be equipped to navigate challenges, seize opportunities, and achieve your entrepreneurial goals.

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Ankur Srivastava is a Serial Entrepreneur, Founder of QiMedia, QiTech

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