You’ve got the brilliant business idea, you might have even started setting up or running your business, but writing a business plan is vital for the launch and growth of any venture. It’s a document where you can organise all your ideas, make sure that you’ve considered and researched everything, and ultimately decide that the business is viable. Commitment to making a business plan is a commitment to the business.
What is a business plan?
A business plan is a document that details all the future plans and predictions for your business. It will explain your ideas, map out how they’ll be put into practice and provide relevant information and facts including the business details, marketing and sales strategy, financial projections, and operational and team specifics.
A business plan is essential in helping you:
| Plan your business | Put some meat on the bones of your initial idea, calculate your startup costs, and research if your business is realistic and viable. |
| Launch your business | Use your plan to secure startup funds, decide what marketing and sales channels you’ll use and plan what order you need to do things in. |
| Manage your business | Who will take care of the day-to-day running of the business, are you legally compliant, do you need assets, equipment and employees? |
| Grow your business | Look ahead to your medium to long-term sales projections and what you’ll need in place (for example, funding, a larger team, equipment and premises) to make this happen. |
The business plan is a living, working document that should be read and reviewed regularly. If there are multiple directors or partners in the business then they should all be in agreement with what is written in the plan and you will also need to share it with potential investors. The business plan will formalise all the ideas and assumptions, keep you focused, and ensure that everyone is on the same page.
How long the business plan should be will depend on your business size, the complexities of it and what stage you’re at. The most important thing is that it’s user-friendly and doesn’t include any waffle. Get straight to the nitty-gritty so that your stakeholders are engaged when reading it and so that you are more likely to use and update it regularly. Your business plan will probably cover the first three to five years. It’s important to include all the right information (see the checklist below) but it’s not a document to spend too long on. It’s more important that you are spending time running the business.
A business plan should include:
- What your business will do
- The business structure and operations
- Team members and their expertise
- The current and projected state of the market and industry
- How your business will sell and market
- Startup costs and funding required
- Financial projections
- Legal requirements
Writing a business plan will allow you to take a step back and look at the business more objectively, predicting potential issues in advance and coming up with solutions or a shift in how you originally thought that you would do something.
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Getting started on a business plan
Before you begin to make your business plan, keep these three things at the forefront of your mind.
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Focus on what makes you unique
Be creative with your plan, shout about your unique selling proposition (USPs) and what makes you different. Represent your brand using language and visuals, and talk about why you and your team are best to run this business.
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Don’t over complicate it
Keep it concise so that you can get on with running the business and so the business plan is an easily readable and usable document. Too much detail in the plan can become confusing.
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Be realistic and honest
The business plan will give you an indication of where you’re supposed to be. Review it every few months, update it as you go and change your activities in line with it. It will be impossible for you to predict everything so just give it your best shot and be prepared to be flexible.
How to structure a business plan step-by-step
The business plan should follow this format with these six sections.
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Business plan examples
Take a look at these business plan sections in more detail to see examples of the sort of details you should include, depending on your type of business.
1. The executive summary
Give a topline description of:
- In the most basic terms, what is the business? Is it a product or service? What does it do and how?
- Why is there a need for this business?
- What does this business do better than similar existing businesses?
- What experience or skills do you have that will help make this business a success?
- How will it make money?
- Who will your customers be?
- Who are your main competitors?
- How will people find out about you?
- What is the opportunity for investors?
2. Business details and description
- Describe your what, where, who and why – including your product/service, brand, location, business model and size.
- Make an extensive list of all your products/services/revenue streams (all the ways your business can possibly make money). For example, for a bar this could be:
- Drinks
- Food (lunch / dinner)
- Private hire for meetings / parties / events
- Putting on own events (music, comedy)
- Classes (e.g. cocktail making)
- Opening for breakfast / take away coffee
- What will the legal structure of your company be (LTD, PLC, sole trader, partnership, charity, social enterprise)?
3. Marketing and sales strategy
| Market conditions and competition | You can include your gut instincts about the market here and what you know, but be sure to also back this up with evidence and research.
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| Target market |
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| The brand |
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| Sales and marketing plan |
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4. Management and employees
- Who will make up your team and what relevant skills and experience do they have?
- Do you need to employ people?
- What friends/family/business contacts do you have with skills that might be able to help you (preferably for free)?
- Do you need to outsource anything?
5. Operational set up
- What premises do you need? Where will they be? Where will you work from?
- What assets/tools do you require (and which of these do you already have)?
- Are there any licences that you require? Any other legal considerations?
6. Financial plan and projections
| Costs |
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| Startup finance |
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| Pricing |
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| Projected accounts |
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Business plan writing tips
Writing a business plan can take some time and some areas of the plan will be easier to tackle than others.
- Make initial notes every time you think of something and don’t worry if you can’t cover all points at the start
- When you are ready to start to write the plan, make sure you use sections and these are in a logical order
- It is important that your plan is simple, accurate and easy to follow if you are going to ask others to look at it
- Try to avoid jargon or terms that only people in your type of industry will understand.
