Step-by-Step Guide to Writing a Simple Business Plan

By Joe Weller | October 11, 2021

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A business plan is the cornerstone of any successful company, regardless of size or industry. This step-by-step guide provides information on writing a business plan for organizations at any stage, complete with free templates and expert advice. 

Included on this page, you’ll find a step-by-step guide to writing a business plan and a chart to identify which type of business plan you should write . Plus, find information on how a business plan can help grow a business and expert tips on writing one .

What Is a Business Plan?

A business plan is a document that communicates a company’s goals and ambitions, along with the timeline, finances, and methods needed to achieve them. Additionally, it may include a mission statement and details about the specific products or services offered.

A business plan can highlight varying time periods, depending on the stage of your company and its goals. That said, a typical business plan will include the following benchmarks:

  • Product goals and deadlines for each month
  • Monthly financials for the first two years
  • Profit and loss statements for the first three to five years
  • Balance sheet projections for the first three to five years

Startups, entrepreneurs, and small businesses all create business plans to use as a guide as their new company progresses. Larger organizations may also create (and update) a business plan to keep high-level goals, financials, and timelines in check.

While you certainly need to have a formalized outline of your business’s goals and finances, creating a business plan can also help you determine a company’s viability, its profitability (including when it will first turn a profit), and how much money you will need from investors. In turn, a business plan has functional value as well: Not only does outlining goals help keep you accountable on a timeline, it can also attract investors in and of itself and, therefore, act as an effective strategy for growth.

For more information, visit our comprehensive guide to writing a strategic plan or download free strategic plan templates . This page focuses on for-profit business plans, but you can read our article with nonprofit business plan templates .

Business Plan Steps

The specific information in your business plan will vary, depending on the needs and goals of your venture, but a typical plan includes the following ordered elements:

  • Executive summary
  • Description of business
  • Market analysis
  • Competitive analysis
  • Description of organizational management
  • Description of product or services
  • Marketing plan
  • Sales strategy
  • Funding details (or request for funding)
  • Financial projections

If your plan is particularly long or complicated, consider adding a table of contents or an appendix for reference. For an in-depth description of each step listed above, read “ How to Write a Business Plan Step by Step ” below.

Broadly speaking, your audience includes anyone with a vested interest in your organization. They can include potential and existing investors, as well as customers, internal team members, suppliers, and vendors.

Do I Need a Simple or Detailed Plan?

Your business’s stage and intended audience dictates the level of detail your plan needs. Corporations require a thorough business plan — up to 100 pages. Small businesses or startups should have a concise plan focusing on financials and strategy.

How to Choose the Right Plan for Your Business

In order to identify which type of business plan you need to create, ask: “What do we want the plan to do?” Identify function first, and form will follow.

Use the chart below as a guide for what type of business plan to create:

Is the Order of Your Business Plan Important?

There is no set order for a business plan, with the exception of the executive summary, which should always come first. Beyond that, simply ensure that you organize the plan in a way that makes sense and flows naturally.

The Difference Between Traditional and Lean Business Plans

A traditional business plan follows the standard structure — because these plans encourage detail, they tend to require more work upfront and can run dozens of pages. A Lean business plan is less common and focuses on summarizing critical points for each section. These plans take much less work and typically run one page in length.

In general, you should use a traditional model for a legacy company, a large company, or any business that does not adhere to Lean (or another Agile method ). Use Lean if you expect the company to pivot quickly or if you already employ a Lean strategy with other business operations. Additionally, a Lean business plan can suffice if the document is for internal use only. Stick to a traditional version for investors, as they may be more sensitive to sudden changes or a high degree of built-in flexibility in the plan.

How to Write a Business Plan Step by Step

Writing a strong business plan requires research and attention to detail for each section. Below, you’ll find a 10-step guide to researching and defining each element in the plan.

Step 1: Executive Summary

The executive summary will always be the first section of your business plan. The goal is to answer the following questions:

  • What is the vision and mission of the company?
  • What are the company’s short- and long-term goals?

See our  roundup of executive summary examples and templates for samples. Read our executive summary guide to learn more about writing one.

Step 2: Description of Business

The goal of this section is to define the realm, scope, and intent of your venture. To do so, answer the following questions as clearly and concisely as possible:

  • What business are we in?
  • What does our business do?

Step 3: Market Analysis

In this section, provide evidence that you have surveyed and understand the current marketplace, and that your product or service satisfies a niche in the market. To do so, answer these questions:

  • Who is our customer? 
  • What does that customer value?

Step 4: Competitive Analysis

In many cases, a business plan proposes not a brand-new (or even market-disrupting) venture, but a more competitive version — whether via features, pricing, integrations, etc. — than what is currently available. In this section, answer the following questions to show that your product or service stands to outpace competitors:

  • Who is the competition? 
  • What do they do best? 
  • What is our unique value proposition?

Step 5: Description of Organizational Management

In this section, write an overview of the team members and other key personnel who are integral to success. List roles and responsibilities, and if possible, note the hierarchy or team structure.

Step 6: Description of Products or Services

In this section, clearly define your product or service, as well as all the effort and resources that go into producing it. The strength of your product largely defines the success of your business, so it’s imperative that you take time to test and refine the product before launching into marketing, sales, or funding details.

Questions to answer in this section are as follows:

  • What is the product or service?
  • How do we produce it, and what resources are necessary for production?

Step 7: Marketing Plan

In this section, define the marketing strategy for your product or service. This doesn’t need to be as fleshed out as a full marketing plan , but it should answer basic questions, such as the following:

  • Who is the target market (if different from existing customer base)?
  • What channels will you use to reach your target market?
  • What resources does your marketing strategy require, and do you have access to them?
  • If possible, do you have a rough estimate of timeline and budget?
  • How will you measure success?

Step 8: Sales Plan

Write an overview of the sales strategy, including the priorities of each cycle, steps to achieve these goals, and metrics for success. For the purposes of a business plan, this section does not need to be a comprehensive, in-depth sales plan , but can simply outline the high-level objectives and strategies of your sales efforts. 

Start by answering the following questions:

  • What is the sales strategy?
  • What are the tools and tactics you will use to achieve your goals?
  • What are the potential obstacles, and how will you overcome them?
  • What is the timeline for sales and turning a profit?
  • What are the metrics of success?

Step 9: Funding Details (or Request for Funding)

This section is one of the most critical parts of your business plan, particularly if you are sharing it with investors. You do not need to provide a full financial plan, but you should be able to answer the following questions:

  • How much capital do you currently have? How much capital do you need?
  • How will you grow the team (onboarding, team structure, training and development)?
  • What are your physical needs and constraints (space, equipment, etc.)?

Step 10: Financial Projections

Apart from the fundraising analysis, investors like to see thought-out financial projections for the future. As discussed earlier, depending on the scope and stage of your business, this could be anywhere from one to five years. 

While these projections won’t be exact — and will need to be somewhat flexible — you should be able to gauge the following:

  • How and when will the company first generate a profit?
  • How will the company maintain profit thereafter?

Business Plan Template

Business Plan Template

Download Business Plan Template

Microsoft Excel | Smartsheet

This basic business plan template has space for all the traditional elements: an executive summary, product or service details, target audience, marketing and sales strategies, etc. In the finances sections, input your baseline numbers, and the template will automatically calculate projections for sales forecasting, financial statements, and more.

For templates tailored to more specific needs, visit this business plan template roundup or download a fill-in-the-blank business plan template to make things easy. 

If you are looking for a particular template by file type, visit our pages dedicated exclusively to Microsoft Excel , Microsoft Word , and Adobe PDF business plan templates.

How to Write a Simple Business Plan

A simple business plan is a streamlined, lightweight version of the large, traditional model. As opposed to a one-page business plan , which communicates high-level information for quick overviews (such as a stakeholder presentation), a simple business plan can exceed one page.

Below are the steps for creating a generic simple business plan, which are reflected in the template below .

  • Write the Executive Summary This section is the same as in the traditional business plan — simply offer an overview of what’s in the business plan, the prospect or core offering, and the short- and long-term goals of the company. 
  • Add a Company Overview Document the larger company mission and vision. 
  • Provide the Problem and Solution In straightforward terms, define the problem you are attempting to solve with your product or service and how your company will attempt to do it. Think of this section as the gap in the market you are attempting to close.
  • Identify the Target Market Who is your company (and its products or services) attempting to reach? If possible, briefly define your buyer personas .
  • Write About the Competition In this section, demonstrate your knowledge of the market by listing the current competitors and outlining your competitive advantage.
  • Describe Your Product or Service Offerings Get down to brass tacks and define your product or service. What exactly are you selling?
  • Outline Your Marketing Tactics Without getting into too much detail, describe your planned marketing initiatives.
  • Add a Timeline and the Metrics You Will Use to Measure Success Offer a rough timeline, including milestones and key performance indicators (KPIs) that you will use to measure your progress.
  • Include Your Financial Forecasts Write an overview of your financial plan that demonstrates you have done your research and adequate modeling. You can also list key assumptions that go into this forecasting. 
  • Identify Your Financing Needs This section is where you will make your funding request. Based on everything in the business plan, list your proposed sources of funding, as well as how you will use it.

Simple Business Plan Template

Simple Business Plan Template

Download Simple Business Plan Template

Microsoft Excel |  Microsoft Word | Adobe PDF  | Smartsheet

Use this simple business plan template to outline each aspect of your organization, including information about financing and opportunities to seek out further funding. This template is completely customizable to fit the needs of any business, whether it’s a startup or large company.

Read our article offering free simple business plan templates or free 30-60-90-day business plan templates to find more tailored options. You can also explore our collection of one page business templates . 

How to Write a Business Plan for a Lean Startup

A Lean startup business plan is a more Agile approach to a traditional version. The plan focuses more on activities, processes, and relationships (and maintains flexibility in all aspects), rather than on concrete deliverables and timelines.

While there is some overlap between a traditional and a Lean business plan, you can write a Lean plan by following the steps below:

  • Add Your Value Proposition Take a streamlined approach to describing your product or service. What is the unique value your startup aims to deliver to customers? Make sure the team is aligned on the core offering and that you can state it in clear, simple language.
  • List Your Key Partners List any other businesses you will work with to realize your vision, including external vendors, suppliers, and partners. This section demonstrates that you have thoughtfully considered the resources you can provide internally, identified areas for external assistance, and conducted research to find alternatives.
  • Note the Key Activities Describe the key activities of your business, including sourcing, production, marketing, distribution channels, and customer relationships.
  • Include Your Key Resources List the critical resources — including personnel, equipment, space, and intellectual property — that will enable you to deliver your unique value.
  • Identify Your Customer Relationships and Channels In this section, document how you will reach and build relationships with customers. Provide a high-level map of the customer experience from start to finish, including the spaces in which you will interact with the customer (online, retail, etc.). 
  • Detail Your Marketing Channels Describe the marketing methods and communication platforms you will use to identify and nurture your relationships with customers. These could be email, advertising, social media, etc.
  • Explain the Cost Structure This section is especially necessary in the early stages of a business. Will you prioritize maximizing value or keeping costs low? List the foundational startup costs and how you will move toward profit over time.
  • Share Your Revenue Streams Over time, how will the company make money? Include both the direct product or service purchase, as well as secondary sources of revenue, such as subscriptions, selling advertising space, fundraising, etc.

Lean Business Plan Template for Startups

Lean Business Plan Templates for Startups

Download Lean Business Plan Template for Startups

Microsoft Word | Adobe PDF

Startup leaders can use this Lean business plan template to relay the most critical information from a traditional plan. You’ll find all the sections listed above, including spaces for industry and product overviews, cost structure and sources of revenue, and key metrics, and a timeline. The template is completely customizable, so you can edit it to suit the objectives of your Lean startups.

See our wide variety of  startup business plan templates for more options.

How to Write a Business Plan for a Loan

A business plan for a loan, often called a loan proposal , includes many of the same aspects of a traditional business plan, as well as additional financial documents, such as a credit history, a loan request, and a loan repayment plan.

In addition, you may be asked to include personal and business financial statements, a form of collateral, and equity investment information.

Download free financial templates to support your business plan.

Tips for Writing a Business Plan

Outside of including all the key details in your business plan, you have several options to elevate the document for the highest chance of winning funding and other resources. Follow these tips from experts:.

  • Keep It Simple: Avner Brodsky , the Co-Founder and CEO of Lezgo Limited, an online marketing company, uses the acronym KISS (keep it short and simple) as a variation on this idea. “The business plan is not a college thesis,” he says. “Just focus on providing the essential information.”
  • Do Adequate Research: Michael Dean, the Co-Founder of Pool Research , encourages business leaders to “invest time in research, both internal and external (market, finance, legal etc.). Avoid being overly ambitious or presumptive. Instead, keep everything objective, balanced, and accurate.” Your plan needs to stand on its own, and you must have the data to back up any claims or forecasting you make. As Brodsky explains, “Your business needs to be grounded on the realities of the market in your chosen location. Get the most recent data from authoritative sources so that the figures are vetted by experts and are reliable.”
  • Set Clear Goals: Make sure your plan includes clear, time-based goals. “Short-term goals are key to momentum growth and are especially important to identify for new businesses,” advises Dean.
  • Know (and Address) Your Weaknesses: “This awareness sets you up to overcome your weak points much quicker than waiting for them to arise,” shares Dean. Brodsky recommends performing a full SWOT analysis to identify your weaknesses, too. “Your business will fare better with self-knowledge, which will help you better define the mission of your business, as well as the strategies you will choose to achieve your objectives,” he adds.
  • Seek Peer or Mentor Review: “Ask for feedback on your drafts and for areas to improve,” advises Brodsky. “When your mind is filled with dreams for your business, sometimes it is an outsider who can tell you what you’re missing and will save your business from being a product of whimsy.”

Outside of these more practical tips, the language you use is also important and may make or break your business plan.

Shaun Heng, VP of Operations at Coin Market Cap , gives the following advice on the writing, “Your business plan is your sales pitch to an investor. And as with any sales pitch, you need to strike the right tone and hit a few emotional chords. This is a little tricky in a business plan, because you also need to be formal and matter-of-fact. But you can still impress by weaving in descriptive language and saying things in a more elegant way.

“A great way to do this is by expanding your vocabulary, avoiding word repetition, and using business language. Instead of saying that something ‘will bring in as many customers as possible,’ try saying ‘will garner the largest possible market segment.’ Elevate your writing with precise descriptive words and you'll impress even the busiest investor.”

Additionally, Dean recommends that you “stay consistent and concise by keeping your tone and style steady throughout, and your language clear and precise. Include only what is 100 percent necessary.”

Resources for Writing a Business Plan

While a template provides a great outline of what to include in a business plan, a live document or more robust program can provide additional functionality, visibility, and real-time updates. The U.S. Small Business Association also curates resources for writing a business plan.

Additionally, you can use business plan software to house data, attach documentation, and share information with stakeholders. Popular options include LivePlan, Enloop, BizPlanner, PlanGuru, and iPlanner.

How a Business Plan Helps to Grow Your Business

A business plan — both the exercise of creating one and the document — can grow your business by helping you to refine your product, target audience, sales plan, identify opportunities, secure funding, and build new partnerships. 

Outside of these immediate returns, writing a business plan is a useful exercise in that it forces you to research the market, which prompts you to forge your unique value proposition and identify ways to beat the competition. Doing so will also help you build (and keep you accountable to) attainable financial and product milestones. And down the line, it will serve as a welcome guide as hurdles inevitably arise.

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How to Write a Business Plan, Step by Step

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Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

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. add additional information to an appendix, business plan tips and resources.

A business plan is a document that outlines your business’s financial goals and explains how you’ll achieve them. A strong, detailed plan will provide a road map for the business’s next three to five years, and you can share it with potential investors, lenders or other important partners.

Here’s a step-by-step guide to writing your business plan.

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

writing a business plan step by step

This is the first page of your business plan. Think of it as your elevator pitch. It should include a mission statement, a brief description of the products or services offered, 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, which should contain 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, it should cover 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 exactly what you’d like to accomplish, both in the near term and over the long term.

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

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

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.

Your sales strategy.

Your distribution 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.

» 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.

You may also include 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.

» NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

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.

List any supporting information or additional materials that you couldn’t fit in elsewhere, such as resumes of key employees, licenses, equipment leases, permits, patents, receipts, bank statements, contracts and personal and business credit history. 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?

Here are some tips to help your business plan stand out:

Avoid over-optimism: If you’re applying for a business loan at a local bank, the loan officer likely knows your market pretty well. Providing unreasonable sales estimates can hurt your chances of loan approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors, taking their mind off your business and putting it on the mistakes you made. 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. You can search for a mentor or find a local SCORE chapter for more guidance.

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.

On a similar note...

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

African American entrepreneur climbing a mountain representative of writing a business plan to outline your entrepreneurial journey.

Noah Parsons

24 min. read

Updated November 30, 2023

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.

What’s your biggest business challenge right now?

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

  • 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, 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: How to collaborate with AI on your 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.

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Content Author: Noah Parsons

Noah is currently the COO at Palo Alto Software, makers of the online business plan app LivePlan.

writing a business plan step by step

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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Start » startup, writing a business plan here’s how to do it, step by step.

At the foundation of every strong business is a solid business plan. Looking to develop a business plan for your new venture? Here’s what to include in each step.

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At the foundation of every strong business is a solid business plan. A business plan outlines important information regarding a company’s operations and goals, and serves as a blueprint for how to achieve those goals. This document not only helps entrepreneurs think through and research their venture thoroughly, it also demonstrates to investors the viability of the business idea.

If you’re looking to develop a business plan for your new venture, it’s important to include all the necessary information. Here are the nine sections to include in a strong business plan, step by step.

1. Executive summary.

Your business plan should begin with an executive summary, which outlines what your company is about and why it will succeed. This section includes your mission statement, a brief description of the product or service you are offering, a summary of your plans and basic logistical details about your team.

2. Company description.

Your company description should further detail the logistics of your business, such as its registered name, address and key people involved. Here, you should also provide specific information about your product or service, including who your business serves and what problem you solve for that population.

3. Market analysis.

Conducting thorough market research can help you understand the nature of your industry, as well as how to stand out from competitors. Include a summary of your research findings in this section. Consider any trends or themes that emerge, what other successful businesses in the field are doing (or failing to do) and how your business can do better.

[Read: How to Conduct a Market Analysis ]

4. Organization and management.

This section should include your business’s legal structure — for example, whether you are incorporating as an S or C corporation, forming a partnership or operating as an LLC or sole proprietor. Provide pertinent information on your leadership team and other key employees, including each relevant individual’s percent of ownership and extent of involvement.

Describe how you will attract and retain your customer base, including what makes you stand out from competitors, and detail the actual sales process.

5. Products/services.

Your product or service is the crux of your business idea, so you’ll want to ensure you make a strong case for it being on the market. Use this section to elaborate on your product or service throughout its life cycle, including how it works, who it serves, what it costs and why it is better than the competition. If you have any pending or current intellectual property, include this information here. You can also detail any research and development for your product or service in this section.

6. Marketing and sales.

In this section, you should explain what your marketing and sales strategies are, and how you will execute them. (Note that these strategies will likely evolve over time, and you can always make adjustments as needed.) Describe how you will attract and retain your customer base, including what makes you stand out from competitors, and detail the actual sales process.

[Read: 5 KPIs to Measure Your Business’s Marketing Success ]

7. Funding request.

If you’re seeking funding, this section is critical for investors to understand the level of funding you need. Specify what type of funding you need (debt or equity) and how much, as well as how that capital will be used. You should also include information on any future financial plans, such as selling your business or paying off debts.

8. Financial projections.

The goal of your financial projections section is to show that your business is viable and worth the investment. Offer a financial forecast for the next five years, using information from current or projected income statements, balance sheets and cash flow statements to support it. Graphs and charts can be an especially helpful tool in visualizing your business’s finances.

9. Appendix.

Finally, use the appendix for any information that could not fit or did not apply to other sections of the document. Information such as employee resumes, permits, credit history and receipts are often included in this section. If you have a long appendix, consider adding a table of contents to make it easier for the reader.

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Blog / Small business tips / How to create a business plan: A complete guide to writing your company roadmap

writing a business plan step by step

How to create a business plan: A complete guide to writing your company roadmap

A business plan is a roadmap that outlines what your business does, how it’s going to work and how you’re going to achieve your goals. 

According to Bplans , who worked with the University of Oregon to analyse academic research around planning, entrepreneurs who take the time to create a plan for their business idea are 152% more likely to start that business.

Further, 129% are more likely to push forward with it beyond the start-up phase. And companies that strategically plan grow 30% faster than those that don’t. 

In this guide, we’re going to walk you through how to write a business plan that helps your company start, build and achieve success.   

Table of contents

What is a business plan and why do you need one, the nine key components of a business plan and how to write them.

  • Five top tips for writing a compelling business plan

📹 Masterclass video: How to write the perfect business plan

Wrapping up.

A business plan is a document that guides you through the various stages of building, launching and running your business. Essentially, it helps you put the building blocks in place to make your company a success.

If you’re bringing a new small business to market, a business plan will be crucial in:

  • Securing funding or loans
  • Achieving investment or raising venture capital
  • Attracting talent or business partners
  • Guiding your go-to-market strategy

All banks and most investors and venture capitalists will only invest in a business if they can see that they’ll get their money back. They want to know that you have the business idea, team, scalability and planned sales growth to succeed. A business plan gives financiers the details they need to make informed decisions. 

Similarly, for talent or prospective partners, a business plan is your assurance to them that your business matches their short and long-term career ambitions. 

A business plan also keeps you focused on what you need to do to accomplish your goals. If you’re not meeting your targets, you can turn to your business plan to help guide you on changes that need to be made. It’s the drawing board you can always go back to. 

Because of this, having a business plan is as important for existing businesses as it is for start-ups. 

Top Tip: Business plans also apply to side hustles. Even if you have a full-time job or already run a small business, a side hustle can be a great way to pull in extra income or capitalise on a hobby. But just because it doesn’t take up all of your time doesn’t mean it should lack structure. To learn more about how to effectively run a side business, read our guide to 5 side businesses you can start quickly and affordably 💡

How long should a business plan be?

According to Growthink surveys, 15 to 25 pages is the optimum business plan length. But the number of pages isn’t the ideal way to measure length. 

As Bplans points out: “A 20-page business plan with dense text and no graphics is much longer than a 35-page plan broken up into readable bullet points, useful illustrations of locations or products, and business charts to illustrate important projections.”

Instead, Bplans says that your business plan should: 

  • Take no longer than 15 minutes to skim read . Make sure that key information in each section is easy for readers to find.
  • Mirror the length of its audience . The length is directly tied to the intent. If the purpose is for outsiders who know nothing about your business to gain a deeper understanding, it must include detailed executive summaries and team descriptions. If the intent is to procure investment, it must be built to withstand legal scrutiny and include any information a bank would look for in a business loan application. Know your audience, and work backwards to create the ideal business plan to match that scenario (we’ll dive into exactly how to do this in a later section).

How to present your business plan?

Your business plan is designed to evolve as your business grows. It’s a living document that should be consistently tweaked to match the health and goals of your company. Because of this, it’s best to keep your plan as a digital document that can be easily updated and sent to third parties as a PDF. 

That said, there may be times when your plan needs to be presented to investors or bank managers in person, so it should always be print-ready with a front cover that includes your:

  • Company name
  • Company logo and colour scheme
  • Business name and date
  • Contact information

It should also have a contents page, with numbered pages and sections so that readers can easily find what they’re looking for.

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A business plan features nine main sections related to your business operations, structure and finances: 

  • Executive summary
  • Company description

Market analysis

  • Management and company structure
  • Service or product information
  • Marketing and sales strategy
  • Funding information
  • Financial projections

Let’s take a closer look at each. 

1. Executive summary

The executive summary is a top-level look at your business that summarises the detailed information found in the rest of the sections.

It’s also your elevator pitch—a chance for you to immediately captivate the reader by portraying your mission, vision, goals, product, leadership, finance information and growth plans.

Picture yourself in a lift for 45 seconds with a potential investor. How would you sell your business? Think about that when writing this section. Be concise and compelling with your words.

Because it is a summary, it’s often easier to write this section last after you’ve fleshed out the finer details of your business plan .

Writing your executive summary

Start with the basic information:

  • Your company name
  • Company address
  • Names of all owners and partners

Then, get into the business information. 

  • Value proposition . Describe in one sentence what your company does and why it’s great. This is your value proposition. For example, Uber’s value proposition is “The smartest way to get around”. For email marketing platform MailChimp it’s “Send Better Email”. For Dollar Shave Club it’s “A great shave for a few bucks a month”.
  • Problem and solution . In a paragraph, briefly explain the problem customers are facing and how your product or service solves it.
  • Target customers. Who is your ideal customer? Be extremely specific. For example, if you’re selling men’s suits, your audience won’t simply be every man because every man wears suits. That doesn’t hold true. It’s more likely to be targeted towards ‘fashion-conscious men’ or ‘businessmen’.
  • Competitors . List other companies that are solving the same problems you are and how they’re solving them.
  • Team . A sentence or two on why your team is the best team to bring your product or service to market.
  • Finances . Focus on the key aspects of your financial plan–your planned costs and how you will make money.
  • Funding . Details of your start-up costs and how much you need to raise to get your business off the ground. 
  • Milestones . Briefly mention what you’ve achieved so far and what goals you plan to achieve. This lets potential investors, talent or partners know how serious you are in building a successful business. 

As mentioned above, before you can write this section you have to flesh out all of your company details, including who you are, who you’re selling to, how you’re going to sell your product or service, what your financial goals are, how you will reach those financial goals, and so on. 

The rest of this article will inform you on how to do just that. 

2. Company description

The company description is your story. It digs deeper into your value proposition, looking at how you came to be and what you intend to achieve.

Break your description down into three sections: 

Mission statement

Company profile, business objectives.

An example of a target, mission, and values

Your mission statement is a sentence or short paragraph that describes why your business exists.

To create your mission statement, answer the following questions:

  • What does my business do?
  • How do we do it?
  • Who do we do it for?
  • What value are we bringing to customers?

For example, Patagonia’s mission statement is “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”

In a single sentence, they get across their aims and ambitions, their value to the market (safe, quality products) and their value to people and the world (helping the environment). 

Use this as inspiration to come up with a statement that captures the heart and soul of your business.

Top Tip: Your company description will also help to inform your business culture. You will carry these core values throughout all of your business behaviours and they will also influence how you make future business decisions. Because of this, it’s crucial to devote the necessary time and energy to get this right. To learn exactly how to do that, read our guide on why business culture matters & how to get it right from the start ☀️

In a paragraph or two, your company profile should detail your: 

  • Founding date
  • Company location
  • Products or services
  • Number of employees
  • Details of company leaders and their roles
  • Company milestones

The information is the most important thing here, so approach it like a business profile and stick to the facts and figures.

In a paragraph or two explain what you want to achieve as a business. This needs to be a realistic aim that investors can get behind and your team members can work towards. 

The SMART goals method can help you to ensure your goals are practical.

SMART stands for: Specific, Measurable, Attainable, Relevant, and Timely. 

Infographic describing SMART goals

Use graphs to add weight to your objectives. For example, if you aim to increase revenue from £100,000 in year one to £500,000 by year five, create a chart that plots your growth. The visual aspect helps to grab attention whilst providing readers with key information they may miss if skim reading. 

This chart from an example business plan does just that:

Example of 5 year net revenue projections

You’re immediately drawn to the planned-growth projections and want to learn about how they’ll reach such high goals. We will get into the specifics of how to create accurate sales and revenue forecasts in a later section.

Top Tip: To learn more about how to establish practical SMART goals that will inform your business strategy and help you effectively market your brand, read our beginners guide to digital marketing strategy . 

3. Market analysis

Marketing analysis focuses on three areas:

  • Your target market (the industry your selling in)
  • Your customers (who you’re selling to)
  • Your competitors (who you’re selling against)

By detailing information about the themes and trends within your industry, you’ll be able to show that the appetite for your product or service exists. Outlining information about your ideal customer helps you to identify the marketing and sales tactics you can use to attract them. And highlighting your competitor’s strengths and weaknesses gives you a chance to showcase what you do better than the rest. 

Market analysis should identify the market as a whole, as well as your addressable market and your share of the market. From this information, you can begin to get an idea of your target market, which informs your messaging, positioning and unique selling point (USP).

Venn diagram demonstrating how to find your USP

Start by researching the current state of your industry and where the market is heading in terms of size, trends and projected growth.

Your approach here will depend on your business. For example, if you’re opening a small local shop, you should assess the market around your shop. If you’re starting an ecommerce business and selling UK-wide, you’ll need to analyse the market at a national level. 

When estimating market size, look at:

  • Volume . The number of potential customers
  • Value . The value of the market

You can find this information by searching for publicly available data or by commissioning a market research report. If you’re searching on a national level, you may find figures published online. On a local level, data might not be as easy to come by, which is where you’ll need to carry out your own research. 

Top Tip: Conducting market research takes time, but it’s important that you get a full picture of your audience to ensure your message and USP resonates. To learn more, read our detailed guide on how to conduct market research for your business idea ⚡️

Once you have the information, you can use TAM SAM SOM to work out your business’ relationship to the market size.

  • TAM stands for Total Addressable Market
  • SAM stands for Serviceable Addressable Market
  • SOM stands for Serviceable Obtainable Market

Infographic describing TAM SAM SOM

  • To calculate your TAM, work out how many people have a need for your business. For example, let’s say you’re opening a shop selling custom-designed women’s clothes in a town of 100,000 people. Market research shows that 50% (50,000) of residents are women. Your total addressable market would be 50,000 people. 
  • To calculate your SAM, take your TAM and discount all the people that fall outside of your target market. Let’s say your target market is women between 18 and 35, with disposable income. This discounts 30,000 people, which means your serviceable addressable market is 40% (20,000) of your total addressable market. 
  • To calculate your SOM, work out how many of your SAM you can realistically serve. Your shop offers a measuring service and design consultation but only to people in a five-mile radius, which means you can serve 200 people a month. That would mean serving 2,400 people a year, which makes your SOM around 12% of your SAM.

Ideal customer

Your ideal customer is the person your product or service is aimed at. In the above example of the women’s clothes shop, the ideal customer is between 18 and 35, with disposable income. 

Customer analysis digs deeper than this, looking at your target customers’ education, income, job, relationship, buying concerns, interests and more.

You’ll find methods to help you discover your ideal customer and create customer personas in our guide on how to create a go-to-market strategy . 


Competitive analysis is the process of identifying gaps in the market that your product or service can fill. It’s about finding out what the competition does so you gain a competitive advantage. 

In our guide on how to run a competitive analysis , we walk you through the process of analysing the finer details of your rivals in five steps:

Step 1: Identify & segment your competitors

Step 2: Analyse their market positioning

Step 3: Review their content & social media

Step 4: Check out what their customers are saying

Step 5: Walk through their customer journey

Use this information to show potential investors and talent that your business is going places. Our competitive analysis matrix template is a great starting point.

Screenshot showing competitor analysis matrix template with examples

Once complete, take it a step further and create a simple visual that clearly shows where your company outperforms the competition. Here is a basic example of how to build out this visual.

Example competitive analysis matrix

It’s hard to ignore a chart that checks all of the boxes. 

4. Management and company structure

This section goes into detail on how your company is structured and who is running it. 

The structure here means two different things:

Team structure

Company structure.

First, you need to show your management structure: what each leader’s role is within the company. 

The simplest way to show your company hierarchy is with an organisational chart like this example:

Example organisational chart

For each member of your team, give details on their background and credentials with a bio that includes their:

  • Professional background
  • Achievements

Including this information gives readers assurances that the team you have in place is well-positioned to take the company forward. 

If there are any roles yet to be filled, give details on those positions.

Company structure is your legal structure. For example, limited company or sole trader.

Top Tip: If you’re yet to decide on a business structure, you can weigh up the pros and cons for setting up as a sole trader or limited company in our sole trader vs limited company guide.

writing a business plan step by step

If you plan on changing the structure of your company in the future, include details on this as well. For example, you may start as a private limited company (Ltd), but grow to become a public limited company with shares offered to members of the public. 

5. Service or product information

Here is where you get to wax lyrical about your offer and why it’s better than anything currently on the market. 

This section should include: 

  • A description of your product or service . Details on what it is and what it does.
  • How your product or service will be priced . Do you offer tiered pricing or a subscription model, for example.

Top Tip: Choosing the right pricing strategy is another key part of your go-to-market strategy. Will you price higher, lower, or similar to your competitors? What does the market demand? How does your pricing strategy reflect the value of your products and services? To learn more about how to answer these questions, read our 6-step guide on how to price a product and achieve profitable markups 💷

  • How your products compare to competitors . List several competitor products along with their pros and cons.
  • The production process . Details on how your products are created, how your source materials, quality control management, supply chain, inventory and bookkeeping.
  • Product lifecycle . Details on upsells and cross-sells, research and development plans and time between purchases.
  • Orders . Details on how you process and fulfil orders.
  • Legal aspects . Details on any intellectual property or trademarks you own.
  • Future products or services . If you plan on expanding your offer, give details on the offer and any research and development plans.

While there are formal and practical details to get across, the main point of this section is to get the reader excited about your product. To do this:

  • Focus on the benefits . Describe how features give value to the customer. Here are some examples of features turned into benefits:
  • Highlight your features. Get across what features your product or service has that the competition doesn’t. For example, your product might be the cheapest on the market or your turnaround time might be quicker or your expertise might allow you to offer a better level of service. 
  • Get across why you’re needed . Shine the light on why your product or service is important to the market. This will be especially crucial if your startup is bringing a new invention to the market, or you’re creating an entirely new market. 

6. Marketing and sales strategy

If your business is going to be a success, you need a marketing strategy and sales plan that takes customers on a journey from awareness to purchase.

Diagram of the marketing funnel from awareness stage to advocacy

This section of your business plan should include:

  • Your target market . Reiterating the information from the market analysis section.
  • Which marketing channels you’ll use and which you’ll prioritise . For example, social media, word of mouth, Google Ads, print or radio advertising, exhibition stands or fairs, or referrals.
  • Your plan to attract customers at launch . For example, you might run an opening discount offer to people who share your post on social media. Or give a voucher to every customer who refers a friend.
  • Your plan to retain customers . For example, you may offer reward programs that allow customers to collect points for every purchase that can be redeemed for free or discounted products.
  • Your expected results . What you hope to achieve from your marketing and how it will help you grow your business in terms of sales and visibility. If you’ve already started marketing your business, give details on what you’ve done and how it’s benefited the business.

7. Funding information 

Funding information is all about how much money you need to start your business, why you need it and how you’ll use any capital. 

The most critical part of this is your startup costs, which detail:

  • The cost of producing your product or service
  • Your fixed outgoings
  • The cost of equipment, premises, supplies, insurance and other necessities required to run your business

Top Tip: If you’re yet to work out how much capital you need, check out our guide on how much it costs to start a business in the UK 📌

If you have the figures in place, you can set out presenting them. 

This section should be broken down into three parts: 

Current and future funding requirements

How funds will be used, current and future financial plans.

Include how much money you need to get your business off the ground, along with any funding you’ll need in the foreseeable future (up to five years). Be clear about why you’re requesting a loan or investment and outline what your needs are based on in your financial forecasts (we’ll get onto those soon). 

If you’re offering equity in exchange for investment, provide details on how an investor will be paid, as well as how and when they can cash out. For most small businesses, investors are paid in dividends (a share of company profits).

This part should explain how you plan to use the funds so that investors can determine if your business is a worthwhile investment. If you plan on using capital for several things, list and provide costs for each.

Again, putting these numbers into a visual format will help to more clearly outline your vision.

Example funding allocation

Finally, if applicable, provide information on any current investments and/or outstanding loan repayment plans. 

If you’re seeking investment or a loan for the first time, most lenders will have their own repayment schedules. However, you should detail any factors that may affect lenders, such as any plans to relocate or sell the business. 

Unlike other sections, funding information will need to be tailored to each financier. Investors will be interested in return on investment (ROI), whereas lenders will be interested in loan repayments. Create separate reports so that information is relevant to the reader. 

Top Tip: Investors and banks will also be interested in your business credit report (if you have one). To learn more about why your business credit score is important and how it’s determined, read our guide to everything you need to know about your business credit score (and how to improve it) 🙌

8. Financial projections

Financial projections supplement your funding information by showing potential lenders and investors that your business has a positive financial outlook.

This section should include the following key information: 

  • Sales forecast. The amount of money you expect to raise from sales.
  • Cash flow statement. Your cash flow balance and monthly cash flow patterns–how much is coming in and going out of your business every month.
  • Balance sheet. An overview of the financial health of your business.
  • Profit and loss statement . Your profit level and how much you expect to make based on projected sales, minus the cost of overheads and providing goods or services. 

Top Tip: Unless you’re an accountant, this part of the business plan can be overwhelming. To learn more about the fundamentals of accounting and how to create each of the aforementioned statements, read our complete guide to accounting for startups 📣 

If your business is already established, you’ll need to include financial figures from the last three years (or however long you’ve been trading if it’s less than three years) for all of the above, other than your sales forecast. 

If you’re a new business, your financial figures need to be predicted.

We’ve built several spreadsheet templates to help you generate the below financial reports:

  • Three main financial statements (balance sheet, profit and loss statement, cash flow statement)
  • Cash flow forecast
  • Estimated sales

Forecasting your finances

Sales forecast.

Use your market analysis and knowledge of industry trends to estimate your future sales. For the first year, break these figures down into monthly sales, detailing what you’re selling, price points and how much you expect to sell. Moving into the second and third year of business, reduce forecasting to quarterly sales.

Cash flow statement

As a startup, your cash flow statement becomes a cash flow forecast based on your sales forecast, minus your expenses. Your expenses are the: 

  • Fixed costs . Expenses that are the same or close the same every month (e.g. rent, insurance and utilities).
  • Variable costs . Expenses that vary every month depending on demand (e.g.costs for raw materials, production costs, shipping and advertising).

Provide monthly cash flow patterns for the first 36 months. Keep in mind that, depending on your business, you may need to account for a lag in revenue. For example, if you provide a service to a client, their payment terms might dictate the invoice is paid 60 days after being sent.

Top Tip: To learn more about the various types of expenses and how to manage them, read our guide to small business expense management 🙌

Balance sheet

Create a balance sheet by calculating company assets, minus company liabilities.  

Company assets include:

  • Property you own
  • Equipment you own
  • Unsold inventory
  • Company vehicles you own
  • Outstanding invoices

Company liabilities include:

  • The amount you owe on a business loan
  • The amount you owe unpaid invoices

Your balance is the difference between your assets total and your liabilities total.

Profit and loss statement

Use the figures from your sales forecast, expenses and cash flow statement to forecast how much you expect in profit and losses for your first three years in business. 

Your statement needs profit and loss projections for each year, as well as a total figure for the three years and should include a breakdown of:

  • Sales . Based on figures from your sales forecast.
  • Cost of goods sold (COGS) . The total cost of selling your product or service. If you need help with this, check out our guide on everything you need to know about cost of sales .
  • Gross margin . Your sales minus your COGS. This is usually listed as a percentage, which you can calculate as: 

Gross margin (total revenue – COGS / total revenue x 100

For example, £500,000 total revenue, minus £300,000 leaves a gross margin of £200,000. 

£200,000 / £500,000 x 100 = 40%

  • Operating expenses . A list of all your expenses, minus COGS (which you’ve already included), tax, amortisation and depreciation. List each expense individually and include a total sum. 
  • Operating income statement . Your total operating expenses minus your COGS, before interest, tax, amortisation and depreciation.
  • Total expenses . Your expenses including interest, tax, amortisation and depreciation.
  • Net profit . Your monthly and yearly bottom line.

List financial figures using bullet points and include graphs to show how you predict your business will grow over your first three years of trading.

9. Appendix 

The appendix is the place to include any supporting documents. If a lender or investor hasn’t requested additional documentation, you can choose to leave this section out. But it’s a good place to strengthen your business plan, by including: 

  • Reference letters
  • Credit reports
  • Permits and licences
  • Client contracts or customer purchase orders
  • Legal documents
  • Associations and memberships  

Format the appendix with a clear table of contents and sections that correspond to the business plan section.

5 top tips for writing a compelling business plan 

  • Keep it concise . Say what you need to say using simple language (no jargon) in as few words as possible. Your business plan only needs to get the key information across. The intricacies can come later. 
  • Make it easy on the eye . Most lenders and investors will skim read your business plan, picking out relevant information as they go. Use headings to define sections and make key data stand out on each page by using bullet points for lists, bolding important sentences and using graphs and charts to add weight to financial figures. 
  • Think about your audience . Consider who your business plan is aimed at and write with them in mind. If it’s an internal plan, think about what your team would want to gain from reading the document. If it’s for a lender or investor, think about the questions they might ask and which information is of particular interest to them. 
  • Get the figures right. If you’re forecasting costs, sales and expenses, numbers will never be 100% accurate and it’s better to overestimate than underestimate. However, figures must be realistic and they must add up. Expect lenders and investors to scrutinise your calculations. Always double and triple check the numbers. 
  • Proofread and proofread again . Don’t let your hard work be undone by something as simple as a typo or grammar mistake. Proofread your document from start to finish and then finish to start. Have someone you trust look over it too.

You now know what goes into a strong business plan, but you might be wondering what tools and frameworks you can use to bring it to life.

In this Tide Masterclass, our Events Manager Cuan Hawker is joined by Tom Horbye , Head of Campaigns Development at Seedrs .

Seedrs connects investors and businesses. They help startups raise capital and grow a supportive community. As they put it, it’s “equity crowdfunding done properly”. It’s unlikely anyone has seen and improved more business plans than Tom!

Tom will explain:

  • Why you need a business plan 📘
  • How to structure your plan 📃 Two tried-and-tested structures that work.
  • What to include in your plan 📋 And what to leave out.
  • Tools, help and next steps 🛠

This Masterclass is useful for anyone thinking about starting their own business in the UK.

A business plan is the cornerstone of your company. By clearly detailing your business objectives, strategies, marketing and sales plans, and financial forecasts you’ll be able to set out your business goals and keep track of your progress. 

Use this guide to complete the key components and put together a plan that a) brings clarity to your team, and b) provides assurances to lenders and investors that your business is a safe bet.

Set up your business with Tide for free

Photo by William Ivan, published on Unsplash

Valentine Hutchings

Valentine Hutchings

Head of Community and small business enthusiast

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October 31, 2023

Block Advisors

How to Write a Business Plan Step-By-Step

October 31, 2023 • Block Advisors


  • A business plan outlines your business’s goals, services, financing, and more.
  • Business plans vary in length and complexity but should always include an explanation of what your business will do and how it will do it.
  • Business plans serve as a guide for business owners and employees and are key to boosting investor confidence.

Whether you’re a serial entrepreneur or just getting your first small business idea off the ground, creating a business plan is an important step. Good business planning will help you clarify your goals and objectives, identify strategies, and note any potential issues or roadblocks you might face.

Not every business owner chooses to write a business plan, but many find it to be a valuable step to take when starting a business. Creating a business plan can seem daunting and confusing at first. But taking the time to plan and research can be very beneficial, especially for first-time small business owners.

If you want to learn how to create a business plan or if you feel you just need a little business plan help, read on!

What is a Business Plan?

A business plan serves as a comprehensive document that outlines your business’s goals, services, financing, leadership, and more details essential to its success. Think of the plan as the who, what, and why of your new business:

A small business owner learning how to write a business plan

Who are the major players in your business?

What goods or services do you offer and why are they important?

Why are you in business and why should customers choose you?

Business plans can range in complexity and length, but, at their core, all plans explain what the business will do and how it will do it. A business plan serves as a guide for business owners and employees and should boost investor confidence. Some important advantages of business plans include:

  • Shows investors you have an in-demand product or service, a solid team to achieve business goals, and the potential for growth and scalability.
  • Increases the likelihood of securing a business loan, locking in investments, or raising capital. >>Read: A Guide to Raising Capital as a Small Business Founder
  • Helps recognize partnership opportunities with other companies.
  • Identifies and defines competitors within your given industry.

Looking for an examples of a successful business plan? Check out the SBA’s business plan page for walkthroughs of different business plan outlines.

How to Write a Business Plan: 10 Simple Steps

Starting with a blank page is undoubtedly intimidating. So, begin with a structured business plan template including the key elements for each section. Once your outline is complete, it’ll be time to fill in the details. Don’t worry, you’ll know how to write a business plan in no time. We’ve broken each section down to help you write a business plan in a few simple steps.

1. Brainstorm and Draft an Executive Summary for Your Business Plan

This will be the first page of your business plan. Think of it as your business’ written elevator pitch. In this high level summary, include a mission statement, a short description of the products or services you will be providing, and a summary of your financial and growth projections.

This section will be the first part people read, but you may find it easier to write it last. Writing it after building out the rest of your plan may help you condense the most important information into a concise statement. You’ll need to streamline your thoughts from the other sections into a one page or less summary.

2. Create a Business Description

In this next section, describe your business. Add more specific details than the executive summary. You should include your business’s registered name, the address of your business’s location, basic information about your business structure , and the names of key people involved in the business.

The company description should also answer these two questions:

  • Who are you?
  • What do you plan to do?

Explain why you’re in business. Show how you are different from competitors. Tell investors why they should finance your company. This section is often more inspirational and emotional. Make sure you grab the reader’s attention. The goal is to get them to believe in your vision as much as you do.

What business structure is right for my company?

Answer these six questions to help you find your fit

3. Outline Your Business Goals

This section should serve as an objective statement. Explain what you want to accomplish and your timeline. Business goals and objectives give you a clear focus. They drive your business to success, so dream big. Include objectives that will help you reach each goal. Don’t forget to make your goals and objectives SMART – that is, they should be:

S pecific | M easurable | A ttainable | R elevant | T ime-bound

4. Conduct and Summarize Market Research

Next, outline your ideal customer with some research. Do the math to estimate the potential size of your target market. Make sure you are choosing the right market for your product, one with plenty of customers who want and need your product. Define your customer’s pain points. Explain your expertise in relation to the market. Show how your product or service fills an important gap and brings value to your customers. Use your findings to build out a value proposition statement.

5. Conduct a Competitive Analysis

In a similar way, you’ll also want to conduct and include a competitive analysis. The purpose of this analysis is to determine the strengths and weaknesses of competitors in your market, strategies that will give you a competitive advantage, and how your company is different. Some people choose to conduct a competitive analysis using the SWOT method .

6. Outline Your Marketing and Sales Strategies

Your marketing sales strategy can make or break your business. Your marketing plan should outline your current sales decisions as well as future marketing strategies. In this section, you should reiterate your value proposition, target markets, and customer segments. Then, include details such as:

  • A launch plan
  • Growth tactics and strategies
  • A customer retention plan
  • Advertising and promotion channels (i.e. social media, print, search engines, etc.)

7. Describe Your Product or Service

By this point, your products or services have probably been mentioned in several areas of the business plan. But it’s still important to include a separate section that outlines their key details. Describe what you’re offering and how it fits in the current market. Also include details about the benefits, production process, and life cycle of your products. If you have any trademarks or patents, include them here. This is also a good time to ask yourself, “Should my plan include visual aids?”

[ Read More Must-Have Tips to Start Your Small Business ]

8. Compile Financial Plans

Financial health is crucial to the success of any business. If you’re just starting your business, you likely won’t have financial data yet. However, you still need to prepare a budget and financial plan. If you have them, include income statements , balance sheets , and cash flow statements . You can also include reporting metrics such as net income and your ratio of liquidity to debt repayment ability.

If you haven’t launched your business yet, include realistic projections of the same information. Set clear financial goals and include projected milestones. Share information about the budget. What are the business operations costs? Ensure you are comprehensive when considering what costs you may need to prepare for.

9. Build a Management and Operations Plan

Identify your team members. Highlight their expertise and qualifications. Outline roles that still need to be filled now to establish your company and later as the business grows. Read More: 8 tax steps to take when hiring employees >>

Include a section detailing your logistics and operations plan. Consider all parts of your operation. Create a plan that provides details on suppliers, production, equipment, shipment and fulfillment, and inventory. This shows how your business will get done.

10. Create an Appendix – A Place for Additional Information and Documents

Lastly, assemble an organized appendix. This section can contain any other relevant information a reader might need to enhance their understanding of other sections. If you feel like the appendix is getting long, consider adding a table of contents at the beginning of this section. Appendices often include documents such as:

  • Licenses and permits
  • Bank statements
  • Resumes of key employees
  • Equipment leases

How to Create a Business Plan: The Bottom Line

A business plan helps you identify clear goals and provides your business direction. Many small business plans are 10-20 pages in length. But as long as the essentials are covered, feel empowered to build a plan that works for you and your company’s needs. Creating a business plan will help you identify your market and target customers, define business aims, and foster long-term financial health.

We’re ready to help you get your business started on the right foot today, and help you find long-term satisfaction as you pursue your business dream. Writing a business plan can be exciting. But if the steps to starting your business are feeling overwhelming, Block Advisors is here to help. Make an appointment today – our experts can assist you with tax prep , bookkeeping , payroll , business formation , and more .

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business plan

How to Write a Business Plan in 2023: The Ultimate Guide for Every Entrepreneur

Are you starting a new business or trying to get a loan for your existing venture? If so, you’re going to need to know how to write a business plan. Business plans give entrepreneurs the opportunity to formally analyze and define every aspect of their business idea .

In this post, you’ll learn how to put together a business plan and find the best resources to help you along the way.

writing a business plan step by step

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writing a business plan step by step

What is a Business Plan? 

A business plan is a formal document that outlines your business’s goals and how you will achieve those goals. Entrepreneurs who start out with business plans are 16 percent more likely to build successful companies , according to the Harvard Business Review.  Developing a business plan ensures sustainable success, guiding you as you grow your business, legitimizing your venture, and helping you secure funding (among countless other benefits). 

What Are the Main Purposes of a Business Plan?

Most financial institutions and service providers require you to submit a detailed business plan to obtain funding for your business. Online businesses will likely have a low overhead to start, so they may not need funding and therefore may not feel the need to write a business plan. That said, writing a business plan is still a good idea as it can help you secure a drastic increase limit on your credit card as your business grows or open a business account. This varies per bank.

If you’re growing your business, use it to help you raise expansion capital, create a growth strategy, find opportunities, and mitigate risks.Palo Alto software found that companies who make business plans are twice as likely to secure funding . .

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If you’re just starting your business, making a business plan can help you  identify your strengths and weaknesses, communicate your vision to others, and develop accurate forecasts.

business plan format

How to Make a Business Plan: The Prerequisites 

Here are the prerequisites to creating a solid business plan:

  • Establish goals
  • Understand your audience
  • Determine your business plan format
  • Get to writing! 

Establish Goals

There are two key questions to ask here: 

  • What are you hoping to accomplish with your business?
  • What are you hoping to accomplish with your business plan?

Approaching your business plan through that lens will help you focus on the end goal throughout the writing process. These also provide metrics to measure success against. 

Before writing your business plan, gather the content and data needed to inform what goes in it. This includes researching your market and industry – spanning everything from customer research to legalities you’ll need to consider. It’s a lot easier to start with the information already in front of you instead of researching each section individually as you go. 

Turn to guides, samples, and small business plan templates to help. Many countries have an official administration or service dedicated to providing information, resources, and tools to help entrepreneurs and store owners plan, launch, manage, and grow their businesses. 

The following will take you to online business plan guides and templates for specific countries.

  • United States Small Business Administration (SBA) – The “write your business plan page” includes traditional and lean startup business plan formats, three downloadable sample business plans, a template, and a step-by-step build a business plan tool.
  • Australian Government – The “business plan template” page includes a downloadable template, guide, and business plan creation app.
  • UK Government Business and Self-Employed – The “write a business plan” page includes links to a downloadable business plan template and resources from trusted UK businesses. .
  • Canada Business Network – The “writing your business plan” page includes a detailed guide to writing your business plan and links to business plan templates from Canadian business development organizations and banks.

These business resource sites also offer a wealth of valuable information for entrepreneurs including local and regional regulations, structuring, tax obligations, funding programs, market research data, and much more. Visit the sites above or do the following Google searches to find official local business resources in your area:

  • your country government business services
  • your state/province government business services
  • your city government business services

Some Chamber of Commerce websites offer resources for business owners, including business plan guides and templates. Check your local chapter to see if they have any.

Banks that offer business funding also often have a resource section for entrepreneurs. Do a Google search to find banks that offer business funding as well as business plan advice to see the business plans that get funding. If your bank doesn’t offer any advice, search for the largest banks in your area:

  • business plan guide bank name
  • business plan samples bank name
  • business plan template bank name

If you’re looking for more sample business plans, Bplans has over 500 free business plan samples organized by business type as well as a business plan template. Their collection includes 116 business plans for retail and online stores. Shopify also offers business plan templates intended to help small business owners and aspiring entrepreneurs identify functional areas of a business they may not have considered.

writing a business plan step by step

Understand Your Audience

Because business plans serve different purposes, you’re not always presenting it to the same audience. It’s important to understand who’s going to be reading your business plan, what you’re trying to convince them to do, and what hesitations they might have. 

That way, you can adapt your business plan accordingly. As such, your audience also determines which type of business plan format you use. Which brings us to our next point…

Which Business Plan Format Should You Use? 

The United States Small Business Administration (SBA) presents two business plan formats: 

  • The traditional business plan format is for entrepreneurs who want to create a detailed plan for themselves or for business funding. 
  • The lean startup business plan format, on the other hand, is for business owners that want to create a condensed, single-page business plan.

If the business plan is just for you and internal folks, draft a lean startup business plan or a customized version of the traditional business plan with only the sections you need. If you need it for business funding or other official purposes, choose the formal business plan and thoroughly complete the required sections while paying extra attention to financial projections.

If your business operates outside the U.S., clarify the preferred format with your bank.

How to Create a Business Plan: Questions to Ask Yourself

As you write a business plan, take time to not only analyze your business idea, but yourself as well. Ask the following questions to help you analyze your business idea along the way:

  • Why do I want to start or expand my business?
  • Do my goals (personal and professional) and values align with my business idea?
  • What income do I need to generate for myself?
  • What education, experience, and skills do I bring to my business?

writing a business plan step by step

How to Write a Business Plan Step by Step

According to the business plan template created by SCORE, Deluxe, and the SBA , a traditional business plan encompasses the following sections. 

  • Executive summary
  • Company description
  • Products & services
  • Market analysis
  • Marketing & sales
  • Management & organization
  • Funding request
  • Financial projections
  • SWOT analysis

Since not everyone is aware of the key details to include in each section, we’ve listed information you can copy to fill in your business plan outline. Here’s how to build a business plan step by step.  

Executive Summary

The Executive Summary is the first part of your business plan, so this is where you need to hook readers in. Every business plan starts this way — even a simple business plan template should kick off with the Executive Summary. Summarize your entire business plan in a single page, highlighting details about your business that will excite potential investors and lenders. 

Explain what your business has to offer, your target market , what separates you from the competition, a little bit about yourself and the core people behind your business, and realistic projections about your business’ success.

While this is the first section of your business plan, write it after you’ve completed the rest of your business plan. It’s a lot easier because you can pull from the sections you’ve already written, and it’s easier to identify the best parts of your business plan to include on the first page.

Company Description

In the Company Description, share 411 about your business. Include basic details like: 

  • Legal structure (sole proprietor, partnership, corporation, etc.)
  • Business and tax ID numbers
  • When the business started
  • Ownership information
  • Number of employees

Your mission statement , philosophy and values, vision, short- and long-term goals, and milestones along with a brief overview of your industry, market, outlook, and competitors should also be in the Company Description.

Pro tip: These are the details you’ll use each time you create a business profile, whether that's on social media, business directories, or other networks. Keep your information consistent to reduce confusion and instill more confidence in potential customers. 

Products & Services

The Products & Services section details what you plan to sell to customers. For a dropshipping business , this section should explain which trending products you’re going to sell, the pain points your products solve for customers, how you’ll price your products compared to your competitors, expected profit margin, and production and delivery details.

Remember to include any unique selling points for specific products or product groupings, such as low overhead, exclusive agreements with vendors, the ability to obtain products that are in short supply / high demand based on your connections, personalized customer service, or other advantages.

For dropshipping businesses selling hundreds or even thousands of products, detail the main categories of products and the number of products you plan to offer within each category. By doing this, it’s easier to visualize your business offerings as a whole to determine if you need more products in one category to fully flesh out your online store.

Market Analysis

The Market Analysis section of your business plan allows you to share the research you have done to learn about your target audience — the potential buyers of your products. People requesting a business plan will want to know that you have a solid understanding of your industry, the competitive landscape, who’s most likely to become your customers. It’s important to demonstrate that  there’s a large enough market for your product to make it profitable and/or to make a strong return on investment .

To complete the Market Analysis component of your business plan, check out the following resources for industry, market, and local economic research:

  • U.S. Embassy websites in most countries have a business section with information for people who want to sell abroad. Business sections include a basic “getting started” guide, links to economic and data reports, trade events, and additional useful business links for a particular region.
  • IBISWorld is a provider of free and paid industry research and procurement research reports for the United States , United Kingdom , Australia , and New Zealand .  
  • Statista offers free and paid statistics and studies from over 18,000 sources including industry reports, country reports, market studies, outlook reports, and consumer market reports.   

Use these websites and others to learn about the projected growth of your industry and your potential profitability. You can also use social media tools like Facebook Audience Insights to estimate the size of your target market on the largest social network

Another way to research your market and products is through Google Trends . This free tool will allow you to see how often people search for the products your business offers over time. Be sure to explain how your business plans to capitalize on increasing and decreasing search trends accordingly.

Marketing & Sales

Knowing your target market is half the battle. In the Marketing & Sales section, share how you plan to reach and sell products to your target market. Outline the marketing and advertising strategies you intend to use to market your product to potential customers – search marketing , social media marketing , email marketing , and influencer marketing methods .

If you’re unsure how to market your business’ products, analyze your competitors for some inspiration. Discovering your competition’s marketing tactics will help you customize your own strategy for building a customer base and ultimately taking your business to the next level. 

Do a Google search for your competitor’s business name to find the websites, social accounts, and content they’ve created to market their products. Look at the ways your competitor uses each online entity to drive new customers to their website and product pages.

Then come up with a plan to convert a similar audience with your marketing and advertising messages. For dropshipping businesses, conversions will typically take place on your website as people purchase your products and/or by phone if you take orders over the phone. 

Management & Organization

In the Management & Organization piece of your business plan, describe the structure of your business. In terms of legal structure and incorporation, most businesses are classified as sole proprietorships (one owner), partnerships (two or more owners), corporations, or S corporations.

Draft a condensed resume for each of the key members of your business. If you’re a solopreneur , include how your past education and work experience will help you run each aspect of your business. If you have one or more partner(s) and employee(s), include their relevant education and experience as well.

Think of this as a great way to evaluate the strengths of each individual running your business. When self-evaluating, you’ll be able to identify the aspects of your business that’ll be easier to manage and which ones to delegate to freelancers, contractors, employees, and third-party services. This also makes it easier to find the best way to utilize their strengths for business growth.

Funding Request

Chances are, you don’t have a funding request for a startup dropshipping business since the appeal to dropshipping is the low upfront investment . If you’re looking for a loan, however, this would be the section where you outline the dollar amount you need, what you plan to invest in, and how you see the return on your investment.

Another way to use this section is to analyze the investment you have or plan to make when starting or growing your business. This should include everything from the computer you use to run your website to the monthly fee for business services.

Financial Projections

In Financial Projections, share your projected revenue and expenses for the first or next five years of your business. The idea here is to demonstrate that the revenue you’re anticipating will easily lead to a return on any investment, whether from your personal finances or a capital lending service.

writing a business plan step by step

If you’re looking for funding, you’ll need to go into detail with projected income statements, balance sheets, cash flow statements, and capital expenditure budgets. If you aren’t looking for funding, it won’t hurt to create these types of financial projections so you can realistically plan for the future of your business.

The Appendix of your business plan includes any supplemental documents needed throughout the sections of your business plan. These may include, but are not limited to: 

  • Credit histories
  • Product brochures
  • Legal forms
  • Supplier contracts

If you’re submitting your business plan for funding, contact the lender to see what documentation they want included with your funding request.

SWOT Analysis

In addition to the above sections, some business plans also include a SWOT Analysis. This is a one-page summary of your business’s strengths, weaknesses, opportunities, and threats. The strengths and weaknesses you include will be internal, whereas opportunities and threats you include will be external. 

Depending on the revelations of this section, you may or may not want to make a SWOT analysis when submitting your business plan formally unless it is requested.

writing a business plan step by step

Summary: How to Create a Business Plan

As you can see, creating a business plan for your dropshipping business is a great way to validate your business idea , discover your business’s strengths and weaknesses, and make a blueprint for your business's future.

In summary, here are the sections you will need to write for your business plan, step by step:

  • SWOT analysis (Optional)

If you haven’t already, take the time to create a business plan to launch or grow your business in 2023!

Want to Learn More?

  • How to Start a Dropshipping Business
  • How to Register a Business in the USA
  • How to Launch Your Ecommerce Store in Less Than 30 Minutes Flat
  • 30+ Amazing Startup Business Ideas That’ll Make You Money

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How to write a business plan in seven simple steps

When written effectively, a business plan can help raise capital, inform decisions, and draw new talent.

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Writing a business plan is often the first step in transforming your business from an idea into something tangible . As you write, your thoughts begin to solidify into strategy, and a path forward starts to emerge. But a business plan is not only the realm of startups; established companies can also benefit from revisiting and rewriting theirs. In any case, the formal documentation can provide the clarity needed to motivate staff , woo investors, or inform future decisions.  

No matter your industry or the size of your team, the task of writing a business plan—a document filled with so much detail and documentation—can feel daunting. Don’t let that stop you, however; there are easy steps to getting started. 

What is a business plan and why does it matter? 

A business plan is a formal document outlining the goals, direction, finances, team, and future planning of your business. It can be geared toward investors, in a bid to raise capital, or used as an internal document to align teams and provide direction. It typically includes extensive market research, competitor analysis, financial documentation, and an overview of your business and marketing strategy. When written effectively, a business plan can help prescribe action and keep business owners on track to meeting business goals. 

Who needs a business plan?

A business plan can be particularly helpful during a company’s initial growth and serve as a guiding force amid the uncertainty, distractions, and at-times rapid developments involved in starting a business . For enterprise companies, a business plan should be a living, breathing document that guides decision-making and facilitates intentional growth.

“You should have a game plan for every major commitment you’ll have, from early-stage founder agreements to onboarding legal professionals,” says Colin Keogh, CEO of the Rapid Foundation—a company that brings technology and training to communities in need—and a WeWork Labs mentor in the UK . “You can’t go out on funding rounds or take part in accelerators without any planning.”

How to make a business plan and seven components every plan needs

While there is no set format for writing a business plan, there are several elements that are typically included. Here’s what’s important to consider when writing your business plan. 

1. Executive summary 

No longer than half a page, the executive summary should briefly introduce your business and describe the purpose of the business plan. Are you writing the plan to attract capital? If so, specify how much money you hope to raise, and how you’re going to repay the loan. If you’re writing the plan to align your team and provide direction, explain at a high level what you hope to achieve with this alignment, as well as the size and state of your existing team.

The executive summary should explain what your business does, and provide an introductory overview of your financial health and major achievements to date.  

2. Company description 

To properly introduce your company, it’s important to also describe the wider industry. What is the financial worth of your market? Are there market trends that will affect the success of your company? What is the state of the industry and its future potential? Use data to support your claims and be sure to include the full gamut of information—both positive and negative—to provide investors and your employees a complete and accurate portrayal of your company’s milieu. 

Go on to describe your company and what it provides your customers. Are you a sole proprietor , LLC, partnership, or corporation? Are you an established company or a budding startup? What does your leadership team look like and how many employees do you have? This section should provide both historical and future context around your business, including its founding story, mission statement , and vision for the future. 

It’s essential to showcase your point of difference in your company description, as well as any advantages you may have in terms of expert talent or leading technology. This is typically one of the first pieces of the plan to be written.

3. Market analysis and opportunity

Research is key in completing a business plan and, ideally, more time should be spent on research and analysis than writing the plan itself. Understanding the size, growth, history, future potential, and current risks inherent to the wider market is essential for the success of your business, and these considerations should be described here. 

In addition to this, it’s important to include research into the target demographic of your product or service. This might be in the form of fictional customer personas, or a broader overview of the income, location, age, gender, and buying habits of your existing and potential customers. 

Though the research should be objective, the analysis in this section is a good place to reiterate your point of difference and the ways you plan to capture the market and surpass your competition.

4. Competitive analysis 

Beyond explaining the elements that differentiate you from your competition, it’s important to provide an in-depth analysis of your competitors themselves.

This research should delve into the operations, financials, history, leadership, and distribution channels of your direct and indirect competitors. It should explore the value propositions of these competitors, and explain the ways you can compete with, or exploit, their strengths and weaknesses. 

5. Execution plan: operations, development, management 

This segment provides details around how you’re going to do the work necessary to fulfill this plan. It should include information about your organizational structure and the everyday operations of your team, contractors, and physical and digital assets.

Consider including your company’s organizational chart, as well as more in-depth information on the leadership team: Who are they? What are their backgrounds? What do they bring to the table? Potentially include the résumés of key people on your team. 

For startups, your execution plan should include how long it will take to begin operations, and then how much longer to reach profitability. For established companies, it’s a good idea to outline how long it will take to execute your plan, and the ways in which you will change existing operations.

If applicable, it’s also beneficial to include your strategy for hiring new team members and scaling into different markets. 

6. Marketing plan 

It’s essential to have a comprehensive marketing plan in place as you scale operations or kick off a new strategy—and this should be shared with your stakeholders and employees. This segment of your business plan should show how you’re going to promote your business, attract customers, and retain existing clients.

Include brand messaging, marketing assets, and the timeline and budget for engaging consumers across different channels. Potentially include a marketing SWOT analysis into your strengths, weaknesses, opportunities, and threats. Evaluate the way your competitors market themselves, and how your target audience responds—or doesn’t respond—to these messages.

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7. Financial history and projections  

It’s essential to disclose all finances involved in running your company within your business plan. This is so your shareholders properly understand how you’re projected to perform going forward, and the progress you’ve made so far. 

You should include your income statement, which outlines annual net profits or losses; a cash flow statement, which shows how much money you need to launch or scale operations; and a balance sheet that shows financial liabilities and assets. 

“An income statement is the measure of your financial results for a certain period and the most accurate report of business activities during that time, [whereas a balance sheet] presents your assets, liabilities, and equity,” Amit Perry, a corporate finance expert, explained at a WeWork Labs educational session in Israel.

It’s crucial to understand the terms correctly so you know how to present your finances when you’re speaking to investors. Amit Perry, CEO and founder of Perryllion Ltd.

In addition, if you’re asking for funding, you will need to outline exactly how much money you need as well as where this money will go and how you plan to pay it back. 

12 quick tips for writing a business plan 

Now that you know what components are traditionally included in a business plan, it’s time to consider how you’ll actually construct the document.

Here are 12 key factors to keep in mind when writing a business plan. These overarching principles will help you write a business plan that serves its purpose (whatever that may be) and becomes an easy reference in the years ahead. 

1. Don’t be long-winded

Use clear, concise language and avoid jargon. When business plans are too long-winded, they’re less likely to be used as intended and more likely to be forgotten or glazed over by stakeholders. 

2. Show why you care

Let your passion for your business shine through; show employees and investors why you care (and why they should too). 

3. Provide supporting documents

Don’t be afraid to have an extensive list of appendices, including the CVs of team members, built-out customer personas, product demonstrations, and examples of internal or external messaging. 

4. Reference data

All information regarding the market, your competitors, and your customers should reference authoritative and relevant data points.  

5. Research, research, research

The research that goes into your business plan should take you longer than the writing itself. Consider tracking your research as supporting documentation. 

6. Clearly demonstrate your points of difference

At every opportunity, it’s important to drive home the way your product or service differentiates you from your competition and helps solve a problem for your target audience. Don’t shy away from reiterating these differentiating factors throughout the plan. 

7. Be objective in your research

As important as it is to showcase your company and the benefits you provide your customers, it’s also important to be objective in the data and research you reference. Showcase the good and the bad when it comes to market research and your financials; you want your shareholders to know you’ve thought through every possible contingency. 

8. Know the purpose of your plan

It’s important you understand the purpose of your plan before you begin researching and writing. Be clear about whether you’re writing this plan to attract investment, align teams, or provide direction. 

9. Identify your audience

The same way your business plan must have a clearly defined purpose, you must have a clearly defined audience. To whom are you writing? New investors? Current employees? Potential collaborators? Existing shareholders? 

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10. Avoid jargon

Avoid using industry-specific jargon, unless completely unavoidable, and try making your business plan as easy to understand as possible—for all potential stakeholders. 

11. Don’t be afraid to change it

Your business plan should evolve with your company’s growth, which means your business plan document should evolve as well. Revisit and rework your business plan as needed, and remember the most important factor: having a plan in place, even if it changes.

A business plan shouldn’t just be a line on your to-do list; it should be referenced and used as intended going forward. Keep your business plan close, and use it to inform decisions and guide your team in the years ahead. 

Creating a business plan is an important step in growing your company 

Whether you’re just starting out or running an existing operation, writing an effective business plan can be a key predictor of future success. It can be a foundational document from which you grow and thrive . It can serve as a constant reminder to employees and clients about what you stand for, and the direction in which you’re moving. Or, it can prove to investors that your business, team, and vision are worth their investment. 

No matter the size or stage of your business, WeWork can help you fulfill the objectives outlined in your business plan—and WeWork’s coworking spaces can be a hotbed for finding talent and investors, too. The benefits of coworking spaces include intentionally designed lounges, conference rooms, and private offices that foster connection and bolster creativity, while a global network of professionals allows you to expand your reach and meet new collaborators. 

Using these steps to write a business plan will put you in good stead to not only create a document that fulfills a purpose but one that also helps to more clearly understand your market, competition, point of difference, and plan for the future. 

For more tips on growing teams and building a business, check out all our articles on  Ideas by WeWork.

Caitlin Bishop is a writer for WeWork’s  Ideas by WeWork , based in New York City. Previously, she was a journalist and editor at  Mamamia  in Sydney, Australia, and a contributing reporter at  Gotham Gazette .

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How To Write a Business Plan

Importance of a business plan, the bottom line, frequently asked questions about writing a business plan, how to write a business plan: a step-by-step guide (2024).

To set your new business on the path to success, you’ll need to create a roadmap, formally known as a business plan. According to a 2021 study from the New England Journal of Entrepreneurship , the act of writing a business plan was correlated with measures of growth and success. Embracing the power of strategic planning is a good step toward ensuring the prosperity of your venture. 

In this detailed guide, we’ll walk you through the process of writing an effective business plan and explain why it’s a powerful tool for launching your business, no matter what stage of business formation you are in.

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1. Write a Strong Executive Summary

Start your business plan with an executive summary. This should be a high-level overview of your business, including the company’s name, location, mission statement and planned products or services. Though it comes first, you might find it easier to write this part last. 

For startups seeking investment, the executive summary is particularly important because it’s the first chance to grab the investor’s attention and generate interest in your business. It should be clear, concise and compelling, and highlight why the business is destined to succeed. 

2. Provide a Company Description

A company description gives readers — who might also include potential investors or partners — a clear understanding of what the company does. It is also an opportunity to communicate the unique attributes of your business and how your offerings meet the needs of the current market. 

Your company description should include the following: 

  • Formal name
  • Physical address
  • Type of business structure (such as an LLC , Inc. or sole proprietorship) 
  • Mission statement 
  • Target market 
  • Brief history 
  • Future outlook 

3. Share Market Analysis 

Here, you should present your research on the industry. By providing a thorough analysis, you demonstrate to potential investors and lenders that you have a unique point of view of the space in which your business operates. 

The market analysis should include the following: 

  • Industry overview
  • Primary audience, including demographic and psychographic profiles 
  • Market needs, trends and growth 
  • Competitor analysis via market share

4. Outline the Product or Service  

In this part, elaborate on what you’re selling or what service you’re providing. The purpose of this section is to make a compelling case for your offering and how it meets the needs of your target market. 

The outline of the product or service should include the following: 

  • Product or service overview describing key features and how it works
  • Customer benefit and competitive advantage 
  • Development stage of the offering 
  • Pricing strategy 
  • Life cycle 
  • Intellectual property such as patents, trademarks or copyrights 

5. Describe the Marketing and Sales Strategy 

This is where you outline your plan for attracting and retaining customers. The marketing and sales strategy section should include the following: 

  • Target market needs and motivations
  • Brand positioning 
  • Sales/marketing strategy
  • Distribution channels 
  • Targeted/secured marketing partnerships 
  • Outsourcing needs 
  • Customer retention 

6. Present Important Financials  

If you’re seeking funding, explain how much you need over the next five years and what you plan to use it for. You should include forecasted income statements, balance sheets, cash flow statements and capital expenditure budgets.

7. Include Additional Details in a Concise Appendix 

This section is optional but could include resumes of key employees, letters of recommendation, job descriptions and organization hierarchy, contracts, legal information and other relevant documents.

A business plan serves as a strategic blueprint for how your company will operate, grow and overcome potential challenges. It is critical for communicating the business’s viability to potential investors, partners and stakeholders.  

A well-thought-out business plan serves several purposes, including the following:

Drives Investment 

A clear business plan can attract potential funding sources to your business. By articulating your business model, strategy and financial projections, you are demonstrating the overall profitability of your venture. Evidence of financial viability is essential for investors. 

Establishes a Roadmap

Your business plan acts as a roadmap, keeping your business on track and measuring progress. At its core, a business plan outlines the mission, vision and key objectives, which will direct all subsequent strategies. It will also set key benchmarks and guide decision-making.  

Attracts Partners 

A clear and detailed business plan is often instrumental in attracting partners or key employees. When writing a business plan, think about how a potential partner might see themselves fitting in with your strategies or company history. A business plan can be extremely persuasive when a partner can identify shared goals or culture alignment.

Creating a business plan is a vital step in launching a successful business, no matter what stage of formation you are in. It requires careful planning and critical thinking, but the payoff is a clear roadmap for your business’s future. Remember to keep your plan dynamic and revisit it as your business grows and evolves.

Consider consulting with a business professional or mentor to ensure your plan is thorough and ready to present to potential investors and stakeholders.

What is a business plan?

A business plan is a document that outlines your business goals, the strategies you will employ to meet these goals and the time frame within which you plan to achieve them.

How long should a business plan be?

A typical business plan can range from 15 to 25 pages. However, this can vary significantly depending on the type and complexity of the business.

How often should I update my business plan?

You should update your business plan at least annually or when any major changes occur internally or in the market.

Do I need a business plan?

While many states don’t require a business plan during the registration process, it’s generally a good practice to have one. However, if you’re unsure about the specific requirements in your state, it’s recommended to consult with local business authorities, such as your state’s Secretary of State office or Small Business Development Center (SBDC), to get accurate and up-to-date information. Check out our all-inclusive, state-specific LLC formation guides below.

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How to Write a Detailed Business Plan, Step-by-Step (Free Templates)

Posted november 14, 2022 by noah parsons.

how to write a business plan step by step

Writing a business plan is one of the most valuable things you can do for your business. Study after study proves that business planning significantly improves your chances of success by up to 30 percent . That’s because the planning process helps you think about all aspects of your business and how your business will operate and grow.

In fact, writing a business plan is one of the only free things you can do to greatly impact the success and growth of your business. Ready to write your own detailed business plan? Here’s everything you need ( along with a free template ) to create your plan.

Before you write a detailed business plan, start with a one-page business plan

Despite the benefit of planning, it’s easy to procrastinate writing a business plan. Most people would prefer to work hands-on in their business rather than think about business strategy. That’s why, to make things easier, we recommend you start with a simpler and shorter one-page business plan .

With a one-page plan, there’s no need to go into a lot of details or dive deep into financial projections—you just write down the fundamentals of your business and how it works. A one-page plan should cover:

  • Value proposition
  • Market need
  • Your solution


Target market.

  • Sales and marketing
  • Budget and sales goals
  • Team summary
  • Key partners
  • Funding needs

A one-page business plan is a great jumping-off point in the planning process. It’ll give you an overview of your business and help you quickly refine your ideas.

If you’re ready to work on your one-page plan, check out our guide to writing a one-page business plan . It has detailed instructions, examples, and even a free downloadable template .

When do you need a more detailed business plan?

A one-page plan doesn’t always capture all the information that you need, however. If that’s the case, then it may be time to expand into a more detailed business plan.

There are several reasons for putting together a detailed business plan:

Flesh out the details 

A one-page business plan is just a summary of your business. If you want to document additional details such as market research, marketing and sales strategies, or product direction—you should expand your plan into a longer, more detailed plan. 

Build a more detailed financial forecast

A one-page plan only includes a summary of your financial projections. A detailed plan includes a full financial forecast, including a profit and loss statement , balance sheet , and cash flow forecast —one of the most important forecasts for any business.

Be prepared for lenders and investors

While investors might not ask to actually read your business plan, they will certainly ask detailed questions about your business. Planning is the only way to be well-prepared for these investor meetings.

Selling your business

If you’re selling your business, a detailed business plan presentation will be part of your sales kit. Potential buyers will want to know the details of how your business works, from marketing details to your product roadmap.

A powerful, data-driven process anyone can use. Explore Growth Planning

How to write a detailed business plan

When you do need to write a detailed business plan, focus on the parts most important to you and your business. If you plan on distributing your plan to outsiders, you should complete every section. But, if your plan is just for internal use, focus on the areas that will help you right now.

For example, if you’re struggling with marketing, spend time working on your target market section and marketing strategy and skip the sections covering the company organization.

Let’s go step-by-step through the sections you should include in your business plan:

1. Executive summary

Yes, the executive summary comes first in your plan, but you should write it last, once you know all the details of your business plan. It is truly just a summary of all the details in your plan, so be careful not to be too repetitive—just summarize and try to keep it to one or two pages at most. If you’ve already put together a one-page business plan, you can use that here instead of writing a new executive summary.

Your executive summary should be able to stand alone as a document because it’s often useful to share just the summary with potential investors. When they’re ready for more detail, they’ll ask for the full business plan.

For existing businesses, write the executive summary for your audience—whether it’s investors, business partners, or employees. Think about what your audience will want to know and just hit the highlights.

The key parts of your plan that you’ll want to highlight in your executive summary are:

  • Your opportunity: This is a summary of what your business does, what problem it solves, and who your customers are. This is where you want readers to get excited about your business
  • Your team: For investors, your business’s team is often even more important than what the business is. Briefly highlight why your team is uniquely qualified to build the business and make it successful.
  • Financials: What are the highlights of your financial forecast ? Summarize your sales goals , when you plan to be profitable, and how much money you need to get your business off the ground.

2. Opportunity

The “opportunity” section of your business plan is all about the products and services that you are creating. The goal is to explain why your business is exciting and the problems that it solves for people. You’ll want to cover:

Mission statement

A mission statement is a short summary of your overall goals. It’s a short summary of how you hope to improve customers’ lives with your products and services. It’s a summary of the aspirations of your business and the guiding north star for you and your team. 

Problem & solution

Most successful businesses solve a problem for their customers. Their products and services make people’s lives easier or fill an unmet need in the marketplace. In this section, you’ll want to explain the problem that you solve, whom you solve it for, and what your solution is. This is where you go in-depth to describe what you do and how you improve the lives of your customers.

In the previous section, you summarized your target customer. Now you’ll want to describe them in much greater detail. You’ll want to cover things like your target market’s demographics (age, gender, location, etc.) and psychographics (hobbies and other behaviors). Ideally, you can also estimate the size of your target market so you know how many potential customers you might have.

Every business has competition , so don’t leave this section out. You’ll need to explain what other companies are doing to serve your customers or if your customers have other options for solving the problem you are solving. Explain how your approach is different and better than your competitors, whether it’s better features, better pricing, or a better location. Explain why a customer would come to you instead of going to another company. 

3. Execution

This section of your business plan dives into how you’re going to accomplish your goals. While the Opportunity section discussed what you’re doing, you now need to explain the specifics of how you’re going to do it.

Marketing & sales

What marketing tactics do you plan to use to get the word out about your business? You’ll want to explain how you get customers to your door and what the sales process looks like. For businesses that have a sales force, explain how the sales team gets leads and what the process is like for closing a sale.

Depending on the type of business that you are starting, the operations section needs to be customized to meet your needs. If you are building a mail-order business you’ll want to cover how you source your products and how fulfillment will work .

If you’re building a manufacturing business, explain the manufacturing process and the facilities you need to use. This is where you’ll talk about how your business “works,” meaning, you should explain what day-to-day functions and processes are needed to make your business successful.

Milestones & metrics

Until now, your business plan has mostly discussed what you’re doing and how you’re going to do it. The milestones and metrics section is all about timing. Your plan should highlight key dates and goals that you intend to hit. You don’t need extensive project planning in this section, just key milestones that you want to hit and when you plan to hit them. You should also discuss key metrics: the numbers you will track to determine your success.

Use the Company section of your business plan to explain the overall structure of your business and the team behind it.

Organizational structure

Describe your location, facilities, and anything else about your physical location that is relevant to your business. You’ll also want to explain the legal structure of your business—are you an S-corp, C-corp, or an LLC? What does company ownership look like?

Arguably one of the most important parts of your plan when seeking investment is the “Team” section. This should explain who you are and who else is helping you run the business. Focus on experience and qualifications for building the type of business that you want to build. 

It’s OK if you don’t have a complete team yet. Just highlight the key roles that you need to fill and the type of person you hope to hire for each role.

5. Financial plan and projections

Your business plan has now covered the “what”, the “how”, and the “when” for your business. Now it’s time to talk about money. What revenue do you plan on bringing in and when? What kind of expenses will you have?

Financial Forecasts

Your sales forecast should cover at least the first 12 months of your business and ideally contain educated guesses at the following two years in annual totals. Some investors and lenders might want to see a five-year forecast, but three years is usually enough.

You’ll want to cover sales, expenses, personnel costs, asset purchases, and more. You’ll end up with three key financial statements: An Income Statement (also called Profit and Loss), a Cash Flow Statement , and a Balance Sheet .

If you’re raising money for your business, the Financing section is where you describe how much you need. Whether you’re getting loans or investments, you should highlight what you need, and when you need it. Ideally, you’ll also want to summarize the specific ways that you’ll use the cash once you have it in hand.

6. Appendix 

The final section of your business plan is the appendix. Include detailed financial forecasts here as well as any other key documentation for your business. If you have product schematics, patent information, or any other details that aren’t appropriate for the main body of the plan but need to be included for reference.

Download a business plan template

Are you ready to write your business plan? Get started by downloading our free business plan template . With that, you will be well on your way to a better business strategy, with all of the necessary information expected in a more detailed plan.

If you want to elevate your ability to build a healthy, growing business, you may want to consider LivePlan.

It’s a product that makes planning easy and features step-by-step guidance that ensures you cover everything necessary while reducing the time spent on formatting and presenting. You’ll also gain access to financial forecasting tools that propel you through the process. Finally, it will transform your plan into a management tool that will help you easily compare your forecasts to your actual results.

Using your plan to grow your business

Your business plan isn’t just a document to attract investors or close a bank loan. It’s a tool that helps you better manage and grow your business. And you’ll get the most value from your business plan if you use it as part of a growth planning process . 

With growth planning, you’ll easily create and execute your plan, track performance, identify opportunities and issues, and consistently revise your strategy. It’s a flexible process that encourages you to build a plan that fits your needs.  So, whether you stick with a one-page plan or expand into a more detailed business plan—you’ll be ready to start growth planning. 

Ready to try it for yourself? Learn how LivePlan can help you use this modern business planning method to write your plan and consistently grow your business.

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Noah Parsons

Noah Parsons

Posted in business plan writing, join over 1 million entrepreneurs who found success with liveplan.

  • The Definitive Guide to Writing a Business Plan

writing a business plan step by step

  • Startup Culture
  • Business Skills

Last Updated: July 25, 2023 By TRUiC Team

A cartoon man leans enthusiastically over a desk while writing rapidly

This free step-by-step guide to writing a business plan was built just for you, if you aren't really sure what planning a business is all about. To save time, stress and energy we'll walk you through everything you need to know without fluff or heavy brain work.

Instead, we're focusing on the basics. If you're looking to create a super-dense collegiate 40-page plan, then you should probably take a business planning course at the nearest college.

This guide just covers what your average startup needs to dramatically increase chances of follow-through and success. Enjoy!

Note: Business planning software  can help you write a professional business plan that will lead you to success.

Step 1) Create A Business Plan Shortcut

For the sake of argument, let’s say you’re the most gifted cat burglar on earth-- a real savvy savant of the steal. Put yourself in the mindset where strategy and planning are time-erasing pleasures, delicious treats that reward you with immense prosperity-- not complex tasks that can be skipped or shelved.

Too many entrepreneurs perceive putting a business plan together as some kind of chore. It's not. When the product or service is something you believe in, it’s as awesome as it is for those cat burglars in the movies, except you're plotting honest work.

Fact : It’s possible to create your initial business plan in less than an hour!

Let’s build a “lean plan” that’s simple to create and helps you identify core assets. You start with a pitch, a single page overview which can become your executive summary later on. It’s your business strategy all on one page that's easy to update as you evolve.

You may be thinking,

“ Wait a minute. If I’m not raising money from investors, why do I need a pitch? ”

Well, after years working with entrepreneurs we've found a pitch is really the ideal format to document your business idea , share it with others, and quickly adjust as you learn more about/analyze how you’re going to build your brand.

Furthermore, once you have your pitch done you can easily convert it into a presentation-ready business plan with massive clarity. To begin, follow the simple outline below or allow tools like LivePlan (what we used for Startup Savant) to walk you through the entire process with examples and video tutorials.

What To Include in Your Pitch

As you tackle your one-pager, mentally channel Twitter and try to keep each section as short/concise as possible-- the size of a solid tweet.

  • Mini-Pitch : Typically a refined sentence summarizing your USP (unique selling proposition).
  • Market Need : The problem your business solves for your customers.
  • Your Solution : How you’re solving the problem through your products and services.
  • Primary Competition : The products and services your customers choose today instead of yours.
  • Target Market : This is where you detail your ideal client and niche.
  • Sales & Marketing : How you plan on marketing.
  • Budget & Sales Goals : How much do you project/calculate you’ll sell and how much is it going to cost to make your product or deliver your service? Also, show other key expenses when your business is up and running.
  • Milestones : What you’ve achieved so far and your major goals for the next few months and years.
  • Team : Why you and your team are the right people to make your company successful.
  • Partners & Resources : List primary companies/organizations needed to go the distance.
  • Funding Needs : If you need to raise money, how much and where will this capital be going (channels)?

That might seem like a fair amount of work if you’ve never put together a real pitch before, but remember, that’s just one page of content. Another way to look at it is a one page resume for your business.

A Couple Writing Tips

First, you start with the putty. Don’t try to self-edit or curate, just barf everything out on paper as it flows from your brilliant mind. Format each section out and just let it go. That’s putting the basic shape together.

Now you need to let it dry, so walk away for a day (week) or two. After that, begin chipping away and condensing. Cut the fat and keep tightening the ideas until you’re down to one page. Be brutal! Stick to the facts. Numbers are easier, but when you’re tackling words remember the average person these days has a shorter attention span (if not compelled by your ideas) than a goldfish.

Taking Action on This Step

Create a pitch outline from the points mentioned above and refine down to one or two sentences. If you need help, check out LivePlan. It’s a solid tool that walks you through the entire process. Plus, they offer a 50% Discount .

Step 2) What To Include in Your Plan

Now that you have a running outline, it’s time to go deeper into the framework of your platform.

Perhaps you’re thinking the one-page pitch is all you’ll need? That would be like going on a road trip in unfamiliar territory with a map that only shows destinations-- no routes, no roads, no other icons whatsoever. Even if you never plan on showing this to anyone, the process of creating a solid plan optimizes everything about you and your business! Here’s a quick overview of what you need to include in your business plan:

  • Cover Page/Pitch
  • Executive Summary
  • Products & Services
  • Target Market
  • Marketing & Sales Plan
  • Milestones & Metrics
  • Company & Management Team
  • Financial Plan

If you need extra space for product images, detailed financial forecasts, or general additional info, use the appendix. There are three layers of complexity here. First, your pitch with a very brief summary. Then, your Executive Summary that adds details and context. Then into the finer points of the overall business plan.

Not too shabby, right?

Taking Action on The Step

Please revisit your pitch and find a good way to optimize it just a smidgen. The better your pitch, the better the overall plan.

As you fill in the structure, first focus on providing “mental barf” data you can go through and optimize later. Remember, if you need help, LivePlan will walk you through the entire process with video tutorials and examples.

Step 3) Create a Unique Selling Proposition

When copywriters are given a business idea to optimize, they often begin by defining the USP (unique selling proposition) and mini-pitch. A USP can be just a couple words or an incomplete sentence, while the mini-pitch is usually one or two concise sentences.

Just in case you’re fuzzy on the whole copywriter thing, these folks are paid big bucks to write sales and marketing copy which often includes core slogans.

As an example, here’s what the USP and Pitch for Startup Savant sound like:

USP : " Entrepreneurship Simplified "

Pitch : " Startup Savant is a free website that shows you how to start a business and own your future ." Now let’s get past the “How to Write Your USP 101” stuff and dive straight into three core truths.

USPs & Pitches Evolve

The first thing a copywriter will tell you if you’re struggling with this is to relax. They know sales and branding copy optimizes (matures) over time, especially in the first 2-5 years in business.

If possible, avoid thinking your USP is set in stone, never to be altered. It’s more like a sculpture that the market chips away at. Your pitch evolves as you and your platform do. What matters is whether your USP & Pitch are as refined as they can be based on where you are now.

  • USPs can be creative & full of personality, but they also need to make sense.
  • Is your pitch wordy and confusing? Hazy or unclear?
  • Sometimes you have the right words, they just need to be in an optimized order.

Always be ready to “kill your darlings” as copywriters would say. Meaning, get rid of any and all words,

“ That aren’t necessary for the idea or concept you’re conveying to make perfect sense within the context it’s delivered, and to whom it’s being written to. ”

You can begin with half a page, but systematically chisel down to a core concept like, Entrepreneurship Simplified.

Your Ideal Customers Will Do It For You

Copywriters care what you have to say as a business owner or marketing manager, but they know you’re not the ultimate authority in terms of advertising copy.

They’re writing for buyers. In any and all ways your business can optimize over the years, your customers, clients and users should steer the course as much as possible. Be on the lookout for their valuable signals and indications!

Hop at 20 Questions

Copywriters ask TONS of questions. They’re a bit like copy-detectives in how they search high and low for very precise data from their clients. Never fear giving your users, clients or customers a megaphone with which to bark their concerns.

We all love sharing our opinions, right? Yes we do. Let us. Prompt us. Ask us. Bribe us with incentives and discounts… then listen… carefully. Easily 9 out of 10 entrepreneurs are given the ultimate USPs on silver platters by their customers but fail to recognize when they see, read, or hear them.

  • If you’ve been stressing on your USP, relax. If it doesn’t feel perfect right now, or 100% distilled, let it happen naturally.
  • Your audience can and will steer the course if you choose to notice their cues. Ask three people you haven’t spoken to before how they feel about your product or service.
  • Are there any indications out there waiting to be plucked? Blog or social media comments and reviews are primary starting points. It only takes one solid indicator for the magic “pivots” to cause your business or brand to see huge boosts.

Step 4) Crafting the Executive Summary

In brief, what exactly is an executive summary? An executive summary (ES) is an overview of your business and your vision. It comes first in formal/informal business plans and is ideally 1-2 pages.

The ES introduces your business to your reader. If you don’t nail it, no one’s going to read any further. And if an ES sucks, despite it being professionally crafted, then the business model itself needs work or isn’t worth your time. Every ES should include a brief overview of the following:

  • The problem your business addresses.
  • Your solution.
  • Your target market.
  • Why the timing’s right for your brand.
  • Financial forecast highlights, along with initial/current customer acquisition costs (CAC) and lifetime customer value (LCV).

If you’re raising money or presenting to investors, you’ll also want to cover:

  • Your existing team and partners.
  • How much money you’re looking to raise and the type of exit strategies in place.

Ideally your ES should fit on one or two pages and be able to stand alone, apart from your business plan. A common strategy is to send your ES out to investors/family/friends and then the complete plan if more detail is requested.

Remember to try and position your writing for people who don’t know anything about your business before they start reading. Explain things simply so that anyone can understand your opportunity, whether they be an in-tune player, an 8th grader, or a grandma.

  • Over the next couple weeks, refresh your ES!
  • Who is the first person you’re going to send your ES to that has no real previous knowledge of what your business is? It helps having someone in mind when writing.
  • Find one amazing ES to read over and see what you can learn from it. Here and here are two great examples.

Well done, in the next step we’ll help you explain your product or service and how it makes an impact on customers.

Step 5) Understanding Customers

Once upon a time there was this lovely, vibrant and ambitious entrepreneur who decided to sell organic breast enlargement cream. It sold well for a while, but then her numbers plateaued, and eventually began to decline.

She knew her business needed a makeover after years in the trenches. So, she created an automated incentive program, a 25% discount coupon code offer sent with every order in exchange for an anonymous review with a photograph. Just a simple before/after image showing the front of their body from neckline to belly button (to confirm usage).

They started rolling in and here are the gems she unearthed :

  • A small portion of her customers were husbands buying a discreet gift for their wives/girlfriends, but most (85%) were transgender folks in transition.
  • For the vast majority of her cis-female customers, larger breasts had more to do with enhancing self-esteem/identity and filling out clothes than attracting mates.
  • Almost 100% really hammered down on the fact her cream was all-natural, organic and didn’t cause irritation or allergic reactions.

She went back and dusted off her original copy she put together years before.

From: “ A certified organic breast enlargement cream. ”
To something more along the lines of: “ Increase confidence and femininity through an organic non-allergenic breast enlargement cream. ”

When stuck in a rut, and we all get there as entrepreneurs, the quickest and most effective way out is to look at your predicament from different perspectives.

Begin with the fundamental question, “What problem does my product/service solve for customers?” then look deeper and from unique angles. Who are your buyers? They have the answer. And remember, actions speak louder than words.

Oftentimes we rationalize buying things for one reason, but in reality have a more potent ulterior motive. Sure, her customers want larger breasts, that’s what prompt initial sales. But the needs her product solves in their day-to-day lives are more interesting. It actually made her customers feel more confident, happy, and healthy.

Find one deeper way your product or service materializes in everyday life for your customers. Pay close attention to the simple verbiage you and others use to describe it, e.g. “Your earphones really get rid of all the noise on the bus.”

If possible, get hold of one fresh buyer perspective. Who and where are they? That woman in our example had spent years excluding nearly half her customer base in her advertorial copy. Do you use your own product or service? If so, find a way to record yourself explaining it in the most natural language possible. Use a smartphone or leave yourself a voicemail. Then, just listen.

But wait, what if you’re just starting out and don’t have much to draw on in terms of direct customer or user feedback? Glad you asked! In the next section we’re going to talk about competition, which is another valuable source of indicators.

Step 6) Leveraging Competition

What products and/or services are people choosing instead of yours?

Whether you’re new to the market or not, these so-called “competitors” are really the ideal source of optimization for your brand. And it’s not about being better per se. All things equal, it’s more about uniqueness.

Would you rather be a prettier, more flashy brand trying desperately to stand out, or develop intense brand-character that the right people notice? Once you’ve narrowed down your competitors, look at them from new angles to discover what makes you distinctive.

  • Can they help you better define your target market/sub-markets?
  • How effective are their social media marketing methods and website copy?
  • What do you know about their buyers’ needs?
  • What do they make “stand out” when shoulder to shoulder with your brand?

A common practice entrepreneurs use in pitch presentations to venture capitalists or investors is the Comparison Matrix.

Comparison Matrix

You’ve seen these a zillion times. In short, list your competitors across the top of the page and your features and benefits along the side, then check the boxes for which company offers each. Don’t forget you can be creative here. You may even already use one of these on your website, or within some other marketing media.

  • Could these features and benefits be communicated in different, more compelling ways?
  • What real need-based copy is being left out?
  • How can you simplify it? An easy way is to reduce the number of competitors, so shoot for less players with more interesting copy.

Got time to put something simple together? In reality what we’re looking for are the things about your competitors that help you stand out.

  • Think about your biggest competitor: what do they make obvious about your brand?
  • What are you doing with more personality from the perspective of ideal clients or customers?
  • Could you take your primary competitor’s copy and make it clearer, or more optimized?

All in all, understanding your competition is an important part of the planning process. This is where you find your true competitive advantage.

For a more in-depth look at how you stand up to the competition, check out LivePlan's Benchmark feature. You can see at-a-glance how you compare to companies just like yours. Tell LivePlan your industry and location, and it shows if/how you're doing better or worse than your competition.

Now let's talk about your unique marketing approach. This will help you stand out and connect with your customers on multiple levels.

Step 7) Create a Marketing Plan

Fred is a brand spanking new entrepreneur with a neat new fitness product he believes is going to make a big splash.

He knows exactly who his ideal customers are and his niche is carved out like a Renaissance marble sculpture. Fred’s also managed to get his hands on $100k in debt-free funding (don’t ask us how, this is hypothetical)…

  • His product costs exactly $32 to source, make and package.
  • To be competitive, and account for shipping/processing, he’s going live at $55.
  • Initial margin is about $13 per sale.

Admittedly, that would be pretty amazing, but that’s because we’re coming from a standpoint of experience. Fred’s just showing up to the 21st-Century party. He’s never built, owned, or managed a business before, let alone an ecommerce platform.

He’s never outsourced a graphic artist or content writer before; never had to choose which analytic dashboard to use; never designed a conversion model or tangled with paid advertising platforms. Let’s say Fred called and begged us to lunch. We accepted. And so there we are, the three amigos with Fred sitting on a huge meal ticket drooling for answers.

“ How Do I Market My Product? ”

Once the table conch gets passed to us, we’re going to hit him hard with massive bombshells:

  • Tight responsive funnels can be constructed in a couple months with the right designer, or design agency (website, landing pages, ecommerce setup, branding packages, etc.).
  • Initial market testing and adjustment can be bootstrapped.
  • There are a variety of intuitive and relatively simple software tools, apps, plugins, add-ons, and cloud-based solutions that range from free to expensive.
  • It takes a savvy mix of highly-focused content, social exposure and paid advertising.
  • It takes a team.

Question is, what advice would you give Fred? That’s what we’d like you to consider. And it needs to be marketing-based. The money’s there, the production system’s in place, it’s just a matter of reaching his fitness-based audience and selling.

Let’s imagine Fred’s offered you a lifetime, no questions asked, 5% share of his company from now till doomsday. All you have to do is provide valuable direction in these three areas:

  • Content : What kind of content should he invest in? Blogs, video, infographics, imagery, etc.
  • Social : How to handle social media if he a) doesn’t have the time, b) has no clue what works?
  • Paid Advertising : AdWords? Facebook? TV? Magazine ads? How does he get to buyers?

Just let your mind wander, and don’t worry, in the next section we’ll talk about setting milestones for your business.

Step 8) Set Milestones

If there’s one specific part of the entrepreneurial journey that we get really nerdy about, it’s the way people verbally describe their trials and successes. We’re listening intently for clues as to how they set milestones and metrics and then track them.

Let's spend some time pondering the way(s) you’re measuring your journey and how you approach KPIs (key performance indicators) in relation to both your marketing and your competition. Or, if you’re trying to figure out how viable a product idea is, how you’re calculating acceptable setbacks and struggle.

What have you achieved so far and what are your major goals for the next few months or years?

Sure, it’s cliché to talk about tracking milestones in an era of big data, but truth be told too many aspiring entrepreneurs either skip this part until much further down the road when it can’t be ignored anymore, or they only take it seriously in the beginning then fail to stick to the plan.

Avoid Drowning Out Customer Journey!

Of course there are folks who obsess on this part and try to manage a small army of analytic dashboards and amazing software solutions like FreshBooks or Xero.

Once it becomes too much they end up transforming their perspective of the customer journey from something organic into a mesh of math and graphs. Most of their day is spent pouring over dense numbers or marketing data and trying to figure out how to alter this metric or that.

  • How many of your milestones are focused entirely on your customers instead of you and your business?
  • Instead of views, likes, and shares, what about the amount of service calls you’re getting? How many people are actually reaching out with questions and concerns?
  • How well do your metrics allow you to understand each part of their trek from initially discovering your business to making a purchase?

Find ways to do more with less data. It’s always within reach these days, especially when you’re tuned in to your customers!

  • Find one way to streamline how you’re dealing with milestones/metrics, or how you intend to.
  • Also, look for one single way to be more holistic in your approach to setting goals.
  • Find a part of your customer journey/behavior and decide if current metrics help or hinder it.

Need help in this area? LivePlan has a really impressive dashboard  to help you set goals and stay accountable over the lifetime of your business. This dramatically increases your chances of success.

Step 9) Refine Aquisition Costs

Without question, failure to clearly know the cost of acquiring customers is a mighty new business demolisher. It’s crushed more entrepreneurial dreams than every economic collapse combined since the creation of fiat currency. To come to grips, or optimize your Customer Acquisition Costs (CAC), begin by figuring out exactly how you’re reaching customers.

Or, if you’re building an initial business plan, how much will it cost to reach buyers on the platforms where they spend their time? Your financials should easily allow you to calculate CAC.

Now, in the simplest terms here’s how:

  • Take (estimate) the entire cost of sales and marketing over whatever period of time you’re dealing with, for example when forecasting sales and financials. Make sure to include salaries and any other headcount-related costs.
  • Divide that number by the amount of buying customers/clients/users that were acquired within this time.

If you happen to run a purely web-based business, headcount likely doesn’t need to grow as you scale customer acquisition, but it’s a useful metric to include nonetheless.

The second part of this is your Lifetime Customer Value, or LCV, because in most cases 80% of your revenue will come from 20% of overall customers and happen AFTER the initial sale. Never shortchange the follow-through!

If your CAC is too high, it must be able to come down through optimization. If LCV is horrid, then in the long run it’s an unsustainable business model. Or in other words, once CAC exceeds LCV, something needs to change or you’ll have to close shop.

  • Begin looking at one stream of cost per lead. So for example, maybe a Google AdWords or Facebook advertising campaign.
  • What’s one single way you could get more in touch with a hot-spot within your customers’ buyer experience?
  • Let your mind stew a little on the level of ‘touch’ required to increase LCV. How can you up-sell or generate more revenue from each customer long term?

After you make these calculations three or four times, it starts becoming second nature. LivePlan's forecasting  handles this pretty well. It walks you through creating expenses that are a certain percentage of sales.

Step 10) Forecast Sales

Smart entrepreneurs start forecasting sales early on.

And while ‘the numbers’ part of business planning can be intimidating, this exercise is definitely a small mountain worth karate chopping down.

Keep in mind that if you get stuck at any point, LivePlan's Forecasting and Budgeting  feature is extremely helpful. Whether you're starting a bakery, a subscription software business, or a manufacturing company, LivePlan walks you through the entire forecasting process within a few clicks.

How Detailed Does it Need to Be?

Don’t be too generic and just forecast sales for your entire business. But on the other hand, don’t go nuts and create a forecast for everything you sell if you’ve got a large assortment.

For example, if you’re starting a restaurant you don’t want to create forecasts for each item on the menu.

Instead, focus on broader categories like lunch, dinner, and drinks. Or if you’re starting a clothing brand, forecast key categories like outerwear, casual wear, and so on.

Top-Down or Bottom-up?

In our humble opinion, forecasting “from the top down” can be costly. What that means is figuring out the total size of the market you’re in and trying to capture a small percentage.

For example, in 2015, more than $1.4 billion smartphones were sold worldwide. It’s pretty tempting for a startup to say they’re going to get 1% of that total market. After all, 1% is such a tiny little sliver it’s got to be believable, right?

The problem is this kind of guessing isn’t based on reality. Sure, it looks like it might be credible on the surface, but you have to dig deeper.

  • What’s driving those sales?
  • How are people finding your new smartphone company?
  • Of the people that find out, how many will buy?

Instead of “from the top down,” do a “bottom-up” forecast. Just like the name suggests, bottom-up starts at the bottom and works its way up to a forecast. Start by thinking about how many potential customers you might be able to make contact with.

This could be through advertising, sales calls, or other marketing methods. Of the people you can reach, how many do you think you’ll be able to bring in the door or get onto your website?

And finally, of the people that come in the door, get on the phone, or visit your site, how many will buy?

Here’s an example:

  • 10,000 people see my company’s ad online,
  • 1,000 people click from the ad to my website,
  • 100 people end up making a purchase.

Obviously, these are all nice round numbers, but it should give you an idea of how bottom-up forecasting works. The last step of the bottom-up forecasting method is to think about the average amount that each of those 100 people in our example ends up spending (remember LCV).

On average, do they spend $20? $100? It’s fine to guess here, and the best way to refine your guess is to go out and talk to potential customers. You’ll be surprised how accurate a number you can get with a few simple interviews.

How Far to Forecast

Try forecasting monthly for a year into the future and then just annually for another three to five years.

The further your forecast into the future, the less you’re going to know and the less benefit it’s going to have for your company. After all, the world’s going to change, your business is going to change, and you’ll be updating your forecast to reflect them.

And don’t forget, all forecasts are wrong—that’s fine. Your forecast is just your best guess at what’s going to happen. As you learn more about your business and your customers, you’ll adjust. It’s not set in stone.

  • First, remind yourself that ALL forecasts are wrong. Forecasting is more about learning and evolving.
  • Without adding too much to your plate, take a look at your monthly sales chart and see what kinds of optimizations forecasting might bring to light. If you aren’t already charting sales, start today or begin planning how.
  • Try two easy bottom-up projections with nice round numbers to get the feel for it.

Just remember that sales forecasting doesn’t have to be hard. Anyone can do it and you, as an entrepreneur, are the most qualified to do it for your business. You know your customers and you know your market, so you can forecast your sales.

But if you decide you'd appreciate help, we highly recommend forecasting your sales with LivePlan. LivePlan  automatically generates all the charts and graphs you need and automatically includes them in your plan.

Wrapping Up: Formatting Your Plan

The format of your business plan is critical. It goes a long way toward refining and achieving your goals: raising money, setting the strategy for your team and growing your platform. That being the case, let's breeze through seven tips that can help you create, refine, and optimize your brilliant business plan.

1. Always Start with Your Executive Summary

An ES should be written for ideal readers, customers, potential investors or team members, or even just to help you ‘goal-map’ your way to where you need to be. Regardless, nailing the Executive Summary is critical in terms of understanding the potential behind your business idea.

2. End with Supporting Documents

The appendix is composed of key numbers and other details that support your plan. At a minimum, your appendix should include financial forecasts and budgets. Typically, it’s wise to include a Profit & Loss statement, Cash Flow forecast, and a Balance Sheet. With practice and a smidgen of savvy software like LivePlan these pages can take a couple hours or so.

You might also use your appendix to include product diagrams or detailed research findings, depending on your business, your industry, and how deep your business plan needs to go given the reader/purpose.

Quick Recap of the Lineup Pitch Executive Summary Products & Services Target Market Marketing & Sales Plan Milestones & Metrics Company & Management Team Financial Plan & Appendix

3. Keep it Short

Let’s face it: no one has time to read a 40-page business plan. If you’ve nailed your ES, you’ll want to follow up with 8 to 12 additional pages at most in support. Instead of trying to cram everything in using small fonts and tiny margins, focus on trimming down your writing (‘kill your darlings’). Use direct, simple language that gets to the point.

4. Get Visual

As the old adage goes, “ A picture is worth a thousand words. ” This is especially true when you’re formatting a business plan. Use charts and graphs to explain forecasts. Add pictures of your product(s). Again, there are plenty of software solutions that make it easy to do more showing and less telling. That said…

5. Don’t Obsess on Looks

It’s your ideas that matter. A beautiful plan that talks about an ill-conceived business with incomplete financial forecasts is never going to beat a plan that’s formatted poorly but discusses a great, clearly explained vision. Spending days making a beautiful plan isn’t going to make your business ideas better. Instead, focus on polishing the words. Trim extra content you don’t need, and make sure ideas are well-presented.

6. Keep Formatting Simple

  • For general formatting use single spacing with an extra space between paragraphs.
  • If you’re printing your plan, use a nice serif font like Garamond or Baskerville.
  • If your plan will mostly be read on a computer screen, go with a sans serif font like Verdana or Arial.

Why choose different fonts for on-screen versus off-screen? Well, research shows readers have higher comprehension when they read a document with a serif font on paper, and higher comprehension reading with a sans serif font on a screen.

Don’t stress too much about this, though. Choose any one of the four fonts mentioned above and move forward.

  • For font size, 10 to 12 point is usually ideal and readable for most people. If you need to reduce the font size to make your plan shorter, then you should be cutting content, not adjusting the font size.
  • The same rule goes for margins: use typical one-inch margins to make the plan readable.

Cover pages are always a good idea, too. Use the cover page to show off your logo, tagline, and pitch.

Finally, make sure your plan document flows well and doesn’t have any “widows” or “orphans” when it prints out. A “widow” is when the last line of a paragraph appears alone at the top of a page, and an “orphan” is a single word that gets left behind at the bottom of a paragraph.

7. Get a Second Pair of Eyes

The last piece of advice is to get a second pair of eyes. When you’re the only one working on your plan, you can become blind to common errors. Recruit a friend or family member, or even hire a copy-editing professional to give it that last bit of polish. There’s nothing worse than a plan with grammatical or spelling errors. A second pair of eyes will go a long way toward catching the majority of those potential problems or holes.

  • Who’s your second, third, and possibly fourth pair of eyes going to be?
  • What’s one part of your business plan you could optimize today?
  • What’s one piece of visual content you could add to your appendix?

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How to write a perfect business plan

How To Write A Business Plan In Just 9 Simple Steps

A good business plan should have information about what your company wants to achieve, what it sells or does, and how it manages money.

In the world of entrepreneurship, a well-crafted business plan serves as your North Star, guiding your startup from conception to success. Whether you’re seeking investors or simply aiming to align your team’s efforts, a solid business plan is essential. In this comprehensive guide, we will walk you through the process of creating a business plan that not only impresses but also drives your venture forward.

business plan

What is a business plan?

Click to view real business plan samples or examples, the importance of a business plan, types of business plan, one page business plan template, lean business plan template, 1. crafting the perfect executive summary, 2. painting a vivid business picture, 3. mastering market analysis, 4. presenting your products or services, 5. the road to sales and marketing success, 6. building a winning team, 7. funding request (if applicable), 8. navigating financial projections, 9.supporting documents in the appendix, how to write a business plan (2023 guide), how to write a winning business plan, tips for success, leveraging a business planner: your path to a strong business plan.

A business plan is a comprehensive document that outlines a company’s goals, strategies, financial projections, and other key details to guide its operations and attract investors or lenders.

bank business plan sample

Before we delve into the specifics, let’s first understand why a business plan is so crucial for any business endeavor. A business plan is more than just a document; it’s a strategic tool that helps you define your business goals, chart your course of action, and secure the resources necessary for success. It serves as a communication tool, providing clarity to stakeholders, from potential investors to your internal team.

  • One Page Business Plans .
  • Start-ups Business Plans.
  • Strategic Business Plans.
  • Feasibility Business Plans.
  • Internal Business Plans.

Before we start learning how to make a business plan, let’s see what a business plan template looks like.

Check out our collection of various business templates.

How to write a Business Plan, Step by Step

  • Crafting the Perfect Executive Summary
  •  Painting a Vivid Business Picture
  • Mastering Market Analysis
  • presenting your products and services
  • The Road to Sales and Marketing Success
  • Building a Winning Team
  •  Funding request
  •  Navigating Financial Projections
  • Supporting Documents in the Appendix

Looking for someone to write a Business Plan

It will be helpful to hire someone to write a business plan. Our Award-winning business plan writers will help you achieve your business goals.

Consider this as the opening page of your business plan, akin to your elevator pitch. It should encompass a mission statement, a concise portrayal of your products or services, and a general overview of your financial expansion strategies.

While the executive summary serves as the initial point of engagement for your investors, crafting it towards the end of your business plan may prove more effective. This approach allows you to spotlight insights and details uncovered while working on other sections, resulting in a more comprehensive and compelling summary.

Here’s what should be encompassed in the executive summary of your business plan:

  • Business purpose. What are the core activities of your business?
  • Business objectives and vision. What are your business’s aspirations and goals?
  • Product or service description and distinctiveness. What are you offering, and what sets it apart?
  • Target audience. Who is your customer base?
  • Marketing approach. How do you plan to connect with your customers?
  • Current financial position. What is your current revenue?
  • Projected financial position. What revenue do you anticipate in the future?
  • Funding request. How much capital are you seeking?
  • Team composition. Who are the individuals involved in the business?

Crafting the Perfect Executive Summary

Read more: Executive summary examples

In the Business Description section, you have the opportunity to paint a vivid picture of your business. Here’s what to include:

  • Define your business concept and mission. What problem are you solving, and why does it matter?
  • Introduce your industry and market. Who are your target customers, and what trends are shaping your field?
  • Showcase what makes your business unique and how it stands out in the marketplace.

Painting A Vivid Business Picture

Read more: How to write company overview or description and its  examples

Market analysis is all about understanding your target market and competition. Your goal is to demonstrate that you’ve done your homework. Here’s how:

  • Conduct thorough market research to identify opportunities and threats.
  • Analyze your target demographics, market size, and trends.
  • Identify and assess your competitors’ strengths and weaknesses.

Here are some general guidelines to kickstart your research:

Define your ideal customer profile. Seek government data for insights into your target market’s size, demographics, geographic locations, online behaviors, and purchasing patterns.

Investigate industry trends. Explore consumer and product trends within your industry using resources like Google Trends, trade publications, and insights from industry influencers.

Form educated assumptions. Recognize that you may not have access to perfect, comprehensive data about your entire potential market. Aim to base your estimates on a solid foundation of verifiable data points.

In this section, delve into the specifics of the products or services you provide or intend to provide. Include the following details:

  • A comprehensive explanation of how your product or service functions. Your pricing model for the product or service.
  • An overview of the typical customers you cater to.
  • Insights into your supply chain and approach to order fulfillment.
  • Details about your sales strategy.
  • Your distribution strategy.

Your marketing and sales strategy outlines how you’ll reach and persuade customers to choose your products or services be sure to:

  • Describe your pricing strategy, distribution channels, and promotional efforts.
  • Explain how your marketing and sales plan aligns with your broader business goals.

The Road to Sales and Marketing Success

Read more: how to do market research.

These are the following points you must need to write in the building a winning team section.

  • Leadership Team: Introduce key members of your leadership team, including their names, roles, and a brief description of their professional backgrounds. Highlight their expertise and how it aligns with your business’s goals.
  • Roles and Responsibilities: Specify the responsibilities and functions of each leadership team member. Clearly define who is responsible for what within the organization.
  • Biographical Profiles: Provide concise biographical profiles or resumes for top executives, showcasing their relevant qualifications, experiences, and achievements.
  • Advisory Board (if applicable): If you have an advisory board, describe its composition and the expertise each member brings. Explain how the advisory board contributes to strategic decision-making.
  • Organizational Structure: Present an organizational chart to illustrate the hierarchy and reporting relationships within your company.
  • Succession Planning: Discuss your plans for leadership succession and how you intend to ensure continuity in case of key personnel changes.
  • Team Development: Mention your strategies for team development, including training, mentorship programs, and ongoing skill enhancement initiatives.
  • Cultural Values: Describe the cultural values and principles that guide your organization’s behavior, fostering a positive work environment and alignment with your mission.
  • Ethical Standards: Highlight your commitment to ethical business practices, including integrity, transparency, and adherence to industry regulations.

These are the following points you must need to write in the funding section.

  • Capital Needs: Clearly state the amount of funding you are seeking and the purpose for which you need it. Whether it’s for startup costs, expansion, working capital, or specific projects, provide a detailed breakdown.
  • Use of Funds: Specify how you plan to utilize the funds you’re requesting. Describe the allocation of funds for various purposes, such as equipment purchase, marketing campaigns, staffing, or research and development.
  • Financial Projections: Align your funding request with your financial projections. Explain how the injection of capital will impact your revenue, profitability, and growth. Back your projections with realistic and data-backed assumptions.
  • Timeline: Outline the timeline for when you need the funding and when you expect to achieve specific milestones or goals with the injected capital.
  • Repayment Plan (if applicable): If the funding request involves loans or investments with repayment terms, provide details on your repayment plan, including interest rates, repayment schedules, and collateral if applicable.
  • Exit Strategy (if applicable): If investors are involved, discuss your exit strategy. Explain how they can expect to realize a return on their investment, whether through acquisition, IPO, or other means.
  • Investor Benefits: Describe any additional benefits or perks that investors might receive, such as equity ownership, voting rights, or participation in decision-making processes.
  • Risks and Mitigations: Acknowledge potential risks associated with the funding request and explain how you plan to mitigate these risks, providing reassurance to potential investors.
  • Supporting Documents: Include any supporting documents, such as financial statements, pro forma financials, or valuations, to substantiate your funding request and the financial health of your business.

Funding Request

Read more: ways to find investors for your business

If you’re a startup, you might have limited financial data available. However, for established businesses, it’s essential to provide financial documentation, including income or profit-and-loss statements, a balance sheet detailing assets and liabilities, and a cash flow statement illustrating cash inflows and outflows.

You can also incorporate key financial metrics such as:

  • Net profit margin: representing the percentage of revenue retained as net income.
  • Current ratio: assessing your liquidity and debt repayment capacity.
  • Accounts receivable turnover ratio: measuring the frequency of receivables collection annually.

Consider using charts and graphs in this section to visually convey your business’s financial status, making it easier for readers to grasp.

Navigating Financial Projections

The appendix is where you can include any additional information that supports your plan. This may include:

  • Resumes of key team members.
  • Detailed market research data.
  • Any other documents that add credibility to your plan.

Free: Business Plan Examples

Do you need help creating a business plan? Check out these 14 free, proven business plan examples from different industries to help you write your own.

Crafting a business plan is a crucial step in shaping the future of your venture. To get started, begin with brainstorming an executive summary that succinctly captures your business’s essence. Then, create a company description that paints a vivid picture of your organization. Moving forward, articulate your business goals, ensuring they are specific, measurable, and attainable. Conduct thorough market research to understand your target audience and industry landscape. Next, delve into the financial plan, projecting revenue, expenses, and funding needs. Ultimately, it’s all about the bottom line – your plan should culminate in a clear strategy for financial success. Brainstorming an Executive Summary sets the stage, followed by Creating a Company Description to provide context. Articulating Your Business Goals defines your vision, and Conducting Market Research equips you with essential insights. Building a Financial Plan lays out the financial roadmap, and ultimately, it’s all about the Bottom Line – summarizing your strategy for financial success.

A solid plan provides clarity of vision, outlines strategic goals, and attracts investors. Key components include a compelling executive summary, detailed market research, product/service descriptions, marketing strategies, financial projections, and funding requirements. By incorporating these elements, you’ll be well-prepared to outrank competitors and achieve your entrepreneurial goals.

  • Keep your plan concise and focused on the most important details.
  • Back up your claims with data and market research.
  • Seek feedback from mentors, advisors, or industry experts.
  • Regularly review and update your plan to reflect changing circumstances.

While crafting a business plan independently is commendable, seeking the guidance of a skilled business planner can be a game-changer. A business planner or advisor brings expertise, objectivity, and a fresh perspective to your planning process. Here, we explore how collaborating with a business planner can enhance your business plan’s quality and increase your chances of success:

  • Expert Insights: A seasoned business planner possesses a deep understanding of market dynamics, industry trends, and successful business strategies. They can provide valuable insights and knowledge to refine your plan.
  • Objective Evaluation: An external business planner can offer an unbiased assessment of your ideas and strategies, helping you identify weaknesses and refine your approach.
  • Customized Solutions: Business planners tailor their advice to your specific business needs, helping you create a business plan that aligns perfectly with your goals and resources.
  • Financial Expertise: Many business planners excel in financial analysis, ensuring that your financial projections are realistic and well-supported.
  • Network and Resources: A business planner may have an extensive network and access to resources that can benefit your business, from potential investors to industry connections.

To draft an effective business plan, start with a clear executive summary that outlines your business’s purpose and potential. Conduct thorough market research to understand your industry and target audience. Then, detail your strategies, financial projections, and risk mitigation plans, providing a comprehensive roadmap for your business’s success.

A business plan is a detailed document that outlines your business goals, strategies, and financial projections. It’s essential for securing funding, guiding your business’s growth, and attracting investors.

Business justification is vital as it provides solid reasoning and evidence behind key decisions, enhancing plan credibility and showcasing strategic thinking.

A typical business plan includes sections on the executive summary, company description, market analysis, product/service details, marketing strategy, management team, financial projections, and an appendix.

While the length can vary, a typical business plan is around 20-30 pages. However, it’s essential to prioritize clarity and conciseness over length.

The executive summary should provide a concise overview of your business, highlighting its unique selling points, goals, and financial needs. It’s often the first section investors read.

You can gather market data through online research, surveys, interviews, and industry reports. It’s crucial to understand your target audience, competition, and industry trends.

Begin with an executive summary summarizing your business idea. Conduct market research to understand your industry and competition. Outline your business strategies, financial projections, and goals for a comprehensive plan.

Financial projections should include income statements, cash flow forecasts, and balance sheets. They should be based on realistic assumptions, such as sales forecasts, expenses, and funding needs.

While it’s possible to write a business plan independently, many entrepreneurs seek help from business plan writers, consultants, or mentors for expertise and guidance.

Common mistakes include overestimating sales, neglecting market research, not addressing potential risks, and lacking a clear marketing strategy. Proofreading is also crucial to avoid errors.

It’s a good practice to review and update your business plan annually or when significant changes occur in your business, such as expansion, new products, or financial shifts.

Hey Joseph! I liked your explanation of how to write a business plan, but it left me wondering what it would cost to hire a business plan writer?

Thank you for asking a question. we would like to give you our blog link which briefly states on how to hire a business plan writer and all other information regarding cost to write a business plan Thanks for your comment. I hope this will make a change.

Hey, your blog was very detailed. I absolutely had no idea about how product and service segmentation works, I had a potential product but no idea about the market competitors and how to manage the finances. this helped me a lot but still, I have some doubts that how to hire your team. I will be looking forward to your reply. Thank you!

Hey Beckman, Really appreciate your feedback,. If you want to have more detailed information, please visit Financial Plan Tips and product and services plan Please feel free to contact us, these are our contact details

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10 Simple Tips to Write a Successful Business Plan

Posted: September 26, 2023 | Last updated: September 26, 2023

"The absolute biggest business plan mistake you can make is to not plan at all." So writes Noah Parsons in his helpful blog post 17 Key Business Plan Mistakes to Avoid in 2023 . But how does one pull together all of the necessary components of a cohesive plan? It can feel overwhelming.

Eric Butow, CEO of online marketing ROI improvement firm Butow Communications Group, has teamed up with Entrepreneur Media to update the second edition of our best-selling book Write Your Business Plan to provide you with a simple, step-by-step process for creating a successful business plan. In the following excerpt, he gives ten tips to gather all of the critical information you will need to succeed.

1. Know your competition.

You need to name them and point out what makes you different from (and better than) each of them. But do not disparage your competition.

2. Know your audience.

You may need several versions of your business plan. For example, you may need one for bankers or venture capitalists, one for individual investors, and one for companies that may want to do a joint venture with you rather than fund you.

3. Have proof to back up every claim you make.

If you expect to be the leader in your field in six months, you have to say why you think that is. If you say your product will take the market by storm, you have to support this statement with facts. If you say your management team is fully qualified to make the business a success, be sure staff resumes demonstrate their experience.

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4. Be conservative in all financial estimates and projections.

If you feel certain you'll capture 50 percent of the market in the first year, you can say why you think so and hint at what those numbers may be. But make your financial projections more conservative. For example, a 10 percent market share is much more credible.

5. Be realistic with time and resources available.

If you're working with a big company before you buy a business, you may think things will happen faster than they will once you have to buy the supplies, write the checks, and answer the phones yourself. Being overly optimistic with time and resources is a common error entrepreneurs make. Being realistic is important because it lends credibility to your presentation. Always assume things will take 20 percent longer than you anticipated. Therefore, twenty weeks is now twenty-four weeks.

6. Be logical.

Think like a banker and write what they would want to see.

7. Have a strong management team.

Make sure it has good credentials and expertise. Your team members don't have to have worked in the field. However, you need to draw parallels between what they've done and the skills needed to make your venture succeed. Don't have all the skills you need? Consider adding an advisory board of people skilled in your field and include their resumes.

Write Your Own Business Plan is available now at Entrepreneur Bookstore | Barnes & Noble | Amazon

8. Document why your idea will work.

Have others done something similar that was successful? Have you made a prototype? Include all the variables that can have an impact on the result or outcome of your idea. Show why some of the variables don't apply to your situation or explain how you intend to overcome them or make them better.

9. Describe your facilities and location for performing the work.

That includes equipment you use to create your products and/or services. If you'll need to expand, discuss when, where, and why.

10. Discuss payout options for the investors.

Some investors want a hands-on role. Some want to put associates on your board of directors. Some don't want to be involved in day-to-day activities at all. All investors want to know when they can get their money back and at what rate of return. Most want out within three to five years. Provide a brief description of options for investors, or at least mention that you're ready to discuss options with any serious prospect.

To dig deeper, buy Write Your Own Business Plan and get 1 month of free access to business planning software Liveplan Premium.

10 Simple Tips to Write a Successful Business Plan

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The Step by Step Guide for Writing a Business Plan

Yash Gupta

Yash Gupta , Abhishek Kumar

A business plan decides the future of a business. It's working, profit, features, everything is provided in a business plan. But there is no universally accepted template of a business plan - it tends to differ from company to company, owner to owner, product to product, and service to service.

Steps in writing a business plan are very very important, which is why you need to learn how to write a business plan step by step. No matter what the format of the document is, certain sections and components just can’t be missed out, which is why everyone must know how to write up a business plan. Since many people don't know how to write a business plan.

This write-up is going to present the important points of an ultimate business plan in parts of Essential sections, business planning tips, and general tips.

Essential Sections Of A Business Plan Sales And Marketing Figure Operating Strategy Executive Summary Target Market Analysis Product Or Service In Question Management And Advisory Committee Financial Summary Future Requirements Competitive Analysis Some Tips And Business Plan Suggestions Avoid These Mistakes While Drafting a Business Plan FAQs

writing a business plan step by step

Essential Sections of a Business Plan

How to start a business plan? The first step to write a business plan is portraying it's Motto and Vision . Quite catchy slides or print-ups with interesting quotes and catchy vocabulary doesn't make it an excellent business plan. Remember, the vision and mission are two important factors of an excellent business plan section, you can also check some samples of a business plan to get an idea of it and come up with your own.

One of the top business plan tips is writing a simple one-liner that exudes the vision of one’s venture, creating a formidable impression on potential investors instead of long descriptive write-ups with no mention of the vision and the motto of business.

Sales and Marketing Figure

As the sharks on "Shark Tanks" say let's talk about numbers because business is all about numbers, isn't it? So this section is an insight into the true potential of the business. It highlights the existing funds raised, predicted sales over the financial year, marketing costs, and ROI, etc, and is an important part of any small business plan.

The key point of writing a business plan is not to exaggerate or bluff data in any way. The tip for writing a good business plan is providing data about the real sales of the business and giving a pictorial representation such as charts and graphs to elucidate the intended message. It's better than creating a large table, spanning over several slides or pages. You can also check the best business plan template to understand how it can be written.

Also, give an estimate of the turnover that the business is planning to make in the upcoming year. This will eventually make the investor ponder about the investment portfolio. These are the main things to remember if you don't know how to write a business proposal.

sales and marketing go hand in hand

Operating Strategy

The major purpose and hassle of creating a business plan is to decide the operating strategy of how the entire business will operate as this is the part of writing a great business plan. Every good business plan will describe the process flow in terms of how the entire business would operate and endeavor. After all, any execution method is best understood when one is aware of its algorithm, in other words how the execution process takes place, because that is what is the bottom line of all the hard work.

writing a business plan step by step

Executive Summary

Many people don't know how to write a business plan executive summary. The ultimate business plan is usually confined to a page or two, the executive summary ought to paint the entire picture without going into further details. The value proposition is an essential component of this summary and shouldn’t be skipped.

It’s advised to write the executive summary after drafting the entire business plan because by picking important ideas from other sections of the document, a concise crux can be formulated. You can follow many guides to writing a business plan or check for a free business plan template to make sure you haven't missed anything.

Target Market Analysis

A no-brainer would be aiming to sell the product or service to everyone out there without any research and analysis which is why writing a business plan is important. This is the main part of how to write a business plan. A niche item would attract only a particular segment of the customers. When you write up a business plan it is necessary to let whoever is reviewing the business plan to figure out the audience that the venture is targeting.

Product or Service in Question

Imagine you are on a flight and don't know the destination of it, will it make any sense? No of course, right? Likewise, without specifying the product and its specifications that the business intends to disseminate, it makes the entire document meaningless. Among all the steps to write a business plan, it is an important step to add specifications of the product.

Are you going to explain a chemistry experiment without specifying the substances and compounds involved? A startup business plan will always have a list of product dimensions, working, identified flaws and workarounds, usage, demand in the market, etc. A description should be mentally stimulating so that the customer can envision the entire thing before owning it.

writing a business plan step by step

Management and Advisory Committee

The business plan must include a section that consists of a short profile of each member involved in the startup/company. This is the top business plan tip as it provides a parameter to evaluate the credibility of the business from the eyes of a VC or Angel Investor . It is the main part of how to do a business plan. The reasoning is clear—the ethics, personality, and various other attributes of the founder and his team are reflected in the final product.

This may seem absurd to some but pondering over it does ring a bell as it is setting up a business plan. Also, if the business is being mentored by some kind of advisory committee, it is a testament to the fact that the business can turn profitable otherwise experienced individuals would have stayed away from guiding such a venture and that is why it is an important part of business plans for any startups.

Financial Summary

Not to be confused with the sales figure section, the financial summary resembles a probable balance sheet and this is one of the top business planning tips. Revenue projections give an idea of the rewards you expect for the efforts you put in running the business because the numbers on the plan will surely speak your company's story to the presenters because as mentioned earlier, numbers play all the game in business. A financial summary is part of a good business plan.

Future Requirements

One reason which makes a businessman work hard is the growth of its business in the future and a sample of the business plan must have this. Even if it is a small business plan, it must have future requirements as the future needs are going to vary when compared to the current ones.

For example, if the investment required at present is a six-digit figure, it may become an eight-digit one to sustain the business as time progresses. However, justification of the predicted requirements ought to be mentioned to make sense. You can check free business plan templates to see how this can be listed out.

writing a business plan step by step

Competitive Analysis

While writing a business plan you don’t want to create a rip-off. The idea is to be unique with one or more unique selling points to stand out from rivals in the same segment. This is among the important steps to write a business plan, an analysis with existing products with nearly the same functionality helps to bring out the USP and also gives you the scale to make your product better than the competitors. Any guide to writing a business plan will have a competitive analysis in it.

Some Tips and Business Plan Suggestions

  • Don’t make the business plan boring by leaving out graphics. Not losing the listener or reader’s attention determines the outcome is one of the best tips for writing a business plan.
  • The best business plans include an appendix to make traversing across the document easily.
  • Executive summary in the beginning or at the end won’t make much of a difference as long as the entire plan is cohesive and is part of a good business plan.
  • There are various types of business plans , you can figure out want you want by looking for the best business plan template. Research about them before choosing a free business plan template.
  • Don’t read it out like a textbook when presenting the plan somewhere. It is one of the main steps in writing a business plan and you should know the key points and themes to sound convincing.
  • Every startup business plan details the strengths and weaknesses of the business, and how you are going to seize the opportunity if provided.
  • One of the other business planning tips is using the same indentation and formatting throughout the document. The sudden transition from a times new roman 16 to comic sans 24 can be disturbing and agonizing.
  • While writing up a business plan, make it a story-based interactive session because no one likes to listen to lectures where you are not allowed to interact. The more people are going to interact, the more they will indulge in your business plan.
  • The most important tip while writing a business plan, be the master of the plan that you have created to monitor your business. Go through each point thoroughly, make sure you are aware of all the numbers, all the future expectations, and anticipations, growth, etc. Make sure you are satisfied with the small business plan you have created.

writing a business plan step by step

Avoid these Mistakes while drafting a Business Plan

Drafting a business plan requires intense focus and integrity as it forms the backbone of the entire business. Many people get confused about how to write a business proposal. Remember that when you are writing a business plan it should outline both the present and future strategy of the business, elucidate necessary points, facts, and stats around which it revolves.

Simply put, it can make or break everything at stake. You can check out the best business plan template to avoid making these mistakes. Here is a list of dont's that should be kept in mind while creating your ultimate business plan:-

Worn out Phrases

Phrases like 'disruptive' and game-changing are over-used and stale; avoid using them in the draft. These words may show what the business is but evade its idea in an actual sense. Avoiding worn-out phrases is a part of the steps to writing a good business plan.

The plan here is to make the readers/clients/investors resonate with the business plan and convey the right message when propagated to others. Moreover, cliched expressions make you sound over-ambitious and over-confident in nature and is not good for a good business plan. It might be the greatest plan on the planet but claims that are beyond your capabilities are a bummer.

Don’t use the word ‘DONE’ to Describe your Business

The theory behind the working of a business plan is that it keeps on going forever; business is a cycle of implement-improve-repeat. Using ‘done’ may put an end to your aspirations outlined in the business plan. If you want an ultimate business plan process then you should PLAN-RUN-REVIEW-REVISE when repeated takes the business to the next level.

This is why when you are writing a great business plan, using the words finished and done makes the plan one-dimensional and less prone to getting success. Always keep it open-ended in nature and sound optimistic throughout the draft and follow all steps in writing a business plan.

Never Calculate the Sales from a Big Market

At the same time, don’t consider the segment you’re targeting as a small percentage of a large market. Forecast the details like stores, distributors, users, subscribers, click and emails, etc. Keep everything upwards, not downwards in business plans for startups.

Avoid Extreme and Unsupported Optimism

Not involving the risk factors involved can be a deranged factor for the company's future if the words mentioned in the business plan take twice as long to make half as much as forecast.

Don't Fill The Business Plan With The Product’s Or Service’s Technical Specification Or Characteristics. Keep it at a minimum. Emphasize more on questions like:

  • What problem are you going to solve for the client?
  • How are you going to solve the problem?
  • What is the product’s value proposition?

Outline the answers to these questions in your business plan. Be careful about what you put in the business plan because it’s your business canvas while setting up a business plan. Deliberate thoroughly, ponder all possibilities and points, don’t make wild claims, stick to the facts, and finally avoid the mistakes explained above!

writing a business plan step by step

What is the most important part of a business plan?

The executive summary is the most important part of your business plan, and perhaps the only one that will get read, so make it perfect! The executive summary has only one objective: get the investor to read the rest of your business plan.

What is in a good business plan?

A company often needs a business plan before it can borrow money from a bank. Good plans are usually highly detailed and include information on all aspects of the business, including the industry, marketing, personnel, finance, and various operating procedures.

What are the 4 types of business plans?

Business plans can be divided roughly into four distinct types:

  • Short plans, or mini-plans
  • Presentation plans or decks
  • Working plans
  • What-if plans

What are the steps to writing a business plan?

Business plan Steps:

  • The executive summary.
  • Who are your customers?
  • Evaluate the target audience.
  • What are your opportunities?
  • Understand the competition.
  • Build a simple financial plan.
  • Include an outline marketing plan.
  • Plan your operations.

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