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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

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

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

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.

Streamline Your Business Planning Activities with Real-Time Work Management in Smartsheet

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When teams have clarity into the work getting done, there’s no telling how much more they can accomplish in the same amount of time.  Try Smartsheet for free, today.

Discover why over 90% of Fortune 100 companies trust Smartsheet to get work done.

How to Write a Business Plan (Plus Examples & Templates)

• 3 years ago

Have you ever wondered how to write a business plan step by step? Mike Andes, told us: 

This guide will help you write a business plan to impress investors.

Throughout this process, we’ll get information from Mike Andes, who started Augusta Lawn Care Services when he was 12 and turned it into a franchise with over 90 locations. He has gone on to help others learn how to write business plans and start businesses.  He knows a thing or two about writing  business plans!

We’ll start by discussing the definition of a business plan. Then we’ll discuss how to come up with the idea, how to do the market research, and then the important elements in the business plan format. Keep reading to start your journey!

What Is a Business Plan?

A business plan is simply a road map of what you are trying to achieve with your business and how you will go about achieving it. It should cover all elements of your business including: 

• Finding customers
• Plans for developing a team
•  Competition
• Legal structures
• Key milestones you are pursuing

If you aren’t quite ready to create a business plan, consider starting by reading our business startup guide .

Get a Business Idea

Before you can write a business plan, you have to have a business idea. You may see a problem that needs to be solved and have an idea how to solve it, or you might start by evaluating your interests and skills. 

Mike told us, “The three things I suggest asking yourself when thinking about starting a business are:

• What am I good at?
• What would I enjoy doing?
• What can I get paid for?”

If all three of these questions don’t lead to at least one common answer, it will probably be a much harder road to success. Either there is not much market for it, you won’t be good at it, or you won’t enjoy doing it. 

As Mike told us, “There’s enough stress starting and running a business that if you don’t like it or aren’t good at it, it’s hard to succeed.”

If you’d like to hear more about Mike’s approach to starting a business, check out our YouTube video

Conduct Market Analysis

Market analysis is focused on establishing if there is a target market for your products and services, how large the target market is, and identifying the demographics of people or businesses that would be interested in the product or service. The goal here is to establish how much money your business concept can make.

Product and Service Demand

A search engine is your best friend when trying to figure out if there is demand for your products and services. Personally, I love using presearch.org because it lets you directly search on a ton of different platforms including Google, Youtube, Twitter, and more. Check out the screenshot for the full list of search options.

With quick web searches, you can find out how many competitors you have, look through their reviews, and see if there are common complaints about the competitors. Bad reviews are a great place to find opportunities to offer better products or services. 

If there are no similar products or services, you may have stumbled upon something new, or there may just be no demand for it. To find out, go talk to your most honest friend about the idea and see what they think. If they tell you it’s dumb or stare at you vacantly, there’s probably no market for it.

You can also conduct a survey through social media to get public opinion on your idea. Using Facebook Business Manager , you could get a feel for who would be interested in your product or service.

 I ran a quick test of how many people between 18-65  you could reach in the U.S. during a week. It returned an estimated 700-2,000 for the total number of leads, which is enough to do a fairly accurate statistical analysis.

Identify Demographics of Target Market

Depending on what type of business you want to run, your target market will be different. The narrower the demographic, the fewer potential customers you’ll have. If you did a survey, you’ll be able to use that data to help define your target audience. Some considerations you’ll want to consider are:

• Other Interests
• Marital Status
• Do they have kids?

Once you have this information, it can help you narrow down your options for location and help define your marketing further. One resource that Mike recommended using is the Census Bureau’s Quick Facts Map . He told us,  

“It helps you quickly evaluate what the best areas are for your business to be located.”

How to Write a Business Plan

Now that you’ve developed your idea a little and established there is a market for it, you can begin writing a business plan. Getting started is easier with the business plan template we created for you to download. I strongly recommend using it as it is updated to make it easier to create an action plan. 

Each of the following should be a section of your business plan:

• Business Plan Cover Page
• Table of Contents
• Executive Summary
• Company Description
• Description of Products and Services

SWOT Analysis

• Competitor Data
• Competitive Analysis
• Marketing Expenses Strategy 

Pricing Strategy

• Distribution Channel Assessment
• Operational Plan
• Management and Organizational Strategy
• Financial Statements and/or Financial Projections

We’ll look into each of these. Don’t forget to download our free business plan template (mentioned just above) so you can follow along as we go. 

How to Write a Business Plan Step 1. Create a Cover Page

The first thing investors will see is the cover page for your business plan. Make sure it looks professional. A great cover page shows that you think about first impressions.

A good business plan should have the following elements on a cover page:

• Professionally designed logo
• Company name
• Mission or Vision Statement
• Contact Info

Basically, think of a cover page for your business plan like a giant business card. It is meant to capture people’s attention but be quickly processed.

How to Write a Business Plan Step 2. Create a Table of Contents

Most people are busy enough that they don’t have a lot of time. Providing a table of contents makes it easy for them to find the pages of your plan that are meaningful to them.

A table of contents will be immediately after the cover page, but you can include it after the executive summary. Including the table of contents immediately after the executive summary will help investors know what section of your business plan they want to review more thoroughly.

Check out Canva’s article about creating a  table of contents . It has a ton of great information about creating easy access to each section of your business plan. Just remember that you’ll want to use different strategies for digital and hard copy business plans.

How to Write a Business Plan Step 3. Write an Executive Summary

An executive summary is where your business plan should catch the readers interest.  It doesn’t need to be long, but should be quick and easy to read.

Mike told us,

How long should an executive summary bein an informal business plan?

For casual use, an executive summary should be similar to an elevator pitch, no more than 150-160 words, just enough to get them interested and wanting more. Indeed has a great article on elevator pitches .  This can also be used for the content of emails to get readers’ attention.

It consists of three basic parts:

• An introduction to you and your business.
• What your business is about.
• A call to action

Example of an informal executive summary 

One of the best elevator pitches I’ve used is:

So far that pitch has achieved a 100% success rate in getting partnerships for the business.

What should I include in an executive summary for investors?

Investors are going to need a more detailed executive summary if you want to secure financing or sell equity. The executive summary should be a brief overview of your entire business plan and include:

• Introduction of yourself and company.
• An origin story (Recognition of a problem and how you came to solution)
• An introduction to your products or services.
• Your unique value proposition. Make sure to include intellectual property.
• Where you are in the business life cycle
• Request and why you need it.

Successful business plan examples

The owner of Urbanity told us he spent 2 months writing a 75-page business plan and received a $250,000 loan from the bank when he was 23. Make your business plan as detailed as possible when looking for financing. We’ve provided a template to help you prepare the portions of a business plan that banks expect.

Here’s the interview with the owner of Urbanity:

When to write an executive summary?

Even though the summary is near the beginning of a business plan, you should write it after you complete the rest of a business plan. You can’t talk about revenue, profits, and expected expenditures if you haven’t done the market research and created a financial plan.

What mistakes do people make when writing an executive summary?

Business owners commonly go into too much detail about the following items in an executive summary:

• Marketing and sales processes
• Financial statements
• Organizational structure
• Market analysis

These are things that people will want to know later, but they don’t hook the reader. They won’t spark interest in your small business, but they’ll close the deal.

How to Write a Business Plan Step 4. Company Description

Every business plan should include a company description. A great business plan will include the following elements while describing the company:

• Mission statement
• Philosophy and vision
• Company goals

Target market

• Legal structure

Let’s take a look at what each section includes in a good business plan.

Mission Statement

A mission statement is a brief explanation of why you started the company and what the company’s main focus is. It should be no more than one or two sentences. Check out HubSpot’s article 27 Inspiring Mission Statement for a great read on informative and inspiring mission and vision statements. 

Company Philosophy and Vision

The company philosophy is what drives your company. You’ll normally hear them called core values.  These are the building blocks that make your company different. You want to communicate your values to customers, business owners, and investors as often as possible to build a company culture, but make sure to back them up.

What makes your company different?

Each company is different. Your new business should rise above the standard company lines of honesty, integrity, fun, innovation, and community when communicating your business values. The standard answers are corporate jargon and lack authenticity. 

Examples of core values

One of my clients decided to add a core values page to their website. As a tech company they emphasized the values:

•  Prioritize communication.
•  Never stop learning.
•  Be transparent.
•  Start small and grow incrementally.

These values communicate how the owner and the rest of the company operate. They also show a value proposition and competitive advantage because they specifically focus on delivering business value from the start. These values also genuinely show what the company is about and customers recognize the sincerity. Indeed has a great blog about how to identify your core values .

What is a vision statement?

A vision statement communicate the long lasting change a business pursues. The vision helps investors and customers understand what your company is trying to accomplish. The vision statement goes beyond a mission statement to provide something meaningful to the community, customer’s lives, or even the world.

Example vision statements

The Alzheimer’s Association is a great example of a vision statement:

A world without Alzheimer’s Disease and other dementia.

It clearly tells how they want to change the world. A world without Alzheimers might be unachievable, but that means they always have room for improvement.

Business Goals

You have to measure success against goals for a business plan to be meaningful. A business plan helps guide a company similar to how your GPS provides a road map to your favorite travel destination. A goal to make as much money as possible is not inspirational and sounds greedy.

Sure, business owners want to increase their profits and improve customer service, but they need to present an overview of what they consider success. The goals should help everyone prioritize their work.

How far in advance should a business plan?

Business planning should be done at least one year in advance, but many banks and investors prefer three to five year business plans. Longer plans show investors that the management team  understands the market and knows the business is operating in a constantly shifting market. In addition, a plan helps businesses to adjust to changes because they have already considered how to handle them.

Example of great business goals

My all time-favorite long-term company goals are included in Tesla’s Master Plan, Part Deux . These goals were written in 2016 and drive the company’s decisions through 2026. They are the reason that investors are so forgiving when Elon Musk continually fails to meet his quarterly and annual goals.

If the progress aligns with the business plan investors are likely to continue to believe in the company. Just make sure the goals are reasonable or you’ll be discredited (unless you’re Elon Musk).

You did target market research before creating a business plan. Now it’s time to add it to the plan so others understand what your ideal customer looks like. As a new business owner, you may not be considered an expert in your field yet, so document everything. Make sure the references you use are from respectable sources. 

Use information from the specific lender when you are applying for lending. Most lenders provide industry research reports and using their data can strengthen the position of your business plan.

A small business plan should include a section on the external environment. Understanding the industry is crucial because we don’t plan a business in a vacuum. Make sure to research the industry trends, competitors, and forecasts. I personally prefer IBIS World for my business research. Make sure to answer questions like:

• What is the industry outlook long-term and short-term?
• How will your business take advantage of projected industry changes and trends?
• What might happen to your competitors and how will your business successfully compete?

Industry resources

Some helpful resources to help you establish more about your industry are:

• Trade Associations
• Federal Reserve
• Bureau of Labor Statistics

Legal Structure

There are five basic types of legal structures that most people will utilize:

• Sole proprietorships
• Limited Liability Companies (LLC)

Partnerships

Corporations.

• Franchises.

Each business structure has their pros and cons. An LLC is the most common legal structure due to its protection of personal assets and ease of setting up. Make sure to specify how ownership is divided and what roles each owner plays when you have more than one business owner.

You’ll have to decide which structure is best for you, but we’ve gathered information on each to make it easier.

Sole Proprietorship

A sole proprietorship is the easiest legal structure to set up but doesn’t protect the owner’s personal assets from legal issues. That means if something goes wrong, you could lose both your company and your home.

To start a sole proprietorship, fill out a special tax form called a  Schedule C . Sole proprietors can also join the American Independent Business Alliance .

Limited Liability Company (LLC)

An LLC is the most common business structure used in the United States because an LLC protects the owner’s personal assets. It’s similar to partnerships and corporations, but can be a single-member LLC in most states. An LLC requires a document called an operating agreement.

Each state has different requirements. Here’s a link to find your state’s requirements . Delaware and Nevada are common states to file an LLC because they are really business-friendly. Here’s a blog on the top 10 states to get an LLC.

Partnerships are typically for legal firms. If you choose to use a partnership choose a Limited Liability Partnership. Alternatively, you can just use an LLC.

Corporations are typically for massive organizations. Corporations have taxes on both corporate and income tax so unless you plan on selling stock, you are better off considering an LLC with S-Corp status . Investopedia has good information corporations here .

There are several opportunities to purchase successful franchises. TopFranchise.com has a list of companies in a variety of industries that offer franchise opportunities. This makes it where an entrepreneur can benefit from the reputation of an established business that has already worked out many of the kinks of starting from scratch.

How to Write a Business Plan Step 5. Products and Services

This section of the business plan should focus on what you sell, how you source it, and how you sell it. You should include:

• Unique features that differentiate your business products from competitors
• Intellectual property
• Your supply chain
• Cost and pricing structure 

Questions to answer about your products and services

Mike gave us a list  of the most important questions to answer about your product and services:

• How will you be selling the product? (in person, ecommerce, wholesale, direct to consumer)?
• How do you let them know they need a product?
• How do you communicate the message?
• How will you do transactions?
• How much will you be selling it for?
• How many do you think you’ll sell and why?

Make sure to use the worksheet on our business plan template .

How to Write a Business Plan Step 6. Sales and Marketing Plan

The marketing and sales plan is focused on the strategy to bring awareness to your company and guides how you will get the product to the consumer.  It should contain the following sections:

SWOT Analysis stands for strengths, weaknesses, opportunities, and threats. Not only do you want to identify them, but you also want to document how the business plans to deal with them.

Business owners need to do a thorough job documenting how their service or product stacks up against the competition.

If proper research isn’t done, investors will be able to tell that the owner hasn’t researched the competition and is less likely to believe that the team can protect its service from threats by the more well-established competition. This is one of the most common parts of a presentation that trips up business owners presenting on Shark Tank .

SWOT Examples

Examples of strengths and weaknesses could be things like the lack of cash flow, intellectual property ownership, high costs of suppliers, and customers’ expectations on shipping times.

Opportunities could be ways to capitalize on your strengths or improve your weaknesses, but may also be gaps in the industry. This includes:

• Adding offerings that fit with your current small business
• Increase sales to current customers
• Reducing costs through bulk ordering
• Finding ways to reduce inventory
•  And other areas you can improve

Threats will normally come from outside of the company but could also be things like losing a key member of the team. Threats normally come from competition, regulations, taxes, and unforeseen events.

The management team should use the SWOT analysis to guide other areas of business planning, but it absolutely has to be done before a business owner starts marketing. 

Include Competitor Data in Your Business Plan

When you plan a business, taking into consideration the strengths and weaknesses of the competition is key to navigating the field. Providing an overview of your competition and where they are headed shows that you are invested in understanding the industry.

For smaller businesses, you’ll want to search both the company and the owners names to see what they are working on. For publicly held corporations, you can find their quarterly and annual reports on the SEC website .

What another business plans to do can impact your business. Make sure to include things that might make it attractive for bigger companies to outsource to a small business.

Marketing Strategy

The marketing and sales part of business plans should be focused on how you are going to make potential customers aware of your business and then sell to them.

If you haven’t already included it, Mike recommends:

“They’ll want to know about Demographics, ages, and wealth of your target market.”

Make sure to include the Total addressable market .  The term refers to the value if you captured 100% of the market.

Advertising Strategy

You’ll explain what formats of advertising you’ll be using. Some possibilities are:

• Online: Facebook and Google are the big names to work with here.
• Print : Print can be used to reach broad groups or targeted markets. Check out this for tips .
• Radio : iHeartMedia is one of the best ways to advertise on the radio
• Cable television : High priced, hard to measure ROI, but here’s an explanation of the process
• Billboards: Attracting customers with billboards can be beneficial in high traffic areas.

You’ll want to define how you’ll be using each including frequency, duration, and cost. If you have the materials already created, including pictures or links to the marketing to show creative assets.

Mike told us “Most businesses are marketing digitally now due to Covid, but that’s not always the right answer.”

Make sure the marketing strategy will help team members or external marketing agencies stay within the brand guidelines .

This section of a business plan should be focused on pricing. There are a ton of pricing strategies that may work for different business plans. Which one will work for you depends on what kind of a business you run.

Some common pricing strategies are:

• Value-based pricing – Commonly used with home buying and selling or other products that are status symbols.
• Skimming pricing – Commonly seen in video game consoles, price starts off high to recoup expenses quickly, then reduces over time.
• Competition-based pricing – Pricing based on competitors’ pricing is commonly seen at gas stations.
• Freemium services –  Commonly used for software, where there is a free plan, then purchase options for more functionality.

HubSpot has a great calculator and blog on pricing strategies.

Beyond explaining what strategy your business plans to use, you should include references for how you came to this pricing strategy and how it will impact your cash flow.

Distribution Plan

This part of a business plan is focused on how the product or service is going to go through the supply chain. These may include multiple divisions or multiple companies. Make sure to include any parts of the workflow that are automated so investors can see where cost savings are expected and when.

Supply Chain Examples

For instance, lawn care companies  would need to cover aspects such as:

• Suppliers for lawn care equipment and tools
• Any chemicals or treatments needed
• Repair parts for sprinkler systems
• Vehicles to transport equipment and employees
• Insurance to protect the company vehicles and people.

Examples of Supply Chains

These are fairly flat supply chains compared to something like a clothing designer where the clothes would go through multiple vendors. A clothing company might have the following supply chain:

• Raw materials
• Shipping of raw materials
• Converting of raw materials to thread
• Shipping thread to produce garments
• Garment producer
• Shipping to company
• Company storage
• Shipping to retail stores

There have been advances such as print on demand that eliminate many of these steps. If you are designing completely custom clothing, all of this would need to be planned to keep from having business disruptions.

The main thing to include in the business plan is the list of suppliers, the path the supply chain follows, the time from order to the customer’s home, and the costs associated with each step of the process.

According to BizPlanReview , a business plan without this information is likely to get rejected because they have failed to research the key elements necessary to make sales to the customer.

How to Write a Business Plan Step 7. Company Organization and Operational Plan

This part of the business plan is focused on how the business model will function while serving customers.  The business plan should provide an overview of  how the team will manage the following aspects:

Quality Control

• Legal environment

Let’s look at each for some insight.

Production has already been discussed in previous sections so I won’t go into it much. When writing a business plan for investors, try to avoid repetition as it creates a more simple business plan.

If the organizational plan will be used by the team as an overview of how to perform the best services for the customer, then redundancy makes more sense as it communicates what is important to the business.

Quality control policies help to keep the team focused on how to verify that the company adheres to the business plan and meets or exceeds customer expectations.

Quality control can be anything from a standard that says “all labels on shirts can be no more than 1/16″ off center” to a defined checklist of steps that should be performed and filled out for every customer.

There are a variety of organizations that help define quality control including:

• International Organization for Standardization – Quality standards for energy, technology, food, production environments, and cybersecurity
• AICPA – Standard defined for accounting.
• The Joint Commission – Healthcare
• ASHRAE – HVAC best practices

You can find lists of the organizations that contribute most to the government regulation of industries on Open Secrets . Research what the leaders in your field are doing. Follow their example and implement it in your quality control plan.

For location, you should use information from the market research to establish where the location will be. Make sure to include the following in the location documentation.

• The size of your location
• The type of building (retail, industrial, commercial, etc.)
• Zoning restrictions – Urban Wire has a good map on how zoning works in each state
• Accessibility – Does it meet ADA requirements?
• Costs including rent, maintenance, utilities, insurance and any buildout or remodeling costs
• Utilities – b.e.f. has a good energy calculator .

Legal Environment

The legal requirement section is focused on defining how to meet the legal requirements for your industry. A good business plan should include all of the following:

• Any licenses and/or permits that are needed and whether you’ve obtained them
• Any trademarks, copyrights, or patents that you have or are in the process of applying for
• The insurance coverage your business requires and how much it costs
• Any environmental, health, or workplace regulations affecting your business
• Any special regulations affecting your industry
• Bonding requirements, if applicable

Your local SBA office can help you establish requirements in your area. I strongly recommend using them. They are a great resource.

Your business plan should include a plan for company organization and hiring. While you may be the only person with the company right now, down the road you’ll need more people. Make sure to consider and document the answers to the following questions:

• What is the current leadership structure and what will it look like in the future?
• What types of employees will you have? Are there any licensing or educational requirements?
• How many employees will you need?
• Will you ever hire freelancers or independent contractors?
• What is each position’s job description?
• What is the pay structure (hourly, salaried, base plus commission, etc.)?
• How do you plan to find qualified employees and contractors?

One of the most crucial parts of a business plan is the organizational chart. This simply shows the positions the company will need, who is in charge of them and the relationship of each of them. It will look similar to this:

Our small business plan template has a much more in-depth organizational chart you can edit to include when you include the organizational chart in your business plan.

How to Write a Business Plan Step 8. Financial Statements 

No business plan is complete without financial statements or financial projections. The business plan format will be different based on whether you are writing a business plan to expand a business or a startup business plan. Let’s dig deeper into each.

Provide All Financial Income from an Existing Business

An existing business should use their past financial documents including the income statement, balance sheet, and cash flow statement to find trends to estimate the next 3-5 years.

You can create easy trendlines in excel to predict future revenue, profit and loss, cash flow, and other changes in year-over-year performance. This will show your expected performance assuming business continues as normal.

If you are seeking an investment, then the business is probably not going to continue as normal. Depending on the financial plan and the purpose of getting financing, adjustments may be needed to the following:

• Higher Revenue if expanding business
• Lower Cost of Goods Sold if purchasing inventory with bulk discounts
• Adding interest if utilizing financing (not equity deal)
• Changes in expenses
• Addition of financing information to the cash flow statement
• Changes in Earnings per Share on the balance sheet

Financial modeling is a challenging subject, but there are plenty of low-cost courses on the subject. If you need help planning your business financial documentation take some time to watch some of them.

Make it a point to document how you calculated all the changes to the income statement, balance sheet, and cash flow statement in your business plan so that key team members or investors can verify your research.

Financial Projections For A Startup Business Plan

Unlike an existing business, a startup doesn’t have previous success to model its future performance. In this scenario, you need to focus on how to make a business plan realistic through the use of industry research and averages.

Mike gave the following advice in his interview:

Financial Forecasting Mistakes

One of the things a lot of inexperienced people use is the argument, “If I get one percent of the market, it is worth $100 million.” If you use this, investors are likely to file the document under bad business plan examples.

Let’s use custom t-shirts as an example.

Credence Research estimated in 2018 there were 11,334,800,000 custom t-shirts sold for a total of $206.12 Billion, with a 6% compound annual growth rate.

With that data,  you can calculate that the industry will grow to $270 Billion in 2023 and that the average shirt sold creates $18.18 in revenue.

Combine that with an IBIS World estimate of 11,094 custom screen printers and that means even if you become an average seller, you’ll get .009% of the market.

Here’s a table for easier viewing of that information.

The point here is to make sure your business proposal examples make sense.

You’ll need to know industry averages such as cost of customer acquisition, revenue per customer, the average cost of goods sold, and admin costs to be able to create accurate estimates.

Our simple business plan templates walk you through most of these processes. If you follow them you’ll have a good idea of how to write a business proposal.

How to Write a Business Plan Step 9. Business Plan Example of Funding Requests

What is a business plan without a plan on how to obtain funding?

The Small Business Administration has an example for a pizza restaurant that theoretically needed nearly $20k to make it through their first month.

In our video, How to Start a $500K/Year T-Shirt Business (Pt. 1 ), Sanford Booth told us he needed about $200,000 to start his franchise and broke even after 4 months.

Freshbooks estimates it takes on average 2-3 years for a business to be profitable, which means the fictitious pizza company from the SBA could need up to $330k to make it through that time and still pay their bills for their home and pizza shop.

Not every business needs that much to start, but realistically it’s a good idea to assume that you need a fairly large cushion.

Ways to get funding for a small business

There are a variety of ways to cover this. the most common are:

• Bootstrapping – Using your savings without external funding.
• Taking out debt – loans, credit cards
• Equity, Seed Funding – Ownership of a percentage of the company in exchange for current funds
• Crowdsourcing – Promising a good for funding to create the product

Keep reading for more tips on how to write a business plan.

How funding will be used

When asking for business financing make sure to include:

• How much to get started?
• What is the minimum viable product and how soon can you make money?
• How will the money be spent?

Mike emphasized two aspects that should be included in every plan, 

How to Write a Business Plan Resources

Here are some links to a business plan sample and business plan outline. 

• Sample plan

It’s also helpful to follow some of the leading influencers in the business plan writing community. Here’s a list:

• Wise Plans –  Shares a lot of information on starting businesses and is a business plan writing company.
• Optimus Business Plans –  Another business plan writing company.
• Venture Capital – A venture capital thread that can help give you ideas.

How to Write a Business Plan: What’s Next?

We hope this guide about how to write a simple business plan step by step has been helpful. We’ve covered:

• The definition of a business plan
• Coming up with a business idea
• Performing market research
• The critical components of a business plan
• An example business plan

In addition, we provided you with a simple business plan template to assist you in the process of writing your startup business plan. The startup business plan template also includes a business model template that will be the key to your success.

Don’t forget to check out the rest of our business hub .

Have you written a business plan before? How did it impact your ability to achieve your goals?

Brandon Boushy

Brandon Boushy lives to improve people’s lives by helping them become successful entrepreneurs. His journey started nearly 30 years ago. He consistently excelled at everything he did, but preferred to make the rules rather than follow him. His exploration of self and knowledge has helped him to get an engineering degree, MBA, and countless certifications. When freelancing and rideshare came onto the scene, he recognized the opportunity to play by his own rules. Since 2017, he has helped businesses across all industries achieve more with his research, writing, and marketing strategies. Since 2021, he has been the Lead Writer for UpFlip where he has published over 170 articles on small business success.

Related posts

• September 27, 2023

How to Start a Business: The Ultimate Guide (2024)

• August 3, 2022

Free Business Plan Template (With Examples)

• May 3, 2022

How to Get a Business License (In 3 Steps)

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How to Write a Business Plan, Step by Step

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What is a business plan?

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

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

ZenBusiness

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

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

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

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

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

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

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

Your business’s registered name.

Address of your business location .

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

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

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

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

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

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

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

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

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

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

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

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

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

Licenses and permits.

Equipment leases.

Bank statements.

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

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

How much do you need?

with Fundera by NerdWallet

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

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

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

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

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

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

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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.

Start selling online now with Shopify

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 . .

→ Click Here to Launch Your Online Business with Shopify

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.

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.

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?

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.

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.

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!

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550+ Business Plan Examples to Launch Your Business

Need help writing your business plan? Explore over 550 industry-specific business plan examples for inspiration.

Find your business plan example

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Business plan template: There's an easier way to get your business plan done.

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Finish your plan faster with step-by-step guidance, financial wizards, and a proven format.

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View all sample business plans

Example business plan format

Before you start exploring our library of business plan examples, it's worth taking the time to understand the traditional business plan format . You'll find that the plans in this library and most investor-approved business plans will include the following sections:

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally only one to two pages. You should also plan to write this section last after you've written your full business plan.

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, and your funding requirements (if you are raising money).

Products & services

The products & services chapter of your business plan is where the real meat of your plan lives. It includes information about the problem that you're solving, your solution, and any traction that proves that it truly meets the need you identified.

This is your chance to explain why you're in business and that people care about what you offer. It needs to go beyond a simple product or service description and get to the heart of why your business works and benefits your customers.

Market analysis

Conducting a market analysis ensures that you fully understand the market that you're entering and who you'll be selling to. This section is where you will showcase all of the information about your potential customers. You'll cover your target market as well as information about the growth of your market and your industry. Focus on outlining why the market you're entering is viable and creating a realistic persona for your ideal customer base.

Competition

Part of defining your opportunity is determining what your competitive advantage may be. To do this effectively you need to get to know your competitors just as well as your target customers. Every business will have competition, if you don't then you're either in a very young industry or there's a good reason no one is pursuing this specific venture.

To succeed, you want to be sure you know who your competitors are, how they operate, necessary financial benchmarks, and how you're business will be positioned. Start by identifying who your competitors are or will be during your market research. Then leverage competitive analysis tools like the competitive matrix and positioning map to solidify where your business stands in relation to the competition.

Marketing & sales

The marketing and sales plan section of your business plan details how you plan to reach your target market segments. You'll address how you plan on selling to those target markets, what your pricing plan is, and what types of activities and partnerships you need to make your business a success.

The operations section covers the day-to-day workflows for your business to deliver your product or service. What's included here fully depends on the type of business. Typically you can expect to add details on your business location, sourcing and fulfillment, use of technology, and any partnerships or agreements that are in place.

Milestones & metrics

The milestones section is where you lay out strategic milestones to reach your business goals.

A good milestone clearly lays out the parameters of the task at hand and sets expectations for its execution. You'll want to include a description of the task, a proposed due date, who is responsible, and eventually a budget that's attached. 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, which are the numbers you will track to determine your success. Some common data points worth tracking include conversion rates, customer acquisition costs, profit, etc.

Company & team

Use this section to describe your current team and who you need to hire. If you intend to pursue funding, you'll need to highlight the relevant experience of your team members. Basically, this is where you prove that this is the right team to successfully start and grow the business. You will also need to provide a quick overview of your legal structure and history if you're already up and running.

Financial projections

Your financial plan should include a sales and revenue forecast, profit and loss statement, cash flow statement, and a balance sheet. You may not have established financials of any kind at this stage. Not to worry, rather than getting all of the details ironed out, focus on making projections and strategic forecasts for your business. You can always update your financial statements as you begin operations and start bringing in actual accounting data.

Now, if you intend to pitch to investors or submit a loan application, you'll also need a "use of funds" report in this section. This outlines how you intend to leverage any funding for your business and how much you're looking to acquire. Like the rest of your financials, this can always be updated later on.

The appendix isn't a required element of your business plan. However, it is a useful place to add any charts, tables, definitions, legal notes, or other critical information that supports your plan. These are often lengthier or out-of-place information that simply didn't work naturally into the structure of your plan. You'll notice that in these business plan examples, the appendix mainly includes extended financial statements.

Types of business plans explained

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. To get the most out of your plan, it's best to find a format that suits your needs. 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 for external purposes. Typically this is the type of plan you'll need when applying for funding or pitching to investors. It can also be used when training or hiring employees, working with vendors, or in any other situation where the full details of your business must be understood by another individual.

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.

The structure ditches a linear format in favor of a cell-based template. It encourages you to build connections between every element of your business. It's faster to write out and update, and much easier for you, your team, and anyone else to visualize your business operations.

One-page business plan

The true middle ground between the business model canvas and a traditional business plan is the one-page business plan . This format is a simplified version of the traditional plan that focuses on the core aspects of your business.

By starting with a one-page plan , you give yourself a minimal document to build from. You'll typically stick with bullet points and single sentences making it much easier to elaborate or expand sections into a longer-form business plan.

Growth planning

Growth planning is more than a specific type of business plan. It's 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, forecast, review, and refine based on your performance.

It holds all of the benefits of the single-page plan, including the potential to complete it in as little as 27 minutes . However, it's even easier to convert into a more detailed plan thanks to how heavily it's tied to your financials. The overall goal of growth planning isn't to just produce documents that you use once and shelve. Instead, the growth planning process helps you build a healthier company that thrives in times of growth and remain stable through times of crisis.

It's faster, keeps your plan concise, and ensures that your plan is always up-to-date.

Download a free sample business plan template

Ready to start writing your own plan but aren't sure where to start? Download our free business plan template that's been updated for 2024.

This simple, modern, investor-approved business plan template is designed to make planning easy. It's a proven format that has helped over 1 million businesses write business plans for bank loans, funding pitches, business expansion, and even business sales. It includes additional instructions for how to write each section and is formatted to be SBA-lender approved. All you need to do is fill in the blanks.

How to use an example business plan to help you write your own

How do you know what elements need to be included in your business plan, especially if you've never written one before? Looking at examples can help you visualize what a full, traditional plan looks like, so you know what you're aiming for before you get started. Here's how to get the most out of a sample business plan.

Choose a business plan example from a similar type of company

You don't need to find an example business plan that's an exact fit for your business. Your business location, target market, and even your particular product or service may not match up exactly with the plans in our gallery. But, you don't need an exact match for it to be helpful. Instead, look for a plan that's related to the type of business you're starting.

For example, if you want to start a vegetarian restaurant, a plan for a steakhouse can be a great match. While the specifics of your actual startup will differ, the elements you'd want to include in your restaurant's business plan are likely to be very similar.

Use a business plan example as a guide

Every startup and small business is unique, so you'll want to avoid copying an example business plan word for word. It just won't be as helpful, since each business is unique. You want your plan to be a useful tool for starting a business —and getting funding if you need it.

One of the key benefits of writing a business plan is simply going through the process. When you sit down to write, you'll naturally think through important pieces, like your startup costs, your target market , and any market analysis or research you'll need to do to be successful.

You'll also look at where you stand among your competition (and everyone has competition), and lay out your goals and the milestones you'll need to meet. Looking at an example business plan's financials section can be helpful because you can see what should be included, but take them with a grain of salt. Don't assume that financial projections for a sample company will fit your own small business.

If you're looking for more resources to help you get started, our business planning guide is a good place to start. You can also download our free business plan template .

Think of business planning as a process, instead of a document

Think about business planning as something you do often , rather than a document you create once and never look at again. If you take the time to write a plan that really fits your own company, it will be a better, more useful tool to grow your business. It should also make it easier to share your vision and strategy so everyone on your team is on the same page.

Adjust your plan regularly to use it as a business management tool

Keep in mind that businesses that use their plan as a management tool to help run their business grow 30 percent faster than those businesses that don't. For that to be true for your company, you'll think of a part of your business planning process as tracking your actual results against your financial forecast on a regular basis.

If things are going well, your plan will help you think about how you can re-invest in your business. If you find that you're not meeting goals, you might need to adjust your budgets or your sales forecast. Either way, tracking your progress compared to your plan can help you adjust quickly when you identify challenges and opportunities—it's one of the most powerful things you can do to grow your business.

Prepare to pitch your business

If you're planning to pitch your business to investors or seek out any funding, you'll need a pitch deck to accompany your business plan. A pitch deck is designed to inform people about your business. You want your pitch deck to be short and easy to follow, so it's best to keep your presentation under 20 slides.

Your pitch deck and pitch presentation are likely some of the first things that an investor will see to learn more about your company. So, you need to be informative and pique their interest. Luckily, just like you can leverage an example business plan template to write your plan, we also have a gallery of over 50 pitch decks for you to reference.

With this gallery, you have the option to view specific industry pitches or get inspired by real-world pitch deck examples.

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Now that you know how to use an example business plan to help you write a plan for your business, it's time to find the right one.

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How to Write a Business Plan

Last Updated: February 16, 2024, 12:05 pm by TRUiC Team

Writing a business plan can be an intimidating endeavor. Whether you’ve decided to start a business , or you already have a business and need to write a business plan to apply for a loan or to pitch to investors , we cover the process in-depth.

Recommended: Our business plan generator walks you through topics like marketing and financial projections so that your business is prepared to succeed.

What Is a Business Plan?

The traditional business plan is typically a 20 to 40-page formal document that describes what your business does, what your objectives are, and how you plan to achieve them.

It lays out your plans for operating, marketing, and managing your business, along with your goals and financial projections.

There are many different types of business plans, depending on the stage of your venture and the purpose of your business plan. In the earliest stages of your business idea, you may want to start small with a three-sentence business plan , or perhaps by sketching out a lean canvas or business model canvas .

Once your business idea has been developed, you’ll be ready to begin writing your business plan .

Why Do You Need a Business Plan?

Writing a business plan requires you to think through all of the key elements of your business. This gives you insights into the challenges you’ll face and the strengths you bring.

A business plan is also often requested by lenders or investors when you are ready to seek financing.

While many companies do not need a formal business plan unless they are planning on seeking investors or applying for a business loan , writing a business plan has extensive benefits.

The process of writing your business plan allows you to take an in-depth look at your industry , market , and competitive position . It helps you set goals , determine your keys to success , and plan your strategies . It also allows you to explore your financial projections and manage cash. So, even if you do not need a formal business plan, the process of planning may still reap huge rewards.

Your Audience

You need to think carefully about who is going to read your business plan.

Although you might begin writing a business plan only to convince yourself, there are a number of stakeholders who may end up reading your business plan.

Your plan might be read by your:

• Partners or potential partners
• Board of directors
• Senior management team
• Current employees
• Employment candidates

Outside the organization , the following stakeholders may want to read your business plan before they decide to do business with you:

• Distributors
• And independent contractors

Think about your primary audience when you are writing your business plan. What are the aspects that are most important to them? This is where you will want to put the majority of your focus.

For example, lenders will be most interested in your financial projections — your cash flow statement and balance sheet.

Investors might be most interested in your business model, the uniqueness of your product or service, and your competitive advantage.

Partners, your senior management team, and current employees might be most interested in your strategic plans- your vision, your operational plan, and your organizational plan.

Find Sample Business Plans in Your Industry

One great resource you should check out before sitting down to write your business plan are sample business plans in your industry.

Not only will you have the opportunity to gain insights on your industry and your competitors, you also might be able to find troves of industry and market research that will make conducting your own analysis of the industry and market much easier.

To find example business plans in your industry, try searching the web for “ your industry business plan example.”

Writing Your Business Plan

Once you have spent some time looking at sample business plans in your industry, it is now time to start writing your business plan . An easy place to begin is by outlining the major sections you will need in your plan.

What you need to include in your business plan will depend on the type of business you are creating, your business model, and who your intended audience is.

Common business plan sections include:

• Executive Summary — a high-level overview of your business or business idea
• Venture Overview — a description of your company, vision, mission, and goals
• Product or Service Description — a detailed description of your product or service
• Industry and Market Analysis — an analysis of the industry and market you compete in
• Marketing Plan — your overall strategy and specific plans to capture market share
• Organizational Plan — the legal form of the business and the key players
• Operational Plan — how you will operate the business and your key resources
• Goals, Milestones, and Risks — short and long-term goals, milestones, and risks
• Financial Statements — Financial statements or the projected financials of your business

Not every type of venture will require every one of these sections to be included in their business plans. However, most business plans will at least include an executive summary, venture overview, a description of the products and services, and some form of financial projections.

Executive Summary

As suggested in its name, an executive summary is a summary of the key points in your business plan . This is your first chance to convey to readers the what, why, who, and how of your business or business idea.

Although there is no set structure for an executive summary, a good executive summary should summarize :

• The problem you are solving
• Your solution
• Your target market
• Any competitive advantages
• The team you’ll build
• Goals and objectives
• An overview of your financials or financial forecast

If you are writing your business plan for the purpose of acquiring funding , you will also need to discuss the amount of funding required, the purpose of the funds, as well as how your investors will get paid back.

The executive summary should be clear and concise . Ideally, this section should be one to two pages and typically follows either a synopsis or story approach, depending on the intended audience.

In the synopsis approach, you would provide a brief summary of each of the key sections of your business plan. In the story approach, your executive summary reads like a narrative, allowing you to tell the “story” of your business or idea.

With either approach to writing the executive summary, the information you want to convey remains the same. The executive summary needs to provide an overall picture of your current business or business idea.

The executive summary should include:

• A brief description of you and your venture,
• The problem your product or service is solving,
• Some information on your target market, including size, potential, & competition, and
• The solution you are offering.

The executive summary should also include:

• A statement of where you are now,
• A statement of your objectives and future plans,
• A list of what you see as keys to your success, and (if you are seeking investors)
• Any relevant financial information such as start-up costs, funding required, and how you will use investor funding.

Although the executive summary is the first section in the business plan, because it is a summary of the rest of your business plan, it is often written last.

Venture Overview

The venture overview is a top-level depiction of your company.

It contains the:

Description of the Venture

• Vision Statement
• Mission Statement
• Goals & Objectives
• Keys to Your Success

The first part of your venture overview is a description of your venture.

The description of your venture should include what you do (a brief description of your products or services), the value you provide to customers, your current operating status or a brief history of the venture, and a short description of the industry or niche in which you compete.

How to Write a Vision Statement

After describing your venture, a vision statement is a very simple, 5 to 10 word sentence or tagline that expresses the fundamental goals of your firm. Good vision statements reflect your company’s long term passion and purpose, often in a way that evokes emotion.

Take a look at the vision statements below for some inspiration:

Disney —  To make people happy. Oxfam —  A world without poverty. Stanford —  To become the Harvard of the West. Marriott —  To be the #1 hospitality company in the world. Microsoft —  A computer on every desk and in every home; all running Microsoft software.

How to Write a Mission Statement

After having crafted your vision statement, you should also create a mission statement. A mission statement explains your company's goals in terms of what you do for your customers. A good mission statement should tell your reader what your company does, who you do it for, and why you do what you do.

Check out these excellent examples of compelling mission statements:

Patagonia —  “Our Reason For Being: Build the best products, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” Trader Joes —  “Our mission is to give our customers the best food and beverage values that they can find anywhere and to provide them with the information required to make informed buying decisions. We provide these with a dedication to the highest quality of customer satisfaction delivered with a sense of warmth, friendliness, fun, individual pride, and company spirit.” Facebook —  "Founded in 2004, Facebook's mission is to give people the power to build community and bring the world closer together. People use Facebook to stay connected with friends and family, to discover what's going on in the world, and to share and express what matters to them."

Goals and Objectives

In this section of the business plan, break down your most important short-term and long-term goals and objectives.

Aim for five to seven of your most important short and long term goals.

This subsection of your venture description should be kept short. You will come back to your goals at the end of your business plan.

However, your key short-term and long-term goals should be highlighted early on in your business plan as well. The rest of your business plan will act as evidence of how you plan on achieving your goals.

Keys to Success

Your keys to success are your insights into what it takes to be successful in your industry, market, or niche.

Your keys to success can include several of the most important milestones that you will need to accomplish in order to achieve your goals.

These may include providing high quality products and services, your ability to attract customers or users and gain market share, or even your ability to develop the technology to deliver your products or services.

Your keys to success may also include the major milestones that you will need to reach along the way in order to achieve your vision. You will come back to your milestones and objectives at the end of your business plan.

Product or Service Description

The product or service description section is where you will go into detail in describing your products or services.

Not only will you describe your product in more detail, you should also discuss the uniqueness of your product, and what gives you an advantage over your competitors.

These are the three main parts of the Product (or Service) Description:

Description of Products or Services

Uniqueness of product, competitive advantage.

In this subsection of your business plan, describe the products or services you will provide, why they are a fit in the market, and how you will compete with similar products and services.

Begin by clearly describing the products or services you will provide. Make sure to explain the features and characteristics of your products and services. Your product or service description does not have to be highly technical. Rather, in addition to describing the features, focus on highlighting the advantages and benefits associated with your products or services.

Also, let your reader know why your product or service is needed. How does your product or service differ from those offered by your competitors? How does it better fill your customers wants and needs?

This is where you tell your reader why your solution is unique. Is it different from everything else out there? How is it different? Why would potential users choose your product or service over your competitors? In order to stand out, you need to distinguish yourself in some way.

To describe your product or service’s uniqueness, you may want to come up with a unique value proposition (or unique selling point). A value proposition is a short description of what you do, who you do it for, and how this benefits them.

A value proposition is similar to a mission statement. However, it differs in that a mission statement is written from the perspective of the company, while a value proposition is written from the perspective of the customer.

Your value proposition should be the center of your customer messaging. It should be front and center on your website, in your marketing materials, and in your advertising.

Here a few examples of great value propositions:

Dollar Shave Club —  A Great Shave for a Few Bucks a Month. No Commitment. No Fees. No B.S. Unbounce —  Build, Publish, & A/B Test Landing Pages Without IT Freshbooks —  Small Business Accounting Software Built for You, the Non-Accountant Skype —  Skype Keeps the World Talking, for Free. Share, Message, and Call - Now with Group Video on Mobile and Tablet Too.

What makes you better than competitors?

Does your competitive advantage come from superior products and services, customer service, technical support, logistics, price? What are the factors that give you an advantage over your competitors?

Clearly defining your competitive advantage is important.

Your competitive advantage is not just some abstract concept. It is at the core of how you deliver value to your customers. Your competitive advantage lays the foundation for your business model and should be a key component of your strategic plans.

Common areas where businesses find competitive advantages include:

• Intellectual Property
• Resources/Capital
• Economies of Scale
• Knowledge/Experience
• Connections and Network
• Customer Service
• Technical Support
• Customization
• Brand Recognition/Loyalty

Industry and Market Analyses

The industry and market analysis is the “big picture” view of your industry and market.

Conducting an industry and market analysis is going to take a good deal of research. You will likely need to research your industry, your competitors, and your customers. But do not rush through this section of your business plan.

A good understanding of your industry and market is critical to your success. By understanding the forces at play within your industry, you will be better able to find additional ways to create value that will allow you to succeed in the current and anticipated competitive environment.

Conducting an industry and market analysis can be intimidating, especially if you do not know what to look for or how to find the information you need. In the next section, we will discuss what should be included in your industry analysis. Then, we will tell you where to begin looking.

Industry Analysis

The industry analysis is a big picture analysis of the industry you will compete in. What does your overall industry look like today? There are a number of insights that will help you assess the attractiveness of your idea and form a big picture view of the industry and segment you are considering competing in.

Key insights to be alert for include:

• The dominant economic features of the industry
• The industry’s driving forces
• The industry’s competitive environment
• The competitive position of major players and key competitors
• Key industry success factors

To arrive at meaningful insights from your industry analysis, try to find answers to the following questions:

• What primary products or services are provided by your industry?
• What is the size and trajectory of the industry?
• What was the annual growth rate of the industry over the past year? Three years? Five years? Ten years?
• What is the forecasted annual growth rate over the next three years? Five years? Ten years?
• What is the average profitability of firms in your industry?
• What trends are affecting your industry?
• Who are the major customer segments served by your industry?
• Who are the major players in your industry?
• Who will be your key competitors in your industry?
• What key factors determine success or failure?

Industry Research

Now that you have a better idea of what to look for, you will need to know where to begin your search. There are a number of great free resources to begin looking for industry research. However, the first step is to determine the industry you are in.

While by this point, you should have some idea of the industry you are in, it is not always so clear. You could try an internet search to see what information you can find on your industry, but you will also want to find the NAICS code. You can do a NAICS Code Lookup and find the NAICS Code for LLC that matches your industry.

Here, you use the NAICS identification tool to drill-down through a list of industries to find the appropriate NAICS code for your business.

Once you know your industry, you can begin collecting more information about the industry trends and trajectory.

www.Bizstats.com provides free industry statistics including industry averages for income statement revenues and expenses, balance sheets, and key financial ratios. This is very helpful in making financial forecasts and setting benchmarks.

The US Census Bureau also provides several tools to help you conduct industry research:

• The Economic Census provides information on employer businesses, including data sorted by industry, state, region, and more.
• Statistics of US Businesses (SUSB) provides additional data on US businesses by enterprise size and industry. Both of these tools may help in conducting your industry analysis.

Target Market Analysis

Once you have a better understanding of the industry, you can begin to narrow down to your target market. In this section of the business plan you describe who your target market is and what you know about them.

What is a target market? Your target market is the specific group of customers to whom your product is intended. And no, it is not everyone. Although many new venture founders would like to sell their product or service to everyone, you should focus your efforts on your most likely customers.

Narrowing your target market requires understanding the three types of markets for your products or services. Your venture’s market can be narrowed down into three categories, the TAM, the SAM, and the SOM.

The total available market (TAM) is the total market for your products and services. Everyone in the universe who might be your customer.

The serviceable available market (SAM) is the subset of the total market that you can actually reach. Although anyone in your universe might be your customer, you are limited in your ability to reach them all.

The share of market (SOM) is the subset of the serviceable available market that you will actually reach. These are your most likely customers. Your target market.

Target markets can be segmented in many different ways. The idea is to narrow down to your most likely customers. This is where your focus should be.

Ways you can segment the market include:

• Demographic (e.g., age, gender, family size, education, income)
• Geographic (e.g., country, state, region, city, neighborhood)
• Psychographic (e.g., benefits sought, personality, social class, lifestyle)
• Behavioral (e.g., benefits sought, usage, attitude, loyalty)

Once you understand who your target market segments are, you will be able to start determining how you can reach them. To do this, consider:

• Where does your target market get information to make purchasing decisions?
• What is it they are looking for when considering buying this product/service?
• What will your target market pay attention to?

Market Research

To determine your target market and conduct a market analysis, you will most likely have to do market research.

Market research is the collection, analysis, and interpretation of data related to your target market and target customer to support strategic decision making.

There are two types of market research : secondary market research, and primary market research.

Secondary market research is the collection, analysis, and interpretation of data that has already been collected for other purposes. Secondary market research may include the collection of data from a number of sources such as the U.S. Census Bureau, consumer agencies, and for-profit organizations.

Primary market research is the collection of new information to gain a further understanding of the problem at hand. Primary market research involves you collecting the data or hiring a market research firm to collect data for you. This is you going out and actually collecting the opinions of your potential customers.

Common methods of primary market research include customer observation, focus groups, customer surveys, and customer interviews .

Because primary market research typically takes more time to complete and may incur significant costs , secondary market research is often conducted before conducting primary market research. This allows you to gather enough insights that you can narrow your primary market research to those more likely to be your customers.

To begin conducting secondary market research, consider these sources:

Think with Google provides a number of free tools and resources to help you find and understand your target market. From tools like Find My Audience and an Insights Library to a wealth of information on customer trends and the consumer journey, Think with Google is a valuable tool in conducting your market analysis.

City Town Info provides free statistics on people and places, colleges and universities, and jobs and careers. You can search for data on more than 20,000 U.S. communities at the city and state levels.

Google Trends is another useful tool for conducting market research. Google Trends allows you to explore what people are searching on the internet. You can examine trending topics, see trends by year, or search your own topic to discover interest over time, by region, or by related queries.

Social Mention allows you to conduct a real-time social media search for topics across more than 100 social media platforms. Social Mention provides you with information on the sentiment behind topic mentions, top keywords, top hashtags, and the social media platforms where these topics are being discussed.

Needless to say, there are several other great sources for both industry and market research. The key is to get creative to find the data and information to both guide your strategy as well as justify your business opportunity.

Competitive Analysis

Once you understand your industry and market, you should also include an analysis of your major competitors.

Your competitors may include anyone offering alternatives to your solution that people are using now to solve the same problem.

You will want to understand and explain who your competitors are along with their market share , price, major competitive advantages and disadvantages, and what makes your product unique from theirs.

Start by identifying the major competitors within your industry. You should focus on your closest competitors. Those that compete with you directly.

Next, for each competitor, describe their strategies, their strengths, and their weaknesses. In doing so, try to answer the following questions:

• What are their primary products and or services?
• Who are their target customers?
• What differentiates your product or service from theirs?
• What is their pricing strategy?
• What is their marketing strategy?
• What is their main message or value proposition?
• What are their strengths and weaknesses?
• What are their competitive advantages?

You should complete a competitive analysis for your top three to five competitors. Doing so will allow you to gain a much better perspective on the competitive landscape and may provide insight into how you can distinguish yourself from your competitors and even how you can take advantage of areas where your competitors fall short.

Marketing Plan

The marketing plan depicts the overall strategy your venture pursues to capture market share.

The marketing plan describes all aspects of marketing for your venture, including the product, price, place, and promotion . This includes a big picture view of your marketing strategy, your planned marketing mix, as well as your pricing strategy, sales strategy, and advertising strategy.

The marketing plan should be well informed by your industry and market analysis. By now, you have a plethora of knowledge about who your target customer is, the problem and pain points that you are alleviating for them, and how your competitors are positioned. All of this knowledge allows you to hone your marketing plan to reach your target market with the right message in the channels they turn to for information.

Marketing Strategy

The first section of your marketing plan is your marketing strategy. Your marketing strategy refers to your overall strategy of how you will market your product. How will you get your message out to your potential customers?

Your marketing strategy should consider the four essential elements of marketing:

The 4 Ps of Marketing:

The product is everything the customer gets, whether it be a physical product, a service, or an experience.

It is what you deliver. This includes the product or service itself, along with its branding, packaging, labeling, and even benefits.

The price is what you charge. What the customer gives you. Your business plan should discuss your pricing strategy and where this fits in your marketing mix.

Are you competing on price and thus offer low pricing? Or are you focusing on value at a medium price point? Or maybe you are positioned as a luxury label or item, and compete at a high price point? Why did you choose this strategy? Does it fit with your target market and within your marketing mix?

Location refers to where your customers find you, or where you find them.

While much of today’s marketing is done online, location is still as important as ever. Once you understand the place, you will have a much better idea on how to deploy your marketing mix. Where do your ideal customers get their information? Where do they shop? What forms of social media do they use?

Promotion is how you tell customers about your products and services.

Simply put, promotion is how you raise awareness of your products, services, or brand. Promotion strategies may include public relations, content creation and curation, marketing, and advertising.

But, keep in mind, your promotional strategies should be focused on one thing: your target customer and the strategies and messaging that works for them.

Your Marketing Mix

Your marketing mix is how you allocate resources to the marketing channels that you plan to pursue. In this section of your marketing plan, you will describe the marketing messaging and channels that you plan to use, and why these are appropriate for your target market.

Inbound Marketing

Inbound marketing, or content marketing, is a form of marketing designed to draw traffic to your website by providing valuable content to your target market. This is often achieved by posting useful web content, content, videos, and blogs.

The idea behind inbound marketing is pretty simple- by providing knowledge and information on your products, services, and other information that is valuable to your customers, you generate more leads and, hopefully, more sales.

Social Media Marketing

With over 3.5 billion people around the world using social media, social media marketing is another powerful tool to reach potential customers.

Social media marketing has many advantages, including allowing you to get your message in front of your specified target audience at little to no cost.

Although there is an overabundance of social media channels to choose from. Focus on the ones that your target market uses to get their information.

For instance, if your target market is middle age or older people, you may want to focus on platforms that are more popular with these demographics such as Facebook, Twitter, and Pinterest. However, if your target market is teen agers and young adults, you are more likely to find them on platforms such as Instagram and TikTok.

The Power of Video Marketing

Do not forget to discuss the use of video marketing in your marketing mix.

In both inbound and social media marketing, video has begun to play an increasingly important role. Video marketing can be employed in inbound marketing, email marketing, and social media marketing to serve a variety of purposes. The most common uses of video marketing include explainer videos, presentation videos, testimonial videos, sales videos, and video ads.

Not only can video marketing be used in a variety of methods and contexts, it is a highly consumed type of advertising. In fact, in 2020, 96% of consumers watched an explainer video to find out more about a product or service. Video works. And marketers believe this too. 92% of marketers who utilize video marketing say that it is a key part of their marketing strategy.

Email Marketing

Depending on the type of venture your company is, email marketing may also be an important element in your marketing mix. A good email marketing strategy balances gaining new customers with keeping your existing customers engaged with your company.

Although you do not want to overdo it, and a lot of email marketing seems “spammy”, email marketing can be very effective in the right form. Welcome notes, confirmation emails, informational emails, newsletters, digital magazines, promotional emails, and seasonal and birthday campaigns are just a few of the many types of email marketing.

Referral Marketing

Another common type of marketing in a company's marketing mix is referral or recommendation marketing. Referral or recommendation marketing can take many forms. Referral marketing might include good old organic word-of-mouth marketing wherein you ask customers for referrals, or even a formal system for rewarding customers who refer new clients.

Pricing Strategy

The Marketing Plan section of the business plan should also describe your pricing strategy. How are you going to price your products and services?

There are a number of ways you can approach pricing:

Markup Pricing —  Markup pricing is pricing based on your costs, plus a predetermined markup. The amount you mark up your product or service is usually expressed as a percentage, known as the gross margin. Markup pricing is most often found in high volume manufacturing industries where manufacturers must cover the cost of the products they are making.

Competitive Pricing —  Competitive pricing is pricing based on your competitors prices for similar products or services. Competitive pricing is most often seen in products or services where there are numerous competitors or substitutes.

Value Pricing —  Value pricing is pricing based on the value or perceived value that you deliver to your customers. In value-based pricing, you set the prices of your products and services in line with what the customer believes your product or service is worth. Value-based pricing is most often seen in higher value products and services, those that cater to self-image, or those that are niche or unique.

Penetration Pricing —  Penetration pricing is setting a low initial price, and then raising it as demand increases. Penetration pricing is designed to capture market share. It is a strategy often used by a new business or in launching new products and services. The idea is to set the price low enough to draw customers from your competition.

Price skimming —  Price skimming pricing is setting a high initial price and then reducing this price as the market evolves. Price skimming is most often used on new or trendy products and services. As initial demand slows and alternatives or competitors emerge, the high initial pricing must then be lowered to stay competitive in the market.

Sales Strategy

A sales strategy is how you plan on selling your products or services to your target market. This includes your sales channels (where will your product or service be available for sale) as well as how you will sell your product or service.

Your sales strategy depends on your business model and the nature of your business. If your business involves retailing, food services, or personal services where your customers come to you to make a purchase, your sales strategy may be quite simple (or even unnecessary to income). However, if your business involves personal selling, you may need a more thought-out sales strategy.

Some questions to ask to determine and document your sales strategy in your business plan:

• Will your products or services be available on your website?
• On a third-party website?
• In retail locations?
• In your own stores?
• In other retail stores?
• Directly to consumers? (Business to Consumer or B2C)
• To businesses? (Business to Business or B2B)
• Cold calling?
• Networking?
• Inside salespeople?
• Outside sales representatives?
• Sales through strategic partners?

Advertising Strategy

An advertising strategy is how you plan to use sponsored, non-personal messaging to reach and inform potential customers of your product, service, or brand.

Your advertising plan should describe the mediums you are going to advertise in , who you are targeting advertising in these mediums, your advertising message(s), and your advertising budget. A good advertising plan is also measurable, so be sure to consider how you are going to measure the effect of your advertising strategy to see if it is working.

Advertising Mediums

The most common advertising mediums typically fall into the categories of traditional advertising and digital advertising.

Traditional advertising includes print advertising such as newspapers, magazines, flyers, direct mail, and even billboards, as well as radio and tv advertising.

Digital advertising includes email advertising, search engine advertising, website advertising, social media advertising, influencer advertising, among many, many more.

The secret to finding the right advertising strategy and advertising mediums for your business is knowing where to find your most likely customers. Where is your target market, and where do they go to get their information?

Organizational Plan

The organizational (or management) plan describes:

• The legal form of the business
• Its organizational structure
• The background and roles of the leadership team
• Key personnel that are already in place or you will need to fill.

Organizational Type and Structure

The first part of your organizational plan describes your organizational type and structure . Who owns your company? And what is its legal business structure?

There are four primary types of organizational structures:

Sole Proprietorships

Partnerships.

• Limited Liability Companies (LLCs)

Corporations

Sole Proprietorships and Partnerships are informal business structures , while LLCs and Corporations are more formal business structures .

The best type of structure for your business will depend on your business’s particular characteristics and needs. A partnership structure may be the best choice for some businesses, while an LLC or a corporation might work better for others.

Sole proprietorships are an informal type of business structure. While many businesses start out as sole proprietorships because they are an informal business structure the owner is liable for 100% of the business's liabilities and risks. Thus sole proprietorships are typically not the preferred ownership structure for small businesses.

Similar to a sole proprietorship, a partnership is also an informal type of business structure. While a sole proprietorship involves only one owner, a partnership is a business structure with two or more partners where there is still no legal distinction between the owners of a partnership and their business.

An LLC is a formal business structure that distinguishes the owners from the business itself.

LLCs offer the personal liability protection of a corporation with the pass-through taxation of a sole proprietorship or partnership.

It is the simplest way of structuring your business to protect your personal assets in the event your business is sued.

LLCs can be owned by one or more people, who are known as LLC “members.” An LLC with one owner is known as a single-member LLC, and an LLC with more than one owner is a multi-member LLC.

LLCs require operating agreements . Operating agreements are legal documents that outline the ownership and member duties of your LLC. This agreement allows you to set out the financial and working relations among business owners ("members") and between members and managers.

Recommended: Learn how to form an LLC in your state using our free guides.

A corporation is a legal business entity that is owned by shareholders, run by a board of directors, and created through registration with the state.

Corporations offer limited liability and tax benefits but are required to follow more complex operating procedures than their counterpart, the limited liability company (LLC).

Ownership and Executive Team

Now it’s time to sell the single most important element in your business plan. You!

This subsection of your business plan tells readers who is in your ownership and executive team and outlines the accomplishments of your team.

You should include a short profile on each member of your ownership and executive team that will play a role in company decision making.

Who is on your ownership and executive team? What roles will each perform? What knowledge, experience, and accomplishments do you and your team bring to the table? What roles do you still need to fill, and how and when do you plan on filling them?

It is well known that many investors consider the experience and ability of the ownership and management team to be just as important as the idea itself. Do not pass over this opportunity to highlight how your knowledge, experience, and accomplishments set you up to succeed.

Also, remember that when you are writing your descriptions of your ownership team, talk about your accomplishments- as opposed to experience. Accomplishments signify that you have a track record and can get things done.

Key Personnel

This section of the business plan highlights the key personnel associated with the business . This may include members of the management team outside of the owners and executive management, the board of directors, and any outside advisors.

Here, include profiles on each key figure associated with your company, focusing on their accomplishments and the knowledge and skill they bring to the business.

Operational Plan

The operational plan describes how you will operate. The processes, strategies, and resources that you will use to operate your business on a daily basis.

This includes descriptions of production (if you produce a product) or the process you will use to carry out your service. The operational plan may also include, as necessary, descriptions of your logistics and supply chain, physical resources and needs, human resources and needs, technological resources and needs, and timetables for carrying out your plan.

Production Plan or Service Description

The production plan or service description explains how you are going to make and deliver your product(s) or provide your service(s). Although the production plans for products and services may look slightly different, both describe how your company will operate in the day-to-day.

If you are making a product , the production plan is where you will describe the process for making the product. What are your methods of production? What are the steps in your processes? How will you ensure quality? Maintain inventory? Handle Logistics?

If you are providing a service , the production plan is where you can describe the process you go through providing that service. What are your service methods? What will your sales and customer service look like? What is the customer experience like?

Most importantly, which of these might give you an advantage over your competitors? If you have any superior methods, processes, or other advantages, make sure to highlight them in your production plan or service description.

Logistics and Supply Chain

This section of the business plan describes your logistics and where you fall within the supply chain in your industry.

If you produce a product , you should discuss how you source materials, where your materials come from, and who your suppliers are. You will also need to discuss how you handle inventory, how you warehouse, and how you distribute your product(s).

If you are a service business , you may still have to discuss how you source materials used in your service, who your suppliers are, and how you handle inventory.

Physical Resources

In this section of the operational plan, you describe the physical resources that you have and the physical resources that you need to acquire. Think through everything you might need. This will become important when it is time to make financial projections.

• What facilities, machinery, equipment, and supplies do you require?
• Do you require raw materials?
• Who will be your primary suppliers?
• Secondary suppliers?
• Do you have back up suppliers and contingency plans if you cannot acquire raw materials?

Technological Resources

You should discuss the technological resources that you are developing, have, or need to create or acquire. Technological resources may include any software, applications, or websites that you have or will need to create, outsource, or purchase.

• What hardware or machinery will you require?
• What software or applications will you require?
• Can you purchase the software and applications you need?
• Are the software and applications you will need off-the-shelf or specialty?
• Will you have to create the software and applications you need?
• Do you need a website?
• Will you create and maintain your website inside the company or have it created and maintained by someone else?

Human Resources

Here, you describe the people that are a part of your team, and the human resources that you need to add to your team, hire, or outsource. Since you have already described the ownership and management team as well as key personnel, this section is more focused on production level workers and lower management.

• How much staffing will you need?
• What skills will your staff require?
• What will your staffing typically look like?
• How will you recruit, train, and retain employees?

Goals, Milestone, and Risk

The goals, milestones, and risks section of your business plan is the place to outline your goals, set key milestones, and explore and explain your preparation for the risks you will face.

Goals lay the foundation of where you intend to take your company and how you are going to get there. It is important to ascertain the short and long-term goals for your company.

Your goals should be connected to your mission and vision, your business model, and your strategic plans. They should also reflect your ambition to move the company forward and are often reflected in key performance indicators (KPIs) , such as numbers of users and customers, revenues, expenses, retention, satisfaction, and other indicators of performance.

Here are some questions to help you develop the goals for your company:

• When do you expect to break even?
• What do you expect your revenue to be in one year? Three years? Five years?
• What market share do you expect to capture in the next year? Three years? Five years?
• Where do you plan to expand from here?
• What KPIs do you need to achieve or improve?
• When do you expect to implement major objectives?
• What level of customer satisfaction do you hope to achieve?

When developing your goals, in addition to defining what your goals are, you also need to consider the how , the when , and the who . First, consider how your goals will get accomplished? What actions need to be taken to achieve your goals? What milestones do you need to accomplish along the way?

Your goals should also include your plan on when you plan on attaining each goal . Not only will your readers be curious about when you plan to achieve your goals, due dates and deadlines make for really powerful motivators.

Finally, you should also determine who is going to be responsible for working toward each goal. In a sole-proprietorship or startup it may be you, the business owner, or your founding team. However, as your organization grows, it will become more and more important to define who is responsible for pushing toward and achieving each goal.

SMART Goals

Your goals should be SMART: S pecific, M easurable, A ttainable, R ealistic, and T imely.

• Specific —  Your goals should be clear and specific. They should be narrow enough that you can determine the appropriate steps to attain them. In addition to what , in planning your goals, do not forget to be specific about how , when , and who . How will your goals be attained? When do you anticipate achieving them? Who is going to be responsible?
• Measurable —  Your goals should be measurable. There should be some objective metric or performance indicator by which you can tell if you have met your goals? How are you going to measure your goals? What metrics or performance indicators will you use? How will you know if you achieve your goals?
• Attainable —  Your goals must also be realistic and attainable. For a goal to be attainable you must be able to achieve it. Do not be afraid to push yourself, but setting unrealistic goals will cast doubt on your entire business plan. Ask yourself, can your goals be accomplished? By you? What will it take to attain them?
• Relevant —  Your goals also need to be relevant. To be relevant, they should contribute to the mission, vision, and success of your venture. Do your goals align with your company’s values? Are they within the scope of and aligned with your operational plan? Your marketing plan? Are they within the budget?
• Timely —  Your goals should also be timely and time-bound. Their process and progress should be clearly defined and they should have a starting and ending date. Without a timeframe, there is no sense of urgency, or motivation to get started. Make your goals time-bound. How long do you expect it to take? When do you plan on getting started? When do you anticipate achieving each goal?

Milestones are important events in your venture’s growth that mark significant change or stage of development.

Creating a list of milestones can act as a checklist of what you need to accomplish for your venture to reach its goals. They tell the story of how you are going to get from where you are to where you are going.

Milestones might include major events and accomplishments, such as:

• Forming an LLC
• Writing a Business Plan
• Securing Seed Capital
• Develop a Prototype
• Begin Production
• First Major Sale
• Reach 10,000 Downloads
• Achieve 1,000 Paying Customers

It is alright to list a few milestones that you have already completed. Or to leave them in your business plan once you complete them. Accomplished milestones show that you are making traction.

Milestones act as a signal to potential investors and other stakeholders what to expect from your venture and when to expect it. They also signal whether the venture is progressing and growing as expected.

Implementation Timeline

The implementation timeline is where you describe where your company is in its lifespan . You should set a timeline to reach your goals and milestones. This should include a short-term timeframe as well as where you anticipate being in the long term.

This section of the business plan should not be long. A simple chart will do. You can find several free timeline templates online to plug in your milestones and the time frame you expect to achieve them.

You will also want to include a section in your business plan showing that you understand the critical risks that your business may be subject to . The risks you will face in your business include both internal and external risks. These are any areas that expose your venture to any kind of loss- assets, customers, sales, profits, and reputation, among others.

By exploring your assumptions and identifying possible risks in those assumptions, you can show that you have assessed and are prepared to handle risks and threats that may arise. There are several tools available to analyze business risks, including SWOT Analysis and contingency planning .

SWOT Analysis

You may want to conduct a SWOT analysis or even include it in your business plan. A SWOT analysis is an analysis of your strengths, weaknesses, opportunities, and threats.

A SWOT analysis can help you understand your industry and market, your venture, and the strategies that you should pursue.

To conduct a SWOT analysis, you will need to assess factors both inside and outside your venture.

Here is how to conduct your own:

• What does your company do well?
• What are your company’s advantages?
• What do you do better than your competitors?
• What unique or low-cost assets do you have access to?
• What does your company not do well?
• What are your company’s disadvantages?
• What do your competitors do better than you?
• What needs to be improved?
• Where can you improve?
• Where can you grow?
• How can you turn your strengths into opportunities?
• How can you turn your weaknesses into opportunities?
• Do the trends of the industry or market represent a threat?
• Is the number of competitors growing?
• Do changes in technology or regulation threaten your success?
• Do your weaknesses represent a threat?

Contingency Plans

After assessing your risks and your SWOT analysis, you should address any major threats or risks that your venture faces with contingency plans.

Contingency plans are plans to help mitigate these risks by establishing a plan of action should an adverse event happen.

Contingency plans show that you understand the threats and risks to your venture, and you have a plan in place to lessen the damage should these risks emerge. There are various ways to prepare for adverse events. One is through planning- identifying alternatives and determining the best course of action. Another is business insurance.

Business Insurance

Business insurance protects against risk from several sources. The type of business insurance you will need varies greatly depending on the nature of your business.

While there are standard types of coverage like general liability insurance , professional liability insurance , workers’ compensation , insurance for commercial property and commercial auto insurance , there are also insurance policies that cover specific business activities and specialized equipment.

You can bundle most of these into what is called a Business Owner’s Policy (BOP) by a trusted insurance provider to get you started doing business.

Financial Statements

Your financial statements should include detailed projections of your income statement , cash flow statement, and balance sheet for the first year. You should also provide quarterly projections for the first three (or preferably five) years as well.

You also will likely need to include some sort of financial statement in your business plan. If you are a new venture, you will supply pro forma financial statements. Pro forma financial statements are simply financial projections.

Financial statements can help you to evaluate the cash needs of your venture, determine whether your venture is feasible and desirable, compare your expected returns with the alternatives, identify milestones and benchmarks, and demonstrate the value of your venture to investors.

Financial Assumptions

Before you begin completing your financial statements, you should first sit down and list the assumptions you will rely on to project your financial statements .

These should include projections concerning your:

• Initial revenue level per month
• Your growth and factors affecting growth
• Your inventory and inventory turnover
• And your operating expenses.

One of the biggest mistakes new ventures make is in making unrealistic assumptions .

Remember, revenue assumptions are key assumptions in determining whether your business will be viable. However, many entrepreneurs are overly optimistic about their revenue assumptions and tend to underestimate their expenses.

In order to make more accurate financial assumptions, back up your assumptions with data whenever possible. To find data to back up your assumptions, look for things like industry averages, market trends, and comparisons with similar ventures. You should already have a substantial amount of this data from your industry and market research.

Pro Forma Income Statements

The income statement , also known as the profit and loss statement , is a statement that shows the projections of your venture’s income and expenses over a fiscal year. On the income statement, you will detail your revenue and sources of revenue based on the assumptions you have made. You will also detail your anticipated expenses and use these to estimate your net income.

The typical income statement includes:

• Revenue —  the total amount of sales, or revenue, projected to be brought in by your business.
• Cost of Goods Sold —  the total direct cost of producing your product or delivering your service.
• Gross Margin —  the difference between revenue and cost of goods sold.
• Operating Expenses —  this section of your income statement details all of the expenses associated with operating your business. Common operating expenses might include rent, utilities, office
• expenses, salary expenses, and marketing and advertising expenses, among others.
• Total Operating Expenses —  the total of your operating expenses, excluding interest, depreciation, and taxes.
• Operating Income —  the difference between your gross margin and operating expenses.
• Interest, Depreciation, and Taxes —  this section of your income statement lists your non-operating expenses- expenses such as interest, depreciation, amortization, and taxes.
• Net Profit —  the total of how much you actually made. This is calculated by subtracting interest, depreciation, and taxes from your operating income.

Pro Forma Cash Flow Statements

The cash flow statement is a financial statement that shows when and where cash (and cash equivalents) flow in and out of your venture. This tells you how much cash you will have on hand at any single point in time.

• Cash from Operating —  Cash flowing into and out of your venture from operating, beginning with “cash on hand.” Cash flowing into your venture from operating includes cash from sales, payments from credit sales, investment income, and any other types of cash income related to operations. Cash flowing out of your venture from operations, your expenses, includes costs of raw goods, materials, inventory, salary expenses, office expenses, marketing and advertising expenses, rent, interest, taxes, insurance, or any other expenses that are paid by the venture.
• Capital Cash Flow —  Cash flow, in or out of the venture, for capital assets such as the purchase or sale of fixed assets.
• Cash from Financing —  Cash flow from financing includes cash flowing in or out of your venture relating to venture financing activities. Inflows of cash from financing include the investments by founders or owners, any loans taken out during the period, or the issuance of any equity. The outflow of cash from financing may include the payment of the principal of any loans, along with the repurchase of any outstanding equity.

Pro Forma Balance Sheet

The balance sheet is a financial statement that balances a venture's finances at a specific point in time. It describes how much the company is worth. The balance sheet uses the accounting equation: assets = liabilities + equity . In fact, these are the main components of the balance sheet:

• Assets —  Resources that hold economic value. A business's assets include current assets and fixed assets. Current assets are resources that can be accessed in the short term. These include cash, accounts receivable, inventory, and other currently available resources. Fixed assets are resources that are intended for long-term use but hold economic value. These include land and buildings, machinery and equipment, furniture and fixtures, vehicles, and other fixed resources.
• Liabilities —  What the business owes. Like assets, a business’s liabilities are also current liabilities and long-term liabilities. Current liabilities are liabilities that are due within 12 months. Current liabilities include accounts payable, loans, and taxes. Long-term liabilities are liabilities that are due after one year. These include long-term loans, notes, and other long-term debts.
• Equity —  What the owners or shareholders own. Equity is also composed of two parts: Capital and Retained Earnings. Retained earnings is the amount of profit that has been retained by the company over the life of the venture. Capital earnings , then, is what’s left. It is what has been invested. For new ventures, this may be the founder’s or early investors’ initial investments. For larger corporations, this would be the value of their shares of stock.

Break-Even Analysis

The break-even analysis shows you how much you have to sell before you break even. The break-even analysis uses fixed and variable costs in order to determine the sales volume you have to attain to reach a break-even point. This is the point where your sales volume covers both your fixed costs and your variable costs.

The break-even point is most often expressed as a number of units. You can calculate the break-even point by dividing fixed cost by the average profit per unit (average price per unit minus the variable cost).

Break-Even Point = Fixed Costs/ Profit Per Unit (Avg. Price - Avg. Variable Costs)

You can also calculate the break-even point in terms of $ of sales. To calculate the break-even point in $ of sales, you can divide total fixed costs for the period by the contribution margin ratio (net sales minus total variable cost / net sales).

Break-Even Point ($ of Sales) = Fixed Costs / Contribution Margin Ratio Contribution Margin Ratio = (Net Sales - Total Variable Cost) / Net Sales

Startup/Funds Required

If you are writing your business plan for the purpose of seeking funding, you should conclude your business plan by describing the investment opportunity.

With your financial projections in place, you will now be able to determine the amount of startup capital or investment you require.

This is because the funding you need is highly dependent on your profit and loss, cash flow, and break-even point. With well-researched assumptions and the evidence to back them up, you are ready to make the case that your business is worth the investment and will be able to pay it back or reward investors in the future.

In this section of the business plan, you will need to explain the amount of funding you are requesting as well as describe what those funds will be used for. The startup funding request will need to cover all expenses (maybe even your own personal expenses) at least until you reach your break-even point.

Business Plan Appendices (Optional)

If you have additional evidence to support your business idea, your business model, or your ability to achieve your goals and meet your financial objectives, you may want to consider including it as an appendix to your business plan.

Additional / Optional Evidence

Owners’ Resumes —  One thing you may want to consider including in your business plan is the resume for each owner. Investors often invest as much in the startup team as they do in the idea itself. Illustrations of Product —  Another helpful appendix is pictures or illustrations of your product. These are especially helpful for new products or those which are difficult to depict with words. Storyboard of Customer Experience — If your business is a service business, you could also consider including a storyboard depicting your customer’s experience. Customer Survey Results — You can also include any market research that you have conducted in an appendix. Showing that you have solicited feedback from real customers or potential customers provides further credence to your venture and venture idea.

Develop Your Business Idea

Before writing your business plan, it is important to take some time to develop your business idea .

If you are starting a new company, there are likely many details of the venture that have not been fully worked through. If you already have an existing venture, the following tools can also be useful in evaluating your business model:

• A three-sentence business plan

The Lean Canvas

The business model canvas, three-sentence business plan.

An easy place to start is with a three-sentence business plan . The three-sentence business plan is easy to construct, and consists of three parts:

• your product or service
• your market and marketing
• your revenue model.

Your Product or Service

The first sentence of your business plan clearly yet simply states your business's primary product or service. This includes the what and the where.

Example: “CoffeeMe is an upscale bakery and coffee shop specializing in imported coffees and international delicacies that will be located in downtown Atlanta.”

Your Market(ing)

The second sentence of your three-sentence business plan describes who your target market is and how you will promote to them.

Example: “CoffeeMe’s target market is urban professionals living and working in downtown Atlanta, marketed and promoted through traditional advertising, company partnerships, and social media.”

Your Revenue Model

The third sentence of your three-sentence business plan explains your revenue model. How will you make money?

Example: “CoffeeMe’s revenue model includes one-time retail sales as well as a unique subscription model featuring all-you-can-drink coffee for subscribers.”

Put it all together, and you have your three-sentence business plan:

Example: “CoffeeMe is an upscale bakery and coffee shop specializing in imported coffees and international delicacies that will be located in downtown Atlanta. CoffeeMe’s target market is urban professionals living and working in downtown Atlanta, marketed and promoted through traditional advertising, company partnerships, and social media. Our revenue model includes one-time retail sales as well as a unique subscription model featuring all-you-can-drink coffee for subscribers.”

Another useful tool for developing your business idea is the Lean Canvas . The Lean Canvas takes a problem-solution approach to helping you plan your business, focusing on the problems you are solving for your customers.

The Lean Canvas helps you describe and visualize your problem, solution, customers, value proposition, key performance indicators, and competitive advantage.

The steps to complete the Lean Canvas are:

• Define your target customers or users
• List the problems you are solving for them and how they are currently solving those problems today
• Describe your solution
• Explain your unique value proposition
• Describe your revenue streams
• Depict how you will reach customers
• Define the key metrics that will tell if you are doing well
• Detail your cost structure
• Explain your unfair advantage

The Lean Canvas, created by Ash Maurya, and licensed under Creative Commons Attribution-Share Alike 3.0 Unported License: https://leanstack.com/lean-canvas

The Business Model Canvas helps you describe and visualize the key aspects of your venture including your customers, value proposition, infrastructure, and revenue and cost models.

If you have already completed a Lean Canvas, you will already have several of the central parts of the Business Model Canvas complete.

The steps to complete the Business Model Canvas are:

• Explain your value proposition
• Describe how you interact with customers
• List the key activities that you will need to do to deliver on your value proposition
• List the key assets that you will need to deliver on your value proposition
• Describe the key partnerships that you will need to put in place to deliver on your value proposition

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What Is a Business Plan?

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

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

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

Key Takeaways

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

Investopedia / Ryan Oakley

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

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

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

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

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

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

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

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

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

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

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

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

2 Types of Business Plans

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

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

Why Do Business Plans Fail?

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

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

What Does a Lean Startup Business Plan Include?

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

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

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

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

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

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How to Write a Business Plan Outline [Examples + Templates] 

By Letícia Fonseca , Aug 11, 2023

When venturing into crafting a business plan, the initial hurdle often lies in taking that first step.

So, how can you evade those prolonged hours of staring at a blank page? Initiate your journey with the aid of a business plan outline.

As with any endeavor, an outline serves as the beacon of clarity, illuminating the path to confront even the most formidable tasks. This holds particularly true when composing pivotal documents vital to your triumph, much like a business plan.

Nonetheless, I understand the enormity of a business plan’s scope, which might make the task of outlining it seem daunting. This is precisely why I’ve compiled all the requisite information to facilitate the creation of a business plan outline. No need to break a sweat!

And if you’re seeking further assistance, a business plan maker and readily available business plan templates can offer valuable support in shaping your comprehensive plan.

Read on for answers to all your business plan outline questions or jump ahead for some handy templates. 

Click to jump ahead:

What is a business plan outline (and why do you need one), what format should you choose for your business plan outline, what are the key components of a business plan outline.

• Business plan template examples
• Writing tips to ace your outline 

A business plan outline is the backbone of your business plan. It contains all the most important information you’ll want to expand on in your full-length plan. 

Think of it this way: your outline is a frame for your plan. It provides a high-level idea of what the final plan should look like, what it will include and how all the information will be organized. 

Why would you do this extra step? Beyond saving you from blank page syndrome, an outline ensures you don’t leave any essential information out of your plan — you can see all the most important points at a glance and quickly identify any content gaps. 

It also serves as a writing guide. Once you know all the sections you want in your plan, you just need to expand on them. Suddenly, you’re “filling in the blanks” as opposed to writing a plan from scratch!

Incidentally, using a business plan template like this one gives you a running head start, too: 

Perhaps most importantly, a business plan outline keeps you focused on the essential parts of your document. (Not to mention what matters most to stakeholders and investors.)  With an outline, you’ll spend less time worrying about structure or organization and more time perfecting the actual content of your document. 

If you’re looking for more general advice, you can read about  how to create a business plan here . But if you’re working on outlining your plan, stick with me.

Return to Table of Contents

Most business plans fit into one of two formats. 

The format you choose largely depends on three factors: (1) the stage of your business, (2) if you’re presenting the plan to investors and (3) what you want to achieve with your business plan. 

Let’s have a closer look at these two formats and why you might choose one over the other.

Traditional format

Traditional business plans  are typically long, detailed documents. In many cases, they take up to 50-60 pages, but it’s not uncommon to see plans spanning 100+ pages. 

Traditional plans are long because they cover  every aspect  of your business. They leave nothing out. You’ll find a traditional business plan template with sections like executive summary, company description, target market, market analysis, marketing plan, financial plan, and more. Basically: the more information the merrier.

This business plan template isn’t of a traditional format, but you could expand it into one by duplicating pages:

Due to their high level of detail, traditional formats are the best way to sell your business. They show you’re reliable and have a clear vision for your business’s future. 

If you’re planning on presenting your plan to investors and stakeholders, you’ll want to go with a traditional plan format. The more information you include, the fewer doubts and questions you’ll get when you present your plan, so don’t hold back. 

Traditional business plans require more detailed outlines before drafting since there’s a lot of information to cover. You’ll want to list all the sections and include bullet points describing what each section should cover. 

It’s also a good idea to include all external resources and visuals in your outline, so you don’t have to gather them later. 

Lean format

Lean business plan formats are high level and quick to write. They’re often only one or two pages. Similar to a  business plan infographic , they’re scannable and quick to digest, like this template: 

This format is often referred to as a “startup” format due to (you guessed it!) many startups using it. 

Lean business plans require less detailed outlines. You can include high-level sections and a few lines in each section covering the basics. Since the final plan will only be a page or two, you don’t need to over prepare. Nor will you need a ton of external resources. 

Lean plans don’t answer all the questions investors and stakeholders may ask, so if you go this route, make sure it’s the right choice for your business . Companies not yet ready to present to investors will typically use a lean/startup business plan format to get their rough plan on paper and share it internally with their management team. 

Here’s another example of a lean business plan format in the form of a financial plan: 

Your business plan outline should include all the following sections. The level of detail you choose to go into will depend on your intentions for your plan (sharing with stakeholders vs. internal use), but you’ll want every section to be clear and to the point. 

1. Executive summary

The executive summary gives a high-level description of your company, product or service. This section should include a mission statement, your company description, your business’s primary goal, and the problem it aims to solve. You’ll want to state how your business can solve the problem and briefly explain what makes you stand out (your competitive advantage).

Having an executive summary is essential to selling your business to stakeholders , so it should be as clear and concise as possible. Summarize your business in a few sentences in a way that will hook the reader (or audience) and get them invested in what you have to say next. In other words, this is your elevator pitch.

2. Product and services description

This is where you should go into more detail about your product or service. Your product is the heart of your business, so it’s essential this section is easy to grasp. After all, if people don’t know what you’re selling, you’ll have a hard time keeping them engaged!

Expand on your description in the executive summary, going into detail about the problem your customers face and how your product/service will solve it. If you have various products or services, go through all of them in equal detail. 

3. Target market and/or Market analysis

A market analysis is crucial for placing your business in a larger context and showing investors you know your industry. This section should include market research on your prospective customer demographic including location, age range, goals and motivations. 

You can even  include detailed customer personas  as a visual aid — these are especially useful if you have several target demographics. You want to showcase your knowledge of your customer, who exactly you’re selling to and how you can fulfill their needs.

Be sure to include information on the overall target market for your product, including direct and indirect competitors and how your industry is performing. If your competitors have strengths you want to mimic or weaknesses you want to exploit, this is the place to record that information. 

4. Organization and management

You can think of this as a “meet the team” section — this is where you should go into depth on your business’s structure from management to legal and HR. If there are people bringing unique skills or experience to the table (I’m sure there are!), you should highlight them in this section. 

The goal here is to showcase why your team is the best to run your business. Investors want to know you’re unified, organized and reliable. This is also a potential opportunity to bring more humanity to your business plan and showcase the faces behind the ideas and product. 

5. Marketing and sales

Now that you’ve introduced your product and team, you need to explain how you’re going to sell it. Give a detailed explanation of your sales and marketing strategy, including pricing, timelines for launching your product and advertising.

This is a major section of your plan and can even live as a separate document for your marketing and sales teams. Here are some  marketing plan templates to help you get started .

Make sure you have research or analysis to back up your decisions — if you want to do paid ads on LinkedIn to advertise your product, include a brief explanation as to why that is the best channel for your business. 

6. Financial projections and funding request

The end of your plan is where you’ll look to the future and how you think your business will perform financially. Your financial plan should include results from your income statement, balance sheet and cash flow projections. 

State your funding requirements and what you need to realize the business. Be extremely clear about how you plan to use the funding and when you expect investors will see returns.

If you aren’t presenting to potential investors, you can skip this part, but it’s something to keep in mind should you seek funding in the future. Covering financial projections and the previous five components is essential at the stage of business formation to ensure everything goes smoothly moving forward.

7. Appendix

Any extra visual aids, receipts, paperwork or charts will live here. Anything that may be relevant to your plan should be included as reference e.g. your cash flow statement (or other financial statements). You can format your appendix in whatever way you think is best — as long as it’s easy for readers to find what they’re looking for, you’ve done your job!

Typically, the best way to start your outline is to list all these high-level sections. Then, you can add bullet points outlining what will go in each section and the resources you’ll need to write them. This should give you a solid starting point for your full-length plan.

Business plan outline templates

Looking for a shortcut? Our  business plan templates  are basically outlines in a box! 

While your outline likely won’t go into as much detail, these templates are great examples of how to organize your sections.

Traditional format templates

A strong template can turn your long, dense business plan into an engaging, easy-to-read document. There are lots to choose from, but here are just a few ideas to inspire you… 

You can duplicate pages and use these styles for a traditional outline, or start with a lean outline as you build your business plan out over time:

Lean format templates

For lean format outlines, a simpler ‘ mind map ’ style is a good bet. With this style, you can get ideas down fast and quickly turn them into one or two-page plans. Plus, because they’re shorter, they’re easy to share with your team.

Writing tips to ace your business plan outline

Business plans are complex documents, so if you’re still not sure how to write your outline, don’t worry! Here are some helpful tips to keep in mind when drafting your business plan outline:

• Ask yourself why you’re writing an outline. Having a clear goal for your outline can help keep you on track as you write. Everything you include in your plan should contribute to your goal. If it doesn’t, it probably doesn’t need to be in there.
• Keep it clear and concise. Whether you’re writing a traditional or lean format business plan, your outline should be easy to understand. Choose your words wisely and avoid unnecessary preambles or padding language. The faster you get to the point, the easier your plan will be to read.
• Add visual aids. No one likes reading huge walls of text! Make room in your outline for visuals, data and charts. This keeps your audience engaged and helps those who are more visual learners. Psst,  infographics  are great for this.
• Make it collaborative. Have someone (or several someones) look it over before finalizing your outline. If you have an established marketing / sales / finance team, have them look it over too. Getting feedback at the outline stage can help you avoid rewrites and wasted time down the line.

If this is your first time writing a business plan outline, don’t be too hard on yourself. You might not get it 100% right on the first try, but with these tips and the key components listed above, you’ll have a strong foundation. Remember, done is better than perfect. 

Create a winning business plan by starting with a detailed, actionable outline

The best way to learn is by doing. So go ahead, get started on your business plan outline. As you develop your plan, you’ll no doubt learn more about your business and what’s important for success along the way. 

A clean, compelling template is a great way to get a head start on your outline. After all, the sections are already separated and defined for you! 

Explore Venngage’s business plan templates  for one that suits your needs. Many are free to use and there are premium templates available for a small monthly fee. Happy outlining!

24 of My Favorite Sample Business Plans & Examples For Your Inspiration

Published: February 06, 2024

Free Business Plan Template

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I believe that reading sample business plans is essential when writing your own.

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As you explore business plan examples from real companies and brands, it’s easier for you to learn how to write a good one.

But what does a good business plan look like? And how do you write one that’s both viable and convincing. I’ll walk you through the ideal business plan format along with some examples to help you get started.

Table of Contents

Business Plan Format

Business plan types, sample business plan templates, top business plan examples.

Ask any successful sports coach how they win so many games, and they’ll tell you they have a unique plan for every single game. To me, the same logic applies to business.

If you want to build a thriving company that can pull ahead of the competition, you need to prepare for battle before breaking into a market.

Business plans guide you along the rocky journey of growing a company. And if your business plan is compelling enough, it can also convince investors to give you funding.

With so much at stake, I’m sure you’re wondering where to begin.

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

You're all set!

Click this link to access this resource at any time.

Fill out the form to get your free template.

First, you’ll want to nail down your formatting. Most business plans include the following sections.

1. Executive Summary

I’d say the executive summary is the most important section of the entire business plan. 

Why? Essentially, it's the overview or introduction, written in a way to grab readers' attention and guide them through the rest of the business plan. This is important, because a business plan can be dozens or hundreds of pages long.

There are two main elements I’d recommend including in your executive summary:

Company Description

This is the perfect space to highlight your company’s mission statement and goals, a brief overview of your history and leadership, and your top accomplishments as a business.

Tell potential investors who you are and why what you do matters. Naturally, they’re going to want to know who they’re getting into business with up front, and this is a great opportunity to showcase your impact.

Need some extra help firming up those business goals? Check out HubSpot Academy’s free course to help you set goals that matter — I’d highly recommend it

Products and Services

To piggyback off of the company description, be sure to incorporate an overview of your offerings. This doesn’t have to be extensive — just another chance to introduce your industry and overall purpose as a business.

In addition to the items above, I recommend including some information about your financial projections and competitive advantage here too.:

Keep in mind you'll cover many of these topics in more detail later on in the business plan. So, keep the executive summary clear and brief, and only include the most important takeaways.

Executive Summary Business Plan Examples

This example was created with HubSpot’s business plan template:

This executive summary is so good to me because it tells potential investors a short story while still covering all of the most important details.

Image Source

Tips for Writing Your Executive Summary

• Start with a strong introduction of your company, showcase your mission and impact, and outline the products and services you provide.
• Clearly define a problem, and explain how your product solves that problem, and show why the market needs your business.
• Be sure to highlight your value proposition, market opportunity, and growth potential.
• Keep it concise and support ideas with data.
• Customize your summary to your audience. For example, emphasize finances and return on investment for venture capitalists.

Check out our tips for writing an effective executive summary for more guidance.

2. Market Opportunity

This is where you'll detail the opportunity in the market.

The main question I’d ask myself here is this: Where is the gap in the current industry, and how will my product fill that gap?

More specifically, here’s what I’d include in this section:

• The size of the market
• Current or potential market share
• Trends in the industry and consumer behavior
• Where the gap is
• What caused the gap
• How you intend to fill it

To get a thorough understanding of the market opportunity, you'll want to conduct a TAM, SAM, and SOM analysis and perform market research on your industry.

You may also benefit from creating a SWOT analysis to get some of the insights for this section.

Market Opportunity Business Plan Example

I like this example because it uses critical data to underline the size of the potential market and what part of that market this service hopes to capture.

Tips for Writing Your Market Opportunity Section

• Focus on demand and potential for growth.
• Use market research, surveys, and industry trend data to support your market forecast and projections.
• Add a review of regulation shifts, tech advances, and consumer behavior changes.
• Refer to reliable sources.
• Showcase how your business can make the most of this opportunity.

3. Competitive Landscape

Since we’re already speaking of market share, you'll also need to create a section that shares details on who the top competitors are.

After all, your customers likely have more than one brand to choose from, and you'll want to understand exactly why they might choose one over another.

My favorite part of performing a competitive analysis is that it can help you uncover:

• Industry trends that other brands may not be utilizing
• Strengths in your competition that may be obstacles to handle
• Weaknesses in your competition that may help you develop selling points
• The unique proposition you bring to the market that may resonate with customers

Competitive Landscape Business Plan Example

I like how the competitive landscape section of this business plan below shows a clear outline of who the top competitors are.

It also highlights specific industry knowledge and the importance of location, which shows useful experience in this specific industry. 

This can help build trust in your ability to execute your business plan.

Tips for Writing Your Competitive Landscape

• Complete in-depth research, then emphasize your most important findings.
• Compare your unique selling proposition (USP) to your direct and indirect competitors.
• Show a clear and realistic plan for product and brand differentiation.
• Look for specific advantages and barriers in the competitive landscape. Then, highlight how that information could impact your business.
• Outline growth opportunities from a competitive perspective.
• Add customer feedback and insights to support your competitive analysis.

4. Target Audience

Use this section to describe who your customer segments are in detail. What is the demographic and psychographic information of your audience?

If your immediate answer is "everyone," you'll need to dig deeper. Here are some questions I’d ask myself here:

• What demographics will most likely need/buy your product or service?
• What are the psychographics of this audience? (Desires, triggering events, etc.)
• Why are your offerings valuable to them?

I’d also recommend building a buyer persona to get in the mindset of your ideal customers and be clear on why you're targeting them.

Target Audience Business Plan Example

I like the example below because it uses in-depth research to draw conclusions about audience priorities. It also analyzes how to create the right content for this audience.

Tips for Writing Your Target Audience Section

• Include details on the size and growth potential of your target audience.
• Figure out and refine the pain points for your target audience , then show why your product is a useful solution.
• Describe your targeted customer acquisition strategy in detail.
• Share anticipated challenges your business may face in acquiring customers and how you plan to address them.
• Add case studies, testimonials, and other data to support your target audience ideas.
• Remember to consider niche audiences and segments of your target audience in your business plan.

5. Marketing Strategy

Here, you'll discuss how you'll acquire new customers with your marketing strategy. I’d suggest including information:

• Your brand positioning vision and how you'll cultivate it
• The goal targets you aim to achieve
• The metrics you'll use to measure success
• The channels and distribution tactics you'll use

I think it’s helpful to have a marketing plan built out in advance to make this part of your business plan easier.

Marketing Strategy Business Plan Example

This business plan example includes the marketing strategy for the town of Gawler.

In my opinion, it really works because it offers a comprehensive picture of how they plan to use digital marketing to promote the community.

Tips for Writing Your Marketing Strategy

• Include a section about how you believe your brand vision will appeal to customers.
• Add the budget and resources you'll need to put your plan in place.
• Outline strategies for specific marketing segments.
• Connect strategies to earlier sections like target audience and competitive analysis.
• Review how your marketing strategy will scale with the growth of your business.
• Cover a range of channels and tactics to highlight your ability to adapt your plan in the face of change.

6. Key Features and Benefits

At some point in your business plan, you'll need to review the key features and benefits of your products and/or services.

Laying these out can give readers an idea of how you're positioning yourself in the market and the messaging you're likely to use. It can even help them gain better insight into your business model.

Key Features and Benefits Business Plan Example

In my opinion, the example below does a great job outlining products and services for this business, along with why these qualities will attract the audience.

Tips for Writing Your Key Features and Benefits

• Emphasize why and how your product or service offers value to customers.
• Use metrics and testimonials to support the ideas in this section.
• Talk about how your products and services have the potential to scale.
• Think about including a product roadmap.
• Focus on customer needs, and how the features and benefits you are sharing meet those needs.
• Offer proof of concept for your ideas, like case studies or pilot program feedback.
• Proofread this section carefully, and remove any jargon or complex language.

7. Pricing and Revenue

This is where you'll discuss your cost structure and various revenue streams. Your pricing strategy must be solid enough to turn a profit while staying competitive in the industry. 

For this reason, here’s what I’d might outline in this section:

• The specific pricing breakdowns per product or service
• Why your pricing is higher or lower than your competition's
• (If higher) Why customers would be willing to pay more
• (If lower) How you're able to offer your products or services at a lower cost
• When you expect to break even, what margins do you expect, etc?

Pricing and Revenue Business Plan Example

I like how this business plan example begins with an overview of the business revenue model, then shows proposed pricing for key products.

Tips for Writing Your Pricing and Revenue Section

• Get specific about your pricing strategy. Specifically, how you connect that strategy to customer needs and product value.
• If you are asking a premium price, share unique features or innovations that justify that price point.
• Show how you plan to communicate pricing to customers.
• Create an overview of every revenue stream for your business and how each stream adds to your business model as a whole.
• Share plans to develop new revenue streams in the future.
• Show how and whether pricing will vary by customer segment and how pricing aligns with marketing strategies.
• Restate your value proposition and explain how it aligns with your revenue model.

8. Financials

To me, this section is particularly informative for investors and leadership teams to figure out funding strategies, investment opportunities, and more.

 According to Forbes , you'll want to include three main things:

• Profit/Loss Statement - This answers the question of whether your business is currently profitable.
• Cash Flow Statement - This details exactly how much cash is incoming and outgoing to give insight into how much cash a business has on hand.
• Balance Sheet - This outlines assets, liabilities, and equity, which gives insight into how much a business is worth.

While some business plans might include more or less information, these are the key details I’d include in this section.

Financials Business Plan Example

This balance sheet is a great example of level of detail you’ll need to include in the financials section of your business plan.

Tips for Writing Your Financials Section

• Growth potential is important in this section too. Using your data, create a forecast of financial performance in the next three to five years.
• Include any data that supports your projections to assure investors of the credibility of your proposal.
• Add a break-even analysis to show that your business plan is financially practical. This information can also help you pivot quickly as your business grows.
• Consider adding a section that reviews potential risks and how sensitive your plan is to changes in the market.
• Triple-check all financial information in your plan for accuracy.
• Show how any proposed funding needs align with your plans for growth.

As you create your business plan, keep in mind that each of these sections will be formatted differently. Some may be in paragraph format, while others could be charts or graphs.

The formats above apply to most types of business plans. That said, the format and structure of your plan will vary by your goals for that plan. 

So, I’ve added a quick review of different business plan types. For a more detailed overview, check out this post .

1. Startups

Startup business plans are for proposing new business ideas.

If you’re planning to start a small business, preparing a business plan is crucial. The plan should include all the major factors of your business.

You can check out this guide for more detailed business plan inspiration .

2. Feasibility Studies

Feasibility business plans focus on that business's product or service. Feasibility plans are sometimes added to startup business plans. They can also be a new business plan for an already thriving organization.

3. Internal Use

You can use internal business plans to share goals, strategies, or performance updates with stakeholders. In my opinion, internal business plans are useful for alignment and building support for ambitious goals.

4. Strategic Initiatives

Another business plan that's often for sharing internally is a strategic business plan. This plan covers long-term business objectives that might not have been included in the startup business plan.

5. Business Acquisition or Repositioning

When a business is moving forward with an acquisition or repositioning, it may need extra structure and support. These types of business plans expand on a company's acquisition or repositioning strategy.

Growth sometimes just happens as a business continues operations. But more often, a business needs to create a structure with specific targets to meet set goals for expansion. This business plan type can help a business focus on short-term growth goals and align resources with those goals.

Now that you know what's included and how to format a business plan, let's review some of my favorite templates.

1. HubSpot's One-Page Business Plan

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

The business plan linked above was created here at HubSpot and is perfect for businesses of any size — no matter how many strategies we still have to develop.

Fields such as Company Description, Required Funding, and Implementation Timeline give this one-page business plan a framework for how to build your brand and what tasks to keep track of as you grow.

Then, as the business matures, you can expand on your original business plan with a new iteration of the above document.

Why I Like It

This one-page business plan is a fantastic choice for the new business owner who doesn’t have the time or resources to draft a full-blown business plan. It includes all the essential sections in an accessible, bullet-point-friendly format. That way, you can get the broad strokes down before honing in on the details.

2. HubSpot's Downloadable Business Plan Template

We also created a business plan template for entrepreneurs.

The template is designed as a guide and checklist for starting your own business. You’ll learn what to include in each section of your business plan and how to do it.

There’s also a list for you to check off when you finish each section of your business plan.

Strong game plans help coaches win games and help businesses rocket to the top of their industries. So if you dedicate the time and effort required to write a workable and convincing business plan, you’ll boost your chances of success and even dominance in your market.

This business plan kit is essential for the budding entrepreneur who needs a more extensive document to share with investors and other stakeholders.

It not only includes sections for your executive summary, product line, market analysis, marketing plan, and sales plan, but it also offers hands-on guidance for filling out those sections.

3. LiveFlow’s Financial Planning Template with built-in automation

This free template from LiveFlow aims to make it easy for businesses to create a financial plan and track their progress on a monthly basis.

The P&L Budget versus Actual format allows users to track their revenue, cost of sales, operating expenses, operating profit margin, net profit, and more.

The summary dashboard aggregates all of the data put into the financial plan sheet and will automatically update when changes are made.

Instead of wasting hours manually importing your data to your spreadsheet, LiveFlow can also help you to automatically connect your accounting and banking data directly to your spreadsheet, so your numbers are always up-to-date.

With the dashboard, you can view your runway, cash balance, burn rate, gross margins, and other metrics. Having a simple way to track everything in one place will make it easier to complete the financials section of your business plan.

This is a fantastic template to track performance and alignment internally and to create a dependable process for documenting financial information across the business. It’s highly versatile and beginner-friendly.

It’s especially useful if you don’t have an accountant on the team. (I always recommend you do, but for new businesses, having one might not be possible.)

4. ThoughtCo’s Sample Business Plan

One of the more financially oriented sample business plans in this list, BPlan’s free business plan template dedicates many of its pages to your business’s financial plan and financial statements.

After filling this business plan out, your company will truly understand its financial health and the steps you need to take to maintain or improve it.

I absolutely love this business plan template because of its ease-of-use and hands-on instructions (in addition to its finance-centric components). If you feel overwhelmed by the thought of writing an entire business plan, consider using this template to help you with the process.

6. Harvard Business Review’s "How to Write a Winning Business Plan"

Most sample business plans teach you what to include in your business plan, but this Harvard Business Review article will take your business plan to the next level — it teaches you the why and how behind writing a business plan.

With the guidance of Stanley Rich and Richard Gumpert, co-authors of " Business Plans That Win: Lessons From the MIT Enterprise Forum ", you'll learn how to write a convincing business plan that emphasizes the market demand for your product or service.

You’ll also learn the financial benefits investors can reap from putting money into your venture rather than trying to sell them on how great your product or service is.

This business plan guide focuses less on the individual parts of a business plan, and more on the overarching goal of writing one. For that reason, it’s one of my favorites to supplement any template you choose to use. Harvard Business Review’s guide is instrumental for both new and seasoned business owners.

7. HubSpot’s Complete Guide to Starting a Business

If you’re an entrepreneur, you know writing a business plan is one of the most challenging first steps to starting a business.

Fortunately, with HubSpot's comprehensive guide to starting a business, you'll learn how to map out all the details by understanding what to include in your business plan and why it’s important to include them. The guide also fleshes out an entire sample business plan for you.

If you need further guidance on starting a business, HubSpot's guide can teach you how to make your business legal, choose and register your business name, and fund your business. It will also give small business tax information and includes marketing, sales, and service tips.

This comprehensive guide will walk you through the process of starting a business, in addition to writing your business plan, with a high level of exactitude and detail. So if you’re in the midst of starting your business, this is an excellent guide for you.

It also offers other resources you might need, such as market analysis templates.

8. Panda Doc’s Free Business Plan Template

PandaDoc’s free business plan template is one of the more detailed and fleshed-out sample business plans on this list. It describes what you should include in each section, so you don't have to come up with everything from scratch.

Once you fill it out, you’ll fully understand your business’ nitty-gritty details and how all of its moving parts should work together to contribute to its success.

This template has two things I love: comprehensiveness and in-depth instructions. Plus, it’s synced with PandaDoc’s e-signature software so that you and other stakeholders can sign it with ease. For that reason, I especially love it for those starting a business with a partner or with a board of directors.

9. Small Business Administration Free Business Plan Template

The Small Business Administration (SBA) offers several free business plan templates that can be used to inspire your own plan.

Before you get started, you can decide what type of business plan you need — a traditional or lean start-up plan.

Then, you can review the format for both of those plans and view examples of what they might look like.

We love both of the SBA’s templates because of their versatility. You can choose between two options and use the existing content in the templates to flesh out your own plan. Plus, if needed, you can get a free business counselor to help you along the way.

I’ve compiled some completed business plan samples to help you get an idea of how to customize a plan for your business.

I chose different types of business plan ideas to expand your imagination. Some are extensive, while others are fairly simple.

Let’s take a look.

1. LiveFlow

One of the major business expenses is marketing. How you handle your marketing reflects your company’s revenue.

I included this business plan to show you how you can ensure your marketing team is aligned with your overall business plan to get results. The plan also shows you how to track even the smallest metrics of your campaigns, like ROI and payback periods instead of just focusing on big metrics like gross and revenue.

Fintech startup, LiveFlow, allows users to sync real-time data from its accounting services, payment platforms, and banks into custom reports. This eliminates the task of pulling reports together manually, saving teams time and helping automate workflows.

"Using this framework over a traditional marketing plan will help you set a profitable marketing strategy taking things like CAC, LTV, Payback period, and P&L into consideration," explains LiveFlow co-founder, Lasse Kalkar .

When it came to including marketing strategy in its business plan, LiveFlow created a separate marketing profit and loss statement (P&L) to track how well the company was doing with its marketing initiatives.

This is a great approach, allowing businesses to focus on where their marketing dollars are making the most impact. Having this information handy will enable you to build out your business plan’s marketing section with confidence. LiveFlow has shared the template here . You can test it for yourself.

2. Lula Body

Sometimes all you need is a solid mission statement and core values to guide you on how to go about everything. You do this by creating a business plan revolving around how to fulfill your statement best.

For example, Patagonia is an eco-friendly company, so their plan discusses how to make the best environmentally friendly products without causing harm.

A good mission statement  should not only resonate with consumers but should also serve as a core value compass for employees as well.

Patagonia has one of the most compelling mission statements I’ve seen:

"Together, let’s prioritise purpose over profit and protect this wondrous planet, our only home."

It reels you in from the start, and the environmentally friendly theme continues throughout the rest of the statement.

This mission goes on to explain that they are out to "Build the best product, cause no unnecessary harm, and use business to protect nature."

Their mission statement is compelling and detailed, with each section outlining how they will accomplish their goal.

4. Vesta Home Automation

This executive summary for a smart home device startup is part of a business plan created by students at Mount Royal University .

While it lacks some of the sleek visuals of the templates above, its executive summary does a great job of demonstrating how invested they are in the business.

Right away, they mention they’ve invested $200,000 into the company already, which shows investors they have skin in the game and aren’t just looking for someone else to foot the bill.

This is the kind of business plan you need when applying for business funds. It clearly illustrates the expected future of the company and how the business has been coming along over the years.

5. NALB Creative Center

This fictional business plan for an art supply store includes everything one might need in a business plan: an executive summary, a company summary, a list of services, a market analysis summary, and more.

One of its most notable sections is its market analysis summary, which includes an overview of the population growth in the business’ target geographical area, as well as a breakdown of the types of potential customers they expect to welcome at the store. 

This sort of granular insight is essential for understanding and communicating your business’s growth potential. Plus, it lays a strong foundation for creating relevant and useful buyer personas .

It’s essential to keep this information up-to-date as your market and target buyer changes. For that reason, you should carry out market research as often as possible to ensure that you’re targeting the correct audience and sharing accurate information with your investors.

Due to its comprehensiveness, it’s an excellent example to follow if you’re opening a brick-and-mortar store and need to get external funding to start your business .

6. Curriculum Companion Suites (CSS)

If you’re looking for a SaaS business plan example, look no further than this business plan for a fictional educational software company called Curriculum Companion Suites. 

Like the business plan for the NALB Creative Center, it includes plenty of information for prospective investors and other key stakeholders in the business.

One of the most notable features of this business plan is the executive summary, which includes an overview of the product, market, and mission.

The first two are essential for software companies because the product offering is so often at the forefront of the company’s strategy. Without that information being immediately available to investors and executives, then you risk writing an unfocused business plan.

It’s essential to front-load your company’s mission if it explains your "Why?" and this example does just that. In other words, why do you do what you do, and why should stakeholders care? This is an important section to include if you feel that your mission will drive interest in the business and its offerings.

7. Culina Sample Business Plan

Culina's sample business plan is an excellent example of how to lay out your business plan so that it flows naturally, engages readers, and provides the critical information investors and stakeholders need. 

You can use this template as a guide while you're gathering important information for your own business plan. You'll have a better understanding of the data and research you need to do since Culina’s plan outlines these details so flawlessly for inspiration.

8. Plum Sample Business Plan

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12 Key Elements of a Business Plan (Top Components Explained)

Starting and running a successful business requires proper planning and execution of effective business tactics and strategies .

You need to prepare many essential business documents when starting a business for maximum success; the business plan is one such document.

When creating a business, you want to achieve business objectives and financial goals like productivity, profitability, and business growth. You need an effective business plan to help you get to your desired business destination.

Even if you are already running a business, the proper understanding and review of the key elements of a business plan help you navigate potential crises and obstacles.

This article will teach you why the business document is at the core of any successful business and its key elements you can not avoid.

Let’s get started.

Why Are Business Plans Important?

Business plans are practical steps or guidelines that usually outline what companies need to do to reach their goals. They are essential documents for any business wanting to grow and thrive in a highly-competitive business environment .

1. Proves Your Business Viability

A business plan gives companies an idea of how viable they are and what actions they need to take to grow and reach their financial targets. With a well-written and clearly defined business plan, your business is better positioned to meet its goals.

2. Guides You Throughout the Business Cycle

A business plan is not just important at the start of a business. As a business owner, you must draw up a business plan to remain relevant throughout the business cycle .

During the starting phase of your business, a business plan helps bring your ideas into reality. A solid business plan can secure funding from lenders and investors.

After successfully setting up your business, the next phase is management. Your business plan still has a role to play in this phase, as it assists in communicating your business vision to employees and external partners.

Essentially, your business plan needs to be flexible enough to adapt to changes in the needs of your business.

3. Helps You Make Better Business Decisions

As a business owner, you are involved in an endless decision-making cycle. Your business plan helps you find answers to your most crucial business decisions.

A robust business plan helps you settle your major business components before you launch your product, such as your marketing and sales strategy and competitive advantage.

4. Eliminates Big Mistakes

Many small businesses fail within their first five years for several reasons: lack of financing, stiff competition, low market need, inadequate teams, and inefficient pricing strategy.

Creating an effective plan helps you eliminate these big mistakes that lead to businesses' decline. Every business plan element is crucial for helping you avoid potential mistakes before they happen.

5. Secures Financing and Attracts Top Talents

Having an effective plan increases your chances of securing business loans. One of the essential requirements many lenders ask for to grant your loan request is your business plan.

A business plan helps investors feel confident that your business can attract a significant return on investments ( ROI ).

You can attract and retain top-quality talents with a clear business plan. It inspires your employees and keeps them aligned to achieve your strategic business goals.

Key Elements of Business Plan

Starting and running a successful business requires well-laid actions and supporting documents that better position a company to achieve its business goals and maximize success.

A business plan is a written document with relevant information detailing business objectives and how it intends to achieve its goals.

With an effective business plan, investors, lenders, and potential partners understand your organizational structure and goals, usually around profitability, productivity, and growth.

Every successful business plan is made up of key components that help solidify the efficacy of the business plan in delivering on what it was created to do.

Here are some of the components of an effective business plan.

1. Executive Summary

One of the key elements of a business plan is the executive summary. Write the executive summary as part of the concluding topics in the business plan. Creating an executive summary with all the facts and information available is easier.

In the overall business plan document, the executive summary should be at the forefront of the business plan. It helps set the tone for readers on what to expect from the business plan.

A well-written executive summary includes all vital information about the organization's operations, making it easy for a reader to understand.

The key points that need to be acted upon are highlighted in the executive summary. They should be well spelled out to make decisions easy for the management team.

A good and compelling executive summary points out a company's mission statement and a brief description of its products and services.

An executive summary summarizes a business's expected value proposition to distinct customer segments. It highlights the other key elements to be discussed during the rest of the business plan.

Including your prior experiences as an entrepreneur is a good idea in drawing up an executive summary for your business. A brief but detailed explanation of why you decided to start the business in the first place is essential.

Adding your company's mission statement in your executive summary cannot be overemphasized. It creates a culture that defines how employees and all individuals associated with your company abide when carrying out its related processes and operations.

Your executive summary should be brief and detailed to catch readers' attention and encourage them to learn more about your company.

Components of an Executive Summary

Here are some of the information that makes up an executive summary:

• The name and location of your company
• Products and services offered by your company
• Mission and vision statements
• Success factors of your business plan

2. Business Description

Your business description needs to be exciting and captivating as it is the formal introduction a reader gets about your company.

What your company aims to provide, its products and services, goals and objectives, target audience , and potential customers it plans to serve need to be highlighted in your business description.

A company description helps point out notable qualities that make your company stand out from other businesses in the industry. It details its unique strengths and the competitive advantages that give it an edge to succeed over its direct and indirect competitors.

Spell out how your business aims to deliver on the particular needs and wants of identified customers in your company description, as well as the particular industry and target market of the particular focus of the company.

Include trends and significant competitors within your particular industry in your company description. Your business description should contain what sets your company apart from other businesses and provides it with the needed competitive advantage.

In essence, if there is any area in your business plan where you need to brag about your business, your company description provides that unique opportunity as readers look to get a high-level overview.

Components of a Business Description

Your business description needs to contain these categories of information.

• Business location
• The legal structure of your business
• Summary of your business’s short and long-term goals

3. Market Analysis

The market analysis section should be solely based on analytical research as it details trends particular to the market you want to penetrate.

Graphs, spreadsheets, and histograms are handy data and statistical tools you need to utilize in your market analysis. They make it easy to understand the relationship between your current ideas and the future goals you have for the business.

All details about the target customers you plan to sell products or services should be in the market analysis section. It helps readers with a helpful overview of the market.

In your market analysis, you provide the needed data and statistics about industry and market share, the identified strengths in your company description, and compare them against other businesses in the same industry.

The market analysis section aims to define your target audience and estimate how your product or service would fare with these identified audiences.

Market analysis helps visualize a target market by researching and identifying the primary target audience of your company and detailing steps and plans based on your audience location.

Obtaining this information through market research is essential as it helps shape how your business achieves its short-term and long-term goals.

Market Analysis Factors

Here are some of the factors to be included in your market analysis.

• The geographical location of your target market
• Needs of your target market and how your products and services can meet those needs
• Demographics of your target audience

Components of the Market Analysis Section

Here is some of the information to be included in your market analysis.

• Industry description and statistics
• Demographics and profile of target customers
• Marketing data for your products and services
• Detailed evaluation of your competitors

4. Marketing Plan

A marketing plan defines how your business aims to reach its target customers, generate sales leads, and, ultimately, make sales.

Promotion is at the center of any successful marketing plan. It is a series of steps to pitch a product or service to a larger audience to generate engagement. Note that the marketing strategy for a business should not be stagnant and must evolve depending on its outcome.

Include the budgetary requirement for successfully implementing your marketing plan in this section to make it easy for readers to measure your marketing plan's impact in terms of numbers.

The information to include in your marketing plan includes marketing and promotion strategies, pricing plans and strategies , and sales proposals. You need to include how you intend to get customers to return and make repeat purchases in your business plan.

5. Sales Strategy

Sales strategy defines how you intend to get your product or service to your target customers and works hand in hand with your business marketing strategy.

Your sales strategy approach should not be complex. Break it down into simple and understandable steps to promote your product or service to target customers.

Apart from the steps to promote your product or service, define the budget you need to implement your sales strategies and the number of sales reps needed to help the business assist in direct sales.

Your sales strategy should be specific on what you need and how you intend to deliver on your sales targets, where numbers are reflected to make it easier for readers to understand and relate better.

6. Competitive Analysis

Providing transparent and honest information, even with direct and indirect competitors, defines a good business plan. Provide the reader with a clear picture of your rank against major competitors.

Identifying your competitors' weaknesses and strengths is useful in drawing up a market analysis. It is one information investors look out for when assessing business plans.

The competitive analysis section clearly defines the notable differences between your company and your competitors as measured against their strengths and weaknesses.

This section should define the following:

• Your competitors' identified advantages in the market
• How do you plan to set up your company to challenge your competitors’ advantage and gain grounds from them?
• The standout qualities that distinguish you from other companies
• Potential bottlenecks you have identified that have plagued competitors in the same industry and how you intend to overcome these bottlenecks

In your business plan, you need to prove your industry knowledge to anyone who reads your business plan. The competitive analysis section is designed for that purpose.

7. Management and Organization

Management and organization are key components of a business plan. They define its structure and how it is positioned to run.

Whether you intend to run a sole proprietorship, general or limited partnership, or corporation, the legal structure of your business needs to be clearly defined in your business plan.

Use an organizational chart that illustrates the hierarchy of operations of your company and spells out separate departments and their roles and functions in this business plan section.

The management and organization section includes profiles of advisors, board of directors, and executive team members and their roles and responsibilities in guaranteeing the company's success.

Apparent factors that influence your company's corporate culture, such as human resources requirements and legal structure, should be well defined in the management and organization section.

Defining the business's chain of command if you are not a sole proprietor is necessary. It leaves room for little or no confusion about who is in charge or responsible during business operations.

This section provides relevant information on how the management team intends to help employees maximize their strengths and address their identified weaknesses to help all quarters improve for the business's success.

8. Products and Services

This business plan section describes what a company has to offer regarding products and services to the maximum benefit and satisfaction of its target market.

Boldly spell out pending patents or copyright products and intellectual property in this section alongside costs, expected sales revenue, research and development, and competitors' advantage as an overview.

At this stage of your business plan, the reader needs to know what your business plans to produce and sell and the benefits these products offer in meeting customers' needs.

The supply network of your business product, production costs, and how you intend to sell the products are crucial components of the products and services section.

Investors are always keen on this information to help them reach a balanced assessment of if investing in your business is risky or offer benefits to them.

You need to create a link in this section on how your products or services are designed to meet the market's needs and how you intend to keep those customers and carve out a market share for your company.

Repeat purchases are the backing that a successful business relies on and measure how much customers are into what your company is offering.

This section is more like an expansion of the executive summary section. You need to analyze each product or service under the business.

9. Operating Plan

An operations plan describes how you plan to carry out your business operations and processes.

The operating plan for your business should include:

• Information about how your company plans to carry out its operations.
• The base location from which your company intends to operate.
• The number of employees to be utilized and other information about your company's operations.
• Key business processes.

This section should highlight how your organization is set up to run. You can also introduce your company's management team in this section, alongside their skills, roles, and responsibilities in the company.

The best way to introduce the company team is by drawing up an organizational chart that effectively maps out an organization's rank and chain of command.

What should be spelled out to readers when they come across this business plan section is how the business plans to operate day-in and day-out successfully.

10. Financial Projections and Assumptions

Bringing your great business ideas into reality is why business plans are important. They help create a sustainable and viable business.

The financial section of your business plan offers significant value. A business uses a financial plan to solve all its financial concerns, which usually involves startup costs, labor expenses, financial projections, and funding and investor pitches.

All key assumptions about the business finances need to be listed alongside the business financial projection, and changes to be made on the assumptions side until it balances with the projection for the business.

The financial plan should also include how the business plans to generate income and the capital expenditure budgets that tend to eat into the budget to arrive at an accurate cash flow projection for the business.

Base your financial goals and expectations on extensive market research backed with relevant financial statements for the relevant period.

Examples of financial statements you can include in the financial projections and assumptions section of your business plan include:

• Projected income statements
• Cash flow statements
• Balance sheets
• Income statements

Revealing the financial goals and potentials of the business is what the financial projection and assumption section of your business plan is all about. It needs to be purely based on facts that can be measurable and attainable.

11. Request For Funding

The request for funding section focuses on the amount of money needed to set up your business and underlying plans for raising the money required. This section includes plans for utilizing the funds for your business's operational and manufacturing processes.

When seeking funding, a reasonable timeline is required alongside it. If the need arises for additional funding to complete other business-related projects, you are not left scampering and desperate for funds.

If you do not have the funds to start up your business, then you should devote a whole section of your business plan to explaining the amount of money you need and how you plan to utilize every penny of the funds. You need to explain it in detail for a future funding request.

When an investor picks up your business plan to analyze it, with all your plans for the funds well spelled out, they are motivated to invest as they have gotten a backing guarantee from your funding request section.

Include timelines and plans for how you intend to repay the loans received in your funding request section. This addition keeps investors assured that they could recoup their investment in the business.

12. Exhibits and Appendices

Exhibits and appendices comprise the final section of your business plan and contain all supporting documents for other sections of the business plan.

Some of the documents that comprise the exhibits and appendices section includes:

• Legal documents
• Licenses and permits
• Credit histories
• Customer lists

The choice of what additional document to include in your business plan to support your statements depends mainly on the intended audience of your business plan. Hence, it is better to play it safe and not leave anything out when drawing up the appendix and exhibit section.

Supporting documentation is particularly helpful when you need funding or support for your business. This section provides investors with a clearer understanding of the research that backs the claims made in your business plan.

There are key points to include in the appendix and exhibits section of your business plan.

• The management team and other stakeholders resume
• Marketing research
• Permits and relevant legal documents
• Financial documents

Was This Article Helpful?

Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

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10 topics your business plan must include

Krishnan Hariharan

Product Coalition

Late last year, a CEO who is currently looking to build out a new product line for his business approached me to get some help on a business plan. He has a great idea for a product that he believes will bring in the sales he wants but needed help in determining how to build a new business. The CEO’s mandate and requirement was for a business case he wanted to include in his business justification request to the board of directors.

While many successful companies are built on a simple idea, creating successful companies based on those ideas needs more than just an idea. After spending a couple of months interviewing the CEO and his leadership team, including the sales team, to better understand their strategic goals, their business, and doing the necessary research and analysis, I finally created the desired plan for him. But, during that entire experience, it continued to nag me why even CEO’s struggle to create ideal business plans. What is the ideal business plan and what should it include? How much information is necessary to provide enough context and content to get the investment you seek? Realistically, there is no ideal business investment plan because it all depends on 5 simple factors, 1 of which is not in your control:

• Are your investors experienced investors?
• Are there enough customers in the market that can buy your product?
• Why should the customers buy your solution ?
• Is your investment plan financially sound?
• What is your experience in creating business plans?

While it certainly can help to know more about your investment team or your leadership’s experience in funding the investment you seek, the reality is that it’s not a factor you can influence or control. Assuming that the investors are the most experienced you will ever find, you still need to do your best. In fact, the only thing you can do is to put your best foot forward and put together a business plan that you can defend. But if you don’t have enough experience putting together a business plan, how do you know what a business plan look like?

There are plenty of resources on the Internet that can assist you in creating a plan, but based on my experience of having launched 8 new products in the market and helped launch a startup, OneHive.com , I would highly recommend including the following, in some form, in your business plan.

• What is the current or future market trend and challenges that customers are facing?
• What does the ideal solution do? Problems it solves, capabilities it will have, description for each capability, and value derived by solving each problem.
• Create a gap analysis to highlight the differences between what your company does today and what the ideal solution looks like.
• What is the addressable market opportunity? The addressable market opportunity normally includes: Total market size , potential market size, customer profiles , and solution buying patterns.
• Who are your competitors in the market and where does your company fit in, assuming you can deliver on the promise?
• What is the solution plan?
• What are the potential packaging and pricing strategies for your product?If you cannot create a detailed pricing model, always create some benchmark pricing. It goes a long way to show that you know what you are talking about and also helps you create your financial summary.
• What does the sales model look like? Most product managers or marketers overlook this aspect but it is important to understand the sales model as your product grows from it’s introductory phase, through it’s growth phase, and all the way up to market maturing and being recognized as a brand.
• Timelines for your solution and market growth, which should certainly include plan to build a product, staffing and growing a team, a customer acquisition plan , and a sales model and enablement.
• Financial Summary should include revenue analysis, EBITDA, free cash flow, and NPV (Optional)

Gone are the days where a business strategy or plan written on the back of the napkin would get you the investment you seek. While a back of the napkin business plan can certainly give you the framework you need, creating a business plan is essential to your business’s future. Without it, no investor is going to give you the money you seek.

Written by Krishnan Hariharan

products leader | advisor | loves building products | ceo, rivernorthlabs.com : helping companies with products, strategy, & marketing. linkedin.com/in/krishnanh

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What the activism of ben & jerry’s can teach business leaders.

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WASHINGTON, DC - NOVEMBER 08, 2019 Ben Cohen and Jerry Greenfield, co-founders of Ben and Jerry's, ... [+] join about 20 people sitting in front of the White House northwest gate as part of a "Fire Drill Fridays" rally protesting climate change November 08, 2019 in Washington, DC. The demonstrators marched from the U.S. Capitol to the White House where they temporarily blocked the northwest gate before ending the protest and eating free ice cream. (Photo by Chip Somodevilla/Getty Images)

News last week that Unilever plans to spin-off its ice cream business, including Ben & Jerry’s, into a stand-alone company brought renewed attention to the activism of the Vermont-based ice cream company.

“The brand would arguably be the crown jewel of the new company, of which Unilever shareholders would own a stake, but some analysts expect Ben & Jerry’s to be sold separately to another buyer,” the Boston Globe reported .

Founded by Ben Cohen and Jerry Greenfield, the company’s priorities and policies have not always been embraced in the business world, including its corporate parent.

But Ben & Jerry’s approach to activism can be instructive for corporate leaders across the political spectrum who want their companies to have an impact on hot button issues. Executives should be mindful, however, of how customers and members of the public, who may not agree with that activism, will respond to those efforts.

State Corporate Values

Before going down the activism road, it’s important to clearly state—internally and externally—the values and beliefs of the organization.

“We believe that ice cream can change the world,” according to Ben & Jerry’s website .“We have a progressive, nonpartisan social mission that seeks to meet human needs and eliminate injustices in our local, national, and international communities by integrating these concerns in our day-to-day business activities.”

Ukraine Just Blew Up Two More Russian Landing Ships It s Too Late To Matter

The world s best single malt whisky according to the 2024 world whiskies awards, previously obscure attorney lands big payday representing trump in high profile lawsuits, connect with audiences.

WASHINGTON, DC - NOVEMBER 08, 2019: Ben Cohen and Jerry Greenfield,, co-founders of Ben and Jerry's, ... [+] join about 20 people sitting in front of the White House northwest gate as part of a "Fire Drill Fridays" rally protesting climate change November 08, 2019 in Washington, DC. The demonstrators marched from the U.S. Capitol to the White House where they temporarily blocked the northwest gate before ending the protest and eating free ice cream. (Photo by Chip Somodevilla/Getty Images)

Depending on the nature and purpose of the business, corporate executives should identify when and how they will connect with the public.

“Ben & Jerry's doesn't just sell ice cream; it serves up a scoop of activism with every cone; connecting with their audience on a profoundly deeper level than mere consumption,” Tenyse Williams, an adjunct instructor specialist at Columbia University and George Washington University, said via email.

“Their strategy is a masterclass for business leaders on how to create a community with their customers by crafting experiences that resonate on a personal level. This results in turning everyday transactions into meaningful ones. Such a strategy doesn't just boost brand loyalty and customer engagement—it turns occasional buyers into lifelong fans, which is a key driver of profitability,” she commented.

Be Committed

Consistency, determination, and persistence are keys in helping to ensure the success of corporate activism.

“Ben & Jerry’s doesn't do performative activism. Every campaign, every message, and every pint sold is a testament to their unwavering commitment to social justice,” Tara Furiani, CEO of Not the HR Lady , said via email.

Be Authentic

Ben & Jerry’s teaches “that authenticity cannot be an afterthought or a marketing ploy; it must be the core ingredient of your brand. As leaders, our challenge is to embed this authenticity into the fabric of our companies, ensuring that our actions always align with our words,” Furiani observed,

Exercise Leverage

“Political and social activism relies on the personal charisma of the activist, and both Ben and Jerry leveraged their own charm to great effect in promoting their company and its values,” Robert Bird , a professor of business law at the University of Connecticut, said in an emailed message.

Recognize Limitations

Corporate activism campaigns usually do not last forever, and there can be built-in limitations as to how long they can or should last.

“When a brand is sold to a company, the social and political values of the founders only remain for so long. Eventually the enterprise becomes culturally integrated into the larger company and loses some of the distinction that made Ben & Jerry's ice cream company unique,” Bird noted.

In the case of Ben & Jerry’s, however, the company has vowed to continue its controversial activism even if it is sold to another organization, according to The Telegraph.

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International Edition

Is Whole Foods coming to Wesley Chapel, or not?

• John C. Cotey Tampa Beacon

WESLEY CHAPEL — Social media was ablaze earlier this month when a developer’s preliminary plans to bring a Whole Foods grocery store to Wesley Chapel were posted on Facebook.

The post, by the Pasco Development and Growth Updates page, received hundreds of likes and comments from those who read it.

But two days later, the plans for the development were withdrawn.

“Last week I submitted the preapp (pre-application) request for this project,” David Fuxan, of Fuxan Engineering Inc. wrote to the county. “My client has asked me to withdraw this pre-app request.”

The plans for a retail center just north of Aronwood Boulevard (at the northernmost entrance to Meadow Pointe off Bruce B. Downs Boulevard) included roughly 170,000 square feet of retail space. That included a 36,000-square-foot Whole Foods, a two-story, 65,000-square-foot Life Time athletic center, three other buildings ranging from 11,000-15,000 square feet and one smaller one.

Life Time, not to be confused with Lifestyle Family Fitness, is a national health club chain that bills itself as an “Athletic Country Club.”

The former Harbour Island Athletic Club is currently being transformed into a Life Time, and expects to open this summer.

So, with the plans no longer in the county queue, does that mean that Whole Foods and Life Time are not coming to Wesley Chapel, a quickly growing area that has clamored for a store like it — trendy, organic, upscale — for years?

“The initial package was submitted with the oversight of having tenant names from another project,” according to Candice Brown-McElya, who does public relations and communications for developer, Atlanta-based SJC Ventures. “At this time, Whole Foods (and Life Time) are not confirmed tenants.”

Brown-McElya seemed to indicate the plans will be resubmitted.

“The team is still planning to move forward on the Pasco County project, but the plans are being revised without tenants’ names,” she said, via an email to the Beacon.

However, for the folks eager for a Whole Foods, there is still hope, and maybe even a high likelihood that the popular grocery store is headed this way.

Based on SJC Ventures portfolio, of the 20 similar completed retail projects listed on its website, 17 of them are anchored by a Whole Foods, including locations in Delray Beach, Tallahassee, Fort Myers and Sarasota.

And just two weeks ago, SJC Ventures completed a Whole Foods Market at the former Sunshine Plaza strip mall property in St. Petersburg.

Typically, many developers are averse to their projects being made public before they are signed, sealed and delivered, for a variety of reasons.

The pre-application process was created by the county to save developers and property owners time and money by giving them a chance to show their plans and get feedback.

It also provides an early peek into what future developments may be headed our way, as many do make it across the finish line.

With a caveat.

“It’s a whole non-binding session where proposals are vetted with the county staff, and many of them don’t come to fruition, or are substantially redesigned before they come into the formal land development review process,” said David Engel, the county’s planning and economic growth director. “So sometimes they get misconstrued by (social media).”

A good percentage of plans, he added, never come to fruition or noticeably change.

The Aldi grocery store on State Road 56 near the Tampa Premium Outlets mall, for example, filed for pre-app status three times, with three different sites, including the first one that placed it near The Grove at Wesley Chapel. It finally settled on its current location, miles away.

Kohl’s, a department store, which now appears to be a certainty to be built next to the At Home and behind the Costco on State Road 56, has gone through the pre-app process as far back as 2007, with two pre-app filings for a store in two different locations than the one it has settled on.

John C. Cotey is the managing editor of the Tampa Beacon. He can be reached at [email protected]

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