How do you start with your business idea? Well, one of the things that keep you and your business streamlined and focused is a business plan. A business plan shows that you know what you’re doing and boosts the confidence of your investors that you’re an investment worth putting the money in. So, we’re here to guide you on how to write a great business plan in just 10 steps. We’re also giving you recommendations for free templates you can use!
What is a business plan?
It’s a comprehensive document that lays out the road map for your business development and growth. It communicates what your brand is all about, goals, ambitions, timeline, finances, leadership and staff, operations model, income generation, mission statements, etc. Basically, it contains everything that someone needs to know for them to know your company.
The benefits of having a business plan
A business plan is important because it offers you benefits like:
1. Clarify your strategies
It can bring clarity to your business strategies and their efficacies. Business strategies and follow-up decision-making are very important to get right and a good business plan will help you identify priorities to focus on and maybe even how to adapt your strategies to any future changes.
2. Set and manage your goals
Successful brands are continuously evolving and dynamic. Business plans allow you to prioritize performance indicators and goals, track accountability, engage in course correction when needed, and steer your company within the mission set.
3. Determine financial projection
Often times a business plan is required if you’re thinking of seeking and securing financing from outside sources. Investors and financiers are always looking at the risks and earning potential and your business’ profitability. A business plan gives them a glimpse into your financials and how much you project your company to grow in the future financially.
4. Manage resources
There are large spending decisions you have to make when running a business. A business plan can lay out the resource acquisition and allocation for things like assets, human resources, and business space. It also gives insight into cash flow and revenues and expenses.
5. Reduce and manage the risk
Any level of uncertainty is an inherent trait of any business. And a business plan is a start to reducing and managing potential risks by uncovering your brand’s weak spots. While a business plan can’t entirely eliminate risk, it is still a safety net, greatly reducing major challenges, weaknesses and mistakes.
How to write a business plan step by step
With the what and whys out of the way, it’s time to see how you can go about writing a business plan:
1. Create an executive summary
An executive summary is always the first section of the business plan. It rounds up your company’s mission and vision and your short-term and long-term goals. It’s an overview of your business, summarizing the key points of your plan and is used to persuade people to read more.
2. Describe your company
Define the scope and intentions of your brand venture. What exactly is your business. Include your business structure, business model, the industry that you’re a part of, a bit of history for some context and maybe even some key personnel on your team.
3. Do market analysis
In this section, you highlight the results of your surveying and knowledge on the marketplace and where you fit in it and the niche that you serve as a business. In this, you understand your ideal customer profile, relevant industry trend and trajectory that you’ve researched, and making informed guesses on the market’s future and, again, your place in it.
4. Conduct competitive analysis
Regularly, you’re not proposing a completely brand new, never before seen venture, but more of a competitive version against your competitors. Here, you identify your competition; their reputation in investment, sales, branding, and what they do best. While you have to show how you’re better and the unique value you bring as a company.
5. Describe organizational management
For this section, you display an overview of the team members, key personnel and high-ranking officials that you believe are integral to the success of the company. List down their roles and responsibility and note the hierarchy that you’ve chosen to set up.
6. Describe your products and services
You’re a business that sells something. So, of course, you would need to clearly define your products or services. This includes the efforts and resources that go into making your products and the refinements you conducted before launching them and future prospects of product expansions.
7. Define a sales and marketing plan
A business plan also contains a marketing plan. You describe the marketing and sales strategy that you’ll be adopting. The aim is to let the reader know who your target consumers are, your marketing and sales channels, the resources, budget and timeline your marketing and sales plans need and how you’d measure the success of your sales and your marketing.
8. Create a financial plan
Businesses live and die on their financial health. Making this section the most crucial for a business plan. People only want to work with a business that is financially viable in the foreseeable future. Here, you’re giving your income statement, balance sheet and cash flow statement. Importantly, investors want to see financial projections for the future.
9. Explain your funding request
Now you get to asking for investment and funding. You need to properly inform them of the amount of capital you have, the amount you need or intend on asking for, how you will grow your team, and any physical constraints your business is having.
10. Compile an appendix containing additional information
Finally, assemble an organized appendix to your business plan. It acts as a supplement to the information present in the main body of the document. Consider extra information that; helps investors with due diligence, easy access to employees, and other information like; deeds, local documents, certifications, registries, licenses, patents, associations, intellectual properties and contracts.
Free and simple business plan templates
You don’t have to necessarily sweat on making a business plan from scratch. There are plenty of free business plan templates you can find online, for free. Among them are:
HubSpot’s Downloadable Template
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.
LiveFlow’s Financial Planning Template
This free template from LiveFlow makes it easy for you to create a financial plan and track your monthly progress. The P&L Budget versus Actual format allows users to track their revenue, cost of sales, operating expenses, operating profit margin, net profit, etc. LiveFlow can also allow you to connect your accounting and banking data directly to your spreadsheet for automatic updates.
Score’s Template for Startups
Score is dedicated to helping entrepreneurs get their companies off the ground. Its template is available as a PDF or Word download and is generic enough to customize for most types of businesses. The Refining the Plan resource that comes with it is helpful, especially if this is your first crack at writing a business plan.
Office Online Templates Galore
Of course, Microsoft offers a ton of business plan templates for Office users. If you’d rather do a business plan presentation than a Word doc, you can download one of Microsoft Office’s half a dozen or so PowerPoint templates for just that purpose. You’ll want to customize it with your company branding, but it’s easier than starting from a blank, white PowerPoint slide.
SME Toolkit Samples
The SME Toolkit gives you a simple two-page outline of what you should include in your business plan to meet the minimum requirements of funders and tax authorities. It contains 10 broad sections, including market analysis, management and organization, etc., with a one-paragraph explanation of each. However, it is US based on so it follows US standards.
Start your venture right
Your business plan is your ticket to a successful business venture and the beginning to achieving your entrepreneurial dreams. Make your business plan right and make it well. And when you’re done, why not set up shop with us here at Yezza? You get unlimited product uploads and being able to generate sales as you sleep!