Writing a business plan is a critical step in the process of starting or growing a business. A well-structured and comprehensive plan serves as a roadmap for your business, helping you clarify your vision, secure financing, and make informed decisions.
Here’s our step-by-step guide on how to write a business plan to help you plan, finance and grow a profitable business:
1. Executive Summary
Begin your business plan with a concise executive summary. This should provide an overview of your business, its mission, and the key points of your plan. This is the most important part of your
business plan because if someone is busy, this might be the only section they read. After reading it, the reader should understand what the business is about and be keen to know more.
While it’s the first section, it’s often easier to write it last, as it summarizes the rest of the plan.
2. Company Description
Describe your business’s
- history
- mission
- vision
- values
Explain the legal structure (e.g., sole trader, partnership, ltd co) and location.
Remember to explain why you want to start your own business and why you think you (and, if applicable, your partners) have the experience, ability, and commitment to make your idea a success. Include any relevant details of education and qualifications, work experience, training, and hobbies. Any practical experience is especially important to demonstrate your knowledge of the industry.
Share your business’s unique selling points and competitive advantage.
3. Market Research
Conduct a thorough market analysis. And define your target market and its size. Describe market trends and opportunities.
Identify your competitors, you need to think hard about your business and how you compare to them.
SWOT Analysis
You should put your thoughts in a SWOT analysis. SWOT stands for:
- Strengths,
- Weaknesses
- Opportunities
- Threats
What will your business do differently?
What’s your USP?
Be specific and avoid clichés, such as, better quality products, better customer service or cheaper products. Consider how you will show your customers that you are a better choice than your competitors.
4. Products & Services
What are you offering to customers?
Include any features and benefits and highlight any unique features or innovations. Remember people reading your business plan may not be familiar with your product/service so you need to explain everything, even things that seem obvious to you.
Discuss how your products/services meet customer needs.
5. Marketing & Sales Strategy
Explain your marketing approach. Outline your pricing and sales strategy, including channels and tactics. Discuss your marketing budget and remember to include costs of methods such as website, social media, and advertising in your cashflow forecast.
6. Financial Projections
7. Funding Requirements
If you’re seeking funding, specify how much you need and how you’ll use it. Explain the potential returns for investors and include a detailed plan for repaying loans or providing an exit strategy for investors.
8. Operations Plan
Detail your business’s day-to-day operations, including location, equipment, and suppliers.
Outline any regulatory or compliance requirements. Describe any intellectual property or technology involved.
9. Milestones & Metrics
Set specific, measurable, and time-bound goals for your business.
Explain how you’ll track your progress and what key performance indicators (KPIs) you’ll monitor.
This is something that Glow Accounts does for many of our clients, not just the new businesses.
10. Risk Analysis
Identify potential risks and challenges your business might face. Discuss strategies for mitigating and managing these risks. Consider factors like competition, economic downturns, and industry changes. What will your Plan B be? How can you reduce costs or boost your income?
11. Appendix
12. Review & Revise
After writing your plan, review it for clarity, consistency, and accuracy.
Seek feedback from mentors, advisors, or potential investors. Again Glow Accounts can help here too. Revise and update your plan as needed.
Conclusion
Remember, your business plan is a dynamic document that should evolve as your business grows and circumstances change. Regularly revisit and update it to ensure it remains relevant and aligned with your business goals.
A well-structured business plan not only helps secure financing and business funding, but it also guides your business toward success. A business plan will help provide a clear roadmap for achieving your goals and give you the metrics in which to measure success.
