Table of Contents
A business plan is your secret tool to grow your business and take it where you want it to go. Even research backs this up.
- A vast majority of successful medium-sized and large businesses have a business plan in place.
- The University of Oregon compared businesses with plans with businesses without plans and found that the former were consistently better at determining strategy-handling challenges, getting things done, and moving their businesses forward.
- Entrepreneurs that write formal business plans receive more financial support than if they had no plan.
- A study found an association between the completion of a company’s strategic plans and its profitability.
- Another study found that having a formal business plan was associated with higher gross revenues and growth in sales.
- Companies who finish their business plans are twice as likely to succeed in growing their business than those who don’t have a business plan. Case in point: Companies with a business plan grow 30% faster than companies without the plan.
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What Is a Business Plan?
- The kind of business you intend to build
- The products you plan to sell
- The people you want to sell to
- The structure of how you want to capitalize on the market
- The competitors you have in the market
- The exit strategies you’ve considered
- Which route will you take to go to Las Vegas from Los Angeles?
- What kind of car do you plan to use to make this journey?
- How much gas will making the journey cost?
- Do you have enough money to cover all expenses for the trip?
- What sites do you want to see along the way?
How Should You Present Your Business Plan?
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How Can Making a Business Plan Help Your Business?
Business Plans for Startups
Business Plans for Existing Businesses
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Why Making a Business Plan is SO Important
Business Idea Evaluation and Legitimization
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Securing Finance and Loans
Strategizing and Better Decision-Making
Identifying Potential Weaknesses and Uncovering New Opportunities
Procuring Business License
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The Different Types of Business Plans
The Lean Business Plan
The Standard Business Plan or External Business Plan
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Decoding the Crucial Sections of a Business Plan
1. Executive Summary
- Business Concept. What does your business do?
- Mission Statement. What does your business want to do? What are its core values and purpose?
- Product Description and Differentiation. What product or service do you sell, and why is it different?
- Target Market. Who do you want to sell to?
- Marketing Strategy. How do you plan to reach out to your customers?
- Current and Projected Financial State. What's your current revenue, and how much do you foresee earning in the future? Do you have any existing funding sources or investors?
- The Ask. How much capital do you want to raise?
- Company Information. What is the company‘s name? Where is its headquarters? Who are the founders or owners and the management team?
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2. Company Summary
- Your business structure, i.e, are you a general partnership, limited partnership, or a corporation?
- Your business model and operating industry
- Your business’s vision and mission statement, as well as a value proposition
- Information on your business or history
- Your long-term and short-term business objectives
- Your team, including the key personnel and their salaries
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Consider all the people your company is accountable to, including owners, employees, suppliers, investors, and of course, customers.
How would you like to conduct business with each one of them? - Your short-term objectives should cover goals you plan on achieving within the next year, whereas your long-term goals should focus on a longer period, say, five years. What would yours be?
- A good mission statement should explain why your business exists and how it can help — all presented convincingly in a one-sentence format. Do you have one?
3. Products and Services
- Pricing – Your approach for your pricing strategy, i.e whether it’s cost-plus, market-based, or value-based.
- Promotion – Your promotion plan should cover your plan for communicating with your prospects and customers, along with how you’ll measure the overall cost and success
- Packaging – Mention whether your packaging matches your positioning strategy, and how it communicates your key value proposition and compares to your competition.
- Advertising – An overview of the kinds of advertising you plan to spend money on — traditional, off-line, or social media.
- Content Marketing – Your approach to educating your prospects on topics they are interested in and leverage your product or service as the perfect solution for their pain points.
- Public Relations and Social Media – While you don’t need to be on every social media channel or invest in public relations, both tactics can be useful to give the exposure you need to grow your business.
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4. Market Analysis Summary
- What features or benefits do you offer to your target customers that your competitors don’t?
- How would you describe your customer's primary needs and wants?
- How are your competitors positioning themselves?
- Do you have any strategy for differentiating your company from your rivals? Why should a customer choose your product or service instead of your competition?
- Where do you see your company in the market of other solutions?
- What risks are you taking with this business?
5. Web Plan Summary
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6. Management Summary
7. Financial Plan Summary
- Sales Forecast – Your projections of how much you think you’re going to sell over the next few years.
- Personnel Plan – An estimate of how much you plan on paying your employees, along with something known as “employee burden,“ which refers to the cost of an employee beyond the salary. This usually includes insurance, payroll taxes, benefits, and so on.
- Income Statement – Also known as the profit and loss statement, the income statement indicates whether you’re making a profit or loss based on your sales forecast, personal plan, and a list of other ongoing expenses (cost of goods sold, operating expenses, interest, taxes, depreciation, etc.).
- Cash Flow Statement – This statement helps you keep track of how much cash you have at any given point in time, and no, it isn’t the same as the profit and loss statement.
- Balance Sheet – This document gives you an overview of the overall financial health of your business. It’ll list your assets, liabilities, and equity in detail.
- Use of Funds – A brief explanation of how you plan on using your investor’s cash.
- Exit Strategy – Your plan for eventually selling your business either to the public in an IPO or to another company.
8. Appendix
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Get Started With Your Business Plan ASAP!
The good news is, irrespective of whether you’re overwhelmed or contemplative, As a business coach, I can help you make a strong business plan that does everything you want it to do using my 20-year experience and expertise.
Get in touch with a business coach today to create your roadmap for growing your business and ensure success.
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Streamline your business and grow your profits – get a copy of my Strategy Scorecard to benchmark your business strategy in less than 10 minutes