How Do I Write A Business Plan?
Despite what you might hear about some entrepreneurs, a successful business rarely succeeds without a little help. No matter how good your idea, how talented your team and how certain you are of your product, almost every business requires some investment. Sometimes, investment is financial. By approaching banks, venture capitalists or even online crowdsourcing sites, you can raise the money that you need to spend on getting your business off the ground.
On other occasions, investment is less tangible. If you are starting a work-from-home business, you will need an investment of time, and lots of it! You may even need your friends and family to invest their faith in the big step that you are about to take.
Whatever the nature of investment that you require, it is impossible to make people confident about a business that is in your head. A business plan is a must-have, taking your intangible idea and making it a clear, concise and detailed proposal.
Most people find the idea of a business plan intimidating, but if you know what kind of business you will be starting, you already have everything that you need! Read on to find out what you should be thinking about as you prepare to write your first business plan.
What Is The Purpose OfÂ A Business Plan?
Before you consider picking up a pen or firing up your laptop, put your business aside for a moment. Instead of making things complicated with your own venture, take some time to think about the general purpose of a business plan.
A business plan inspires confidence. It is a tool designed to convince others, to provide an overall view of your new business â€“ or growth plans for an existing one. You will need to leave no stone unturned and include every detail that you can think of.
It is also a tool that is designed to inspire action. It is useless to write a business plan that people enjoy reading if they canâ€™t figure out the action that they should be taking. Whatever it is that you are looking for, your business plan must make this clear.
Finally, a business plan needs to make complex ideas, goals and forecasts accessible. Most of the people that read your business plan will be intelligent enough for big paragraphs and long sentences, but do they have time?
To summarise, a business plan is:
Those of you that are one step ahead will already have noted a common problem. How can you make a business plan meticulously detailed and concise at the same time?
A Business Plan Is Really Two Documents
As with most corporate documents, a business plan actually contains two distinct sections â€“ the Executive Summary and, well, the rest! That is how you can provide a concise view of your business as well as precise and exhaustive detail.
An Executive Summary is exactly as it sounds. Designed to be read by busy executives, this is a short section that provides an overall summary of your business. In less than two pages, somebody who does not have time to read your entire document can get an overview of what your business is about.
The remainder of a business plan contains as much detail as you feel is necessary to convince and persuade the reader. Most investors will read the executive summary first, and search for additional details as necessary.
As the first thing that readers see, your executive summary can make or break your business plan. Letâ€™s look at where you should start.
Start Your Business Plan With The Most Convincing Part
You may have an innovative product that is a completely new invention. You may have an unusual approach to a common business, using a model that is sure to generate more profit. You could even plan to use your own talents as the foundation of your business.
Whatever the most important thing is, put it right at the top of your executive summary. In one sentence, say what it is that you will be doing and â€“ crucially â€“ why it will work.
From there, use the executive summary to give someone a brief overview of everything that your business will do. If you have a product, name its best features. You will need a clear target audience, so say who they are.
Finally, an executive summary should always contain information on what exactly you plan to do to get your business off the ground. If you need investment, how will you spend it? Crucially, how will it pay off and what kind of return on investment will you get?
For more information on writing a good executive summary, see here. In addition, the Gov.uk website offers a video overview of business plans that is worth a few minutes of your time. To see it, visit here.
This section may be easier to write after you have continued on with the rest of your plan. Often, the act of writing a full business plan helps you to understand what is really the most important thing about your business.
Make Your Business Plan Your Own
Outside of the Executive Summary, things get difficult. What should you include? What are the different sections that make up the body of a good business plan?
Many websites offer complete business plan templates, making it quick and easy to add information about your business. Whatâ€™s more, your favourite word processor such as Microsoft Word or Apple Pages will usually include a suitable template to make your writing clear and easy to read.
But although a template is an effective starting point for your business plan, it is not an instant solution. If you want to create a business plan that really reflects your business, you need a structure and content that is your own.
As you look over your completed first draft business plan, ask yourself if there is anything else that you want to include. Find a place for it; make a place for it; put it in the appendix if all else fails.
And for the best results, donâ€™t forget those less tangible aspects of your business â€“ your passion, enthusiasm and commitment. Even though a template will help you to get started, it can often leave out the unique and personal information that makes your business so worthwhile.
To give you a head start, we have developed our own guide to the different sections that a business plan should feature. Although it is not a template, be sure to check out our next article, What To Write In A Business Plan, for more help.