In today’s internet-driven world, it’s easier than ever to start a business. Many entrepreneurs, solopreneurs and small business owners get so excited with all these great ideas they have swirling in their head, that often times they skip over a lot of the planning to get to the fun part – the execution. Sometimes, the idea just takes off and before they know it, they are flooded with success (and a lot of work). Other times, people aren’t so fortunate.
But regardless of the success level of the business, it is good to bring things back to basics. Having a good business plan really can help you to scale an existing business, or launch a new one with clarity and a clear plan for the future. In this blog post, we have outlined some of the main sections of a business plan, and provide some explanation for what to include in each section.
What to Include in a Business Plan?
There are a lot of different recommendations for what to include in a business plan. And there isn’t a clear right or wrong way to do it. It’s really about going through the steps to put together a thorough plan for your business. At minimum, here’s what I think you should include in your business plan:
- Company description
- Business Management & Organization / Structure
- Products & Services Provided
- Market Assessment & Competitor Assessment (may include a SWOT analysis too)
- Marketing and Sales Plan (including target market assessment)
- Funding & Financial Projections
Let’s go over each of these areas in more detail.
This is where you should describe what your company is and what you wish to achieve. You can really write whatever you want here, but it’s also important to include key sections such as your vision, mission statement, and describe the core values of the organization. A lot of people get these items confused, but I promise they are actually quite straight forward. I like to think of them as an upside-down pyramid with the vision at the top.
Your vision is some lofty, aspirational, long-term goal for the business. It’s where you are going or what you hope to become in the future. It’s quite a broad statement. Then, your mission statement narrows that down a bit. A mission statement describes what you will do to achieve that bigger vision with regard to products, processes, competitors, etc. Finally, your company values are like your moral compass to the business. It’s the code of ethics and the framework with which you make decisions. For example, at Disney their core business values are “Innovation, quality, community, storytelling, optimism, and decency.” If something doesn’t fall in line with those values, then they don’t pursue it.
Business Management & Organization / Structure
In this section, you should really just describe your business. Who are the founders or key members of leadership and how will the business be structured. You should also explain the legal organization of the business, such as if it is an LLC or sole proprietorship, etc. Lastly, you may want to outline the general organizational structure and how the company will operate.
Products & Services Provided
In this section, it’s important to outline the core products and services that your company will provide. It’s up to you how much detail you go into, but it’s important to not just describe the features of the products or services but all the benefits they provide to customers. You don’t need to make this super long and drawn out. You could have a summary of the product and then have a table featuring the information or other graphics to explain it simply. But the important thing is that you can clearly communicate what it is you are offering in the marketplace.
Market & Competitor Assessment
In this section, you should include any type of research and insight into the marketplace where you will be operating. You should assess the overall market and your position in the market (is there a clear leader?). If you have not yet launched, it’s important to understand the market and figure out where in the market your business would fit. Having any kind of data, trends, or projects for the market is also good to include because it shows the opportunity.
You should also be sure to do a thorough competitor analysis. Even if you think you don’t have any competitors…I promise, you do. Look at both direct and indirect competitors. Understand how they are doing business and how they are marketing. Who are their customers? What’s their reputation? You need to understand your competitors well so that you can further identify your opportunities.
Some of you may even want to dig deeper in this part and go into a good ol’ fashioned SWOT Analysis. You may already be familiar with this, but it’s basically just assessing your internal strengths and weaknesses as well as external threats and opportunities. This is a great exercise that will give you a clearer understanding of your business – but especially the opportunities that exist for you in the market.
Marketing Plan & Sales Strategy
In this section of the business plan you should outline how you plan to market your products and services. It’s also important to describe your target market in detail – including demographics, psychographics (ideally, you have created “Avatars” or “Personas”). Then also describe your sales strategy, including your value proposition and your unique selling proposition.
Funding & Financial Projections
You don’t need to go into too much detail here. Just overall describe how the business will be funded. Perhaps you are providing all the capital, or if you have other investors or if you plan to get a loan. You should also include some numbers and projections for sales and profitability. If you can do a break-even analysis for the business as well, that would be good to include too.
Did You Download the Business Plan Template?
Let’s face it, everything is easier when you have a template! So if you haven’t already, feel free to download our Business Plan Template – which is a Word Document with all of these sections and prompts. That way you just need to input your own information.