Overview
If you are writing a business plan yourself, you need to make sure you have included all the essential content. So, in this blog I will briefly outline the 10 key sections and give a quick summary of each. Importantly, I suggest you follow a typical structure for your business plan as it makes it easier for anyone evaluating it. For example, bankers and investors see hundreds of plans. Therefore, if they are hunting around for key information your business plan will likely end up in the reject pile.
Before You Start
Writing the business plan assumes you have already crunched the numbers. So, if you haven’t, do it now! Because, if it doesn’t stack up financially, no-one will back your idea and ultimately you won’t be successful. Therefore, if you don’t have the data to hand, one way to do this is to get a Feasibility Assessment done. Above all, make sure you have established the likely profitability of the business or your time writing a business plan will be wasted.
10 Key Sections
So, assuming you have got a sound set of forecasts. The following sections should be in every business plan:
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Executive Summary
This should be no more than two pages and should give an overall summary of the Why, When, How, What and Who of your plan. Crucially, it should be written to inspire the reader to turn the page and delve into the detail. So, make sure this is written last of all once all other sections are complete. Take a look at one of our other blogs here about the best way to approach this. - Company Background and Legal Entity
Telling how and why your business came into existence gives context for the reader. In addition, any historic business performance will be of interest here too. Finally, stating the legal status of your business (Sole Trader, Limited Company, etc) will give further understanding of who is responsible for the business. - The Market
Giving an idea of the nature of the market in which you are operating is important. For example, it shows your understanding of the factors affecting the future of your business. So, this should include current statistics and trends on the market. And, it should also include an analysis of the customers in the market space – who they are, how and what they buy. Finally, this section should culminate in the market opportunity that you see is facing the company. - Company Product and/or Services
Having stated the market opportunity for your business, this section shows how you will capitalise on it. In particular, it should identify what products and/or services you are providing to meet market needs. Above all it needs to demonstrate and how these fit your target market & customer demand trends. - Competitive Analysis
So, this is a section everyone will be interested in. In particular, they will want to know how your products and/or services stack up abasing the competition. So, this should include an analysis of your direct (and indirect) competition. Then, you should conclude saying how the value of your offering differentiates from that of your competitors, And finally, how this will gain you competitive advantage. - Sales & Marketing Plan
If you have got this far, Well Done! Now, you can now switch your focus more onto “How” you are going to deliver your business. So, this will incorporate how your business is positioned in the market and what marketing tools you are going to us to reach your target audience. In addition, it will ideally give detail your marketing action plan timetable and metrics. Finally, it will show how this will deliver your sales forecast. - Operations
This section is where the nuts and bolts of how you are going to run the business is laid out. So, it tells how you are going to operate the business on a day to day basis. As such, it should show who is responsible for the different areas of the business. In addition, it needs to communicate the practical flow of sales and order processing and fulfilment. - Management Team
This is a key section that will get special attention. Critically, it needs to show that you (and your team) have the experience and skill-sets to deliver your business to the market. So, if you don’t have the skills or experience it is not the end of the world. Remember, no one person has it all! But, you do need to show that you will employ people who will fill the skills gaps. - Financial Plan
This is a summary of your financial projections, cash-flow highlights, breakeven, and investor proposition. And typically, this is an area where a lot of people fall down because of a lack of understanding of their numbers. So, if you are not sure about this section, get professional help. Above all, make sure you understand how the numbers are put together, and the key financial performance indicators (e.g. costs of sale % & profit margins) - Appendices
This should include all the detail that you need to support your plan but would make the body of the plan too long if it were included. So, this will likely include detailed monthly financial forecasts, management resumes, legal documents, letters of interest etc.
Finally, you should also remember that completeness and coherence are important. For example, it won’t matter how well written your business plan is if you have omitted to include how an investor will get a return (yes – it happens!) or the bank their money back. So, if you keep to the above guide you shouldn’t go far wrong.
Good Luck!
Jon Hunt
Lead Consultant
The Business Plan Team
www.TheBusinessPlanTeam.co.uk
The Business Plan Team specialises in helping entrepreneurs, start-ups and growing businesses create business plans. It helps translate a vision into a coherent and executable business plan that can help secure funding and guide management. It provides a range of services from early feasibility studies through to professional business plan development.