You’re ready to write your business plan, so make sure you have all the parts you need!
Congratulations! You’re finally ready to start writing your business plan and make your business stronger! Now, I know it seems a bit daunting, but remember – break it up if you need to. Work on pieces, come back to them, and then each year review them to see if they need adjusting. Your business plan should grow with your business, and change as it needs to. Especially if you are a new business just starting out…sometimes it takes some time to figure out your ideal client/customer, or what services you want to offer, or if you want to offer new services after you get started! Relax, hang in there, and enjoy the ride as best you can 😉
Alright, so what all do you need in your business plan? Google “business plan” and you will get a gazillion websites that tell you what you need. Some are more detailed than others. You may want to focus in on a more local level – like your state – to make sure there isn’t anything you’ve left out on a state level. But, there are some general parts to a business plan that you will see across the board:
Statement of Purpose/Executive Summary – What type of business and services are you offering, and who will you be catering to? A lot of websites will suggest you start with this, then come back to it after doing all the rest of the business plan to fine-tune it (some even say do it last). This should probably be about 2 pages or less, depending on how big your business is.
Description of the Business – Depending on your business, this may be extremely detailed, or more general. Either way, you want to make sure you clarify the type of business you’re in, why you decided to be in this business, where you’re located, what your products/services are, your business history, if you’re in this business alone or if there are others (employees, co-owners, silent partners, independent contractors, etc.), and where you may want to take your business in the future. Some models also incorporate the Mission Statement and Company Philosophy here in this section.
Marketing Plan – You need to know how to market your business and who to market it to. This part will take some research because you are REALLY getting to know your ideal client(s) and as much as you can about them. Create a profile for them so you can look back at this later for advertising. You need to know their income (if they can afford you), what are their interests, do they belong to any associations or organizations, how you will reach them and bring them into your business, what competition you have and how you are different, how much money you can bring into your business, and even creating a timetable for specific marketing activities you plan on implementing and when.
Description of Services and Facilities – Your physical location and set up of your business/office, including a list of equipment, hardware, and software. Take a detailed inventory, because you can use this later in your expenses to determine depreciation values. If you need backup your server/computer/data – how do you do it and where do you store it? How do you protect your business and keep it secure? How do you keep your client information private and secure? What do you do to maintain up-to-date client records? This is where you also need to list all your business standards, including: hours of operation, vacation days, fees/fee structure, how you operate your business on a daily basis, client care, late payments, an emergency plan, etc. You can also include any known vendors you will be dealing with. Some models will divide this section into two: Operational Plan and Management and Organization Plan.
Assessment of Management Abilities – What are your talents, skills, past experiences and training and how do they relate to your business now? List your resources: what you have now and what you will need moving forward. If you bring anyone else into the business, what type of relationship will that be: contractor or employee? What will their pay schedule look like and how will you deliver payment? What is your process for finding them (list any skills and/or qualifications they will need), and how will they benefit your business? Create and advisory team for your business and list them here.
Projected Timeline – If you are starting your business from scratch, write out a timeline of when you want to open your business and the specific steps it will take to do so. If you are transitioning from a full- or part-time job into your own business, make a specific plan to open your new business and transition from your old to new job (include dates!)
Finances – Some models have all of these combined, and some have them separated into 3 sections: Personal Financial Statement, Startup Expenses and Capitalization, and Financial Plan. The personal statement is needed for all the business owners/stockholders. Your startup expenses are an estimate of what you think it will cost to open your business. This part can take some time to get a good estimate because of all the research that may be required. The Financial Plan includes your Profit and Loss (P&L) for 12 months, an optional 3-year Profit Projection, and a Projected Cash flow. This is where you list all your business expenses to determine how much you need to charge for your services or products. Often, an opening day balance sheet and break-even analysis are included in this part of the business plan.
Remember, creating a great business plan takes time and effort – but it is so worth it in the end! Don’t try to knock it out in one day, you will probably go crazy 😉 Take each step at a time and adjust them as needed to make your business the best it can be.