Got a winning idea for a business? Looking to get your ideas straight, or attract investment? What you need is a business plan.
In this beginner-friendly guide, we’ll walk you through the core elements every plan should include, broken down step-by-step.
A business plan is a formal written document that outlines your company’s goals and how you plan to achieve them. It should include your company’s strategy, identify potential roadblocks, and evaluate how viable your plans are financially in the long term.
Not necessarily – successful businesses are launched without a plan every day. However, it can be invaluable if you’re hoping to secure loans or funding from the bank or investors because it demonstrates a deep understanding of your market.
Even if you're bootstrapping (self-funding) your business initially, taking the time to develop a business plan can be a great exercise to solidify your vision, proactively solve problems and increase your overall chances of success.
It’s not enough for you to care about your company – your business plan should inspire others to care about it, too! To achieve this, your second section should focus on the ‘five Ws’, and elaborate on the points you made in your executive summary.
Who: Who are you, and who is your business? Who is your target consumer or client?
What: What is your product or service? What are your long and short-term business goals?
Where: Where is your business located? Where do you aim to expand in the future?
When: When will you implement the key steps in your plan, and start seeing results?
Why: Why would customers want your product and service? Why are you passionate about your business?
Don’t be afraid to mention risks or bumps in the road you might face along the way. Any lender or investor will likely identify these anyway, and be reassured that you’ve been up-front.
Of course, you’ll have touched on this already, but this is the section where you’ll delve into more detail about what your company actually offers, along with the effort and resources that go into it.
If you have multiple product lines, include a dedicated section for each, including pricing, product lifespan, materials, and any relevant patents or proprietary technology. If relevant, you can also outline your research and development (R&D) processes.
Any investor or potential business partner looking at your business plan will need reassurance that you have a thorough understanding of the market you’re operating in and the competitive landscape. Try to focus on the following points:
This section doesn’t need to be a full-blown marketing plan, but rather a basic outline of how you intend to attract and retain customers. Remember, if your business plan is aimed at investors, you want to give them confidence you can deliver results!
So, what should you include?
Messaging and positioning: Briefly describe your unique selling proposition (USP), and explain how you'll position your business to stand out in a crowded marketplace.
Key channels: What mediums will you use to attract new business or grow your brand? For example, organic content marketing, Google Ads or email campaigns.
Sales strategy: Outline the methods you'll use to convert interest into action. This could include direct sales calls, online booking systems, free consultations, or referral programmes.
Customer retention strategies: Demonstrate how you plan to build long-term relationships with your customers, for example, through loyalty programmes or subscription services.
Metrics and tracking: Briefly mention the key figures you'll use to track the success of your marketing and sales efforts. This could include website traffic, lead generation, customer acquisition cost, and customer lifetime value.
Here, you’ll also need to explain the legal structure of your company (for example, limited company or LLP), and specify how much of a stake everyone has in the business. If you’ve hired any staff, an organisational chart can be useful to illustrate functions and who reports to whom. You may also wish to briefly outline your plans for building and expanding your team as your business grows.
This section should outline the physical necessities involved in your business’s function, such as premises, facilities, equipment, and day-to-day operating costs. This may be more (or less) detailed depending on how complex your business is.
Aim to include the following:
Arguably the most important section of them all!
Let’s break down what you’ll need to cover:
As a side note, investors and other interested parties will also want to know your ‘break even’ point, which is the level of sales at which your business covers all its expenses and neither makes a profit nor a loss. This critical metric indicates the minimum sales volume needed for sustainability and can be a key factor in pricing strategies and business decision-making.
It might seem like a lot of work, but ultimately, putting the effort in now can pay dividends down the line. A well-crafted business plan is an ideal tool not only for securing investment, but also for convincing business partners and potential employees to have faith in your vision. So, take a deep breath, grab a pen (or fire up your laptop!), and get started!
Ask away! One of our team will get back to you!
