How to Write a Business Plan for Your Small Business Success
Author
8 minutes 32 seconds
How to start a business/ startup? How do you write a traditional business plan for a new business? How to define your goals, objectives, and marketing plan? What exactly should it contain? And is it possible to make one yourself? If you want to start your adventure as an entrepreneur, you should read this article first!
What is a Business Plan?
A business plan is essential. It explains what your business will do, how it will earn money, and who the customers will be. Such a document lets you clarify your vision and organize your activities well.
But it's not just a piece of paper you'll put away in a drawer and forget about. You will also show your business plan to lenders and investors to convince them to finance your venture.
Besides, you can change your plan over time—it's worth revisiting and updating it regularly. Refresh the document constantly before applying for a business loan.
How to Write a Good Business Plan: Step-by-Step Template for Business Owner
A business plan is a big task. But dividing its writing into smaller steps makes everything much easier. So, go through all the following points at your own pace. Before you know it, you'll have a fantastic strategy!
Introduction
Briefly describe your business and explain why it will be successful. Mention your mission, product, or service, and include basic information about your management team, employees, and location. Also include financial information and ways to raise additional funds (if you are considering it).
Basic information about the company and SWOT analysis
This should be followed by a more comprehensive description of your company. Include here:
-
The registered name of your company.
-
The exact address of your headquarters.
-
The names of key people in the company. (You may be tempted to highlight unique skills or technical expertise among team members).
-
The company's structure — will it be a sole proprietorship or perhaps a partnership? If you're not running the company yourself, include information about each owner's percentage and the extent of their involvement in the company.
-
A brief history of the entire business.
-
The current nature of the business.
-
SWOT analysis.
Determining the goals of the business
The next section of the business plan defines the business's purpose. In this section, write what you want to achieve today and in a few years.
Hint: if the document is to help you get a business loan, explain how it will help you pursue your goals. Make it as straightforward as possible, so that even people outside your industry have a chance to understand everything.
Market analysis
To create a business plan to perfection, you need to identify the needs, demographics, and behavior of your target market. How do you do this?
For starters, brainstorm with your team, or use ChatGPT to find answers to questions:
-
What does the market currently look like?
-
Who are my competitors?
-
What are they offering?
-
What will give me a competitive advantage and increase my chances of business success?
-
Who is part of my target audience?
-
What are potential customers looking for and why?
-
How will my product or service meet their needs?
Remember to model your business after the best. Think about why their methods work and how you can emulate them. Also, try to find their weaknesses and offer your audience something better.
Create your website, your way
Financial plan and marketing plan + small business administration
It's time to think about how you want to go to market and where you will get the funds to implement the venture.
Let's start with a marketing strategy.
Target market
First, tackle segmentation - divide the market into smaller groups of customers with similar needs and characteristics. You can do this based on demographic (age, gender, income, education), psychographic (lifestyle, values, interests) or behavioral (frequency of purchases, brand loyalty) criteria. Then choose the segment you want to focus on. Justify your decision by referring to the analysis and potential of the group in question.
Next, estimate the market size (based on statistics or market research) and determine its growth potential. Write down your conclusions.
Pricing strategy
The description of the pricing strategy consists of several elements:
-
Pricing model: based on cost (adding margin to production costs), value (pricing based on customer perceived value) or competitor prices.
-
Examples of specific pricing for selected products or services
-
Determining whether you will offer discounts and promotions, and when they will be applied.
-
A description of how the company will respond to changes in competitor prices.
Sales channels
It is worth detailing how you will reach individual customers. Regardless of your business type, consider direct sales and online marketing. But I won't insert another clever, yet not much contributing sentence here.
See by example how it should look!
Internet marketing:
-
A professional website, including a detailed description of services, a price list, a photo gallery of completed projects, and a contact form. The website will be optimized for search engines (SEO) so potential clients can easily find it.
-
Social media: The company should actively maintain social media profiles (e.g., Facebook, Instagram), where it will showcase its services, post cleaning tips, and build relationships with customers. To do this effectively, read our guide “How to get more followers on Instagram?”
-
Online advertising: Use paid forms of online advertising (e.g., Google Ads, Facebook Ads) to reach a wide range of potential customers.
Direct marketing:
-
Leaflet distribution: Distributing flyers in local neighborhoods, especially in residential and office buildings.
-
Cooperation with property managers: Establish cooperation with property managers to offer cleaning services in residential buildings and communities.
-
Referrals: Encouraging satisfied customers to recommend the company's services to their friends and family. Introduce a loyalty program for referral customers.
-
Partnerships with other companies: Establish partnerships with companies in related industries (e.g., renovation companies, moving companies) to refer customers to each other.
Financial Forecast
Are you looking for funding or investors? This point will be the most important in your business plan! Describe how the company will generate enough profit to repay the loan or earn a decent return for investors.
And there's no room for guesswork or understatement here. Provide monthly or quarterly sales, expenses, and profits estimates over at least three years.
Do this under the assumption that you have taken out a new loan. Include as much data and authoritative assumptions as possible. If possible, back yourself up with the help of a qualified person. Only then can you count on your application being taken seriously.
Again, let me simulate such a forecast for my example cleaning company.
Enterprise characteristics — organization and management
You are almost at the finish line, but don't take shortcuts. A good business plan must also include how the company is organized. If you employ more people, try to visually depict the company's teams, roles, and hierarchy. It's essential to describe the entire employee base, from board members to cleaners.
As an entrepreneur, you also need to decide on your company's legal structure.
Choose one of the free templates and create your website effortlessly
How to Write a Business Plan that Wins: Conclusion
A business plan is a must. It must be well-thought-out and readable.
Tired of reading this kind of advice? Let me give you some significant tips to help you stand out!
Be realistic. Don't overestimate revenue projections or underestimate expenses. You are supposed to present a plan based on realistic assumptions (budget, resources, and capabilities).
Be specific. The more details you provide, the easier it will be to achieve your goals. Similarly, the broader and vaguer the plan, it is harder to determine where to start and how to measure success.
Be thorough. Research the market, the competition, your capabilities, and your target audience meticulously. This will help you identify potential risks and challenges and develop a mitigation strategy.
Ask others for their assessment. You may become so fixated on your vision that you lose objectivity. So ask others for honest feedback. They are sure to help you spot opportunities and challenges that you have missed.
Review and revise regularly. Just treat it as part of your periodic tasks. Your business plan should not be sitting dusty in a drawer. It must reflect changes in the market, the industry, and the company!
FAQ
What is an executive summary in a business plan?
The executive summary is a concise overview of your business plan, summarizing your startup's or existing business's key points. It typically includes your business goals, value proposition, and a brief description of the type of business you are starting or managing.
Why do I need a business plan to start a business?
A business plan is essential for guiding you through starting a business. It helps you outline your business idea, market research, and financial projections, which are crucial for securing funding from potential investors and effectively managing your business operations.
What are the elements of a business plan?
A business plan includes an executive summary, description of your business, market analysis, organization and management structure, product line or services, marketing and sales strategies, funding request, financial projections, and an appendix containing additional relevant information.
How do I write a traditional business plan?
To write a traditional business plan, follow a structured format that includes the key elements mentioned earlier. You can use a business plan template to guide you through each section, making sure you provide detailed information about your business goals, market research, and financial projections.
What are financial projections and why are they important?
Financial projections are estimates of your business's future financial performance, including cash flow statements, balance sheets, and income statements. They are important as they help demonstrate the viability of your business idea to potential investors and can guide your financial planning.
Can I use a business plan template for my small business?
Yes, using a business plan template is a great way to structure your business plan effectively. It can save you time and ensure that you include all necessary sections, making it easier to communicate your business goals and strategies to investors or stakeholders.
What is the difference between a lean business plan and a traditional business plan?
A lean business plan is a more streamlined version focusing on key aspects of your business, ideal for startups looking to outline their business model quickly. In contrast, a traditional business plan is more detailed and comprehensive, suitable for established businesses seeking funding or strategic direction.
How can market research enhance my business plan?
Market research provides valuable insights into your target audience, industry trends, and competition. By incorporating this information into your business plan, you can better define your value proposition, tailor your marketing strategies, and set realistic business goals.
What should I include in the appendix of my business plan?
The appendix of your business plan should include additional documents that support your business case, such as charts, graphs, legal documents, detailed financial projections, and resumes of key team members. This section can provide more context for investors and stakeholders.
How does a business plan help secure funding?
A well-prepared business plan helps secure funding by clearly articulating your business idea, market potential, and financial projections. Investors and lenders want a solid plan demonstrating how their investment will lead to a successful business and profitable returns.
Popular articles.
WebWave website builder is your AI-powered solution for building an online presence. Create your website in 3 minutes, add an online store or a blog, and grow your business.
We created this website with WebWave.
Follow us on social media
Company.
Help.
Templates.