Writing a business plan is one of the first and most important steps to the beginning of a new business. It sets the stage for your business idea, organizing and clarifying your thinking process for what you want the end result to be.
That said, knowing exactly where to begin can be tricky. For example, how do you know what to include (or not include)? How long should it be? Who will be reading it? Where can you look for a good sample business plan?
These are some of the tough questions we hope to crack for you with our top five tips for writing a business plan.
Where Should You Start?
You may be tempted to look for a sample business plan first—and that’s okay. It is good to look for examples of successful plans, as well as business planning tools, rather than entering this important process blindly.
However, it is often better to focus on learning how to write a business plan yourself, as this will help you in plotting out your business idea instead of simply copying someone else’s. Let’s explore some helpful ideas for how to do this.
1. Take Your Time and Do Your Research
You want your business plan to be a comprehensive document that includes everything lenders and potential investors will be looking for. After all, a business plan is often one of the most vital first steps toward getting your business funded. However, it is best not to rush through your plan in anticipation of said funding.
There are several parts to a business plan, but in short, it should act as a showcase that summarizes, then thoroughly describes, your chosen products/services, the current market for your business, current industry benchmarks, your operations and management plans, and your budget.
Note that with this much information being shared, you cannot expect to finish in 2-3 days, and you shouldn’t focus on a minimum or maximum number of pages, either. Focus instead on including all of the essential parts.
Do thorough research and reflection to answer the key questions—the who, what, when, where, why, how, and how much of your business—but let your business plan be an organic, unique document, without the pressure of tight deadlines or page number targets. One way to get started is with a one-page Business Model Canvas.
Note: You can also review our Sample here!
2. Cater to Your Audience (and Don’t Be Afraid Of Them)
It is essential to identify and write toward the correct audience as you craft your business plan. It may seem unimportant, as this audience may feel invisible or faceless in some ways. However, writing specifically with them in mind will help you focus on what they need from your plan, instead of only on what you need.
In most cases, your primary audience will be the potential investors you hope to persuade to fund your business. Make sure that, depending on your business focus, you write with language they both understand and support, as they may be paramount to your business starting.
This may seem intimidating, but it does not have to be. As you write your plan, be reasonable and honest, but bold. Tell the truth—especially when it comes to your finances. Yet, be confident in your business idea and plan so that lenders or other potential investors will be confident in them, too.
3. Include Market Research
Market research is an incredibly important part of your business plan. The market research you conduct can tell you the current climate for the industry you hope to join, as well as the demand for your particular idea in a given geographical area. Things like competitor listings, demographic and psychographic data (i.e., who is partaking in the industry the most and why), and consumer behaviors are all things that can be determined by market research, and which are essential to determining the feasibility of your business idea.
Alongside market research is a helpful tool called “SWOT Analysis.” SWOT stands for strengths, weaknesses, opportunities, and threats and is a method of evaluation to determine where you currently stand with your business idea.
Tying SWOT Analysis to your market research findings can be immensely helpful in showing you how feasible your business really is.
4. Include Your Financial Plan and Projections
The financial section of your plan should include a breakdown of your project cost as well as a monthly budget or income statement projection (use our worksheet). As mentioned above (in Tip #2), you must be honest about your finances in order to gain good rapport with investors and to pique their interest in offering you funds.
The financial plan and projections segment of your business plan deserves a full article in itself, but, in short, ensure that your projections are realistic and based on the truth of your current financial standing.
5. Submit Your Plan to Your Local ASBTDC for Review
One of the final and most helpful tips for writing a business plan is to submit your draft to your local Arkansas Small Business and Technology Development Center (ASBTDC) for review. Our expert consultants can work with you one-on-one and look over your draft to tell you what is missing, what needs to be reworked or removed, and overall, how complete your current business plan is.
The ASBTDC also offers more general help with business plans on our website. There you can find our “To the Point” business plan outline, which guides you through a checklist of the essential parts that should be included in your plan. Additionally, we have a highly requested “To the Point” sample business plan, which shows how the outline can be put into practice for an example business.
Let the ASBTDC Help You
The ASBTDC is Arkansas’s go-to for everything small business, and we offer much more than business plan help alone. We offer training opportunities, confidential one-on-one business consulting, and market research services—all at no cost.
Let your local ASBTDC help you get your business up and running. Learn more about us and our services, as well as any other general business questions you may have here. If you are ready to partake in our no-cost business consulting services, call us toll-free at 800-862-2040, or contact us online today!