Writing a business plan is one of the most important actions an entrepreneur can take. It is your elevator pitch, an overview of your business, and an exercise in preparedness, forcing you to consider every aspect of starting a business — both large and small, from your management team to your electrical company — so that your business is in a strong position to hit the ground running.
Since formats of business plans can (and should) vary by industry, you should take a look at more specifically relevant examples when writing a business plan. Below is a standard business plan structure, including directions on creating your own. Good luck!
1. Executive Summary
The executive summary is just as it sounds: a summary, or abstract, of the rest of the plan. For this reason typically completed last, the executive summary will be the equivalent of your investor pitch, giving any potential lenders or investors a good idea of what your business is all about, what your goals are, and how you plan to get there.
2. Organizational Structure
Another obvious one, the organizational structure section will provide an overview of your business structure and operations. Is your business a corporation? Partnership? LLC? If an LLC, will it be managed by managers, or managing members? Do you have directors? In what state will you register your business? Will you work with affiliate partnerships or outside vendors and suppliers, or will you create everything in-house?
3. Industry Analysis
To be successful in an industry, you must understand where your business fits into it. Paint a detailed picture of the industry and its future potential. In which areas is it likely to grow? What areas rely on technology likely to drop out of commercial use?
4. Services and Products
From the previous section, you should have a good idea of what your business has to offer to the industry. Be specific about exactly what it is you do, expanding on anything mentioned in the executive summary clearly for your potential investors.
5. Market Analysis and Marketing Plan
Now, go into detail on how, specifically, you will enter your services into the market defined by your industry. Define your target market. What else do they buy? Where to they buy it? How much money do they have? Conduct a market analysis and really think about how you’re going to reach them.
6. Strategic Plan
This section will outline the “boring” parts of running your business: are you leasing office space? Where will you get your electricity? Your water? This section describes the nuts and bolts of the business.
7. Management Team
This section will describe the specific duties of your key staff: the President, Vice President, Secretary, Treasurer, Directors, CEO, CFO, and any other corporate titles. You should list the name and address of each officer, as well as their percentage of ownership in the company.
8. Financial Analysis and Financial Plan
Based on the information above, come up with a realistic number for your overhead expenses; many advisors also recommend including three years of financial projections so that you can be prepared.
A business plan is like a blueprint, a road map for your business. Revisit it periodically, both to keep your business’s operations in check, and to update it if you decide that the winds of the industry warrant a shift in your services and plan of attack.