Every part of our life needs a plan if we are to be successful. It is what keeps us focused – what allows us to keep our eyes on the prize. So, to properly organize your business, you have to come up with a good business plan. There are various business plan examples that you may find online – but to use them, you must understand what every business plan entails first. This guide should help you in that regard.
In this Article
Deciding on the Right Format
There is no business plan to rule them all, just like there is no “right” or “wrong” kind of business plan. All that matters is that you write it in a way that benefits your business and organizes it, as Asha Mankowska states in an article written for Forbes:
“Having a business plan is like having a blueprint or a solid foundation for your company. Entrepreneurs and leaders know that, like the weather, business isn’t static. It changes over time with your business’ development. It’s also not just a single document that you write at the beginning and then toss aside. Very often, a company will end up with multiple business plans as its vision, objectives, products or services change. No matter what phase your business is in, drafting a strong business plan and understanding what’s essential to it will ensure your success.”
When deciding on a format, two types tend to pop up: traditional business plans, or lean startup business plans. Both are different, depending on the level of detail that you wish to add.
Choosing Traditional Business Plans
Traditional business plan formats are appropriate choices if you wish for a more comprehensive project – one that focuses more on details. It might take more to write, as every free business plan template PDF is different. At the same time, it has the most information – which is why lenders generally ask for this kind of business plan
When a business is planned, you do not have to follow that exact plan. Instead, you must use those sections that make the most sense for you and your business. A traditional business plan will generally combine some of the following sections:
When deciding on a format, two types tend to pop up: traditional business plans, or lean startup business plans. Both are different, depending on the level of detail that you wish to add.
1.Executive Summary
The executive summary will tell the person reading the business plan exactly what you intend to do with your company and why you believe it will be a success. You may include your mission, information about your product, your employees, location – anything you might believe to be relevant about the first impression of your business. This information can be written in any other type of document. It could even be on a business plan template PowerPoint, for all that matters.
2.Company Description
At this point, you need to provide a more detailed description of your company in comparison to the executive summary. Here, you have to talk about the problems that you are trying to address – and you must be as specific as possible. Include everything from the consumers to businesses or organizations that your company will try to serve.
3.Market Analysis
According to Louie Ortiz, the CEO of Monbi.com, market analysis is the most important part of creating a traditional business plan. “You have to understand the outlook of your industry and how your business will be able to compete. Every business has its strong and weak points, and you’ll only be able to surpass them if you do your research,” Ortiz adds.
4.Organization and Management
How do you plan on structuring and running the business? Consider its legal structure, the kind of corporation it is – whether you are running it alone or with someone else. Make a list that will show who is in charge of what.
5.Product or Service Line
Explain what you are planning to sell, what its benefits are, and why would a client want to buy the product from you. It is for long term use, or just temporary? What will its life cycle be?
6.Sales and Marketing
How are you planning to sell the product? Consider using digital marketing to approach the more modern user, as everyone is on the Internet nowadays. The more thorough you are with your marketing strategy, the more profits you should be able to reap.
7.Funding Requests
How are you going to fund your business? Do you want to go for debt or equity? How much money will you need? Give enough details over how you plan on using the funds you have.
8.Financial Projections
At this point, the goal is to convince the reader of your business plan that you have it all sorted out and that you are planning to go towards success. Include your balance sheets, income statements, or any collateral that you might be able to add against your loan.
9.Appendix
At the end of the business plan, you need to attach an appendix. Here, you add all the supporting documents that might be necessary for your business plan. Licenses, resumes, reference letters – these are just a few documents that might go here.
Lean Startup Format
If you don’t want to go through the complications involved with a traditional business plan, then you might want to choose the lean startup business plan template PDF. This type of business plan removes all the bells and whistles associated with a standard full-version model, making it easier for you to follow it.
Tim Berry, CEO of Palo Alto Software touched upon the needs and benefits of a lean business plan for a startup in an article written for Entrepreneur:
“In business, it is the continuous planning process that matters. Your business plan, like your business, is a living, evolving, flexible thing. It requires rapid changes and fact-based decision making. I like the body metaphor implied by the term. Lean doesn’t just mean thin; it also means healthy, muscular, and efficient.”
It is the simplicity and the prospect of modification that make this type of business plan template doc an attractive choice. For it to be successful, you have to respect some of the key components.
1.Main Partnerships
Bear in mind that you will likely have to work with other businesses. Who will your suppliers be? Do you have any subcontractors? What about other strategic partners? Think about who you are going to work with.
2.Main Activities
What is it that you are planning to do, and how do you plan on taking the advantage? List the most important aspects of your business.
3.Main Resources
What are the main resources that you are planning to use to offer value to your customers? What are the most important assets that your company holds? These should all go on your list.
4.Value Proposition
No matter if you are using a business plan template Excel or a simple business plan template Word, you need to make a very clear statement about the value that your company brings to the market.
5.Relationship with Customers
Talk about how your customers will be interacting with your business. Will it be automated, or will it be personal? Are you planning to do things online, or go face to face? Think carefully.
6.Customer Segments
Who are you planning to target? As Louie Ortiz states, “no business is ever for everyone; we all have a certain category in mind whenever we launch a product. For this reason, every business owner needs a clear sense of who will be buying their product.”
7.Channels
How do you plan on talking to your customers? Businesses use multiple channels to get themselves out there. So, you must know which one works best for you. Sometimes, a mix of more is better.
8.Cost Structure
What are the costs that you will be facing? How do you plan on maximizing the value? When filling out your business plan template Google docs, think about the costs associated with the company.
9.Revenue Streams
How will you be making money with your company? Will you have only direct sales, or will you also get it from membership fees? You must write down every revenue stream of your company, even if it’s small.
Wrap Up
You should choose a business plan template based on the flexibility that you desire. For instance, if you have an eye for detail and want everything laid out, then you might benefit more from a traditional business plan format. On the other hand, if you want more flexibility, then you might need to go for a lean startup business plan format. Both options will allow you to organize your business properly.
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