How to write a business plan with examples?
Table of Contents
What is a business plan?
A business plan is a written plan of action that contains details regarding a company's (usually a startup) objectives and execution of tasks. It highlights a strategic roadmap for the firm’s marketing, operational and financial tasks.
Is writing a business plan important?
Statistics show that the absence of a well-thought-out business plan has led to the collapse of many startups in the first year itself. A business plan is an essential component for any company. Not only for the internal audience, but a business plan is also equally useful for the external audience. Here are some of the reasons why having a business plan is important :
- Sourcing capital: A business plan is a document that every investor sees before financing a company. Investors look for at least 10% ROI before investing in any company. A business plan helps them predict whether they will earn any profit by investing or not.
- Identifying the objectives: A well-detailed business plan gives potential investors an idea of the company’s objectives and plans to achieve them. It gives the investors confidence that the company is well prepared to face any situation that befalls them.
- Validating a business idea: A business plan helps an entrepreneur identify the actual worth of a business idea and if it is actually feasible to start a company based on that idea.
Getting started with writing a business plan
Here is a section by section guide with examples to help you write a business plan for your company :
1. Executive summary
It is a page that contains an extensive overview of your company. You need to add the company’s objectives, execution plans, products and/or services offered, employees, location, etc. You can also add financial information if you are seeking investments. It is advised to frame this section once you complete the other sections. Below mentioned is a sample executive summary of a clothing brand.
Company Profile Summary
Market Research Summary
2. Company Description
This section should contain detailed information about your company. Include data like the problems your company solves, the target audience of your company, and any upper hand your company has over its competitors.
3. Market analysis
Study the market and your target audience well before framing this section. Find out the various strengths, weaknesses, opportunities, and threats that your company might face in the long run. Do a SWOT and a competitive analysis for this section.
|Different options of materials||Absence of a distinct style||Expansion in distribution||Vulnerable to crashes and changes due to lack of a strong website|
|Good reputation||Confusing website||Better handling of social networks|
|Good networking||Absence of cohesiveness|
|Considerable social media following and reach|
4. Organisation and management
This section will inform the audience about your business structure. Include the legal structure of your company in this section. Be specific and state whether you want to include your company as an S or a C corporation, form a construct a limited or general partnership, be a sole owner or a limited liability company (LLC). You can also include the work distribution of your company along with the resumes of the important employees.
5. Product and or service line
Describe in detail what all products and/or services your business serves and how those products and/or services will solve the buyer’s problems. Include information about the product life cycle and patenting. Details of the research and development of your product line can also be used in this section.
- Tops & tunics
- Gym Wear
6. Marketing and sales
No marketing strategy is constant. It keeps on evolving and updating as the company progresses. Include your current strategies for scaling your business and acquiring new customers.
7. Funding requirements
If you are seeking investment or funding for your company, then this section is important for including your requirements. Details like how much funding you will require for the next 5 years, are you looking for debt or equity, and what you will use the funding for, should be included in this section.
8. Financial projections
To validate your funding request, add a forecast of your future revenues and expenses. If your company is already operational and established, then add your income statements, balance sheets, and cash flow statements for the past 3 - 5 years.
Month - 1
An estimate of 25 sales, based on similar sales in the previous 2 years employing no marketing efforts during this time.
Month - 2
An increase in sales by 2% due to increased marketing efforts.
Add any other supporting documents like resumes, credit histories, licences, permits, patents, product pictures, etc., in this section.
- Business registration document
- Customer survey details
- Product and website photos
- Photocopy of driver's license
- Letters of intent to purchase