Choosing a business plan format

Choosing the right business plan format

Did you know that choosing the right business plan template is the starting point? It is!

Do you want to write a business plan? What is your business plan format? Which business plan template do you use? Do you use a free business plan template? Do you follow lean business plans or traditional business plans?

Well, this blog concentrates on forming a winning business plan template. You probably heard of:

• the one-page business plan
• lean business plan templates, or
• Old fashion business plan templates

Types of business plan template

A one-page business plan is a short document that summarizes your business. It’s a distillation of your entire business into one page.

A lean business plan is a shorter, simpler version of a traditional business plan. It includes only the essential elements of a business plan and leaves out non-essential details. Entrepreneurs often seeking funding from investors use this type of business plan.

A traditional business plan template is more detailed than a company description and a comprehensive document. Using the template includes all aspects of a business, from its financials to its marketing strategy. A solid business plan template is often used by larger companies or entities seeking bank loans or other outside funding.

My perspective

The traditional plan allows you to understand your business in a much more comprehensive way and can be a valuable tool for attracting top talent to your company. It can also help you secure bank loans and other forms of outside funding.

Which business plan format should you choose?

There is no right or wrong answer. The important thing is to pick a format that will work.

The importance of developing a business plan

There are many benefits to developing a business plan, regardless of the stage of your company. But choosing the business plan template is critical as the starting point. For startups – new business, a business plan can help you secure investment and get your business off the ground. But again, choosing the business plan template will enable users to develop successful plans geared toward the target users. A business plan can guide more established businesses and help you stay on track to reach your goals.

A well-crafted business plan can also be a valuable tool for attracting top talent to your company. A business plan gives job candidates a clear sense of what your company is striving to achieve and can help them decide if they would be a good fit for your team.

Developing a business plan can seem daunting, but it doesn’t have to be. Use this business plan format as a guide to creating your own, and fill in the blanks with your company’s specific details.

Choosing a business plan format is the first decision.

There are many different business plan templates that you can use, depending on your company’s needs. When choosing a format, the most important thing to remember is that the plan is tailored to your specific business and goals.

One popular option is the lean startup business plan, designed for businesses that are just starting and need to move quickly. This business plan focuses on key areas such as your value proposition, customer segments, channels, and resources.

Another option is the traditional business plan, which provides a more in-depth look at your company’s operations and financials. This business plan is often used when seeking investment or loans from banks.

Whichever type of business plan you choose, ensure it is clear and concise and contains all the essential information your company needs to succeed.

Consequently, a business plan is a story, the vision of where you want to go with the business.

Executive summary

A business plan is not just a document; it’s a story. Your executive summary is the first chapter of that story, and it should be designed to capture the attention of your reader and make them want to continue reading.

The executive summary should give an overview of your company (company description), including your value proposition, essential products or services, target market, and business model. It should also explain why you seek investment or loans and how you plan to use that funding to grow your business.

Don’t forget to include your company’s contact information and the names and titles of your team members.

Ensure your executive summary is clear, concise, and easy to read. You risk losing your reader’s attention if it’s too long or dense.

The executive summary is essential to your business plan, so take the time to get it right.

Current situation

Vision, mission, & value statement

The vision statement briefly describes what you want your company to achieve, while the mission statement explains how you plan to achieve it. The value statement outlines the core values that guide your company’s decision-making.

Vision statement

Your vision statement should be aspirational but achievable. It should also be clear and concise so that everyone in your company can understand and rally behind it.

Mission statement

Your mission statement should explain how you plan to achieve your vision and should be specific and measurable. For example, if your vision is to become the leading provider of XYZ products, your mission could be to increase market share by 10% within the following year.

Value statement

Your value statement should capture the essence of who you are as a company and what you stand for. It should be used as a filter for all your big and small decisions.

Overall, your vision, mission, and values should align with each other and contribute to your overall business strategy.

Company description

A business plan template should provide a brief description of the company and include a short description of the company’s history, enterprise structure, and ownership. The description will help your reader understand more about who you are as a business and what you have accomplished so far.

It can be helpful to include information on your company’s size, growth rate, and market share. If you have any significant customers or partners, mention them here.

Finally, provide a brief overview of your team, and explain why they are the best people to achieve your company’s goals.

Organization and management structure

This section of the business plan should provide a detailed description of your company’s organizational structure, including information on the roles and responsibilities of the management team.

Include an org chart to represent your company’s structure visually.

If you have any unique or innovative aspects to your organization, highlight them here.

Finally, explain how your management team is qualified to execute your business plan.

Operations

The operations section of a business plan provides an overview of the company’s operations, including information on its manufacturing process, distribution channels, and supply chain. This section is vital for investors and lenders as it gives them a better understanding of how the business will function. The manufacturing process should describe in detail, including any special equipment or facilities used. The distribution channels should be outlined, along with a description of how the products will be delivered to customers. Finally, the supply chain should be described, including information on suppliers and manufacturers. This section should give readers a clear picture of the business’s operations so that they can make an informed decision about investing in or lending to the company.

Infrastructure

A detailed business plan is essential for any business. It should include a description of the business’s infrastructure, including the facilities, equipment, and other resources it uses to operate. This information can help potential investors and lenders understand the business’s scale and scope and assess its potential for success. Furthermore, a detailed plan can also be used to develop and monitor the progress of the company over time. By including detailed information about the infrastructure, a detailed plan can provide a valuable roadmap for the future of the business.

The infrastructure section should include the physical location of the business, the type of building it is housed in, and the equipment and furnishings inside. It also contains information about the business’s workforce, including the number of employees and their roles within the company.

Finally, the infrastructure section describes the business’s IT systems, including any software or websites that are used to run the business. The information in a detailed plan provides investors with a clear understanding of the resources that are required to run the company and the costs associated with doing so.

Business model

The business plan should outline the company’s business model. The plan should encompass information on your business model, including how you plan to generate revenue and profit.

A business plan is a document that provides a road map for business success. It explains what the business does, its customers, and how it will make money. The business model section of a business plan describes the business’s goals for making money.

Types of business models

There are several traditional types of business models, including:

• B2C, or business-to-consumer. In this type of business, businesses sell products or services to consumers.
• B2B, or business-to-business. In this business, businesses sell products or services to other companies.
• C2B, or consumer-to-business. In this type of business, consumers sell products or services to businesses.
• C2C, or consumer-to-consumer. In this business, consumers sell products or services to other consumers.

The business model section of a business plan is crucial because it describes how the business will make money. This information is critical for potential investors and partners to understand. Raising capital or building a successful business would be difficult without a well-thought-out business model.

Explain how your business model is unique and how it will help you achieve your business goals.

Products and services

The business plan’s products and services section describes what the business will offer customers. This section should be clear and concise, providing a high-level overview of the business’ offerings. This section is vital in convincing potential investors that the company has a profitable product or service. To make sure this section is effective, it should include the following:

• A description of the business’s products or services, including any unique selling points or features.
• An explanation of how the products or services will be delivered to customers.
• A discussion of any patents, copyrights, or other proprietary rights associated with the business’s products or services.
• A detailed timeline for introducing new products or services to the market.
• Information on any research and development efforts underway to improve existing products or develop new ones.

By including this information in the business plan, entrepreneurs will give themselves the best chance of convincing potential investors that their business is worth investing in.

Core competency

As you write the business plan, you must include a section on your company’s core competencies. This section is the heart of what your business does best and is essential for potential investors and partners to understand. Your core competency could be anything from a unique technology to a proven track record in a particular industry. Whatever it is, describe why it gives your company an advantage.

Include specific examples and data to back up your claims. With a strong understanding of your core competencies, investors will have confidence in your ability to succeed.

Market analysis

Businesses use market research to learn about their customers, their needs and wants, and how much they are willing to pay. As a result, business owners also use market research and analysis to understand what trends are impacting their industry and how that might affect business in the future. 

There are many ways to gather market research, including surveys, interviews, focus groups, and secondary research. Consequently, the most important part of market research is ensuring it is relevant and accurate. Relevant market research will help business owners make decisions about their business based on real data rather than guesses or assumptions. Overall, objective market research will help business owners avoid making decisions that could cost the business money in the long run.

Sales and marketing strategy

A business plan’s marketing and sales section is about how you plan to attract customers and sell your product or service. You’ll need to describe your marketing channels, sales strategy, and overall marketing approach. The goal is to convince the reader that you have a solid plan for attracting and keeping customers.

To start, you’ll need to describe your target market. Who are your potential customers? What needs do they have that your product or service can meet? Once you’ve identified your target market, you’ll need to decide how you’re going to reach them. What marketing channels will you use? Will you advertise online, in print, or on TV? Will you use direct mail, email marketing, or social media? The options are endless, but you’ll need to choose the channels that will work best for reaching your target market.

Once you’ve chosen your marketing channels, you’ll need to create a sales strategy. How are you going to convince people to buy your product or service? What features will you emphasize? What pricing structure will you use? Answering these questions will help you develop a sales strategy that will attract customers and close deals.

Last but not least, you’ll need to describe your overall marketing approach. What is your brand identity? How will you position your product or service in the market? Answering these questions will help you develop a cohesive marketing strategy that will guide all of your marketing and sales efforts.

The industry

The industry section of a detailed business plan is where the company defines the market in which it operates. This section includes an industry analysis, including trends, significant players, and growth potential. The industry section also assesses the company’s position within the industry and how it plans to compete against its rivals. The section is a crucial section of the business plan, as it helps to ensure that the company has a clear understanding of both the opportunity and the threat posed by the marketplace. Without this knowledge, it would be difficult to make informed decisions about where to allocate resources or how to position the company for future success.

Our market

The market section in a business plan is where you describe the industry and market in which your business will operate. This section includes an overview of the size and scope of the market, as well as information on your perspective market. You’ll also need to provide an analysis of your competition, including who they are and what their strategies are. This information will help you develop your advantage. Finally, you’ll need to provide an overview of the economic conditions in your market, including any trends that may impact your business. This information will help you understand the risks and opportunities associated with your business.

Competition

One of the most critical aspects of business planning is assessing the competition. This section is essential for several reasons:

1. It can help you identify opportunities and areas where you have a leg up.
2. It can help you to understand the threats that your business faces.
3. It can help you develop strategies for dealing with the competition.

There are many ways to assess the competition, but the most common methods include SWOT analysis, market analysis, and competitor analysis.

Competitive advantages

A business has competitive advantages when offering a unique product or service that competitors do not easily replicate. This section could be due to several factors, such as access to rare resources, patented technology, or a highly-skilled workforce. A competitive advantage is essential for any business that wants to stay ahead of the competition and succeed in the long term. When writing the competitive advantage section of a business plan, it is essential to be clear and concise about what gives your business the edge over others in the market. This section will also help potential investors better to understand your business and its chances of success.

The strategic plan

Any business plan should have a section that details the company’s strategy. This part of the business plan will outline how the business plans to achieve its goals. It should discuss the company’s market, marketing and sales strategies, and overall business model. Additionally, the strategic plan should identify any key partnerships or alliances the company has formed. Finally, it should describe any potential risks or challenges the business may face and how it plans to overcome them. Companies can give themselves a roadmap to success by including all this information.

Production and service costs

The business plan should describe the company’s products or services. The business plan includes a description of the company’s products or services. Be sure to include any unique features or benefits that your product or service offers.

If you have any patents or pending patents, be sure to mention them here.

Pricing 

It can also be helpful to include information on your pricing strategy and how you plan to position your product or service in the market.

The pricing section of your business plan will include an overview of your pricing strategy and how you plan to position your product or service in the market. Your pricing strategy should be based on your business goals and consider your target, production costs, and competitor prices. Once you have determined your pricing strategy, you need to determine your price points. The pricing section will involve calculating your production costs and adding a markup that will cover your overhead costs and generate a profit. Once you have determined your price points, you must decide how to position your product or service in the market. This section will also involve assessing your competition and determining what unique value you can offer that will appeal to your prospective market.

Target market

The business plan should identify the company’s target market. Include information on your market, including demographics, psychographics, and geographics.

And be sure to explain why you have chosen this particular target market and how you plan to reach them.

If you have any existing customers, mention them here as well.

Financial analysis

Capital spending

The capital spending section of a business plan is where you’ll detail how much money you need to start or grow your business. This section will include a description of the company and the money you need. Additionally, it describes what the use funds are used for, and how to repay them. You should also have a detailed budget and financial projections in this section. Ensure all the necessary information in this section so potential investors can make an informed decision about your business.

Staff costs

The staffing cost section of a business plan provides an estimate of the wages and benefits paid to employees. The staff cost includes salary, bonuses, health insurance, and other benefits. The staffing cost section also includes a list of the positions that need to be filled and the number of employees needed for each position. This information is used to calculate the total cost of employee compensation. The staffing cost section is crucial because it helps business owners determine how much they need to budget for employee wages and benefits. Without this information, creating an accurate business plan would be difficult.

Valuation

Business valuation is the process of determining the economic value of a business. The value of a company is determined by its ability to generate future cash flows. When valuing a business, there are two common approaches: the discounted cash flow (DCF) method and the comparable company analysis (CCA) method.

Discounted cash flow

The DCF method estimates the value of a business by discounting its future cash flows back to the present. The key inputs in this method are:

• The business’s forecasted cash flows.
• The required rate of return.
• The discount rate.

Comparative company analysis

The CCA method estimates the value of a business by comparing it to similar companies that have been recently sold. This method relies on data from comparable transactions to estimate the value of the business being valued. The key inputs in this method are data on similar sales and the business’s financial statement. Business valuation is an integral part of business planning and is typically used to raise capital or buy/sell businesses.

Financial projections

The financial projections section of a business plan is critical in providing an overview of the company’s expected financial performance. This financial projections section generally includes a 12-month profit and loss statement, balance sheet, and cash flow statement. The profit and loss statement will show revenue, expenses, and profits for the next 12 months. The balance sheet will provide a snapshot of the company’s assets and liabilities. The cash flow statement will show how much cash the company will generate or burn over the next 12 months. These statements will give potential investors an idea of the company’s financial health and help them make informed investment decisions.

Risk analysis

The risk analysis section of a business plan helps entrepreneurs identify the risks their business may face and develop strategies to mitigate those risks. This section should include a discussion of the business’s strengths and weaknesses and an analysis of the opportunities and threats it faces. Entrepreneurs should also identify potential risks associated with their business model, product, or service. By doing this, they can develop plans to address these risks if they occur. By thoroughly evaluating their business’s risks, entrepreneurs can give themselves a better chance of success.

SWOT – Strengths, weaknesses, opportunities, and threats

Conducting a SWOT analysis is a vital part of any business planning process. The SWOT acronym stands for strengths, weaknesses, opportunities, and threats. This type of analysis provides a snapshot of your business’s current state and can help you identify potential areas of growth or improvement.

Internal factors

To complete a SWOT analysis, take some time to assess your business’s strengths. These could include things like your unique selling points, positive customer reviews, or strong brand identity. Once you’ve identified your business’s strengths, assess its weaknesses. These might include inexperience in your management team, high overhead costs, or outdated technology.

External factors

After taking stock of your business’s strengths and weaknesses, it’s time to consider external factors that could impact your business. These are known as opportunities and threats. Opportunity factors might include market trends, new technologies, or changes in consumer behavior. On the other hand, threats could have increased competition, economic recession, or political instability.

By taking the time to conduct a SWOT analysis, you can better understand your business’s current state and identify potential areas of growth or improvement. This type of analysis can be an invaluable tool for any business owner.

Critical success factors

The critical success factors (CSF) section of a business plan is one of the most vital parts of the document. This section outlines the key areas essential for the business’s success:

• The CSF section should be clear and concise and identify the factors that will make or break the business.
• And the CSF includes having a robust business model, a competitive advantage, a well-defined target market, and a clear value proposition.

However, every business is unique, so it’s essential to tailor the CSF section to the specific needs of your business. By clearly identifying the critical success factors for your business, you can increase your chances of achieving your business goals.

Limiting factors

Any business plan is going to have certain limiting factors. The most common limiting factor is funding. Without enough money to get the business off the ground, it simply won’t be able to succeed. Other common limiting factors include a lack of experience, poor planning, and bad timing.

Any business plan is going to have to take these potential limiting factors into account. For example, if a business doesn’t have enough funding, it may need to look for alternative sources of financing, such as loans or investors. If a company lacks experience, it may need to partner with someone with relevant experience. And finally, if the timing for a business launch isn’t ideal, it may need to adjust its launch date or objectives accordingly.

In short, every business plan is going to face some challenges. By being aware of potential limitations upfront, businesses can give themselves the best chance for success.

Conclusion

So, whether you are a startup or an established business, creating and following a business plan is critical to your success. The good news is that plenty of resources are available to help you, including templates like the one we’ve provided in this blog post. Consequently, whether the plan is for a business loan, secure funding, or taking an existing business to the next level, your written business plan places the business idea on paper. Follow me and link this blog to your writings – I want to hear about your successes (and failures) as you put these principles into action!