Writing a business plan can be an arduous task, especially when you're not 100% sure where to begin and how to organise it. To help you along the way, The Business Plan Shop has put together a step by step guide on writing a business plan.
What's the goal of a business plan?
When writing a business plan, you should keep the following objectives in mind:
- Highlight your business opportunity: demonstrate that there is a gap in the market (demand), and provide a solution for it (by offering your products or services)
- Put together a concrete plan of action: layout the blueprint for what you have in store for your business venture, and how you're planning to sell your products or services
- Show them the money: articulate how much money you will need at the start and how profitable your project could be
7 business plan steps to follow to put together yours
Here are the 7 business plan steps you should follow:
- Executive summary
- Company description
- Products and services
- Market Analysis
- Strategy and implementations
- Financial planning
Do not ignore the business plan steps and let us guide us through what they include.
Business plan step #1: Executive summary
Writing a business plan step by step will first include your executive summary. This section defines the main aspects of your project: company, activity, management team, brief market overview, key numbers for your financial forecast, and your funding requirements.
Business plan step #2: Company
Following this, the company's description presents the company's structure, including shareholders, legal form, head office, and management team.
Business plan step #3: Products and services
Then, the products and services section highlight your unique selling proposition and positioning.
Your positioning is a detailed presentation of your products or services, in order to add credibility to the project. Keep in mind that you're presenting the project to someone who isn't necessarily familiar with your area of expertise, so keep it clear and concise - no jargon!
Business plan step #4: Market analysis
The fourth business plan step is putting together a market analysis for your business plan, which gives an overview of the global and local markets. The goal is to prove there is a need for your products or services, and that there is gap in the market for you to meet those needs.
At this stage, you've already reached the first objective of your business plan: proving there is a business opportunity. Once it's done, the following sections are used to detail a concrete action plan and translate your hypothesis into financial form.
Your action plan is split into two sections: strategy and operations.
Business plan step #5: Strategy
In the Strategy section, explain how you're planning to establish yourself on the market, including the contents of your offer, how attractive it is compared to your competitors, and how you're planning to distribute your goods and create a loyal base of customers.
Business plan step #6: Operations
The Operations section gives a detailed account of day to day life within the company: staffing requirements, which suppliers you're going to use, what the opening hours are, etc.
Business plan step #7: Financial forecast
Once you've done all of this and the business plan steps have been followed, you should have the data needed to put together your financial forecast (balance sheet, P&L and cash flow statements).
The background and context of the previous sections will help you explain how you built your financial forecast and how much funding is required to launch the business.
If you think you don't have the tools or skills to put together your financial forecast, you could use a business plan software to help.
How to write your business plan step by step
Find out which business plan steps you should take for your business plan. There are several ways of writing your business plan step by step, however, we would recommend the following approach:
- Start with the company description, since it's the one section where you're pretty sure to have all the necessary information, considering this is your project.
- There is a slight chance some details could change, however, it should pretty much stay the same throughout your project, which is why it's better to begin there.
- Follow this with your market analysis, which is the foundation of your business plan. A market analysis is key to understand and highlight your business opportunity.
- Make sure this is one of your first steps, otherwise it will be hard (or even impossible) to carry on with the rest of your business plan.
- The Strategy section is a good section to follow with, as it logically follows the market analysis and your strategy (pricing and go to market strategies in particular) will dictate how many sales you can expect and what it will cost to generate those sales.
Once you've completed all the business plan steps, you can have a look at the numbers.
- First, take a look at the sales, then at the costs. From how to put together a sales forecast, you are then able to estimate how many people you need in the team and what equipment and resources are needed, and therefore understand how much money is necessary to kick-start your business.
- By forecasting this, you then have the ability to write your operations and financial sections.
- As a final step, we advise you to proofread your document. Have it read by someone else and make sure you haven't forgotten anything - it's vital to be as precise as possible.
As you can see, writing a business plan demands a lot of work, however, by using our step-by-step guide, it's certainly not impossible! You can also find out about using a professional business plan writer if worth it.
Please do not hesitate to get in touch with us if you need any help.
Also on The Business Plan Shop
- How investors analyse business plans
- Where to write the conclusion of your business plan?
- Download our free business plan template
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