Guides to write a convincing business plan for your hospitality business.

A business plan is a written document that sets out the commercial, operational and financial objectives of a business and explains how it's going to achieve them.

To put it simply, it consists of two distinct parts:

• A written part that presents, in detail, your project, the team, your business strategy, and your medium-term objectives.
• A financial forecast that highlights the expected profitability of the project and the funding requirements.

A business plan is a document that sets out your goals for the next three to five years and explains the strategies and actions you plan to take to achieve them.

There are three main reasons to write a business plan for a hospitality business:

• To draw up a roadmap: helps you make informed decisions about how best to allocate resources and ensure long-term success.
• To track financial performance: enables you to regularly compare your financial performance against what was planned in your business plan and adjust accordingly.
• To raise funding: helps you articulate your growth potential and funding requirements, making it easier to secure financing from lenders.

The absence of a business plan is one of the main reasons why more than 50% of new businesses fail within five years. If you are setting up a hospitality establishment, drawing up a business plan is essential to reduce the risk of your project failing.

The main components of a hospitality business plan follow that of a standard business plan structure:

• Executive summary: provides a concise overview of the business plan, highlighting the key points, financials and objectives of your hospitality business.
• Company description: delivers a comprehensive overview of your hospitality business, covering its vision, legal structure, history, location, and the management team.
• Products and services: describes the products or services offered by your business, emphasizing their benefits.
• Market analysis: evaluates the hospitality industry landscape, target demographics, and competitive dynamics to pinpoint strategic opportunities and threats.
• Strategy: maps out your business's marketing, sales, and pricing strategies aimed at achieving objectives and outmaneuvering competitors.
• Operations: provides insights into your hospitality supply chain, key assets, and staffing requirements.
• Financial projections: presents a detailed financial forecast, including cash flow, income statement.
• Appendix: includes supplementary information such as resumes, legal documents, detailed research, and additional data that support the business plan.

Nowadays, the most efficient way to write an professional business plan is to use a business planning software.

The Business Plan Shop’s online business plan software lets you confidently create your plan without worrying that you've left out a crucial part:

• Our detailed outline includes all the key sections expected in a business plan so you won't have to worry about missing out on crucial aspects.
• Instructions and examples in every section help you power through your plan with confidence.
• Avoid lengthy text by adding images, tables or charts throughout your business plan.

Once you're done, download your business plan as a PDF or Word Document and send it to lenders.

Your business plan serves as a powerful tool to secure funding for your hospitality business by showcasing your vision, market opportunity, operational strategy, and financial projections to potential lenders.

By demonstrating a clear understanding of your industry, a solid plan for growth, and a realistic assessment of financial needs, you can instill confidence and attract the necessary capital to fuel your hospitality venture.

Here are the three main sources of funding for hospitality businesses:

• Loans: you can access financing through bank loans, specialized hospitality lenders, and government-backed loan programs, which can be used for property acquisition, renovations, and operational expenses.
• Equity: you may attract investment from venture capital firms, private equity investors, and angel investors, providing capital for expansion, new projects, and innovation in exchange for equity or ownership stakes.
• Various government grants: these programs are available to support the hospitality industry, including those aimed at tourism development, sustainability initiatives, and small business support.

The Business Plan Shop has a range of business plan templates to help you write a business plan to present to investors or lenders.

Most of our business plan templates are examples of companies and entrepreneurs seeking bank loans and so can be used in the same way to structure your farming business plan!

• Download your chosen template in Word or PDF format (or load it directly into our online business plan software to use as a starting point for your own plan).
• Replace the template’s text and numbers with your business’ details to make it your own.

Here are some of the mostly commonly made mistakes made by entrepreneurs when writing a business plan for an agriculture business:

• Neglecting market research: failing to thoroughly understand the demand, competition, and trends in the hospitality and tourism market can lead to unrealistic projections and ineffective strategies.
• Underestimating operational costs: overlooking the full range of expenses, including staffing, maintenance, marketing, and utilities, can lead to budget shortfalls and operational challenges.
• Ignoring seasonal variations: overlooking the seasonal nature of hospitality can lead to cash flow problems and operational disruptions if not properly planned for.
• Overlooking customer experience: Ignoring the importance of delivering exceptional customer service and creating memorable experiences can harm reputation and reduce repeat business.
• Lack of contingency plannin:g failing to develop contingency plans for emergencies, such as natural disasters, economic downturns, or health crises, can leave the business vulnerable to disruptions.

You should be reviewing and updating your business plan at least quarterly to track your actual performance against what was forecasted at the beginning of the year.

By tracking key performance indicators (KPIs) on a quarterly basis, you can identify any areas of your business which may require a greater budget allocated to them and obtain funding as soon as possible.

You'll also be able to view what's working for your business and what isn't to ensure that your short-term goals and actions are aligned with your long-term objectives outlined in your annual business plan.

The Business Plan Shop's financial forecasting software makes it easy to track your actuals against your forecast to ensure you’re reaching your goals.