Writing a business plan

A business plan is a written document that describes your business, its objectives, strategies, and the market it operates in. It serves as a roadmap for structuring, running, and growing your business and is essential for securing funding from lenders or investors.

64 steps across 11 sections

1. Traditional Business Plan

  • Comprehensive and detailed; uses a standard structure
  • Requires more upfront work; can be dozens of pages
  • Preferred by lenders and investors (especially for SBA loans)
  • Best for businesses seeking funding or with complex operations

2. Lean Startup Plan

  • Summarizes only the most important elements
  • Typically one page; can be created in about an hour
  • Uses a canvas-style format focusing on key partnerships, value propositions, customer segments, and revenue streams
  • Best for businesses that want to iterate quickly or are not seeking traditional funding

3. 1. Executive Summary

  • The most important section — often the only section lenders read first
  • Write it last even though it appears first
  • Should include: business name, location, mission statement, product/service description, the problem you solve, target market, competitive advantage, financial highlights, and funding request (if a...
  • Keep it to 1-2 pages

4. 2. Company Description

  • Detailed information about your company: legal structure, history, location
  • The problem your business solves and for whom
  • Your competitive advantages — what makes you different
  • Specific consumers, organizations, or businesses you plan to serve
  • Short-term and long-term business objectives

5. 3. Market Analysis

  • Industry overview — Size, growth rate, trends, and outlook
  • Target market — Demographics, psychographics, geographic location, buying behavior, market size
  • Competitive analysis — Direct and indirect competitors, their strengths and weaknesses, your differentiation
  • Market research data — Surveys, focus groups, industry reports, government statistics
  • Barriers to entry — Regulatory requirements, capital needs, competitive moats

6. 4. Organization and Management

  • Legal structure — LLC, corporation, partnership, sole proprietorship
  • Organizational chart — Who does what
  • Management team bios — Experience, skills, and roles of key team members
  • Board of directors or advisors (if applicable)
  • Staffing plan — Current and planned hiring needs

7. 5. Products or Services

  • Detailed description of what you sell or the services you provide
  • How it benefits customers — Focus on value, not just features
  • Product lifecycle — Current stage and future development plans
  • Intellectual property — Patents, trademarks, copyrights, trade secrets
  • Research and development — Ongoing or planned R&D activities
  • Supplier/manufacturing information — How products are produced or sourced

8. 6. Marketing and Sales Strategy

  • Marketing plan — How you will attract and retain customers
  • Branding and positioning
  • Pricing strategy
  • Advertising and promotion channels (digital, social media, print, events)
  • Content marketing and SEO
  • Public relations
  • Sales strategy — How you will convert leads to customers
  • Sales process and funnel
  • Sales team structure
  • Customer acquisition cost (CAC) targets

9. 7. Funding Request (if seeking investment or loan)

  • How much money you need and what it will be used for (be specific)
  • Type of funding desired (equity, debt, line of credit, grant)
  • Terms you are seeking
  • Future funding needs over the next 3-5 years
  • Exit strategy for investors (if applicable)

10. 8. Financial Projections

  • 3-5 year forecasts including:
  • Income statement (P&L) — Revenue, cost of goods sold, gross margin, operating expenses, net income
  • Balance sheet — Assets, liabilities, equity
  • Cash flow statement — Operating, investing, and financing cash flows
  • Break-even analysis — When the business will become profitable
  • Key assumptions — Growth rates, pricing, cost structure, market share
  • If existing business: include historical financial statements for past 3-5 years
  • Use realistic, defensible numbers (lenders will scrutinize)

11. 9. Appendix

  • Supporting documents that don't belong in the main body:
  • Resumes of key team members
  • Product photos or mockups
  • Permits and licenses
  • Lease agreements
  • Letters of intent from customers
  • Market research data
  • Credit history (for loan applications)

Common Mistakes

  • Writing the executive summary first (write it last after all other sections a...
  • Ignoring the competition or claiming "we have no competitors"
  • Using unrealistic financial projections
  • Failing to clearly define the target market
  • Not explaining how funds will be used (for funding requests)

Sources

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