Many people come to our site searching for a simple explanation to a pretty complex question: What is a business plan?
Basically, a business plan is a set of goals and objectives and a plan to achieve these goals and objectives, usually for a three to five year period. Business plans can be developed for already existing Fortune 500 companies or any potential entrepreneur working to start a business in their hometown.
A business plan is really vital for the success of new businesses in particular. Imagine going in to a pro football game without a game plan? How about building that swing set in the backyard for your kids without any plan on what it will look like, and you just start hammering boards together? Starting a business without a solid business plan is very similar, and your chances of success without a business plan are quite low.
A typical business plan is going to be about 30 pages, although this can vary greatly depending on the industry and financing required. Successful business plans can range from 10 pages to over 100. There is no set number for success; instead, it’s important to focus on the content first rather than the length of the document.
A typical business plan will include the following sections:
- Executive Summary
- In Depth description of the company, pricing, location, and the overall operation.
- Industry Analysis
- Market Analysis
- Competition and Market Share Breakdown
- Economics of the Business
- Critical Risks and Problems Description and Solution
- Management Team
- Marketing Strategy
- Three Year Financial Projections including balance sheets, income statements, and cash flow statements.
If you’ve never written a business plan before, like most people out there, this is probably a little overwhelming. Take a step back for just a second. Do you know what products you want to sell, for how much, and where you want to be located? Do you know who will compete with you? Do you know how you want to market your business, and who your management team will be? If you have a pretty good idea about these aspects, it’s time to start putting your ideas on paper in the form of a good business plan. Your ideas don’t have to be final; in fact, you should always be re-thinking your ideas to possibly determine a better way.
Now that you have your ideas, are you confident you can write a business plan that investors will want to be a part of? Can you make a compelling argument that your business can and will succeed? If so, get started! There are a number of books and templates out there to help. The Optimus Business Plans Template can be accessed by clicking here.
If you aren’t so confident in your own writing skills, or simply don’t have the time to write it yourself, you may want to seek out professional help. Check out our Business Plan Development page here. We can write a compelling business plan for you, completely custom for your business.
I hope this answers your question of “What is a business plan?” Be sure to check back for our next blog article, “Why do I need a business plan?” some time later this week.