Every business starts with an idea. It’s a specific vision or a goal that a person or group of people want to achieve. After the initial inception of an idea, it needs a lot of extra thinking to turn it into a functioning business. It needs a business plan! 

This article goes over the definition of a business plan, why and when you need one, and the crucial steps of creating one yourself. Let’s get started.  

Definition of a Business Plan 

In short, a business plan is a detailed guide to your business, its growth, and further development. It’s meant to attract investment and talented employees by explaining what your company is and what it aims to achieve. 

A solid, well-written plan shows that you know what you’re doing. Not only does it help you focus on your business objectives, but it also increases the chances of successful growth. Nobody wants to give money to a company that just ‘goes with the flow.’ 

If you’ve started to think about a business plan, it’s a good time to write one. There are many situations when you’ll need it: searching for partners and co-founders, looking for investors, hiring employees, and boosting your growth. A comprehensive business plan comes in handy for a business at many stages. 

Steps to Writing a Business Plan 

With all the what, why, and when questions answered, I will now break down the whole writing process into simple steps. Consider it a general framework. 

The most important thing is for the business plan to outline your central vision and the goal of your business. 

1. Come up with your company description 

It should include your background, main objectives, and mission statement. 

2. Present your potential and market research 

Mention your target demographic and the size of the market. 

3. Write a competitive analysis 

Identify other companies that are already active in your target market. Provide detailed information on them and think about what sets you apart. 

4. Identify your service or product 

Describe the production process, the lifecycle of your service or product, what its benefits are, and how it is better than what your competitors offer. 

5. Build a sales and marketing strategy 

Your strategy will influence the performance of your business. You can also use this section to explain what factors will support your competitive advantage.  

6. Put the financial data together 

If the business is new, prepare the financial plan and a budget. If it’s already operating, it should include the overall performance, too. 

7. Describe the management and organizational structure 

Include an overview of all the people involved in your company. This will help identify who’s going to run the various operations. 

8. Go over the funding request 

It should be clear what your business needs and why. This should include both a best- and worst-case scenario. 

9. Add appendices 

This section will include all the necessary supplements for readers of your business plan to have a clearer picture. 

10. Write an executive summary 

Even though this should be the first thing in your business plan, I’d recommend you write it last. This way, you’ll be able to highlight the most vital points of the whole document. 

That’s it! 

After going through all ten steps listed above, you’ll have yourself a decent and informative business plan. 

I hope that you find this article useful. Stay tuned for more posts in the future!