- Money Mentor
Step by Step Guide to Writing a Business Plan
Updated: May 17, 2022
A lot of people find business plans very intimidating and difficult to write. There seems to be a tremendous amount of fear surrounding the business plan, and that is understandable.
Put yourself in any entrepreneur's shoes, you'll probably experience some degree of anxiety as well.
Planning for the future can be difficult, but it's important at the same time. Writing a business plan forces an entrepreneur to sit down and look at what they're trying to accomplish, and what exactly they need to do to make it happen.
A business plan is filled with great information about your business, which is important to get noticed by investors and banks.
The following is a step by step guide to writing a business plan.
Step 1: Executive summary
The executive summary is the thing that any reader of your business plan will see. It's a one-page synopsis of everything else in your business plan, so it's important to get this part right.
Keep your executive summary brief and to the point, because potential investors are going to want to get all of the vital information quickly.
Your business plan executive summary should include the following:
Your business name
Type of product or services that you are going to offer
Step 2: Business description
What is your business and why should people invest in it? These are the questions that you'll answer when writing a description of your business. You need to give readers a basic idea of what your company does and tell them about your main product or service.
Also include information about who exactly your target audience is for this product or service, and why they need it.
Step 3: Business goals
It's important to write down a list of goals that you have for your business. This includes both short-term as well as long-term goals. Some examples of things that belong on this list would be:
Raising capital to start the business
Gaining customers and clientele
Making a profit within a given time
The number of employees
You have to be very specific while writing down your goals. You should include an estimated time frame for each goal you list.
Step 4: Management structure
How is your business going to be run, and by whom? Start this section by listing the key employees of your business.
List each person's job title, their qualifications for that job, as well as what experience they have in the field.
Step 5: Competitor analysis
Take a look at some of your major competitors, and write down how you are different from them. What are their strengths? What are their weaknesses? How can you improve upon these features to make your product or service better than theirs?
Step 6: Product description
What exactly is it that you are selling? You need to give readers a detailed explanation of your product or service in this part of the business plan. Be sure to include what makes your product unique, so there's no confusion about why you chose to offer this item specifically.
Step 7: Marketing strategies
Marketing is the key aspect of any successful business. Write down a list of marketing strategies that you have in mind, and provide details about how each one will be executed. Things to include here would be:
Customer service plans
Step 8: Financial analysis
Investors want to know what kind of return on their investment they can expect. You need to include a detailed description of how you plan to make money with your business idea. Again, be as specific as possible when giving information about the financial end of things.
Step 9: Appendix
There are probably plenty of other details about your business that didn't fit into the steps above. Appendix sections are used to fill in any blanks that you couldn't cover earlier on.
You shouldn't put anything here that should have already been included in the body of your plan, but don't hesitate to include information about what kind of technology you'll be using in your business, or if you'll require any special licenses.
Step by step guide to writing a business plan - Conclusion:
A business plan is meant to be a guide that you and your investors can refer back to as your startup progresses. Show them that you've thought everything through carefully by getting all of the details down on paper, and they should feel more confident investing in your company.