Your business plan step-by-step

Summary

A business plan is a critical document laying out your company's objectives, strategies, and performance measures over the next few years. It explains your product/service, target customers, competitor analysis, sales and marketing plans, operations, and detailed financial projections. An executive summary briefly overviews the key points to impress readers. Regularly update the living document to track progress towards goals and pivot when necessary. Use appendices to provide supporting documents like market research and financials to strengthen your case to banks and investors.

Takeaways

• 😀 A business plan is like a roadmap, setting goals and strategies to achieve them
• 📝 It shows your business's objectives, how you'll achieve them, and helps measure progress
• 📈 Include info on your products/services, target markets, competitors, marketing, operations
• 💰 Financial section covers cash flow, profit/loss - be realistic!
• 🔍 Do market research and include a SWOT and PEST analysis
• 👥 Explain your staff, systems, compliance requirements and policies
• 🎯 Have a clear unique selling proposition to stand out from competitors
• ✏️ The executive summary comes last, tailor it to your audience
• 📎 Append supporting documents like research, orders, marketing materials
• 📆 Update the plan regularly and use it to track progress and make adjustments

Q & A

What are the key sections that should be included in a business plan?

The key sections that should be included in a business plan are: introduction/company overview, markets/competitors, sales/marketing strategy, operations, financial information, and executive summary.

What is a SWOT analysis and PEST analysis, and where would they be included in a business plan?

A SWOT analysis examines the strengths, weaknesses, opportunities and threats relevant to a business. A PEST analysis looks at political, economic, social and technological factors that may impact a business. These analyses would be included in the markets/competitors section.

What should be included in the sales and marketing strategy section of a business plan?

The sales and marketing strategy section should include details on the target market, how the business plans to promote itself and reach customers, the pricing strategy, a detailed sales forecast with timelines and budgets, and plans for tracking results and measuring performance.

What type of information should be covered in the operations section of the business plan?

The operations section should explain location, premises, equipment, production/storage/delivery of products/services, suppliers and distribution strategies, staff and HR considerations, systems and procedures, IT support, future operational plans.

Why is the financial information section important and what should it include?

The financial information section is important to demonstrate the business has sufficient cash flow to cover costs and make a profit. It should include a month-by-month cash flow forecast for year 1 and profit/loss statements for years 2-3, with realistic forecasts for both income and expenses.

What is the purpose of the executive summary and when should it be written?

The executive summary provides a high-level overview of the key points of the business plan. It should be written last, once all other sections are completed, to summarize the entire plan.

What types of documents should be included in the appendix?

The appendix should include supporting documents like market research, customer letters/orders, examples of previous work, price lists, legal documents, policies and procedures, job specifications, and marketing material examples.

Why is it important for a business plan to be a working document rather than something created and then forgotten?

The business plan serves as an ongoing roadmap for the business's direction and goals. Referring to and updating it regularly allows progress to be tracked and adjustments made as needed to keep the business on course.

What analyses should be included to demonstrate an understanding of the market environment?

Including PEST and SWOT analyses demonstrates an understanding of the wider market environment - PEST covers political, economic, social and technological factors, while SWOT examines internal strengths and weaknesses as well as external opportunities and threats.

How can risks and contingencies be accounted for in the financial forecasts?

Including realistic forecasts with contingency plans for higher/lower than expected sales demonstrates financial prudence - explaining how variances would impact figures and what mitigating actions would be taken.

Outlines

00:00

📝 How to Structure Your Business Plan

This paragraph provides an overview of what a business plan is, why it is important, and how it serves as a roadmap for a business by laying out objectives, strategies, and metrics to track performance. It emphasizes that a business plan is a living document that should be regularly updated and used to demonstrate progress.

05:00

🗂 Sections of a Business Plan

This paragraph outlines the key sections that typically comprise a business plan, in the order they are usually written. It mentions the executive summary, introduction/company overview, markets/competitors, sales/marketing, operations, financials, and appendix. It notes that the executive summary is written last to summarize the entire plan.

Keywords

💡business plan

A business plan is a written document that describes a company's objectives and how it plans to achieve them. It includes details on the company's products/services, target markets, operations, marketing strategy, finances, etc. The video emphasizes how a business plan serves as a roadmap that guides the development of a company. It states that business plans should be regularly updated rather than created once and forgotten.

💡objectives

A company's objectives refer to its overarching business goals over a specific timeframe, usually 2-3 years as stated in the video. Setting clear objectives in the business plan enables a company to determine strategies to achieve those goals and measure its progress.

💡strategies

Strategies refer to the methods or plans a company will employ to achieve its stated objectives. The business plan should outline the key strategies across areas like marketing, operations, pricing, etc. that the company will implement to accomplish its goals.

💡measure performance

This refers to tracking and evaluating metrics to assess progress towards meeting the business objectives. As per the video, the business plan helps measure performance so that adjustments can be made if needed to keep the company on track with its goals.

💡target market

A company's target market comprises the specific customer groups or segments that it aims to sell its products/services to. The video advises being as diverse as possible in selecting target markets to develop a wide customer base.

💡unique selling proposition (USP)

A company's unique selling proposition refers to what makes its offering and value proposition distinct from competitors. The video states that the business plan should clearly encode the USP to convey what sets the company apart in its market.

💡sales forecast

The sales forecast estimates the expected sales volume and revenues over a future period. It is a critical part of the financial information section of the business plan. The video advises making realistic forecasts.

💡cash flow

Cash flow refers to the net amount of cash being generated and used by business operations during a period. The video states that the business plan must demonstrate sufficient cash flow to cover costs and make a profit.

💡contingency plans

Contingency plans outline alternative strategies or courses of action to address unexpected circumstances that may arise. As per the video, business plans should include contingencies for situations like lower-than-expected sales.

💡executive summary

The executive summary briefly encapsulates the key points of the entire business plan. Although it appears first, it is written last as a preview of the plan. The video advises customizing it for the specific audience reviewing the plan.

Highlights

The business plan is the roadmap for your business showing key goals, strategies, and progress measurement.

The business plan details your objectives, plans to achieve them, and metrics to track performance.

The business plan describes your products/services, target customers, competitor analysis, and unique value proposition.

The markets and competitors section shows your market analysis and how you'll compete.

The sales and marketing section details promotional plans, pricing, sales forecasts, and tracking.

The operations section explains your location, premises, equipment, suppliers, distribution, staffing, systems, and procedures.

The financial section shows cash flow projections, profit/loss statements, realistic forecasts, and contingency plans.

Include supporting documents like market research, orders, references, marketing materials in the appendix.

The executive summary briefly overviews the business plan's main points and goals.

Tailor the executive summary to your specific audience and their interests.

Keep your business plan updated as a useful, accessible reference tool.

Describe your products/services in terms of customer benefits rather than just features.

Explain what makes your business unique - your competitive advantage.

Conduct market research and analysis to understand your business environment.

Ask your accountant for help with the critical financial section of your plan.

Transcripts

your business plan is one of the most

important documents in your business you

could look on it as the roadmap for your

business it sets out where you want to

go your key objectives the next two or

three years it shows you your plan to

get there the strategies you're going to

use to achieve your objectives and it

shows you where you are so you can

measure performance and make any

adjustments necessary to achieve your

goals your business plan isn't something

you do and then put away in a drawer

it's a working document that you can

refer to and make sure you're going in

the right direction and following the

right path it's also a great way to give

other people an overview of your

business and to demonstrate how you're

performing

that's why banks and investors ask for a

business plan in this video I'm going to

give you an idea of how you might put

your business plan together and take you

through each section however you ought

to know that the plan is often not

written in the same order as in the

final document for example although the

executive summary appears as a first

section is usually written last when

everything else is done we'll come back

to the executive summary at the end of

the video the first section we'll look

at is the introduction and company

overview you need to include the basic

details of your business your business

name address website address if you have

one and your contact details you should

also give your legal status whether you

are operating as a sole trader a

partnership or a limited company in this

section you also need to explain what

your business is about what you want to

achieve and how you plan to measure your

success

make sure you describe the product or

service you are offering and who you are

selling it to the key here is to keep

your focus on the benefits your

customers get from your product or

service rather than just the features of

what it is or what it does you also want

to explain what it is that makes you

different and what makes you stand out

from your competitors this is known as

your USP your unique selling proposition

there's much more detail about how to

encode your USP and identify the

benefits of your product or service in

the module about winning and keeping

customers the next section in your

business plan is about markets and

competitors this is where you

demonstrate that you've researched your

market and understand the environment

you're working in you may want to

include a pest analysis here to show

which market factors are likely to have

an impact on your business and a SWOT

analysis - to show what's important to

your business how to do both of these as

covered in detail in the creating new

products module so I won't say any more

about them right now

a significant part of this section is

about identifying your target markets

showing who and where your customers are

and how you can satisfy their needs this

is covered in more detail in the module

about winning and keeping customers but

make sure you think as widely as

possible so that you develop a diverse

client base you should also include a

competitor analysis and explain how you

plan to compete in this market the next

section of your business plan is your

sales and marketing strategy this

focuses on your target market where your

customers are and how you plan to

promote your business and reach your

customers again taking into account the

differences you'll also want to include

details of your pricing strategy and a

detailed sales forecast be specific

about what you want to achieve and

include a timeline and budgets it's

important you explain how you'll track

results and measure your performance and

what about if you don't achieve the

sales you'd hope for explain what you

plan to do to minimize the risk a key

section of your business plan is

operations this is where you explain how

you plan to conduct your business it

includes information about your location

premises and equipment and explains how

you plan to produce store and deliver

your products and services you should

also include an overview of your

suppliers your approach and how you deal

with them as well as your distribution

strategies this is also where you'll

include details of the staff you employ

your systems and procedures and what IT

support you have if it's relevant you

could also cover specific information

about health and safety equality and

diversity quality control and note any

compliance requirements it's also useful

to outline your future plans and explain

how the way your business

operates may change over time now we

come to the financial information

section this is one of the most critical

sections and also one that many people

find quite daunting it's a good idea to

ask your accountant or business advisor

to help you out the aim is to

demonstrate that the business has

sufficient cash flow to cover its costs

and make a profit you'll need to show a

detailed month by month cash flow for

the first year and a profit and loss

statement for the years two and three

make sure both your sales forecasts and

predicted expenses are as realistic as

possible again is helpful to include

your contingency plans that what-if

situation what if sales are higher than

expected how does that affect the

figures and what if sales are lower than

expected what happens then the final

section is an appendix this is where you

put all the documents and evidence to

support your business plan this may be

market research information any letters

you have from potential customers or

firm orders already in the bag you could

include references or examples of

previous work price lists legal

documents policies and procedures job

and person specifications and Seavey's

for key members of your team and

examples of promotional and marketing

material make sure you cross-reference

this information to the appropriate

section you don't want people to get

confused do you so that's all the

information now you're in a position to

do the executive summary presented

clearly keep it brief and to the point

it should provide an overview of your

business and cover the most important

points of your business plan make sure

you are positive after all you want to

impress and persuade others and it can

be very useful to tailor this section to

your audience for example if you are

presenting the business plan to your

bank to secure a loan the executive

summary should focus on how important

that loan is to you and how will help

your business to succeed once you've

finished your executive summary your

business plan is complete make sure you

use it keep it up to date and have it

available in a format that everyone in

the business can access after all as the

roadmap for your business it really is a

very useful tool