How to Write a Business Plan? Step-by-Step Guide for 2022

Summary

In this informative video, Mike Plogger from Visme guides aspiring entrepreneurs on crafting an effective business plan. He emphasizes the importance of a business plan for setting realistic goals, staying organized, reducing risk, and securing investment. The video outlines eight essential steps for creating a business plan, which include developing an executive summary, company description, market analysis, competitive analysis, product or service overview, financial plan, marketing strategy, and showcasing the team. Plogger also highlights the significance of using data visualizations to simplify financial figures and make the plan more digestible for readers. Additionally, he shares that Visme offers customizable templates for business plans and pitch decks, tailored to various industries, to help businesses present their ideas professionally and persuasively.

Takeaways

• 📝 Start with a business plan to outline your goals, objectives, audience, and more for a comprehensive understanding of your business idea.
• 🎯 A business plan helps set realistic goals and milestones, making it easier to achieve them by breaking down into actionable steps.
• 📈 Stay organized and grow your business faster; studies show that businesses with a plan grow 30% faster than those without.
• 🛡️ Reduce risks by identifying potential obstacles through a well-thought-out business plan.
• 💰 Attract investors with a professional and serious business plan that can make or break funding opportunities.
• 🧐 Begin the business plan with an executive summary, which is a concise overview of your entire plan.
• 🏢 Include a company description, mission statement, and objectives to define your business and its direction.
• 🔍 Conduct thorough market research to understand the market size, target demographic, demand, and competitive advantages.
• 🤝 Analyze your competition to understand their strengths and weaknesses, and how you can differentiate your business.
• 💼 Outline your products or services clearly, ensuring the language is accessible to a wide audience.
• 📊 Create a detailed financial plan including sales forecasts, balance sheets, income statements, operating budgets, and cash flow statements.
• 📈 Use data visualizations to simplify financial figures and make them more understandable for potential investors.
• 📣 Develop a marketing strategy that identifies the channels and demographics most likely to engage with your business.
• 👥 Showcase your team and their expertise to build trust and confidence in your business's ability to succeed.

Q & A

What is the primary purpose of a business plan?

A business plan is a document that outlines a company's goals and objectives, target market, competition, products or services, financial forecasts, and marketing strategies. It serves as a roadmap for the business and is crucial for securing investment, staying organized, reducing risk, and growing the business.

Why is it recommended to write the executive summary after completing the rest of the business plan?

Writing the executive summary after the rest of the business plan is completed ensures that it accurately summarizes the entire plan. It provides a quick understanding of the business for readers, highlighting the key points and objectives of the company.

What should be included in the company description section of a business plan?

The company description should include the company's history, an overview of the business, a mission statement, and both short-term and long-term objectives. It should concisely explain what the company does and why it was started.

How does market research contribute to a business plan?

Market research is essential for understanding the target market, its size, growth trends, and the specific demographic to be targeted. It also helps in identifying the demand for the product or service, the advantages over competitors, and the pricing strategy of competitors.

What are the key components of a competitive analysis in a business plan?

A competitive analysis should include profiles of direct competitors, their strengths and weaknesses, the marketing tactics they use, and potential future competitors. It should also highlight the company's competitive advantage and strategies for entering the market.

How should the products or services section of a business plan be presented?

The products or services section should clearly outline what the company plans to offer, using language that is easily understood by all readers. It can be a simple list or a more detailed description, depending on the complexity of the offerings.

Why is the financial plan a critical part of a business plan?

The financial plan is crucial as it provides potential investors or co-founders with a detailed view of the company's financial forecasts, including sales projections, balance sheets, income statements, operating budgets, and cash flow statements. It is a key determinant of the company's financial health and viability.

What are the five essential components of a financial plan in a business plan?

The five essential components of a financial plan are: a sales forecast, a balance sheet, an income statement or profit and loss statement, an operating budget, and cash flow statements.

How can data visualizations help in presenting the financial plan?

Data visualizations simplify complex financial figures and make them more accessible and understandable for readers. They can effectively communicate the company's financial position, sales forecasts, and other financial metrics in a clear and concise manner.

What is the role of the marketing strategy in a business plan?

The marketing strategy outlines the channels through which the company will primarily market itself. It should consider the competition's marketing channels, the demographics of the target audience, and the most effective ways to reach and influence potential customers.

Why is showcasing the team important in a business plan?

Showcasing the team helps investors and stakeholders understand who is driving the company forward. It builds trust and confidence in the company's ability to execute its business plan and achieve its objectives.

How can Visme help in creating a business plan?

Visme provides customizable templates for business plans and pitch decks that can be tailored to fit various industries and business needs. These templates include pre-made designs that can be easily edited with the company's colors, images, fonts, and more, making the process of creating a professional and visually appealing business plan more accessible.

Outlines

00:00

📝 Crafting an Effective Business Plan

The first paragraph introduces the importance of starting a business with a well-crafted business plan. It emphasizes that while many talk about their ideas, the speaker is here to help turn those ideas into a business. The paragraph outlines the necessity of a business plan, what it is, and what it should contain. It also mentions the availability of templates to simplify the process. The speaker, Mike Plogger, highlights the business plan's role in setting realistic goals, staying organized, reducing risk, and impressing potential investors. The paragraph concludes by introducing the eight steps to writing a business plan, starting with the executive summary.

05:01

🏢 Understanding Your Business and Market

The second paragraph delves into the specifics of what a business plan encompasses. It covers the company description, including history, mission statement, and objectives. The paragraph also stresses the importance of market research to understand the target market's size, growth, and demographic. It discusses conducting a competitive analysis, identifying direct and potential competitors, and understanding their strengths and weaknesses. The section on products or services outlines what the business offers and how it is presented to ensure universal understanding. The financial plan is described as a critical component, including sales forecast, balance sheet, income statement, operating budget, and cash flow statements, with an emphasis on the use of data visualizations for clarity.

10:03

📈 Financial Planning and Marketing Strategies

The third paragraph focuses on the financial planning aspect of a business plan, detailing the components that make up a robust financial plan. It also touches on the marketing strategy, advising on selecting the right channels to reach the target audience. The paragraph advises against listing every possible marketing method without necessity, advocating for a concise and targeted approach. The final step discussed is showcasing the team behind the business, which can instill confidence in investors. The paragraph concludes with a call to action for viewers to like the video and subscribe to the channel for more helpful content, and a reminder of the availability of business plan templates on Visme for various industries.

Keywords

💡Business Plan

A business plan is a comprehensive document that outlines the goals, strategies, market research, and financial forecasts of a business or project. It is essential for setting realistic goals, staying organized, reducing risk, and securing investment. In the video, the creation of a business plan is the central theme, guiding viewers through the process of developing one for their own business ideas.

💡Executive Summary

An executive summary is a brief, concise section at the beginning of a business plan that summarizes the entire plan. It provides a quick overview of the business concept, objectives, and strategy. In the script, it is recommended to write the executive summary after completing the rest of the business plan to accurately encapsulate the content.

💡Company Description

The company description section of a business plan provides an overview of the business, including its history, mission statement, and objectives. It sets the stage for understanding the company's identity and direction. In the video, the company description is emphasized as a crucial part of the business plan that should be clear and compelling.

💡Market Research

Market research involves studying the market to understand its size, growth, target demographics, and demand for products or services. It is a critical component of a business plan that helps to predict the potential for success and identify competitive advantages. The script highlights the importance of thorough market research in convincing readers of the business's potential.

💡Competitive Analysis

A competitive analysis is a study of a company's main competitors to understand their strengths, weaknesses, and marketing strategies. It helps a business identify opportunities and threats in the market. In the video, creating profiles of direct competitors and potential future competitors is discussed as a key step in the business planning process.

💡Products and Services

This section of a business plan details the products or services that the business intends to offer. It should be written in understandable language to ensure that the reader comprehends what the business is selling. The video emphasizes the need to clearly outline offerings to make them appealing to potential investors or customers.

💡Financial Plan

A financial plan is a section of the business plan that includes projections of sales, a balance sheet, an income statement, an operating budget, and cash flow statements. It is a critical part for potential investors or partners to assess the financial viability of the business. The script stresses the importance of including data visualizations to make the financial plan more digestible.

💡Marketing Strategy

A marketing strategy outlines how a business intends to promote its products or services to reach its target audience. It includes the channels through which the business will market itself, such as social media, print, radio, or digital advertising. In the video, the presenter advises creating a focused and necessary list of marketing tactics rather than an exhaustive one.

💡Team

The team section of a business plan highlights the key individuals who will be driving the business forward. It is important for investors to see the qualifications and experience of the team members. The video suggests using infographics to present team information in an engaging and straightforward manner.

💡Data Visualization

Data visualization refers to the graphical representation of information and data. It is used in business plans to simplify complex financial figures and make them more accessible to readers. The script emphasizes the use of data visualizations to help investors and readers understand the financial aspects of the business more easily.

💡Investment

Investment in the context of a business plan refers to the financial backing a business seeks from investors, which can be crucial for its establishment and growth. The video discusses how a well-prepared business plan can be instrumental in securing such investments by demonstrating the business's potential and professionalism.

Highlights

Starting a business requires a business plan to set realistic goals and milestones.

A business plan helps to stay organized and grow the business faster.

Companies with a business plan grew 30 percent faster than those without one, according to the Journal of Business Venturing.

A well-crafted business plan can reduce risks by providing a clear roadmap to potential obstacles.

Investors are more likely to fund businesses with a solid business plan.

The business plan should not only contain words but also images, infographics, and other visual elements.

The executive summary should be written last, after the rest of the business plan is complete.

The company description should include a mission statement and both short and long-term objectives.

Conduct thorough market research to understand the market size, growth, and target demographic.

Identify direct and potential future competitors and analyze their strengths and weaknesses.

Outline the products or services offered in a way that is easily understandable to all readers.

The financial plan is crucial and should include a sales forecast, balance sheet, income statement, operating budget, and cash flow statements.

Data visualizations are essential for simplifying financial figures and making them accessible to readers.

Identify primary marketing channels, considering both competition and target demographics.

Create a profile of a typical customer and how they are most often reached or influenced.

Introduce your team to build trust and confidence in investors and stakeholders.

Visme provides customizable templates for business plans and pitch decks to fit various needs.

Use pre-made templates and edit them with your own colors, images, fonts, and more for a professional look.

Templates are available for different industries, making it easier to create an impactful business plan.

Transcripts

you want to start a business and you've

been advised to start with a business

plan that's great the only problem is

you have no idea where to begin don't

worry you've come to the right place

[Applause]

[Music]

hello world mike plogger here again with

visme to help you conquer the universe

or to help you grow your business

through design and marketing expertise

either way today we're going to help you

devise an effective business plan while

a lot of people simply talk about their

great ideas you're different you're

ready to take the next step to sharing

your idea with the world and turn it

into a true business the first thing

you're going to need is a business plan

what is this exactly why is it necessary

what should you include in your business

plan all great questions that i'll

answer for you here shortly and for

those of you who are looking for a

shortcut i'll even share some templates

you can use that'll make your life a

whole lot easier shall we

now before we hop into our eight steps i

do want to take a quick moment just to

highlight what a business plan is for

those of you who are unfamiliar in the

simplest of terms it's putting a

business idea on paper and looking at it

from a bird's eye view so if you have an

idea for a unique coffee shop i don't

just mean writing out coffee shop you

need to dig into your goals objectives

your audience your products

characteristics and so much more sure

you can start with your business name

but this will end up being a multi-page

document that should make any reader not

only believe in your idea but in you and

please whatever you do don't make it

consist of only words and facts a

business plan should consist of images

infographics colors shapes and more as

we see here with our first visme

template

there's four reasons why a well thought

out and well-written business plan is

important you may think all of this is a

waste of time and you can just run with

your idea but i don't encourage you take

that route for starters a business plan

can help set realistic goals and

milestones by putting these on paper

it's easier to understand what needs to

be done in order to accomplish them sure

you want a hundred thousand dollars in

sales your first year but what steps are

you going to take to reach that writing

out one big goal without these small

steps to reach it can often make that

goal feel unobtainable

another reason is a business plan helps

you stay organized in turn growing your

business faster a study published by the

journal of business venturing found that

companies or individuals with a business

plan grew 30 percent faster than those

that winged it a business plan will also

help you reduce risk by writing a

roadmap you'll be able to see potential

obstacles more clearly and lastly if

you're not sold yet perhaps the biggest

reason a business plan is important is

because it can be the difference in an

investor giving you funds or not if

you're looking for help whether from a

friend family member or one of those

people on shark tank a business plan

will go a long way even if it's not read

immediately it'll make you appear more

professional and serious about your

ideas and while we're here to discuss

and share business plan ideas there's

pitch deck templates on visme.com as

well just like our business plans

they're fully customizable to fit your

needs and make any investor want to put

their money on

you now getting into our eight steps for

writing a business plan the first is to

consider your executive summary this is

essentially the cliff notes version of

your plan as a whole it's meant to give

readers a quick understanding of your

business and what's to come in the

following pages so rather than write

this right off the bat i actually

recommend writing the rest of your plan

first then revisiting this at the end so

you can sum up what's to follow

to help an executive summary should

consist of your objectives market

research competitor information your

products and services a financial plan a

value proposition and of course how

you're going to get started here's a

template that visme provides for this

purpose it states who they are what they

do who their target audience is what

value they bring how they differentiate

themselves and it's all in two short

paragraphs with a sleek design

[Music]

the following section of your business

plan is your company description here

you can provide a company history if you

have one or just an overview if you are

a younger company also be sure to

include a mission statement and any

objectives you have both short and long

term with the mission statement simply

answer the question why you started the

company again this doesn't need to be

long-winded it could be a single

sentence a paragraph or even a personal

quote like we have in our example to

create the event of your dreams

intriguing your objectives are your

goals what are you setting out to

achieve in a month how about in a year

or even five years for that matter and

your overview it speaks for itself

quickly describe who your company is and

what it does

understanding how your business will fit

into its target market is key in being

able to predict if it can succeed or not

that's why it's our third step and

another component of a business plan

you'll want to spend lots of time

conducting research to show readers you

have something great on horizon what are

some things to consider

how about the market size and if it's

grown or shrunk in the past couple years

what segment of the market do you plan

on marketing to is there a specific

demographic that you want to target

what's the demand for your product or

service and how do you have an advantage

over the competitors and what's the cost

of those competitors products or

services assuming you don't have a

groundbreaking idea

write these down over one or two pages

once you've put in the time and research

then throw it into a template like this

one a few short paragraphs followed by

bulleted facts and statistics

emphasizing your research

[Music]

all right hopefully you're not tired of

the research just yet because step four

is when you want to dive into your

competition with a competitive analysis

start by compiling profiles on your

direct competitors these could be those

with products or services most similar

to yours or maybe it's those that are

closest in proximity to you

write down their strengths what are they

doing well that you admire and want to

emulate then write down their weaknesses

what could they be doing better that

leaves open an opportunity then consider

what marketing tactics that they're

using are they using social media are

they using mostly print-based marketing

like newspapers magazines and billboards

maybe they're advertising through radio

note these things next you'll want to

identify any potential future

competitors if your company could take

on different products or services in the

future once you have all of that

information compiled and organized it's

time to put it into a document for your

business plan it can be one to two pages

and may look something like this it

should break down your competitive

advantage and emphasize how you plan on

breaking into the market

your fifth step should be outlining the

products or services that you plan to

offer this can be a quick list as we

have in our latest example here or you

can dive into it a little bit deeper

just use language that all will

understand there may be big words that

only your industry understands so try to

dumb it down if you will so any reader

will comprehend what you're selling

[Music]

perhaps the most daunting section of

putting together your business plan is

your financial plan this is going to

take some time and it should this is the

section that potential investors or

co-founders will consider very heavily

every financial plan should consist of

these five things the first a sales

forecast how much do you predict your

company will sell in the next year or

two don't just write down a number break

it down explaining each product or

service you offer and how you've arrived

at that number the second is a balance

sheet this is a statement of your

company's current financial position

note existing assets liabilities and

equity to give an overview on your

current positioning

third is an income statement or a profit

and loss statement this will examine

whether your company will be profitable

or not by covering all profits and

expenses

fourth is your operating budget how does

your income stack up against your

expenses how much money is your company

making versus spending and lastly you'll

want to include any cash flow statements

this will track how much cash your

company has at any given point

regardless of whether or not customers

have paid their bills now with all that

said i can't emphasize enough the

importance of using data visualizations

for some of these figures writing all of

this down into a word document is

overwhelming and confusing for a reader

data visualizations can simplify your

numbers and allow readers to understand

them with ease

[Music]

so you've sold the fact that you have a

great idea and it makes sense for

potential investors and there's money to

be made here now it's time to actually

sell your business decide which channels

you want to primarily market your

company through considering the channels

that your competition markets to is a

good place to start but don't stop there

think of the demographics you're hoping

to reach create a profile of what a

typical customer looks like and how

they're most often reached or influenced

then simply create a bulleted list it

can be shorter with details or longer

covering a wider range of marketing

avenues just be prepared to speak on

each item's behalf don't throw in social

media blogs emails postcards newsletters

billboards handouts videos digital ads

just because there's enough room for it

on one page keep it short and necessary

[Music]

your last step is to show off your team

you're leading the charge but who do you

have behind you that's going to drive

this company forward this will again

help any investors feel better about

riding with you and it's also another

opportunity to create an infographic i

know i get a little bit excited when

there's a chance to do so and that's

because i know how simple and fun it is

to do envis me you might see an

infographic like this and think yeah

there's no chance i can ever do that by

myself but that's just incorrect bismi

allows you to start with pre-made

templates just like this and then edit

it with your colors images fonts and

more you can download them straight to

your computer in a hair resolution image

and you are done in minutes and want to

know a little secret we don't have

templates for just individual graphics

and pages we have templates for entire

business plans if you're in real estate

we have a business plan for you maybe

you're in consulting and you have a big

presentation coming up we have a

business plan for you are you a generic

startup looking for those investors to

get your company going visme has the

templates for that too

we have an entire collection of business

plan templates that were specifically

designed with different industries in

mind forget the word documents it's time

to blow your readers away with a

business plan built for today

so without further ado it is time for

you to get started but before you do i

do ask that you so kindly hit that like

button for this video and hey if you

haven't already try subscribing to our

channel we love to produce helpful

workplace videos just like this one and

who knows maybe our next video could

help you too thank you so much for

watching with visme i'm mike plogger

helping you

make information beautiful

[Music]

you