Business plans are among the key documents deemed necessary in the early stages of a company or startup’s growth. However, the elements that go into crafting a strong business plan are worthy of a CEO or business owner’s consideration at any time in the growth process.
This plan offers a description of how your business will operate, its objectives for growth and financial success, and the way it aims to get there. Essentially, the plan articulates the how and why behind a business. Key elements include:
- Executive summary and mission statement
- Projected staffing and equipment needs
- Short- and long-term marketing strategy
- Financial statement, including anticipated startup expenses and capitalization
- Outline of management structure and operational processes
An effective business plan helps leaders focus on what’s truly important to the future of the organization, and that’s always an important part of strategic planning.
Other tips to keep in mind:
Tailor the plan for your intended audience.
Most business plans are targeted for consumption by potential investors or lenders and are thus considered “external.” But aspects of a business plan concerning, say, effective management of human resources, are usually aimed at managers and others within the company, thus considered “internal.”
The document’s wording should reflect whomever it is designed to inform and persuade.
Aim high with vision, stay realistic with goals.
Business plans often include some form of a vision statement, outlining both the company’s foundational purpose and where its leaders envision going in the future. A business plan should include mention of the company’s vision but going into a lot of detail isn’t required.
Company goals, on the other hand, should be grounded in reality—that is, a clear understanding of the business’s likely amount of available capital, operational resources, and the availability of a qualified workforce. Objectives that are properly attainable should be a key part of the business plan.
Include all relevant data.
According to Info Entrepreneurs, a strong business plan should include information on:
- The number of new customers you intend to acquire
- Operational information about the business’s physical location, suggested vendors, and types of equipment needed
- Financial data, ranging from cash flow and sales forecasts to anticipated profit-and-loss status
Armed with this data, a solid business plan will “ensure that you meet certain key targets and manage business priorities” as you pursue your growth objectives.
Work towards an attainable timeframe.
Sometimes, driven by early-stage enthusiasm or a particular entrepreneurial passion, business leaders convince themselves their business plan’s goals can be attained within an unrealistic time period. Unfortunately, this unfounded belief can be a recipe for failure.
Instead, as Pestle Analysis recommends, aim for a realistic timeframe or, better yet, “take into account various time frames to see which business plan would be of most value to external and internal audiences.”
Use accessible language and format the plan to be reader-friendly.
While it may be tempting to include industry-specific jargon and acronyms (thinking this helps bolster credibility), experts strongly advise wording that facilitates a better understanding of the business plan’s objectives. If the plan itself is too long “or too technical, you will lose the attention of your reader who will probably not read the file to completion,” warns Marc Berman, founder of Programming Insider.
Another tip from Berman: Don’t bombard your target audience with ungainly blocks of words. Be sure to “sufficiently ventilate the text and alternate your writing with images or graphics.” The objective is to engage your readers, not put them off.
To learn more about the value of a business plan, register for our free TAB Boss Webinar, “Creating a Business Plan.”