Write a business plan
Your business plan is essentially, the foundation of your business. So, without it, you’ll always lack guidance, reference, and organization.
Which business plan is best for you?
Traditional business plan
Writing a traditional business plan is lengthy but easier than most may think. This type of business plan can be 30 to 40 pages in length, extremely detailed, and are written three to five years out into the future.
Lean canvas business plan
A lean canvas business plan is a 1-page startup plan that helps you our ideas into key assumptions. Deconstruct your idea into its key assumptions. As a result, this type of business plan is much shorter, concise, and informational.
Write a traditional business plan
1. Write an executive summary
The executive summary is the synopsis of the traditional business plan. This is essentially a quick summary that knocks out all questions that the full document will encase. Additionally, this section of your business plan shouldn’t exceed two pages and must answer these nine questions.
- Who are you?
- Who is your business?
- What does your company do?
- What industry is your company entering?
- When will you start doing business?
- Where will your business be located?
- Why will consumers want to pay for your product/services?
- How the business will make money?
- Will your business need extra funding, and if so, how much?
2. Company description
The company description is a high-level review of your business. Also, it’s a great elevator pitch! This section quickly and clearly explains your small business and its goals so investors, financial lenders, or potential customers can understand more about your startup and what it offers.
3. Add a description, concept, and strategy
Use this section to describe your product/service. Make sure to include details on how your product/service works, and how it stands out from competitors in your market. Finally, close with a description of your goals and strategy of how you will reach them.
4. Market and industry analysis
This section of your traditional business plan covers your knowledge of the industry. You’ll need to research these four aspects of your market/industry.
- Identify your target market and audience. (Target audience data consists of demographics, psychographics, future projects, etc.).
- Next, create a competitor analysis. (This helps you learn what’s going on in your industry and how well your competitors are doing it)
- Finalize your pricing structure. (Calculate your gross margin levels, discounts, and promotions.)
- Lastly, research federal and state regulations.
5. Define your organization and management
Create biographies for any partners or other individuals in your startup. When writing this section of your business plan section includes information about their position and responsibilities.
6. Include financial projections
The financial projections section of your business plan should be tables and charts that outline your cash flow, profits, and losses. Also, you can even add in an income statement, sales forecast, expenses budget, and break-even analysis.
7. Financing request
Finally, conclude your traditional business plan with a financing request. When requesting funding from investors and lenders, be direct about the amount that you will require to successfully run your business. Additionally, include information on why, how, and where you will spend the money to help grow your business.
. When requesting funding from investors and lenders, be direct about the amount that you will require to successfully run your business. Additionally, include information on why, how, and where you will spend the money to help grow your business.
When requesting funding from investors and lenders, be direct about the amount that you will require to successfully run your business. Additionally, include information on why, how, and where you will spend the money to help grow your business.
Write a lean canvas business plan
1. Value proposition
This first section of your lean canvas business plan sums up the value of your business. Before you start typing up your lean canvas business plan, you need to figure out what original qualities or problem-solving abilities your business will bring to the market.
2. Key partnerships
Key partnerships are your business partners. This section details information about the partners working alongside your business such as vendors or suppliers.
3. Key activities
Gaining an advantage over the competition is extremely important in business. This section of the lean canvas business plan is where you’ll plan out strategies and activities that will help you gain an upper hand on the competition.
4. Key resources
This section will probably include key resources such as intellectual property or capital. These resources allow you to create value for your desired consumer.
5. Customer segments
This section defines your target market and their needs. Here is where you’ll clearly identify the consumers that make up the target market for your business.
6. Channels
This section of your lean canvas business plan outlines the channels you will use — like email and social media platforms — in order to have, and continue, the conversation with your customers.
7. Customer relationships
How will you talk to your customers? Whether you decide to do it in person or entirely online, take the time to detail the kind of experience your business will be able to provide its customers.
8. Cost structure
Is your business focused on reducing costs or maximizing value? You’ll answer this question in the section of your lean canvas business plan But first, consider what strategy you’ll use and then list the most significant costs you face for reaching that strategy.
9. Revenue streams
This section can lack lots of detail but should have a strong idea of every revenue stream.