Every well-built house has a good foundation, and a business should be no different. Having a concrete business plan sets your company up for success and can alleviate some of the stress that comes with starting a business. Creating and managing a new business can often be overwhelming, so by developing a plan on how to structure, manage, and grow your business, you can accurately assess your goals and objectives. Here is a quick guide on creating a business plan that works best for you. Every business is a little bit different so use what is helpful and ignore what is not. What we do recommend is that you have a gameplan of some sort – it’ll keep you accountable and marching in the right direction towards business success!
What Type of Business Plan do you need?
Once you have decided to start a business, there are two methods of creating a business plan. You can create a traditional business plan or create a lean startup business plan.
Traditional Business Plan
As the name suggests, this method is the traditional and most common way of creating a business plan. Typically divided into sections ranging from company descriptions to market analysis to marketing and sale strategies, a traditional business plan promotes detailed planning. This method encourages people to take a deep dive into planning their business’ future. Since this plan is so comprehensive, many lenders and financial investors request this form of a business plan.
Lean Startup Business Plan
As the name also suggests, this method is a leaner version of the traditional business plan. Lean Startup Business Plans are simplified plans that only include the bare bones of your business’s objectives. This allows you to focus on what you perceive as critical elements in starting your business and how you plan to accomplish your goals. Although not as in-depth as a traditional business plan, Lean Startup plans are a perfect way to summarize your goals and develop a business strategy in as little as one page.
What Should your Business Plan Include?
Regardless of which business plan you choose to create, the factors you should consider in your plan are the same. First, you should consider the nature of your business and then determine which categories are most applicable. Here is a list of the most common categories included in business plans:
This element briefly explains your company’s objectives and includes your mission statement and any standard details about your business such as location, who is a part of your leadership team, etc.
This element differs from an Executive Summary. It provides the opportunity to go into more detail about how your business will operate and the advantages your company brings to the table.
This element lets you note if your business will have any partners, including suppliers, manufacturers, or any other partner necessary to run your business successfully.
This element focuses on how your business plans to interact with customers. It is important to examine this portion from start to finish and elaborate on details such as whether your business will focus on personal interaction, whether everything will be automated, etc.
This element focuses on the industry you are entering. From examining your competitor’s strengths and weaknesses to trends in the industry, research will be key in successfully incorporating this into your business plan.
Organization and Management
The element provides information about how your business will be structured. This includes what legal structure you intend to utilize, who will run the company, and their duties.
Marketing and Sales
This element focuses on how you plan to obtain and retain customers after starting your business. By outlining your marketing strategy, you can ensure that you are reaching your target audience, which will, in turn, promote sales.
Legal and Professional
Make sure you consider smart ways to protect your business and personal assets. Hire an attorney if you can afford it. If not, use an LLC and contracts as a great way to do this on a budget with Drafted Legal.
By creating a business plan, you can set your new company up for success from the first day. Regardless of which type of plan you intend to use, business plans allow you to focus your vision and structure your company in a way that satisfies your goals.