A business plan answers one question for its reader: is this business likely to work, and does the owner understand the numbers? Ask the reader for their requirements first. Then build each section from facts you can show.
Start with the reader
A bank reads to see whether the loan can be repaid. A funder reads against its own criteria and usually has its own template. A landlord wants to know that the rent will be paid. Ask them, in writing if you can, what they require. Write to that.
If nobody but you will read it, a one-page plan is more useful.
The usual sections
| Section | The question it answers |
|---|---|
| Summary | In one page: what is the business, what is being asked for, and what will it be used for? Written last. |
| The business and the owner | What do you sell, to whom, from where? What have you done before? |
| Customers and market | Who buys, how many of them are there, and what do they pay today? What is your evidence? |
| Competitors | Who else serves these customers, at what price, and why would someone choose you? |
| Operations | Premises, equipment, suppliers, staff and a normal working day. |
| Marketing and sales | How will customers find out, and how will you actually take the money? |
| Start-up or expansion costs | What must be bought, with quotations. |
| Financial forecast | Sales, costs and cash in and out, month by month for at least twelve months. Break-even. |
| Risks | What could go wrong, and what you would do. |
| Attachments | Quotations, IDs, registration documents, and whatever the reader lists. |
What readers look at first
- The cash flow. Month by month, is there enough to pay the bills and the repayment?
- The owner's own money. What are you putting in?
- The evidence. Quotations, sales records, customer conversations. Not adjectives.
- Whether you know it. Expect to be asked about any figure in the document.
Mistakes that sink plans
- Sales that rise every month with no reason given.
- No wage for the owner.
- Costs taken from memory and not from quotations.
- “There is no competition.”
- A plan bought ready-made, which the owner cannot explain.
- Copying another business's plan. The numbers will not match your quotations, and readers notice.
How long, and how long it takes
As long as the requirements ask for and no longer. For a small business, 10 to 20 pages plus the figures is common. Gathering quotations and records takes longer than the writing, so start there.
What a plan cannot do
It cannot guarantee a loan or a grant. It can show a reader, and you, whether the business stands up. If the numbers say it does not, that is the cheapest moment to find out.