A Step by step Guide to Writing a Business Plan
If you have found yourself reading through some of the blogs on our website then you probably know the importance of writing a business plan. From SMEs all the way to the largest companies in the world. These plans are crucial for external affairs, for example; If you wanted to add a business partner or get a loan your business plan should be mostly your pitch. Writing a business plan is a must do for any company starting up or planning any big changes. Having your most crucial steps logged down on a plan can help tremendously, and without the use of one it is a lot tougher to maintain a vision for the future of your business. In this piece I will be discussing a step-by-step guide for writing a business plan, I will be delving into each step shedding some light on what to do and what to plan for, and I am also going to stick to writing a traditional startup plan.
Firstly, before you begin writing you need to “know your audience”. An example of this would be if your business is niche and you don’t want to use complex words that the investors or lenders reviewing your plan potentially might not know, as they may not have a lot of knowledge of your business space.
Secondly, it is recommended to keep your business plan as short as possible. Certain people who read it may want more details and others may only want the crucial information.
It is not advised to go overboard with your plan, you should stick to the main points of your vision, and of course have the lower level information presentable for people like business partners who would most likely want more details.
When writing your business plan there are two formats you can choose from; traditional, and a lean startup. The most common is the traditional which is used for most business scenarios and usually has around seven sections explaining the angles of the business. A lean startup plan tends to be ‘one pagers’ and will only have the higher level details included. Lean startups tend to be more suitable for companies that have a very short timeline or need to change very quickly. Once you know what type of plan is fitted best for your business, you’ll need to start writing!
1. As stated before, the traditional plan is more often than not composed of seven detailed sections explaining a vision and the different angles of the business. A good way to start your business plan is by writing an executive summary selling your business and explaining why what you’re talking about matters. Try to keep the maximum number of pages used for this section to two as it is just the introduction, and you should try to look at it as being a catchy hook. Furthermore, feel free to include information such as; the business name, the address, listings of services offered, key employees, and information about the business background.
2. Next you’re going to want to write a description of your business. In this section you can really go into detail about your company. How do you stand out from your competitors? What is your target market? Make sure to put your business in the spotlight and showcase the things that make you stand out!
3. The next step will be discussing competitive analysis, illustrating the competitive landscape, and the market you’re entering. It’s said that any good business will have done a comprehensive analysis of the market it’s being entered in. This applies to any size of business and the reader of your plan will most likely want to see the evidence of this. This section is your chance to describe the market and industry and highlight any opportunities your business could take advantage of within that sector. Furthermore, if there are any unique trends during your market research then definitely showcase what has been found in this part of your plan. You will have to illustrate the competitive landscape as well. This being; whether or not your competitors are doing well, are there any weaknesses that can be exploited? Will you take the competitors’ customers and if so, how? Why are you moving into this business space? Answering these questions in your plan is a good way of ensuring that you have hit every marker needed. A good way of making sure you do talk about everything needed is making a list for yourself and ticking off everything as you go. 
4. Step four is surrounding the operational structure of your business and in this part you will need to go into more objective detail about your company. Your plan should detail how your business is going to operate day-to-day. You should discuss whether or not it is a sole proprietorship which means, “an unincorporated business that has just one owner who pays personal income tax on profits earned from the business.” You should also further go into your business’ legal structure. It is recommended to put together an organisational chart if the scenario has multiple stakeholders to show what everyone brings to the table, and to show exactly who is involved.
5. A sturdy product description is essential as you’re going to want to discuss in detail what goods or services you will be selling. You can make this section longer than the others as it will be the meat and potatoes of your business plan. Make sure you go into detail when describing your product and if there are other products similar out there then explain how it differs from competitors. Discuss your target market again in this section and detail how you are going to make your market aware of your services or product. Talking about your companies’ message and how you are planning on promoting it can be really insightful for whomever is reviewing your plan. Also, make sure you talk about plans for building awareness around your business and retaining loyalty, in the scenario that your business rebrands.
6. If your plan is for a lender or a potential investor to read your plan then you must include a section about your funding request. You need to be clear on the amount you’re asking for and detail the reasons why you are asking for the funding. As Well as explaining what you would use the money for you should clearly discuss the projected ROI (Return Of Investment) that your company expects.
7. In this step of your plan you are going to want to include a financial analysis. In this section you should showcase your business’ performance and show how it can grow in the future. Adding on, the use of images and charts can help explain points in this field easier. 
If your business is smaller and hasn’t been up and running for long, or if it isn’t even profitable yet then be sure to be realistic and clear with projections. Furthermore, if your business is mature and has been operating for a few years then make sure to demonstrate the stability through the years with use of the companies’ finances. Add some research about similar businesses with how they have performed. When doing this step be sure to include; cash flow statements for multiple years, income statements, and also balance sheets. As when you are showcasing your financial outlook you are wanting to project your vision over at least five years or more. Also, when doing this you will need to state the logic behind said projections for them to make sense and to be seen as doable.
8. Finally, in step eight you should create an appendix. In your appendix you should add any remaining supporting documents including information such as; charts, relevant patents, licences and any other bits of information that didn’t fit suitably into your plan. But make sure when adding appendices that they are absolutely needed as you don’t want to just dump irrelevant documents into it. Everything added to your traditional business plan should be crucial information that can go towards supporting and backing up what you are saying. When writing your plan you should make sure that every single word used serves a purpose and isn’t just thrown in there!
I hope this step-by-step guide on writing a traditional business plan has been helpful and informative. Now it is on you to start planning and writing your own! May your business prosper and your plans go smoothly.