Business Strategies

A business plan is a written description of what your business does, who it serves and how it will make money. Writing one forces you to test your ideas on paper, and lenders and investors will usually want to see it. An effective plan is clear, realistic and brief enough to be read.

Start with the purpose

Decide who will read the plan. A plan for a bank emphasizes your ability to repay. A plan for investors emphasizes growth potential. A plan for yourself can be shorter and focus on running the business.

Core sections

Executive summary

One page that says what the business is, who it serves, what makes it different and what you need. Write it last.

Description of the business

Explain your products or services, your legal structure, your location and your history, if any.

Market analysis

Describe your customers, your competitors and the trends affecting your industry. Be specific and honest about the competition. Vague claims of having no competitors undermine credibility.

Marketing and sales

Explain how you will reach customers, how you will price, and how you will convert interest into sales.

Operations and management

Describe how the work gets done: facilities, equipment, suppliers, staffing, and the experience of the people running the business.

Financial projections

This is the section readers examine most closely. Include start-up costs, projected income statements, cash flow projections and a balance sheet, usually for several years, with the assumptions behind them. If you are seeking financing, state how much you need, how you will use it and how you will repay it.

Tips for an effective plan

• Use conservative assumptions and explain them.
• Project cash flow month by month in the first year, since timing gaps sink many new businesses.
• Plan for taxes, including self-employment and payroll taxes.
• Keep the writing plain and avoid hype.
• Update it as your business changes, and compare actual results with it.

The numbers are often the hardest part. Our business plan services can help with projections, and you can also reach out to us to talk through your plan.