5 Tips for Writing a Successful Business Plan

Running a business is not a straightforward path — rather, it’s a curved road full of ups and downs. That’s why it’s easy to get lost and stray away from the destination you originally envisioned.

To make sure business owners don’t get overwhelmed halfway through their journey of building a functional company, they map the entire road out in a business plan.

When you are just starting out, the desire to skip past the formalities and start building, hiring, and networking is so high. However, before you dive into the daily routine of managing a business, make sure you can rely on a business plan that documents your goals, outlines the resources you have, and offers a development strategy for the company.

In this post, we will share 5 business plan writing tips that will help create a realistic and pitch-perfect document for startup and SME owners.

Tip #1. Create audience-specific business plans

As a business owner, you will have to discuss your project with different types of people — stakeholders, partners, investors, journalists, and more. Naturally, a company manager would hardly want a VC firm to know about risks and crises a company could face.

On the other hand, when introducing the company to a co-founder or a valuable employee, business owners would want to discuss risks and resource limitations to make sure no significant detail is left out.

How to create a business plan that appeals to different audiences? The answer is simple — write more than one version of your business plan. Here are the versions of the business plan company managers should have:

  • Business plan for internal use — employees, project stakeholders, etc.
  • Business plan for partners — mainly covers the types of collaboration the company offers, KPIs to hit, and ways for partners to contribute to the business’s growth and development.
  • Business plan for investors that elaborates on financial projects, global expansion plans, and shows the potential of the project.

Tip #2. Get inspired by others

Writing a business plan from scratch is intimidating for company owners who don’t have any experience in writing long-term strategies and plans before. That’s why it’s helpful to see what business plan structure and writing style top companies stick to.

To make writing a business plan much easier and create a satisfying final draft, use examples as references.

Here are a few resources business owners can rely on to find business plan inspiration:

  • BPlans is a large collection of business plan templates for companies operating in different industries.
  • Shopify offers a sample business plan for a retail business — if you plan to enter e-commerce, definitely check it out.
  • LivePlan has a large collection of customizable business plan drafts — they are well-structured and boast a sleek design.

https://www.shopify.com/blog/business-plan-template
                           A video on how to write a business plan from Shopify

Tip #3. Flesh out the structure and stick to it

When working on a business plan, it’s easy to miss out on important points. Spending too much time describing products and services and forgetting to mention the target audience, draft a rundown on competitors, or describe the monetization strategy is a common trap company managers fall into.

To make sure your business plan includes all the necessary information to give your teammates, investors, and partners a solid understanding of the audience, the market, and the company’s future objectives, create a clear structure before you start working on a draft.

Here’s one of the most widely used and effective business plan structure templates:

  • Cover page and table of contents.
  • An executive summary that concisely describes the scale of the company, the market it operates in, and the products/services the business offers.
  • Offer description — in-depth product/service walkthrough that gives investors and employees a clear understanding of the company’s focus.
  • Market landscape review — describe the state of the industry, emerging trends, opportunities, and risks in the market.
  • Target audience analysis — describe your prospective customers, their buyer personas, and outline the strategy and tactics your team plans to use to connect with clients.
  • Competitor analysis — define and describe the products, promotion strategies, as well as strong and weak points of 5-10 of the biggest competitors your company needs to share the market with.
  • Operations plan — outline all marketing, business development, and other activities your team plans on implementing at various stages of its lifecycle.
  • Marketing plan — describe the company’s positioning in the market, strategies to promote your product (SMM, content marketing, sending marketing and transactional emails, and more), the challenges the marketing team can face in the future, and the ways to mitigate them.
  • Financial projections and resources — outline which resources your team possesses for promoting the company (financial, talent, time, and others). State the revenue projections the company has and back this data up with thorough calculations. Be careful to not inflate the estimate too much — otherwise, investors are likely to grill you on details.
  • Conclusion, summarizing the main points of the business plan.

Tip #4. Avoid superlatives and unsupported claims

It’s common for startup managers to think that using powerful adjectives like “major”, “next-generation”, and others helps establish a company as a unique, first-of-its-kind project.

However, in most cases, investors quickly see through ambitious superlatives and consider the company manager who included them in a business plan delusional and overly optimistic.

To make a strong first impression on investors, replace superlatives with data-driven conclusions. Here are a few examples of how changing ten-dollar words for facts and reason improves a business plan:

Unsupported statement: Our application helped homeowners design fabulous apartments.

Supported statement: After using our application to plan a renovation, a homeowner in Florida was about to increase the resale value of his home by $15,000.

While the first statement offers a reader no value, the second one shows a clear use case and hints at the target audience (home-sellers) the platform could be pitched to.

Tip #5. Don’t bloat the page count

When writing business plans, remember that less is more. A busy investor rarely has enough time to carefully read a 20-page-long document. That’s why your pitch will likely get lost and will struggle to get attention from VC firms.

To make business plans pitch-friendly, trim them down. Whenever there’s a financial projection you can’t support or a strategy you are not confident in, leave it out.

Right now, the trend of using lean canvas rather than sending long PDFs to investors is gaining traction.

One of the reasons both startup owners and VC staff like the format is its clear, well-defined structure that fills the pitch with substance and leaves no room for ambiguous statements.

There are plenty of guides and templates for filling lean canvas — take a look at them to get started.

Conclusion

A business plan is one of the pillars a company’s success is built on. Without well-defined goals, strategies, and KPIs, the risk of straying from the founder’s original vision is too high.

One of the reasons business owners put making a business plan off is because writing one is intimidating. The good news is that it doesn’t have to be. Using the tips listed above helps you cut the writing time in half and create an appealing business plan you and your team will use for years to onboard employers, start partnerships, and get funding.

The post 5 Tips for Writing a Successful Business Plan appeared first on Home Business Magazine.

Original source: https://homebusinessmag.com/business-start-up/planning-a-business/5-tips-successful-business-plan/


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