Preparing to write your business plan? You’re already one step ahead of other entrepreneurs who don’t see its value.
A well-thought-out and well-written plan for starting and running your business helps you focus on what you need to do to make your business idea work. It can also boost your chance of getting investments and loans to finance your business.
Did you know that half of small businesses fail in their first four years? Planning is such a crucial step to reducing the risks of managing an enterprise. Turn your business idea from something abstract and uncertain into a successful venture. It starts with drafting a good business plan.
Here’s your definitive guide to writing a business plan that speaks for itself.
What is a Business Plan?
A business plan is a written document that details what a business is, what direction it will take, and how you’ll get it there.
Practically speaking, the business plan evaluates your business’ viability. As the Department of Trade and Industry (DTI) puts it, the document allows entrepreneurs to find out whether or not their business idea will bring in more money than how much it costs to start and run it.
More than just a document, the business plan helps business owners to figure out the key aspects of an enterprise, including the following:
- Business goals and strategies to meet them
- Competitive edge and how to leverage it
- Potential problems and how to solve them
- Funding required to start the business
- Equipment, facilities, and manpower needed for operations
Who Needs a Business Plan and What Is It Used For?
Every aspiring entrepreneur who will spend a great amount of money, time, and energy to earn a profit needs a business plan.
Business planning is a crucial part of starting an entrepreneurial journey, no matter how small or big a business is. Never skip this step—as they say, failing to plan is planning to fail.
Here are some examples of business types that benefit much from business planning:
Founders of startup businesses seek funds to begin their new venture. Business plans help them persuade investors and lenders to provide the funding they need.
For startups, a business plan explains the nature of the new venture, how it will achieve its goals, and why the founders are the best people to lead the company. The startup business plan should also specify the capital needed to jumpstart the new business.
Not only do startups gain advantage from a business plan—existing enterprises need it, too.
But business plans for growing businesses serve a different purpose. Usually, a business plan helps a middle-stage business raise funds for additional facilities, equipment, manpower, and others needed for expansion. This document also defines strategies for growth and allocates resources based on strategic priorities.
Growing businesses also use business plans to communicate their vision to various stakeholders such as customers, business partners, potential investors and lenders, employees, and suppliers.
For such needs, a business plan for existing businesses lays out the goals, strategies, metrics to evaluate success, responsibilities, and resource allocation.
Social enterprises may not be as profit-driven as other business types, but that doesn’t mean they need business planning any less.
A social enterprise needs to prepare a business plan to achieve its social objectives and keep empowering the communities it’s supporting. This document is what government agencies and donor agencies require and evaluate when approving grants for funding a social project.
A social enterprise business plan determines the social issue that a business idea will solve, its beneficiaries, products or services, target market, and sales projections, among many others.
Like social enterprises, non-governmental organizations (NGOs) can also use business plans to source funds for their campaigns and projects.
A nonprofit business plan discusses the problems an NGO is trying to solve through a certain project, as well as how it will do that and how much resources are needed.
It also helps the organization and its board members to prepare for risks by making projections on how likely the activities will push through and how the current sources of funds will continue to yield a certain level of revenue. Most importantly, the business plan defines the Plan B if the original plan ends up failing.
Business Plan Format and Its Components
How does a business plan exactly look like? There’s no recommended universal format for business plans. Ideally, yours is customized according to the nature of your business and what you’re going to use the plan for.
However, all business plans have sections in common. Here’s a quick walkthrough of the six components that make up a business plan.
1. Executive Summary
Like an abstract of a college thesis or a foreword of a book, the executive summary is meant to provide a brief overview of the document. It presents the highlights of a business plan in a page or two.
The executive summary the first thing that readers see, so keep it short yet engaging and compelling enough to make them want to view more details in your plan.
2. Company Profile
The company profile is your chance to introduce yourself and your business to people outside your company. It’s also called the company summary, company information, business description, and business profile.
This section quickly answers the five Ws and one H of your business: who, what, when, where, why, and how.
Think of it as your business calling card. Being the shortest section of the business plan, the company profile provides a quick overview of the business—who the owner and founder is, management team, business goals, business address, product or service, and what makes it unique.
3. Operations Plan
The operations plan explains how you’ll run your business, focusing on the different aspects of manufacturing your product. This section includes the following information, among many others:
- Type of business (sole proprietorship, partnership, corporation, or non-profit)
- How the product is made or the service completed
- Necessary materials, equipment, and facilities to manufacture the product or complete the service
- Any subcontractors needed
- Quality control system
4. Organizational Plan
Your people should play a major role in your business plan, just as how they’re important to your business success. The organizational plan includes a chart that shows how your company is structured according to key departments or functions such as administration, production/manufacturing, marketing, and finance. This organizational chart not only presents the levels of authority in a company but also clarifies who is responsible for which people and function.
Aside from the organizational chart, the organizational plan also includes these details:
- Number of employees to hire
- Responsibilities of each job role
- Qualifications of workers who will perform each role
- Salaries and benefits per job assignment
5. Marketing Plan
The marketing plan and the succeeding chapters are the heart and soul of your business plan, explaining the things that will make your business work. This section details how you plan to promote your product or service in the market.
Specifically, the marketing plan covers the following:
- How the product or service will work and how it will benefit customers
- Target market and its profile
- Strategies for packaging, advertising, public relations, and distribution
- Competitive advantage
6. Financial Plan
A critical section in your business plan, the financial plan helps you assess how much money you’ll need to start or grow your enterprise and identify your funding sources to get your business off the ground and sustain its operations. This is where you’ll provide financial estimates that cover at least one year of running your business.
Investors and lenders specifically look for these financial details in business plans:
- How much you’re going to borrow, what you’ll use the loan for, and how you’ll pay it back
- How much profit you’re expecting to make (through an income statement and balance sheet)
- How you can finance your business operations (through a cash flow statement)
- Whether to keep the business going or close it down to cut losses (through a break-even analysis)
Should You Use a Business Plan Template?
Business plan templates identify what information to put into each section and how it should be structured.
They provide instructions to guide entrepreneurs through the process. This way, nothing is missed out while writing the plan.
Thus, using a business plan template is a great idea, especially if this is your first time to prepare a plan for starting or growing your enterprise.
Helpful as it as may be, a business plan template doesn’t make business planning 100% effortless. While it provides the outline that makes writing the plan easy and quick, you still need to do your homework.
For example, a template won’t compute the financial projections for you—it’s a task you have to complete either on your own or with the help of a professional.
So before you use a business plan template, manage your expectations first and be prepared to do a lot of math!
8 Free Business Plan Templates
Yes, you read it right—you can download free online business plan templates. Some of these templates are designed for a specific niche, while others offer sample business plans for a wide range of business categories and industries.
Start off by choosing any of these free templates that suit your business planning needs.
1. Business Plan Format by the DTI
DTI has a wealth of useful information for micro, small, and medium businesses in the Philippines. Of course, it’s free to access since it comes from the government.
On the DTI website, simply look for the Business Planning section and download the business plan format in a PDF file. This document not only lists down all the information to be included in every section of a business plan, but it also provides guide questions per section—making business planning easier for first-timers.
If you want a more detailed discussion of what should go into each component of your business plan plus sample scenarios, check the DTI’s Negosyo Center e-book that fleshes out things for small business owners.
2. Simple Business Plan Template by The Balance Small Business
The Balance is an online resource for small business owners. It has a free business plan template that’s simple and easy to understand for beginners, with instructions on how to use it. Broken down into sections, the simple business plan template tells you what to include in each component of the plan.
Simply copy the free template and paste it into a word document or spreadsheet. From there, you can start drafting your business plan with the template as a guide.
3. Free Sample Business Plans by Bplans
This website features a collection of over 500 free business plan samples for various industries, including restaurants, e-commerce, real estate, services, nonprofit, and manufacturing.
Under each category are links to many sample business plans for specific types of business. Each sample comes with a plan outline, too. For example, under the Services category, you’ll find sample plans for businesses like auto repair shops, advertising agencies, catering companies, health spas, photography studios, and more.
4. Business Plan Samples by LivePlan
More than 500 free sample business plans are available at the LivePlan website, so you’re likely to find one that suits your business best. The samples allow users to know how other businesses structured and worded each component of their business plans. You can copy and paste the sections into your own plan.
To download a full business plan sample, you’ll have to sign up by submitting your name and email address through the website.
5. Business Plan Templates by PandaDoc
PandaDoc offers free business plan templates for NGOs, startups, restaurants, cafes, bakeries, hotels, and salons. These documents can be downloaded in PDF format.
But if you want a customizable template, you can download the PandaDoc template for a 14-day free trial. This template allows you to edit the document, choose a theme that matches your branding, and add pictures and videos.
The website also has free templates for executive summaries and business letters.
6. The One-Page Business Plan by The $100 Startup
If your business has a simple concept, then a one-page business plan template is ideal to use. This downloadable PDF file is a very simple outline made up of a few sections with questions that you have to answer in just a short sentence or two.
7. Business Plans by Microsoft
Microsoft provides a broad selection of templates for its users, including business plan templates in Word, business plan presentations in PowerPoint, and business plan checklists in Excel.
- Sample business plan template (Word) – Provides the steps in writing a complete business plan
- Business plan presentation template (PowerPoint) – Consists of slides for different sections of a business plan that highlight the key points for viewers
- Business plan checklist template (Excel) – Enumerates the important things to do when writing a business plan, using the Strength, Weakness, Opportunity, and Threat (SWOT) analysis framework
The advantage of using a template from Microsoft is having a professional-looking document, slideshow presentation, or spreadsheet. No need to do the formatting by yourself because the template is already formatted. All you have to do is enter the necessary information into the template to complete your business plan.
8. Social Business Plan Guidelines by the Ateneo de Manila
This free business plan format for social entrepreneurs comes from the Ateneo de Manila University’s John Gokongwei School of Management. In a glimpse, it provides the basic information you need to plan a social enterprise.
It also has more detailed business plan guidelines you can refer to. Simply click the link to the word document at the bottommost part of the page.
How to Write a Business Plan
An outstanding business plan covers everything your stakeholders need to know about your business. So don’t just wing it—put a lot of thought into this critical document.
Let’s get down to the nitty-gritty of drafting a business plan, whether you’ll use a template or not.
1. Brainstorm about your business idea
You may have a very promising business idea, but it won’t fly unless you develop it into a clear-cut concept.
Brainstorm with your team about everything you can think of about starting and running the business. Then list them all down.
Be as creative as possible. No need to be too critical at this point.
While brainstorming, aim to answer these key questions:
- Why do you want to start the business? What has inspired you to go for it?
- What product or service do you plan to sell?
- Who will be your target customers? What are their problems that you’re hoping to solve through your product or service? How will you promote your offerings to them?
- What will be your business branding? How will you position your brand in the industry?
- What is your competitive advantage? What makes your business unique?
- Where do you see your business within a year?
2. Validate your business idea
Research on the specifics of your business idea—paying special attention to your product or service, target market, and competitors.
According to entrepreneurship experts, it’s best to spend twice as much time on this step as spending the time to the actual drafting of the business plan.
Here are some ways to validate your business idea:
- Read studies and research to find information and trends about your industry.
- Conduct market research to gather insights from industry leaders, potential customers, and suppliers. You can do this through surveys, focus group discussions, and one-on-one interviews with your stakeholders.
- Collect data about your competitors, especially the product or service they offer and how they reach their customers. Consider buying from them or visiting their store to get a feel of their products and customer experience.
Gather all relevant information and analyze your findings to assess whether the business idea is feasible or not. You may need to tweak your business idea based on your evaluation of its feasibility.
3. Define the purpose of your business plan
It’s extremely difficult to carry out anything if you aren’t sure about why you’re doing it in the first place. Without a clear purpose, you’re like driving a car without knowing where you’re headed to.
When it comes to writing your business plan, you should have its purpose in mind from the get-go. It can be one or more of the following:
- Create a roadmap to provide the directions the business must take to achieve your goals and overcome challenges. This is ideal for bootstrapping or self-funding startups.
- Seek investments and loans to finance a business. If this is your purpose for making a business plan, it should be compelling enough to attract investors and lenders.
- Set your targets, budget, timelines, and milestones. When you put them all in writing, it’s so much easier to evaluate and measure your business’ actual performance versus your goals.
- Communicate your vision and strategic priorities with the management team. With this purpose, your business plan must establish specific goals for your managers so that they have something to commit to, you can track progress, and get them to follow through on their commitments. Also, having a business plan for this purpose ensures that everybody involved in running your business is on the same page.
- Minimize risks. Running a business in itself involves a lot of risks, and it gets riskier with a poorly researched business idea. A business plan can help entrepreneurs mitigate them by organizing activities and preparing for contingencies.
4. Create an outline for the executive summary
The first section of any business plan is the executive summary. You don’t have to draft it yet at this point, but it helps to write an outline for it before you proceed with the rest of the sections.
In a sentence or two, describe these key aspects of your business:
- Product or service
- Target market
- Unique value proposition (how you set your business apart from the competition)
- Management team
- Short-term and long-term business goals
- Possible sources of revenue
5. Describe your business
The next step is to write your company profile. Get your readers to become familiar with your business and realize why they should be interested in it.
If you have no idea what specifically goes into this crucial business plan section, you can check the company profiles of businesses in your industry. Usually, you can find them on their websites at the About Us or About the Company page. Take note of the information included and how they’re written.
Here are the must-haves of a great company profile:
- Brief history of the company
- Mission and vision
- Product or service lineup
- Target market and audience
- How the business will address the customers’ pain points
- What makes the business unique
6. Provide details about your operations and organizational structure
Anyone who will read your business plan needs to know what they should expect when they deal with you. They need to see a solid plan for your operations and the people who make up your team. So give your operations plan and organizational plan a careful thought.
For your operations plan, choose carefully the right legal structure for your business. Will you be a sole proprietor? Or will you partner with someone or form a corporation? Your choice will have an impact not only on your business operations but also on the taxes you’ll pay and your personal liability.
As for the organizational plan, it’s where you put your organizational chart that shows a glimpse of the hierarchy within your organization. You can easily create this chart in Microsoft Word, Excel, or PowerPoint.
Also introduce the people who comprise your management team—their relevant experience, qualifications, and expertise. The organizational plan must also include information of the support personnel, as well as who reports to whom and who manages whom.
If you’ll be outsourcing some of your business functions, add them to your organizational plan, too. These may include consultants, accountants, lawyers, logistics specialists, and IT specialists. This way, you’re showing that you’re planning to fill in any expertise and skill gaps in your in-house team.
7. Compose your marketing plan
Make this section of your business plan as comprehensive and detailed as possible. You’d want to prove that you’ll take a strategic and aggressive approach to reach your target customers and promote your brand and product or service to them.
Divide your marketing plan into five subsections: objectives, product/service description, target market profile, competition profile, and promotional activities.
Zero in on the what and the why of your marketing activities. Under the marketing objectives section, list down all your goals and the strategies you’ll implement to meet them.
Your marketing goals can be any of the following:
- Raise brand awareness
- Introduce a new product or service
- Regain or get more customers for an existing product or service
- Secure long-term contracts with your ideal clients
- Increase sales in a certain market, product, or price point
- Improve product manufacturing or product/service delivery
- Increase prices without affecting sales
B. Product/Service Description
Describe each product or service you’ll offer, including its features and benefits. You can use storytelling, images, charts, tables, or any visual element that best illustrates how each item will work to the benefit of your target customers.
C. Target Market Profile
Present as much relevant data as you can about your potential customers. Make sure to include the following:
- Demographic profile: age range, gender, income level, education, interests, etc.
- Buying behaviors
- Factors that influence their buying decisions: purchasing power, personal preferences, economic conditions, marketing campaigns, social factors (such as peer pressure and social media influencers), cultural factors, etc.
D. Competition Profile
Your marketing plan must focus not only on your own business but also those of your competitors. List down the similar products or services that they offer to your target customers.
Also, provide an assessment of your competitors’ performance. Which areas are they doing well? How can you improve on their strengths and weaknesses? How can your business stand out? Is it your more competitive pricing? Better customer service? Superior product quality?
To come up with a good competition profile, take the time to research about your competitors. When interviewing your target customers, ask them about the brands they use or businesses they deal with.
You can also do an online search of your competitors. For example, if you’ll run a pet supplies store in Pasig, search for “pet stores Pasig” on Google. The search engine results page may show you the different stores that sell the same products as the ones you plan to offer. Read customer reviews online to get deeper insights on how these businesses serve their clients.
Consider doing a “secret shopping” in your competitor’s store. This way, you can experience firsthand how they treat their customers and how they market and sell their products or services. You might even be able to get information about their product lineup and pricing.
E. Promotional Activities
The last subsection of your marketing plan must discuss how you’ll promote your brand and products or services and connect with customers. Also, be ready to allocate budget for each marketing activity you identify in your plan.
Create a list of marketing activities you plan to implement. Will you reach your audience through SEO (organic online search), paid advertising, and/or social media? Or will you go the traditional route through print and TV advertising or joining expos, exhibits, and trade shows? The right choice depends on the nature of your business and the type of audience you’re trying to reach.
8. Develop your financial plan
The financial plan is the section where you’ll crunch the numbers. Unless you’re really good at math, it’s best to hire an accountant or business consultant who will work with you to develop a foolproof financial plan.
Put simply, a financial plan explains how a business will spend money and make more money. It also estimates the amount of time it will take for the business to earn a profit.
Here are the specifics of a good financial plan:
- Total capital requirement
- Business financing plan and any loan requirement
- Collateral to put up for a business loan
- Schedule for loan repayment
- Financial statements: cash flow statement, income statement/profit and loss statement, and balance sheet
- Break-even analysis
- Return on investment (ROI)
- Financial analysis
Ultimately, these financial projections answer the question, “Is your business financially feasible?”
9. Back up your business plan with supporting documents
Books and theses have an appendix section at the end that provides additional resources. Your business plan should have one, too. This final section consists of documents, surveys, studies, charts, tables, images, and other elements that provide supporting data.
Depending on the information you’ve presented in the other sections of the plan, your appendix may include these things:
- Market research data and findings
- Resumes of the management team
- Relevant financial documents
- Lease agreements
- Bank statements
- Licenses and permits
10. Review and refine your business plan
Your business plan is almost done at this point. Now all you have to do is go over the document once more to ensure you’ve covered everything and nothing crucial is left out.
Check your final draft and be sure it has the following:
- Sound business idea – If you’ve done Step 2 properly (validating business idea), you can be confident that you have a sound business idea.
- Comprehensive and in-depth look into your business in a professional format
- Thorough understanding of your target customers, their behaviors, interests, and needs
- Competent management team – The people who make up your team must possess the skills and expertise that complement yours.
- Business focus or specialization
Aside from yourself, ask a business partner, proofreader, and accountant or financial expert to review your business plan and spot any errors and inconsistencies. You’d want to make sure that it looks professional and is accurate.
11. Write the executive summary
Lastly, get back to the outline you created in Step 4 and write it based on your final draft. Make sure to craft an engaging executive summary that hooks people into reading the rest of the plan.
6 Actionable Tips on Writing a Business Plan
Anyone can write a business plan—but it takes more than great writing skills to create an exceptional one.
Here are some tips to help you prepare an effective business plan that goes beyond the ordinary.
1. Write with your audience in mind
When drafting your business plan, you’re writing not for yourself but for people who will play key roles in starting and running your enterprise. This is why it’s important that you know whom you’re writing for and keep them in mind while preparing your business plan.
If you think you can’t create a plan that caters to all your audience groups, consider having different versions of the document. For example, you can come up with a business plan for investors, another for lenders, one for employees, and so on. But keep the data consistent across all versions.
To write a business plan that suits a particular audience, you have to use the right language, highlight the parts that interest them, and adjust the format accordingly.
A. Use the Right Language
One of the most important rules in business writing: use the language that your target audience easily understands. If you’re writing for engineers, finance people, or lawyers, your language can be technical—meaning you can use jargons and terminologies familiar to them.
However, if you’re writing for investors who barely have technical knowledge, tweak your language in simple terms that are easy to grasp and appreciate.
Likewise, if you’re writing a business plan to communicate internally with managers and employees your company’s direction and strategies, it’s best to use more casual language than you would when writing for high-level, external stakeholders.
B. Appeal to Your Audience’s Interests
It also helps to understand what interests your audience because they will influence how you’ll write your business plan.
Your management team, for instance, will be interested in knowing your business goals and strategies so that they can help you steer the company in the right direction.
Investors and lenders look at the business plan differently—they’ll be more interested in your financial statements to determine your financial health, like if your business is worth investing in or has the ability to pay back a loan.
C. Adopt a Suitable Business Plan Format
There’s no one-size-fits-all format for business plans because it depends mainly on your audience, aside from the nature of your business.
Let’s say you’ll set up a restaurant, and you’re drafting a business plan to apply for a business loan. To convince lenders that your business is viable, details such as your restaurant’s location and possible renovations are crucial.
Meanwhile, if you’re writing the plan for potential big-time investors, you’ll take a different approach. A good restaurant business plan focuses on the business aspects that will lead to growth and profitability (Remember that investors are interested in how they’ll make money from partnering with you).
2. Keep it concise
How long should a business plan be? According to the U.S. Small Business Administration (SBA), it depends on various factors such as the specific audience it’s written for and the nature of a business. The SBA cites surveys that found the ideal length to be at least 25 to 100 pages.
Sounds a lot? If you have a simple business idea and you’re writing a business plan for busy people who don’t have time to pore over hundreds of pages, then one page up to 20 pages should be fine.
However, you may need to provide more explanation (which will take up more pages in your business plan) if you’re planning to build a new kind of business, and a risky one at that.
The size of your business also affects the length of your business plan. Business plans for small businesses need not exceed 30 pages. Corporate business plans are expected to be longer.
What matters more than length is how concise your business plan is. Meaning, it provides all the necessary information—including solid research and analysis—using the fewest words possible. No place for wordiness here!
Support your claims in the business plan with solid facts and proof. Investors, for instance, need an assurance that they won’t lose their investment when they trust you with their money. This is where documenting your business thoroughly plays a crucial role.
What kinds of documentation can you include in your business plan?
- Cash flow
- Industry forecast or projections
- Licensing agreements
- Location strategy
- Prototype of your product or service
- Survey and FGD results
- Resumes of your management team
4. Show your passion and dedication to your business
Although business plans have straightforward, matter-of-fact content, you can still establish an emotional connection with your readers through your plan. After all, your readers are humans with feelings and motivations.
No need to be dramatic about it—you can show your passion and dedication while still sounding professional in your business plan. Write about the mistakes you’ve had (like a failed business in the past), what you’ve learned from the experience, the values you hold, and the problems of your customers you want to solve through your product or service.
5. Know your competition and how you’ll stand out
Your business won’t be the single player in your industry. Other businesses in the same niche have started way ahead of you, and some new ones will also compete for business in the future.
Write your business plan in such a way that you know your competitors so well. Identify all of them and what makes your business unique compared with the rest without belittling them.
6. Be realistic and conservative in all your estimates
In any aspect of your business, it’s better to underpromise and overdeliver than the other way around. This also holds true when writing a business plan. You wouldn’t want to set unrealistic expectations that will lead to disappointments and worse, losses, when you fail to deliver on your promise.
There’s no place for too much optimism in your business plan. Your budget allocation, timelines, capital requirements, sales and revenue targets, and financial projections must be reasonable, realistic, and conservative. These will lend credibility to your business plan and yourself as an entrepreneur. Because there are a lot of factors beyond your control, always assume that things will get completed longer and cost more (consider inflation over time!).
This is where your research prior to writing the draft comes extremely helpful. You have something solid and factual to benchmark against. For example, if your analysis based on the facts you’ve gathered indicates that you’ll be able to get 40% share off the market in your first year of operations, consider making your estimates a bit more conservative and attainable.
10 Mistakes to Avoid When Writing a Business Plan
Now, let’s explore the mistakes entrepreneurs often commit when writing a business plan. Listing them all down here to let you know what to avoid.
1. Prioritizing Form Over Substance
Spend most of your time and energy on building solid research and facts rather than obsessing about which font type or background color will look best for your document.
Many entrepreneurs take too long to complete their business plans because they worry too much about it. Don’t get intimidated by business planning—you don’t have to be an expert or a degree holder in business management or business administration to be able to write an outstanding business plan. Overthinking will just lead to analysis paralysis and get nothing done.
As long as you know your business well and are passionate about it, then writing a business plan won’t be as difficult as you think, especially if you’re using a template.
3. Submitting the Document Without Proofreading It
If your business plan is filled with typos and grammatical errors, readers will get distracted even if you’re presenting substantial information. It may also give your audience an impression that you’re careless—and who wants to deal with a person who isn’t professional and careful enough?
Even if it costs you money, pay a professional proofreader to check your work and correct any errors so that the message you wanted to convey through your business plan will get across.
4. Making Empty Claims
Any statement that isn’t sufficiently supported by solid research or documentation has to go. For example, if you want to claim to be the top player in your industry but you don’t have any evidence to back it up, rethink about including it in your business plan.
5. Writing an Overly Long and Wordy Plan
Make sure that everything you put into your business plan is relevant and serves your purpose. Otherwise, remove unnecessary statements that just add fluff to the document.
Also, don’t waste your readers’ time by using too many words—including highfalutin ones. Remember, your goal is to make your audience understand your business, not to impress them with beautiful or complex prose.
6. Using Too Many Superlatives
Even if you really feel that your business, business idea, or projection is incredible, amazing, the best, great, fantastic, or one of a kind, avoid using these superlatives because they aren’t appropriate for formal documents like a business plan.
7. Doing the Financial Projections on Your Own
Unless you’re an accountant yourself, it’s best that you get a professional to do the job for you. It will save you time and the headache of dealing with numbers and formatting your financial plan properly.
8. Overestimating Your Projections
The business plan is not a place to make impossible promises—while they look good on paper, you might run into trouble fulfilling them. To avoid this mistake, always do your research. Find out how other businesses do it and what the typical timeframes and financial projections are before you come up with your estimates.
9. Long-Term Business Planning
As much as possible, limit your projections to only a year. A lot of things can happen and make your business different from how you initially planned it. Stick with your short-term or one-year targets and estimates, then just tweak your business plan as time goes by.
10. Including Unfounded Rumors About Your Competitors
Not only do rumors make your business plan look unprofessional, but they also distract your readers from your intended message, which is to highlight what makes your business different from the competition. Avoid including details based only on hearsay. Everything in your plan must be backed up by solid, quantifiable facts.
A business plan is more than just a document that you prepare once and will never look at again. Rather, it’s a strategic tool that you should use from time to time to guide your business operations, get the buy-in of your stakeholders, and grow your business over time.
Once you’re done with writing your business plan, make the most of it for your business. Use it and modify it as often as needed!
Ready and confident to start writing your business plan? Share your thoughts and questions below!