Business plan Wikipedia

The goal is to break down each key section into a sentence or two to convey a birds-eye view of your business and prepare the reader for the content to come. Investors want to see evidence for why they should risk their time and money in your business and how they’ll recoup their investment. A business plan can help you organize your ideas so you can figure out which goals to set, which to prioritize, and how to reach them without spreading yourself too thin. The ZenBusiness Editorial Team has more than 20 years of combined small business publishing experience and has helped over 850,000 entrepreneurs launch and grow their companies. Our writers and business formation experts are dedicated to providing accurate, practical, and trustworthy guidance so business owners can make confident decisions. If you’re searching for business plan examples because you’ve never drafted one before, then thinking of how to format it and how long it should be can leave you feeling a bit lost.

Types of Business Plans

Traditional business plans are longer and more detailed than lean startup business plans, which makes them more time-consuming to create but more persuasive to potential investors. Lean startup business plans are shorter and less detailed, but companies should be prepared to provide more information if requested. A business plan is a written document that defines your business goals and the tactics to achieve those goals.

• A business plan helps entrepreneurs make informed decisions by outlining the strategies, objectives, and key milestones for the business.
• Years ago, I had an idea to launch a line of region-specific board games.
• Entrepreneurs often rely on a business plan to secure financing from banks, investors, or other sources.

They tend to require more work upfront and can be dozens of pages long. Keep reading to learn more about business planning, how to write a business plan and why having one is important for your business’s success. Fundraising is the primary purpose of many business plans since they are related to the inherent probable success/failure of the company risk. Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

• Business plans are especially important for startups and businesses that are seeking funding.
• In general, the length of a business plan is typically between 15 to 30 pages.
• A business plan is meant to be shared with those inside and outside your organization.
• Writing a business plan is a structured and strategic process that involves conducting thorough research, gathering relevant data, and carefully planning the content.

What research shows about business plans

Whether you’re launching a startup, securing funding, or steering an established business toward growth, a well-structured plan is your roadmap to success. A business plan works as a big-picture guide for your business giving a detailed description of what your business plans to do and outlining the strategies and processes of how it’s planning to do that. When describing your products or services, you need to start by outlining the problem you’re solving and why what you offer is valuable. This is where you’ll also address current competition in the market and any competitive advantages your products or services bring to the table.

Mark Tilson is a young professional that wants to start a new business. He has the idea of providing an innovative maintenance service to medium-size manufacturing companies but he needs funds to implement it. Mr. Tilson therefore decided to write a business plan to present the idea to some potential capital partners.

A business plan helps define your startup’s direction, attract investors, secure funding, and make informed decisions crucial for success. In this section, the company should describe its products or services, including pricing, product lifespan, and unique benefits to the consumer. Other relevant information could include production and manufacturing processes, patents, and proprietary technology. Use any past financials and other sections of this business plan, such as your price points or sales strategies, to begin your financial planning. Small Business Administration (SBA), the traditional business plan is the more common of the two. At the end of the day, a business plan is simply an explanation of a business idea and why it will be successful.

To Document Your Revenue Model

Remember, when writing a business plan, be sure to include the elements that best support your business and your business needs. For practical guidance and step-by-step help getting started, try the Capital One workbook on how to write a business plan. While a business plan provides the foundation for a business, other types of plans support this guiding document. The business description section of your business plan should introduce your business to the reader in a compelling and concise way.

You can then use your business plan to help you manage the funding you receive. You’ll not only be able to easily track and forecast how you’ll use your funds but also easily report on how it’s been used. Here are just a few ways you can leverage your plan to benefit your business. The biggest mistake you can make is not writing a business plan, and the second is never updating it.

What to include in a business plan?

Since your objective will ultimately inform your plan, you need to know what you’re trying to accomplish before you start writing. After all, someone opening a new restaurant will have different customers, inventory needs, and marketing tactics to consider than someone bringing a new medical device to the market. Thinking about a business plan strictly in terms of page length can risk overlooking more important factors, like the level of detail or clarity in the plan. As is often the case, how often a business plan should be updated depends on your circumstances. A business plan should be reviewed and revised at least annually, or more often if the business is experiencing significant changes. This is because the business landscape is constantly changing, and your business plan needs to reflect those changes in order to remain relevant and effective.

Creating a business plan ensures you dive deep into your marketplace, empowering you to make smart decisions. It also helps you communicate your business vision clearly, both to yourself and to others who might be critical to your success—investors, lenders, partners, and employees. Established companies, in particular, can leverage past successes as indicators of future growth.

They help business leaders set goals, manage cash flow, make financial plans, create a pricing strategy and attract investors. Financial forecasts generally use historical data—anywhere from one to five years’ worth—to demonstrate how revenue, expenses, profit and cash flow may change over time. Externally-focused plans draft goals that are important to outside stakeholders, particularly financial stakeholders. These plans typically have detailed information about the organization or the team making effort to reach its goals. Developing a business plan involves conducting extensive market research, understanding the industry, defining clear objectives and setting achievable goals. It is crucial for business owners to regularly update their business plans to reflect the changing market conditions and the business’s progress.

This plan, known as a business plan, is a comprehensive document that outlines a company’s goals, strategies, and financial projections. Whether you’re starting a new business or looking to expand an existing one, a business plan is an essential tool. As one of the most common types of business plans, a startup business plan is for new business ideas.

If you’re a startup with the chief goal of raising capital to fund your growth, then yes, as previously mentioned, a business plan is a must. A business plan isn’t only useful when you’re just starting out—it’s something that will help you at different stages of your business such as growth, maturity, expansion, and succession. No matter which option you choose, writing a business plan will set you up for success. You can use it to test an idea, figure out how you’ll start, and pursue funding. And if you review and revise your plan regularly, it can turn into your best business management tool.

Investors want to see a clear exit strategy, expected returns, and a timeline for cashing out. It’s likely a good idea to provide five-year profitability forecasts and realistic financial estimates. Business plans often use a mix of these sections, with details varying by company. The business opportunity should convince investors that your organization meets the needs of the market in a way that no other company can.

Bizplanr is a renowned AI-powered business planning platform providing entrepreneurs and business owners with tools, templates, and resources for creating lender-ready business plans. A startup business plan business plan definition is one of the most common types of business plans, specifically designed for new business ventures. Because markets evolve, customer preferences shift, and your company goals may need recalibration. A living business plan helps you stay agile and focused, aligning your strategic decisions with current market trends and financial performance.

It should grab the reader’s attention immediately by clearly communicating your business concept, mission statement, and company description. Luckily, there are some great business planning software tools available online designed to make this whole business planning process a whole lot easier for you. We talked before about the key components that you’ll want to include in your business plan. Instead of jumping in willy-nilly, draft a very basic outline of each of the sections that you will touch on in your business plan. This has become something of a romanticized idea in the startup world.