A solid business plan is like a map. Coupled with careful planning and a dose of common sense, it will make navigating your business much easier.
You’ve made the decision. It’s time to start your own thing and join the ranks of aspiring business owners. Feedback on your idea has been nothing but positive and you’re feeling ready to set sail into entrepreneurship.
“OK. So where do I start?”
If this question keeps you up at night (like it once did me), you’re not alone. Having a top-notch business idea is a good start, but the execution is all that matters. To get things in motion, you’re going to need a plan.
Depending on your goals and the nature of your business-to-be, a solid business plan will help you secure funding if you need it, bring in partners or simply structure the strategy you’ve set down. The goal here is to present the brilliant ideas that are haphazardly scribbled in your notebook in a professional format.
Here are 5 tips that will make writing a business plan as painless as possible.
Table of Contents
1. Conduct Market Research
Before you begin the process of convincing people that your business is the latest thing, make sure it is.
There are a number of statistics about how many companies bite the dust in the first year of operation. While it may be difficult to get an exact number, it’s clear that many businesses don’t make it very far. For that reason, you should carefully scope the market you’re planning to enter and see if there’s some headspace to accommodate your idea.
For example, before getting into copywriting, one of my strategies was to scout Quora to find threads related to the trade. Is it profitable? What rates can I expect? Chances are other people are asking similar questions, and there are many active business owners willing to share their stories.
Another great way to see if there’s interest in your idea is to find companies operating in the field and observe how they fare. What’s their approach? How are their social media accounts doing? What’s in their portfolios? Who are their clients? Sometimes a simple Google search is all you need.
By comparing your ideas to those already in motion, you can quickly assess where your own plan excels and falls short. This way, it’s possible to improve your business before it even begins. Once it hits the market, you’ll be ahead of the game!
Reading list: I strongly recommend that you check out Chris Guillebeau’s Side Hustle: From Idea to Income in 27 Days. The book comes with a handful of methods on how to probe the market and increase your chances of success. It’s a solid read, even if you’re not actually going from a side hustle to a fully fledged business.
2. Identify the Key Readers of Your Business Plan
Another key to writing a top-tier plan is tailoring it for specific readers and telling them exactly what they need to know.
According to Entrepreneur, there are 8 types of audiences your business plan can target. Depending on the group you wish to attract, you should focus on highlighting those aspects of your idea that are relevant to the particular group. For example, suppliers may be interested in your financial forecasts and solvency, while prospective partners are likely to inquire about ownership status.
Regardless of the audience, include detailed cost and ROI projections that are measurable and realistic. Your readers will want to know that you’ve considered the practicality of your plan and aren’t relying on wishful thinking and unlikely gains in the market.
3. Learn How to Summarize Your Ideas
Or in other words, “get to the point.” In brand marketing, the ability to tell gripping narratives is important (check our blog on how to do that), but when it comes to writing a business plan, you could probably do worse than trade creativity for crafting pitches. This is especially important when writing the executive summary part of your plan.
First of all, learn how to summarize your ideas for yourself. Once you’re able to convey the relevant information without being long-winded, your audience will be less likely to stop reading after going through the initial lines. This will also indicate that you have a solid grasp of your plan and are thinking critically about the steps you have to take. If brevity is not your thing, there are many great tools, like the Hemingway Editor, which can help you make your writing crisp and clear.
Finally, remember that you are the first critic of your creation, albeit somewhat partial at times. If the plan doesn’t click for you, chances are that it won’t click for others. Give the text a thorough review and squash any blunders lurking before proceeding.
4. Follow a Standardized Business Template
When I was scribbling down my first, fledgling plan, I didn’t want or need to adhere to a strict structure. Sure, the essential elements like a business description, sales strategy and market analysis were all there, but not exactly in an organized manner. That’s perfectly okay if you don’t intend to show the document to other people. If, however, your goal is to secure funding or attract partners, you might want to polish the document a bit more.
Every industry has a set of rules and those rules should be honored. Your audience will be expecting certain industry jargon, headings and categories that follow each other in a precise manner. To avoid getting labeled a rookie, learn those rules during the industry research stage.
There are many templates available online, completely for free. But in case you need some guidance on the process, check out this tool created by the Small Business Administration. All you need to do is create a free account and follow the instructions that will take you through all the stages of creating a business plan.
Sometimes project managers and lenders appreciate small surprises—it shows creativity and gumption. However, while it’s important that your document stands out from others, its structure should be steadfast and up to par.
5. Seek out Expert Advice and Ask for Help
At this point, you’ve probably done enough research to cover your bases. You’ve considered the financial risks, identified your audience, and you know exactly what you want to accomplish and how.
That being said, it never hurts to get a second opinion.
Experts have been where you are hundreds of times and they’ve encountered every surprise—including the ones coming your way. They can give you solid advice on what to remove, rework or reinforce. Best of all, they can ask the types of questions your audience may have in mind. So, where can we find them?
First, ask friends and family, and seek out business owners in your social circle. There’s a good chance somebody you know runs a business and will be happy to share their learnings.
Online communities are yet another source of entrepreneurial wisdom. I’ve already mentioned Quora, but there are others worth giving a shot. Check out small-business-forum.net for starters.
If everything else fails and you’re not particularly thrilled about writing a business plan yourself, consider giving the reins to professionals who will do it for you. There are many companies—local and online—who handle the process from beginning to end.
The last and final point on this list is more of a piece of advice than a rule. A smart idea and an excellent business plan won’t get you far without taking action. Once you’re done writing, don’t hesitate to take the next step.
Still have time (18 minutes) to spare? Check out the following video by Tim Ferriss with some valuable insights and reading suggestions on starting a business.