Starting a business can be an unpredictable journey, but with a business plan at hand you can have an idea of where the business is going and how to tackle any challenges that you might face. After speaking to 2,000 UK business hopefuls in our most recent survey, we discovered that a number of barriers are preventing them from starting up their business. In fact, fear of failure was one of the top five concerns when it came to setting up a business.
Your business plan helps you to set objectives and the strategy in which to achieve them, as well as your financial budgeting and forecasts. A winning business plan can help you to make that leap into the world of entrepreneurship.
So how should you go about writing your business plan? Our 5 step-by-step process can help you to paint a vivid picture of your business and where you expect it to go.
1. Know your audience and market
Matching the right audience with your aims and objectives will help you to determine any opportunities for your business, as well as how to achieve them.
What do you class as your business’ successes and achievements? Is it sales, funding, development? Perhaps you have multiple aims which would create multiple audiences for your business. In that case, a number of different business plans tailored to each specific audience would be required.
A complete understanding of the market you are looking to invest in with your business, is key to its success. Spend some time researching the market thoroughly, so that you know the current market size, competition, its history, its potential future growth and how easy it is to enter the market. A full analysis of each of these market factors should be discussed in your business plan, for you to identify opportunities and to look back on over the course of your business’ journey.
2. Know your competition and spot opportunities
Research the competition within the market, in terms of how many competitors you might face and how fierce the competition actually is. Is there a market leader that holds a large share or are there multiple competitors with similar holdings within the market?
From here, you can build up an idea of whether or not your business is able to compete with those already in the market and from what direction. You will be able to see where there could be gaps in the market that could be an opportunity for your own business. With an opportunity comes a unique selling point for your business. If this USP is something that your target audience is actively looking for, your business could become a key player within the market.
3. Now for the numbers
The financial aspects of the business is an imperative part of any business plan. They should include fully detailed reports of any costs and outgoings that is to be expected (particularly those you will have to make at the very start), your predictions of future revenue and profits, as well as how you intend to budget and fund the business. Take a look at our business account, a low cost alternative to a business bank account, where you can store your business’ finances separately from your own and handle those much-needed payments to run the business.
Aim to keep these predictions as realistic as possible. Reaching these targets will be a sign of the business’ success and so sticking to what you expect to happen is a surefire way of tracking the business’ growth and progression.
If you don’t have the appropriate skills or knowledge to carry out the financial forecasting yourself, it’s well worth investing in the help and support of someone that does. After all, having a clear and realistic knowledge of the finances required is a major part of setting up the business.
4. The finishing touches
When writing the final draft of your business plan, you should look to make it detailed but as concisely as possible. You should read through the plan multiple times to make sure everything you have presented is accurate and well written.
Provide an Executive Summary at the beginning of the business plan. You should briefly detail the information found within the plan, summarising the entire plan in a couple of paragraphs. This will be a key part of the business plan in the future, especially if you look to secure investment as the business grows. Make the summary as intriguing as possible, to encourage readers to take the time and read the plan in its entirety.
5. Trial and action the plan
Take your plan to a business consultant, who can offer independent and unbiased advice on the plan. After any revisions that need making, you can look to setting the plan in action. Once you have your business up and running, use the business plan as a strategy to regularly review and assess the progression of milestones you are looking to reach. Your plan will offer a focus for the business and can help your startup business to grow and succeed.