How to Do a Simple Business Plan

Create a simple business plan to help achieve your goals.

Creating a simple business plan takes some time and thought but is well worth the effort. Even the most basic plan can help you set and achieve business goals efficiently. A business plan will help you keep your business on track and will provide milestones that let you compare actual progress with expected accomplishments. A simple business plan has seven components that are easy to write and appropriate for all business types.

Instructions

1. Describe the intended services or products. Give as much detail as possible and explain the nature of the product or service, including any physical characteristics or unique aspects. Explain in brief why your service or product is needed and what benefits it will offer to its users.

2. Explain the market (needs analysis). This section explains who will buy/use your product or services and who your competition is. Describe the demographics of your intended clientele including their age, average income, ethnicity and family size. Explain why they are your chosen target audience and the reason your product or service meets their needs. Also identify any competing companies, how your products or services will be better than theirs, and why your customers will prefer what you offer over what your competitors provide.

3. Give an overview of the organization and management of your business. This section should clearly explain how your business will be run. Describe the size of your business and how it will be organized. Tell what departments you will have (human resources, shipping and receiving, management and so on) and how many people will work in each one. Include a flow chart that shows the hierarchy of employees and give a job description for each person or position.

4. Write a strategy and implementation summary. This summary explains how you intend to market your business. Specifically describe your advertising techniques and in what order they will be implemented. For example, you may first advertise in the local newspaper, and then on the radio.

5. Create a financial plan. The financial plan should explain how and where you will raise money to fund your business. Will you apply for loans or grants? If so, at what bank will you apply for the loan, and what grants will you apply for? The financial plan should also include an annual budget that forecasts financial needs, revenues and expenses.

6. Write the executive summary. The executive summary is the first section of a business plan but should be written last because it summarizes the entire plan. The purpose of this section is to give readers an understanding of your business without reading the entire plan. It will help bankers, advisers, potential investors, and others understand your business at a glance. Include your mission statement and objectives in the summary.

7. Create the appendix. Neatly organize graphs, charts and supporting documents in an appendix.

Tips & Warnings

• Include a cover page with the intended business name, contact information and the name of the author of the business plan.

• Write a table of contents and place it after the cover page.

• Use an easy-to-read 12-point font and single spacing.

References

• Free Management Library
• US Department of Commerce
• Hurdle: The Book on Business Planning

Resources

• Entrepreneur: 5 Harmful Myths about Business Plans