How to Write a Business Plan
Before you start working for yourself, you’ll need a business plan. This will keep you on track and demonstrate your business's viability to lenders if you need to borrow money to get your start-up off the ground.
A business plan should set transparent processes for your company, along with targets to aim for as you grow. Better yet, they help you measure progress and stay accountable for your success along the way.
But where do you start? And what should your start-up business plan include?
Read on to find out how to write a business plan, step by step.
Why Do I Need a Business Plan?
A business plan is essential, whether you’re freelancing or contracting through your own limited company, setting up as a sole trader or looking to scale a start-up.
It allows you to document critical information about your business – things like your short, mid or long-term goals (whether business-related or personal), your marketing strategy and financial plans.
And if you’re hoping to secure funding – like a loan from a bank to get you started, for example – business plans are often a requirement, to give potential lenders confidence that their investment is in safe hands.
Now that you know why you need one, we’ll explain how you can structure and write a business plan.
What Should I Include in My Business Plan and How Should I Structure It?
Don’t worry, you don’t need to produce a 100-page document. In fact, writing a business plan can be pretty straightforward, provided you’ve got a clear structure to follow.
We’ve outlined each section below, with a summary of the information to include, as a guide to writing a business plan:
This is the key information: your name, business name, registered address, etc.
You might be wondering how to write an executive summary for a business plan. As a summary, it can be easier to write this after you’ve written the overall business plan – because it should be a short outline of everything that follows.
Products and services
Another essential section is where you’ll detail your products and services, your pricing, and the rationale behind them. This leads nicely into the next section.
Market research & strategy
Here you’ll talk about the market research you’ve carried out to understand your target market or audience. This is also your opportunity to highlight your key points of difference and your marketing strategy to attract and retain clients.
Financials and operations
Alongside your marketing strategy, you’ll also want to outline your operational strategy, such as decision-making processes and who is responsible for what.
Though it’s challenging to know what to include, you’ll need to know how to write a financial plan for a business plan, too.
This should be where you can explain your pricing strategy in more detail – informed by your market research – and include some financial forecasts, like expected cash flow, expected incomings and outgoings, and so on.
A business continuity plan is a kind of backup plan, but it may form part of your business plan, or be written alongside it.
In simple terms, it’s a form of contingency planning that sets out how you might react to an unplanned disruption and return to operating as usual.
While it’s unlikely that you’ll need to prepare a continuity plan from the word go, it’s helpful to know what you might need to do in a crisis. Here are some valuable resources:
- Insurance company, AXA, has advice on how to structure your business continuity plan
- For more general support, visit Business Continuity Institute (BCI)
- The FSB can also provide you with a business continuity plan template
What information do I need?
Alongside setting out the key information about your business, you can also strengthen your business plan with some additional analysis that gives you and any investors a clearer picture of the competitive landscape.
A SWOT analysis
SWOT stands for Strengths, Weaknesses, Opportunities and Threats. A SWOT analysis is a key piece of analysis that you’ll need to carry out so that you’re aware of everything that makes your business stand out, in addition to opportunities to pursue, competitors to be mindful of and wider threats to consider – whether economic uncertainty or legislation changes.
Competitor analysis is how you assess people or businesses in the same field – to establish, for example, how much they charge, what services they provide or who their customers are. Carrying out a competitor analysis is essential to understanding the landscape and where your business fits.
A USP is a Unique Selling Point – it’s what sets you apart from the competition. You’ll want to detail these in your business plan, given highlighting your USP is vital in any marketing activity.
We’ve set out a solid structure for your business plan to follow, but if you’d rather start with a template, you can find plenty online.
The gov.uk website lists this template from the Prince’s Trust; alternatively, you can find templates from the British Business Bank or the Federation of Small Businesses (FSB).
However, if you’d like a template that’s tailored to contractors specifically, you can try reaching out to other contractors for advice, whether through online forums or your network.
A final thought
So, to recap, a business plan is an essential document, setting out your strategy and goals, and contributing towards your company becoming a success.
It’s essential to include the key information about your business so that you can secure funding, if necessary, and keep you on track as you get started working for yourself. Hopefully, our tips for writing a business plan mean that you know what you need to get started.
To find out how Caroola can help with your tax and accounting requirements, please get in touch.
Interested in finding out more? Speak with our expert Sales Team to see how we can work together.
Here's how you can get in touch...