All businesses, regardless of size, need a robust business plan.
Whether you’re a start-up, a mid-size company, or a mega-corporation, a business plan is essential to streamline operations and acquire capital.
Of course, small business plans can be overwhelming to write, which is why many entrepreneurs either cut corners along the way or skip them altogether.
To avoid those situations, we’re going to take a high-level view of small business plans and explain what they are, why they’re important, and how you can write one.
To that end, we will also provide several great templates to help you kickstart the process.
What Is a Small Business Plan?
A small business plan is a strategic document that generally runs between 15–25 pages in length.
If your business is straightforward, it could be as short as 10 pages, while more complex companies can have plans beyond 50 pages.
Though length varies, a standard business plan reveals three key facts about a company:
- Focus: what your business does.
- Goals: what your business hopes to achieve.
- Strategy: how your business intends to get there.
So…what is a small business plan?
Simply put, it’s the sum total of your company. It’s the heart and soul of your business—on paper.
Within the structure of your small business plan, you can reveal your company’s story by detailing elements like your:
- Products.
- Long-term goals.
- Employees.
- Marketing strategies.
- Financial projections.
Ideally, this document isn’t merely factual, it’s compelling. After all, you won’t be the only one reading it.
Benefits of a Small Business Plan
Why should you spend your precious time developing a business plan?
After all, you could be refining your strategy for 2024, interviewing potential employees, and even wooing new investors. A little piece of paper can’t help you with any of that, right?
Wrong!
In fact, a carefully crafted small business plan can enhance operational clarity and attract investors/lenders/talent—all at the same time.
There are internal and external benefits of a small business plan.
From an internal perspective, a business plan compels you to objectively assess the status quo, identify persistent barriers, and declare major objectives for your team to pursue.
It’s not easy to do. Indeed, a business plan requires you to think hard.
A business plan demands that you define your current position in the market, envision your ideal future, and reveal how you intend to reach that destination. In its best form, a business plan can be the “north star” of your business—a blueprint for your short and long-term success.
Externally speaking, the benefits are just as good (if not better).
After all, a business plan shows investors, lenders, and employees that you’ve already done the heavy lifting. They’ll see that you understand the industry at large and are ready for the next level.
Ultimately, a great business plan is proof of potential profitability, and it plays a major role in convincing investors to join you on your journey.
8 Standard Elements of a Small Business Plan
A business plan is like a long-form FAQ.
In other words, it helps answer the foundational questions often posed to businesses.
Though there are many explicit (and implicit) questions to consider, most business plans answer topics including:
- Who are your target customers?
- What products and services do you offer?
- How do you define success?
- How much competition does your business face?
- Do you plan to sell the business at any point?
- What ROI can investors expect from supporting your business?
As you will see, these questions (and others) naturally emerge in the eight steps listed below.
1. Executive Summary
On page one of your small business plan, you have the opportunity to provide a brief overview of your company.
This is your “elevator pitch,” so it’s very important to make this section dynamic for the investors who will read it.
Generally speaking, the executive summary should briefly include your mission statement, brand values, target market, goals, and products/services.
2. Company Description
In this section, you’ll list essential facts including:
- Your company’s registered name.
- Your business model (e.g., B2C, B2B, B2B2C, etc.).
- Your business structure (e.g. corporation, LLC, partnership, etc.).
- Key personnel.
- Primary address.
Here, you can also provide a brief history of your business and articulate the “problems” your company aims to solve.
3. Business Goals
“What do we hope to achieve?”
That’s the primary question to ask (and answer) in this section.
Maybe your goals are purely economic.
Maybe they’re societally-focused or philanthropic.
Maybe they’re a combination of the two.
Whatever you hope to achieve, use this section to clearly define your overarching goals.
And if you’re pursuing additional funding, be sure to illustrate how capital investments or loan products will make those goals more attainable.
Be sure to articulate your exit strategy, so your investors know how they’ll get their ROI.
4. Management and Organization
“Who’s on our team?”
This section prioritizes the people who power your business.
Investors often value your staff just as much as your goals and products. Don’t hesitate to humanize key members of your team with headshots and biographies that emphasize their business experience, tenacity, and creativity.
Investors who choose your business aren’t just supporting your service or product line. They’re investing in the people that bring your business goals to life.
You can also use this section to expand on your specific business model and structure, as well as any key roles that you think you might need to hire down the line.
5. Products and Services
Here, you’ll have carte blanche to describe the origins of your product(s).
Maybe you recognized a need and brought your product to market.
Maybe you invented something people didn’t even know they needed.
Maybe you simply made an existing product better than ever before.
Whatever your story may be, this section gives you the green light to hype up your products and the problems they solve.
While revealing the benefits of your products, you can also use this section to detail other elements including:
- The core audience you serve.
- Your pricing models.
- How your products differ from the competition.
- Your production, manufacturing, and distribution processes.
- Any patents or proprietary technology your company might have.
Plus, if you have additional R&D underway (or any other prototypes in development), be sure to disclose that information. After all, these are signs of additional revenue streams and will be very appealing to investors.
This section can also feature the distribution channels that get products from your facilities to your paying customers.
6. Market Analysis
“Who are our primary competitors?”
Here, you have the opportunity to broaden the conversation and focus on the state of your industry (and the competition within it).
You can do so in a variety of ways.
For starters, you can list strengths, weaknesses, opportunities, and threats (SWOT) that your firm faces. You can run a detailed competitive analysis. Or, you can simply state that you’re focusing on an entirely underserved market.
However you choose to structure this section, always ensure that your business positively contrasts against competitors in your vertical. Freely acknowledge the successes of others, but only from an educational perspective, not one of inferiority.
As an example: “While ABC Company did X well, we have raised the bar in this area thanks to…”
Name your competitors and include their social media accounts in this section. While it may seem counterintuitive, specifying your competition is a sign of strength and confidence.
7. Marketing Plan
“How will we attract, win, and keep our clients?”
In this section, detail how you intend to sell and market your products/services.
For example, you might prioritize TV commercials, social media campaigns, Google Ads, or some combination of all three.
Though there are many marketing channels available, it’s important to be very specific with what you intend to use (and how much you plan to spend on marketing).
Details matter: while it’s easy to promise results, this section shows investors that you have a tangible plan to follow through.
8. Financial Plans and Projections
This last section will differ depending on the age of your business.
For example, if you’re an established firm, you’ll be able to include your key financial documents like your balance sheet, profit-and-loss statement, and cash flow statement.
However, if you’re a start-up, you will likely need to prioritize financial targets and estimates until your business statements are in order.
Beyond documentation, it’s also important to include a sales forecast for the next 12 months (or longer, if possible). This is a great way to get investors excited about partnering with your business.
If you’re seeking additional funding, make your official request in this section and include what you need, why you need it, and how it will help you actualize your goals. The more specific you are, the better.
3 Small Business Plan Templates
If you’re overwhelmed, we have great small business plan resources.
These three (free!) templates provide great entry points to build a plan that you’re proud of:
- Small Business Administration (SBA): a “traditional” business plan.
- SCORE (an SBA non-profit): 11 business plan worksheets.
- Forbes Magazine: a “simple” business plan template.
- SBA’s lean template: can be completed in under an hour and is generally contained within a single page.
While we encourage you to use these templates as a starting point, we also recommend that you deviate from them as you recognize new opportunities for personalization—the best small business plans will always come from you and your unique voice.
Investors, lenders, and top talent are routinely reviewing your competition’s business plans.
Make sure that you and your team stand out from the crowd.
Build Your Business with uLink
Do small business plans require considerable upfront work?
Absolutely, but keep your eyes on the prize and remember the benefits that they provide.
With a solid business plan, you’ll be able to streamline internal operations, define your team’s goals, and attract top investors, lenders, and talent.
Plus, as your business matures, you will have ample opportunity to refine your business plan through all stages of growth. After all, your business plan isn’t a fixed epitaph—it’s an evolving document that helps you stay on target to achieve your most ambitious goals.
At uLink Business, we’re dedicated to linking your small business to the world at large. More specifically, we specialize in making international business payments as seamless as possible.
Reach out to learn more and get started.
