10 Steps on How To Write a Business Plan

Key Takeaways

business plan template is search approximately 163,000 times a month I'm here to tell you to stop searching because in today's video I'll be showing you how to make the ultimate business plan business plans are absolutely essential for any business why well because a solid business plan will allow you to rigorously assess idea of feasibility research and find insights on target markets and assess your competition these are all things that you need to do in order to make your business as successful as it can be and when the time comes investors will rely heavily on your business plan to evaluate the feasibility of your business before funding it if you haven't already make sure you're subscribe to the channel as we release new videos every week that will help you build your business oh and stay tuned to the end of this video when I share a little gift from me to you to you let's get into it the first part of every business plan is the executive summary the executive summaries purpose is to distill everything in the business plan into a single page and give a high-level overview of your business this is like the the Canadian tuxedo almost like a blazer over a flannel shirt admittedly that one page constraint can make it seem like squeezing in a lot of information will be impossible but trust me it's not what I like to do is break down each section of the business plan into one or two sentences to ensure that everything is succinct and easy to read here's what your business plans executive summaries should include your business concept business goals and vision product differentiation and description your target market your marketing plan your current financial state projected financial state the ask so if you're asking for money how much are you asking for and your team for more ideas on how to identify your target market be sure to check out our last video on how to build a brand in the right hand corner right up here now let's move on to a biggie your company overview this section of your business plan should include two fundamental questions who are you and what do you plan to do answering these questions provides an introduction to why you're in business why you're different what you have going for you and why you'd be a good investment answer these questions you want to include these components in your overview your business structure for example is your business a sole proprietorship a general partnership a limited partnership or is it an incorporated company this can often be visualized using an organizational chart you also want to share the nature of your business what are you selling now specify the industry are you in fashion electronics what does your landscape currently look like and where could it be heading you're going to also want to list your team including key personnel and their salaries if I was doing this right now it would just be me but I would also want to include future plans for scaling up my company so I can see here that you've got four years of working experience as a good boy you start on Monday or I could just leave it as me you can also use this section to highlight background information on your business or its history get creative and be authentic in this part this is where you can really draw people in and have them invested in how it all started for you so I thought it might be good to provide an example here so sit with me the dog rescue that I volunteered for and run the store for has been operating since 2012 and since then we've gone on to help over 1200 dogs we do not discriminate based off of breed medical history or age so every dog has a chance to find their forever home through our rescue and that was very important from the get-go and we also do not have anyone that's making a salary so it's entirely volunteer based it's all by the good graces of our community and everyone that's out there willing to put in money time and effort to help these dogs a big component of your company overview will be outlining your business's vision mission and values I'm going to do a deep dive into this one with you to define your values start thinking about all the people that your company is accountable to including owners employees suppliers customers and investors now I want you to consider how you'd like to conduct business with each of them as you make a list your core values should start to emerge for example IKEA lists some of its values as humbleness and willpower leadership by example and daring to be different now the mission statement your statement should explain in a convincing manner and ideally a single sentence why your business exists for example Shopify's mission statement is make commerce better for everyone it's the why behind everything we do and it's crystal clear and needs no further explanation next craft your vision statement what impact do you envision your business having on the world when you've achieved your vision make sure you phrase that impact using assertive language for example Nikes vision statement is bring inspiration and innovation to every athlete in the world if you have a body you are an athlete finally include your business objectives both short and long-term I like to keep my goals on track by ensuring that they are smart meaning specific measurable attainable realistic and time-bound now get ready to do some serious work as the next part of this plan we'll be diving into market research for the marketing analysis section you want to be including an overview of your potential market an analysis of your business's position within that market and an overview of the competitive landscape I'm not exaggerating when I say that your market can make or break your business if you choose the right market with the right products one with plenty of customers who understand and need your product you'll most likely have a head start on success when diving into potential markets you will need to be looking into as much relevant independent data as possible to validate your business this can be a huge task but I find that breaking it down into two starting points it then becomes much more manageable first I seek to identify my ideal customer profile a customer profile should be a detailed back description of your target audience for example if you're targeting millennial customers in the US I would first start by looking at government data about the size of that group secondly I research relevant industry trends and trajectories I like to approach this section by going to Google Trends and using keywords as a jumping-off point and then diving into more granular data for example say that I wanted to start a Halloween masks business and I wanted to know the trends of that industry I would go to Google Trends type in Halloween masks and then get granular on the results page looking at things like where this industry has peaked outside of seasonal times I would then dive into what made a peak and have a look at some of the search terms and show shifts and changes in the popularity of the industry from here I would then dive into sources such as government statistics offices industry associations academic research and respected news outlets covering the industry to get a robust view and understanding of landscape now when assessing my business's position in the market I like to use a SWOT analysis to break things down using a grid format you want to start listing out the strengths weaknesses opportunities and threats to your business I like using SWOT because you can clearly see the positive and negative internal and external factors that may impact your business visually now the competitor analysis for this analysis I like to include a list of a few companies that I would consider direct competitors and then I state how I plan to differentiate my product and business from theirs ok now we're into the products and services section you want to provide more detailed information here on your products and state why your product stands out in the market like before we want things to be succinct and visual patents copyrights and trademarks that you own or have applied for should also be listed in this section in the customer segmentation section you want to give a holistic overview of your ideal customer a lot of this information should be clear to you after you've done preliminary research on your target market when talking about your customers in the SEC you want to include a number of general and specific demographic characteristics such as where they live their age range their level of education how much they earn their values beliefs or opinions ideally you should be specific enough that it's very clear who you're trying to reach with your business and even more importantly why you've made the choices you have based on who your customers are and what they value now we should be ready to move on to highlighting your marketing plan your plan here should outline your current and future strategies for marketing your product to your ideal customers for example say that I have a phone case company and I know that a lot of my audience is on tick-tock I will show that I plan to leverage that knowledge into creating a paid campaign on that platform using content specifically created for my key customers I will then also include how I plan to measure the success of that campaign now although sometimes marketing is seen as purely promotional your plan should include information on the following four key subjects price so how much does your product cost product what are you selling and how do you plan to differentiate yourself in the market place where will you sell your products and finally promotion how will you get your products in front of your ideal customer by including these you're showing investors and yourself that you have thought about every facet of how your marketing strategy will be effective in driving customers to your business now on to our logistics and operations plan you really want to cover all parts of your business operation in this section including where you get the raw materials you need for production or where your products are produced highlighting if you'll make manufacture wholesale or dropship your product then stating how long it takes to produce your products and get them shipped you'll also want to touch on how you might handle a busy season or an unexpected spike in demand discussing facilities for example where will you and your team members work do you have plans to have a physical retail space if so we're outlining the tools and technology that you require in order to be up and running this includes everything from computers to lightbulbs to everything in between finally discuss the specifics on how you're handling inventory for example how much will you keep on hand and where will it be stored how will you ship it to partners if required and how will you keep track of incoming and outgoing inventory this section should demonstrate that you've got a solid understanding of your supply chain and a strong contingency plan in case of any potential uncertainty finally we're gonna end with the financial plan now I know what you're thinking but I assure you this will be an important step in your business plan the level of detail required in your financial plan will really depend on your audience and goals however typically you want to include three major views of your financials an income statement a balance sheet and a cash flow statement your income statement is designed to give your readers a look into your revenue sources and expenses over a given period of time your balance sheet should offer a look at how much equity you have in your business on one side you'll list all of your business's assets so what you own and on the other side all of your liabilities so what you owe this will provide a snapshot at your business's shareholder equity which is calculated as assets minus liabilities equals equity now your cash flow statement is similar to your income statement with one important difference it takes into account when revenues are collected and when expenses are paid it can be especially helpful to forecast your cash flow statement to identify gaps or negative cash flow and adjust operations as required if you're worried right now about how to best format this out because numbers and math are not really your thing don't be put off by this section Shopify has created a set of formatted sheets specifically for helping you formulate this section of your business plan by taking the time to develop your business plan you're actually achieving a number of extremely beneficial things for your business a business plan will allow you to evaluate your business idea for your business to be successful it needs to be tangible this plan will help solidify that it will also help you plan for the next phase of your business and help you think about scaling and go it will then empower you to start thinking about hiring additional staff or even building partnerships additionally it will clarify strategies goals and tactics and make them actionable finally it will help you if you're looking to secure funds for your business whether it be from a bank or an investor as promised I did say that I would have a little gift for you and that is my ultimate business template you're welcome and hey if you did use our template to create your own business plan let us know what learnings you had from doing that did you find a new customer base or a cool new market to tap into let us know listen let us know okay let us let us know if I had a piece of lettuce that would be fantastic