A good business plan outlines your strategy for the next couple of years. It may be used to help support an application for business finance or business grants. Or it could be just for your own use as a roadmap for the growth of your business.
The components of a business plan explain your objectives and the actions required to get your small business from where it is now, to where you want it to be.
The process of creating your business plan will help you focus, crystallise your ideas and identify priorities, saving both time and effort. Your business plan will give you a clear sense of direction and a benchmark enabling you to measure progress.
Keep your plan as short as possible as overly detailed business plans can be too cumbersome to use. Focus on the information the reader needs to know. Leave the finer detail for operational or marketing plans or attach information such as technical details of a product in an appendix.
Involve your team
Involve your employees in the planning process to gain both their insights and their buy-in to the plan. This will help you build a successful, committed team. Planning together will also identify priorities that provide useful benchmarks to measure performance.
Keep your business plan realistic. For example, unrealistic sales forecasts could lead to increased overheads followed by a damaging cash flow crisis and drastic cost cutting. It could also damage your credibility, because lenders and other interested parties will quickly see through optimistic plans that ignore weaknesses or threats.
Even if your plan is intended for internal use only, write and present it as if it's aimed at an outsider. Put a cover on the plan and include a contents page, with page and section numbering.
Start with an executive summary of the key points and purpose of the plan. Use charts if relevant, and include business or product literature as an appendix. Have the plan proofread for clarity, spelling and grammar mistakes. Then show it to friends and business advisers for comments on how to improve it.