What is a business plan? Every small business needs a detailed business plan. Find out how your business plan can help your business grow and succeed, why it's so important and how to get started

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What is a business plan
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What is a business plan?
Every small business needs a detailed business plan. Find out how your business plan can help your business grow and succeed, why it's so important and how to get started.

A business plan is one of the most integral steps in your journey to running a successful small business, whether as a sole trader, partnership or limited company. It's where you'll turn your dreams into an action plan.

We’ll look at what a business plan is, why you need one and how it can shape your business.

What is a business plan and why do I need one?
A business plan is an essential written document that provides a description and overview of your company’s future. All businesses should have a business plan. The plan should explain your business strategy and your key goals to get from where you are now to where you want to be in the future.

  • How will you make your business more profitable, gain more resources or increase your assets?

  • What are your plans for growth in your target market? 

Anyone who sets up a new company should have a business plan. It can also be an important tool for an established company that’s moving in a new direction. 

What should your business plan aim to do?
At its most basic, your business plan outline should explain what you intend to do and how you are going to do it. You should outline your strategies across the business, including financial projections, marketing and operational plans.
An overview of your business
Your business plan should aim to give a good outline of your company, your business strategy and your action plan.

  • How will you make money and what do you need to do to achieve your goals? 

  • What are your targets and how will you meet them?

Knowing your long-term goals will help you to take steps towards them in the day-to-day running of your business. 
It should also act as a benchmark for the performance of your company. Look at your competition in your industry and think about why your business will succeed where others might fail. You might want to carry out a competitor analysis to give you a greater understanding of your space and where there have been recent changes or innovations. 
You know your business best 
Your business plan will show that you have a clear understanding of your business and the market it will operate in. It should set out how you expect it to perform in the coming years and how you will overcome any potential obstacles. It should also be a useful tool to:

  • Focus and develop ideas 

  • Identify your business priorities 

  • Think through options, identify opportunities and make the most of them

Explaining your funding requirements 

Most banks and lenders will require a detailed business plan for loans, including start up loans, so financial planning is a must. An in-depth plan will help you to convince banks, potential investors and other key contacts to support and fund you to grow your business. This takes you through what you’ll need to consider when writing a plan with finance in mind. 
Attracting talent 
As you grow, you might look to hire employees and expand your resources. The plan can also be important for attracting new senior management, business partners and distributors.

  • What is your company’s vision? 

  • What is your mission statement?

  • Why would someone want to work with you?

What should your business plan include?
A business plan should include seven key sections:

  1. an executive summary

  2. a business description

  3. details of market strategies

  4. competitor analysis

  5. a design and development plan of your products and services

  6. information about your operations and management plan

  7. financial information, planning and factors

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