Many people think of business plans as long, complex documents that describe every detail of the business. While this format has its place, for most companies, the owner can accomplish the same goal with a one-page business plan. Why do you need to develop a business plan?
Some owners think that the business plan is just another hoop they must jump through to secure financing for their business or please their bonding company. The real value to owners is the process of collecting the thoughts bouncing around their heads, and, more important, getting them down on paper.
Before beginning to write your business plan, ask yourself how you intend to use it. For the owner, this process of developing a physical or electronic document solidifies what the business is, its goals and how to accomplish them. We are not talking about a turn-by-turn map to guide daily operations. The business plan can help owners stay the course and succeed when challenges arise.
When looking at the outline of a business plan, the sections are the same, whatever length plan you intend to develop. The only difference between a traditional business plan and a one-page plan is how you write the information. With a conventional business plan, paragraphs are often used to explain and describe each section. However, with a one-page plan, concise language, a few sentences and possibly bullet points are used to shape the guidelines.
The executive summary is where you talk about your business, and answer questions such as what are you in business to do and what do you want your business to accomplish? Although this is typically the first section of any business plan, you may find it easier to write this section after you have completed all the other parts and have a clear picture of your whole business.
Next is market analysis, which looks into the demand for your services. This part includes describing what problem you are solving for your customers (more than just the products or services your offer), what makes your company unique and who your potential customers are. You want to be extremely specific with your responses. For example, if you are a service-based contractor, you may identify your customers as facility managers, plant engineers or homeowners, but not general contractors.
The next section is competitive analysis, which details how you go about advertising and selling your services to your target market. What challenges do you see? What are your strengths in the marketplace? Who are your competitors? What potential threats or risks could you encounter? In a one-page plan, you may not be able to cover all the inherent strengths and weaknesses, so you will have to identify and focus on the top ones.
Then there is the strategy section. Here, focus on and paint a clear picture of what differentiates your business from your competition and how this benefits your customers. This is, essentially, your elevator pitch. Explain what your competitive advantage is and what that means for your customers. As you write this section, think of what you want potential customers to remember about your business.
The final section is operations. How will you accomplish everything you described in the previous sections? Think of this section as answering the who, what and by when questions. The responses could include your financial goals (revenue and profit), the milestones or steps needed to achieve these goals, by when you will complete them and how you will measure progress along the way. Identify the key people that you need for success, and what their responsibilities are for reaching the milestones and achieving the goals.
A living document
Writing a business plan may seem daunting. But remember it is more about the process of gathering thoughts, organizing them and using them as a guide. You should think of your business plan as a living document that will be modified and updated as your business grows and matures. You don’t just make it when starting your business and never use it again. It should be reviewed and updated annually.
If you aren’t ready to tackle a complete business plan, try using the ideas outlined in this article to develop a 30-, 60- or 90-day plan to guide your business. Then when you feel ready, use the same principles to develop a simple, one-page business plan that you can use as your map for success.