If you’re considering starting a business and want to know how to write an outline for a business plan, this is the article for you! This guide will teach you everything from what makes up a good outline to where it might go wrong.
The “how to write a business plan step-by-step” is a guide that walks you through the process of writing an outline for a business plan. The article will help you think about what your business plan should be and how it should look, as well as give you tips on how to make sure that your outline is easy to follow and understand.
There are many reasons why every firm should have a business plan, but not every company need a formal strategy to present to outsiders. If you’re just planning for yourself and your team, you may be able to get by with only the lean business plan.
If you do need to create a plan to present to investors, banks, attorneys, and others, you should include the essential components described below. You may determine how detailed or succinct your business plan should be as you go through it.
Simply download our free business plan template and skip to the full overview below if you’re ready to get started. For a complete overview and other resources, see our full guide on how to create a business plan.
Outline of a business strategy
These are the six fundamental parts that should be included in every kind of business strategy. Here’s a quick rundown of a typical business plan structure.
1. a brief overview
Last but not least, write your executive summary. It’s just a page or two, but it summarizes the arguments you’ve made throughout your business plan.
It’s also the entrance to your plan—after reading your executive summary, your target reader will either toss your business plan away or continue reading, so make it perfect.
Summarize the issue you’re addressing for customers, your solution, the target market, the founding team, and the highlights of your financial projection. Keep it short and sweet to attract your audience to discover more about your business.
Describe the issue you address for your clients and the solution you’re offering in the opportunity part of your business plan.
Instead of focusing about your side of the issue, it’s always a good idea to consider about consumer requirements and advantages when defining your product offers (how much the product or service costs, and how you deliver it to the customer).
This portion of the plan may contain tables with additional information, such as a bill of materials or comprehensive pricing lists, but more often than not, this section simply explains what you’re offering and how your goods and services meet a customer’s demand.
3. Summary of the market research
Your market analysis summary will help you gain a better understanding of your target market—the kinds of consumers you’re searching for—and how it’s evolving.
Discuss your consumers’ requirements, where they are, how to contact them, and how to deliver your product to them in this section of your business plan.
You’ll also need to know who your rivals are and how you compare to them—why are you so certain there’s space for you in this market?
In this part of your company plan, you’ll describe your marketing strategy, sales strategy, and other operational details.
You’ll want to include information on the technology you’ll be utilizing, your business location and other facilities, any unique equipment you’ll need, and your strategy for getting your company up and operating. Finally, you’ll want to list the important indicators you’ll be monitoring to ensure your company is on the correct road.
5. A overview of the company and its management
The section about your business and management provides an insight of who you are.
It should explain your company’s structure and important members of the management team, but it should also provide the reader the basics: when your company was established, who the owner(s) are, what state your company is registered in and where you conduct business, and when/if your firm was incorporated.
Include summaries of your managers’ histories and experience (think of them as mini resumes) as well as descriptions of their roles within the business. The strategy should be supplemented by full-length resumes.
6. Make a budget.
This part should at the very least contain your anticipated sales prediction, profit and loss, cash flow statement, and balance sheet, as well as a short explanation of the assumptions you’re basing your forecasts on.
Include your sales projections, company ratios, and break-even analysis if applicable.
Finally, whether you’re raising funds or taking out loans, emphasize how much money you’ll need to get started.
This business plan outline will show you how to create your business plan.
Before we get into the meat of this lengthier outline, I’d want to give you some pointers on how to make the most of it. It’s tempting to get caught up in trying to duplicate it with your own strategy, but that’s not always required. Keep the following points in mind to save time and effort.
What is the best way to structure your company plan?
Apart from maintaining the Executive Summary at the top, there is no set sequence for business plans. As long as you have all of the major components of a business plan, the order should represent your objectives.
If you’re just going to use it for yourself, make a roadmap with related parts grouped together for simple reference. If you’re presenting something to a group of prospective investors, start with the most important parts. If you’re uncertain about the order, the sequence of business plan components that I recommend for a typical business plan is given in this post.
Should your business plan contain tables and graphs?
To show the statistics, I think that every company strategy should contain bar charts and pie charts. It’s a straightforward method for you, your team, and investors to see and understand complicated financial data.
A typical cash flow statement or table should never be absent in a company strategy since cash flow is the single most essential numerical analysis. A sales estimate, income statement (also known as profit and loss), and balance sheet are all included in most conventional business plans.
They should also include predicted business ratios, market analysis tables, and staff lists, in my opinion.
It’s possible that you won’t require a complete business strategy.
Every business owner should have a continuous planning process to aid in the operation of their company, but not every business owner need a full, official business plan. A conventional business plan will be required if you intend to pitch or seek financing from a prospective investor, bank, or venture capital contest.
So, just because they’re on this list, don’t include them. Your company strategy should be tailored to your specific needs. Keep in mind that your business plan should only be as large as what you need to operate your company.
Begin with a lean strategy.
Instead of diving straight into a complete business strategy, a Lean Plan may be a better place to start. It’s a quicker and simpler technique that takes less than an hour to complete and is easy enough to review and update on a frequent basis. When required, you may always extend your first Lean Plan into a conventional business plan.
Lean Planning transforms a static document into a dynamic management tool for your company. LivePlan includes this approach, which is ideal for planning, establishing, managing, and developing a business.
Avoid making these typical planning blunders.
Avoid typical blunders include failing to prepare for financial flow, setting ambiguous objectives, or forecasting unrealistic development. I’ve seen hundreds of company plans, both excellent and terrible, and I can assure you that avoiding these and other typical business planning mistakes will put you miles ahead of the competition.
When drafting your strategy, keep in mind that perfection isn’t required. Simply try your best to be comprehensive, and be ready to make modifications if anything does not turn out as planned.
Template for a business plan overview
Check out the following outline if you want to learn more about what goes into various planning parts. It may assist you in creating a comprehensive business strategy or point out any gaps in your lean plan or pitch deck.
Keep in mind that each business plan will vary based on a variety of variables, such as the kind of company and the purpose for which the plan will be used. Consider the following template as a master version to refer to and consider, but keep in mind that the plan type and parts that are most helpful to your company, pitch, or overall strategic planning should be prioritized.
Executive Summary (1.0)
1.1 The Issue
A brief description of the issue you’re addressing and a market demand you’re filling.
A description of the product or service you’ll provide to address the issue.
1.3 Market Segment
A well defined client base that is likely to buy the goods or service. Check out our article on how to identify your target market for more information.
The present market alternatives or replacements against which you and your company will compete.
1.5 Financial Overview
Costs, revenues, and profitability are all highlighted in your financial strategy.
1.6 Requirements for Funding
A rough estimate of how much money you’ll need to start your company. If you’re going to pitch to investors, be sure to include this.
Traction and 1.7 Milestones
A map of where you are now and precise goals you want to achieve.
2.1 A Problem to Be Solved
A detailed explanation of the issue or pain point you want to alleviate for your target market.
2.2 Our Approach
A detailed explanation of your suggested product or service that solves your customer’s issue.
2.3 Problem and Solution Validation
Any facts or data that supports your proposal. This is the area to put your findings if you’ve previously performed tests to validate your concept.
2.4 Future Plans/Roadmap
A summary of the actions you’ve done so far, as well as an overview of the measures you intend to take to start or develop your company.
3.0 Summary of Market Analysis
3.1 Segmentation of the Market
Customers may be divided into groups based on certain criteria.
3.2 Market segmentation strategy
Your ideal client is someone who will most likely benefit from your services.
3.2.1 Market requirements
A explanation of how your target market is underserved and how your company addresses that need.
3.2.2 Market developments
Consumer behavior in your target market, including buying patterns, financial trends, and any other relevant variables.
3.2.3 Market expansion
The anticipated possibility for your target market’s size to grow or shrink.
3.3 Important clients
Your ideal client archetype, who will be your company’s most ardent supporter.
Futures markets (3.4)
Based on the previous parts, a glimpse of the prospective market and how your company plan fits within it.
A list of competitors who may be interested in working with you. It’s not always easy to spot the competitors, and it may require some digging on your side.
3.5.1 Alternatives and competitors
A list of possible indirect rivals that provide goods or services that are similar to yours.
3.5.2 Advantage in the market
The strategic advantage(s) that make it more probable for your target market to select you over the competitors.
4.1 Marketing strategy
An overview of your marketing and advertising plan, including expenditures, routes of distribution, and objectives.
4.2 Sales strategy
Based on market circumstances, capacity, pricing strategy, and other variables, an estimate of the amount of sales you expect.
4.3 Facilities and location
Details about your actual business location (if applicable), including address and operating expenses.
Any new technology that characterizes your company will be explained.
4.5 Tools and equipment
Any necessary manufacturing equipment or tools, as well as the expense of buying or renting them.
4.6 Significant Milestones
A comprehensive roadmap with precise aims and objectives that will aid in the management and steering of your company.
4.7 Key figures
Performance indicators that assist you assess your company’s overall performance and health.
5.0 Executive summary of the company and its management
5.1 Structure of the organization
An overview of your company’s structure, including particular staff roles and duties, as well as the flow of information between levels.
5.2 The management group
A list of individuals you’d want to see in high-level management positions at your business.
5.3 Management team inconsistencies
Any jobs or areas of expertise for which you do not presently have applicants ready to fill.
5.4 Personnel strategy
A list of possible jobs that you anticipate to need in order to successfully manage your company.
5.5 Ownership and history of the company
A synopsis of your company’s history and how it pertains to business strategy.
6.0 Budgeting plan
6.1 Estimated revenue and sales
Revenue and sales projections for the following 1-3 years, broken down month by month for at least the first year.
Expenses (section 6.2)
6.3 Profit and loss projections
6.4 Cash Flow Forecast
6.5 Balance sheet projections
6.7 Ratios in business
Standard statistical indicators that indicate your company’s present and future health.
A place to save any extra material, such as charts and graphs, that can help you support your business strategy.
Start creating your business plan using these resources.
Looking for more information about business planning? To get your business off the ground, look over the following templates and articles.
- Over 500 free example business plans from a variety of sectors are available.
- Template for a business plan: This blank business plan template follows the structure used by banks and the Small Business Administration in the United States (SBA).
- Template for a lean plan: To rapidly create a one-page lean business planning document, download this template.
- How to Start a Company: An eight-step method for establishing a new business that is simple to follow.
- LivePlan is a simple cloud-based company planning program that anybody can use. Expert guidance, built-in assistance, and over 500 full example business plans are all included in this online program.
Note from the editor: This article was first published in 2018 and has been revised for 2021.
A business plan is a document that contains information about the company and its future. It is a vital part of starting a new business. A business plan outlines what the company does, how it will do it, and where it will be in 2021. Reference: business plan examples for students.
Frequently Asked Questions
How do you write a 2021 business plan?
A: First, you should understand the market and what it wants. Then identify your strengths and weaknesses as a business. Next determine how much funding you need to start up with and create a financial model that will sustain the company for at least one year. Finally, write out an action plan of how you would use those funds.
What are the 7 Elements of a Business Plan?
A: A business plan is a document that outlines the objectives, strategy and tactics for an entrepreneur to start or grow their company. It includes details about what will happen before, during and after the launch of the product.
What are the 10 steps to writing a business plan?
A: 1. Define your market, 2. Create a target customer, 3. Conduct research to identify the competition and their strengths/weaknesses, 4. Determine what pricing strategy should be implemented (costs of goods sold vs costs of reaching customers), 5-8 are marketing steps that vary depending on how much money you want to spend(TV campaigns etc.), 9 is setting up systems for collecting funds like PayPal donations or preorders etc., 10 is tracking the progress of your business plan
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