What 5 Things Should A Business Plan Include [Important!]

When it comes to business, there are few things more important than creating a very compelling business plan.

What 5 Things Should A Business Plan Include [Important!]

While many budding entrepreneurs may not create a business plan that’s all “glitz and glamor”, the majority will know of a business plan’s importance.

Remember, a business plan can completely change the tide when it comes to attracting investors, customers and employees because it can provide a clear and dynamic vision of where the business is going.

Often, business plans can be long and complex – but whatever your business plan entails, there are five things you absolutely must include; concept, market analysis, strategy, organization and your financials. 

Once you’ve got these down and fleshed out, you can take the rest of the business plan in your chosen direction. 

So what are these 5 things exactly? Our guide is going to show you everything you need to know. Read below for much more! 

The 5 Important Things You Need To Include 

Without any further delays, let’s examine these 5 things we’ve mentioned a moment ago. Each one is critical to your business success!

1. Concept 

The primary reason that a business plan exists is to provide a well rounded and easy to understand knowledge of how your business is going to run, what your main goals are and what the purpose of the business is, along with how you’re going to get there.

By presenting a well written and thorough business plan, you are taken full advantage of the opportunity.

Generally speaking, when you’re drafting this part of the business plan, you need to spit it into 3 further key elements:

  • Executive summary 
  • Company description 
  • Products or services 

The first (executive summary) is a short introduction to the business which outlines who is in charge and what roles each person plays, along with what the business will offer.

Second, your company description dives a little deeper into the business.

This is where you will define your company structure, the key roles and responsibilities of the business and who operates within them and then finally your business’s short and long term goals. 

The final part of this section explains to the reader what products and/or services your business can offer, perhaps including what unique offerings the business has and which USP (Unique Selling Points) you can offer. 

2. Market Analysis 

With any business, it’s important that the entrepreneur knows and can demonstrate they understand exactly what they are about to get involved with.

To do this, the entrepreneur must conduct thorough market research.

Notably, you need to detail the target audience including the demographics and an overview of what the industry entails.

You may also want to include specific information about your competition and a more detailed description of the business landscape.

Remember, if this section is highly detailed, then it’s much more likely that the reader will buy into your vision.

However, you can only do this if you have conducted extensive research into your market.

3. Strategy 

While explaining your business strategy is important for you and your potential employees or customers, it’s much more important to have a clear strategy for your potential investors.

This is where you will clearly explain how you are going to execute your plan.

Not only this, but you will need to show how and why your strategy will be successful, and it’s also a good idea to include potential drawbacks, along with how you might overcome them in their potential eventuality.

In this section, it’s important to include the business’s vision for longevity.

Explain to the reader where you believe your business will be and how it will look in 5 years time, assuming your business runs and thrives as you have thought of.

4. Organization 

What 5 Things Should A Business Plan Include [Important!]

This part of your business plan is where you will demonstrate how exactly your business will operate.

It is here where you may provide projections and discuss your idea of company growth.

Indeed, this area will explain how your business can reach a certain milestone based on a certain financial injection and explain where your business will be in terms of revenue based on time and investment.

If applicable, it’s also important to include any person(s) who will be involved in this process, such as advisors and consultants who work alongside the business founders.

Typically, this provides the reader reassurance of the project and where potential conflicts could arise.

Once investors are clear on who is involved and why, they may feel more comfortable becoming involved in the overall project and therefore are more likely to put up some financial injection.

5. Financials 

The final critical element to your business plan is the financials.

This is where you will provide detailed financial evidence of why you are going to a viable business.

This is especially the case when it comes to start-up businesses.

If this is a new business with no previous financial information to cite, then it’s fine to provide a detailed report of anticipated growth based on your research.

However, it’s far more beneficial in this instance to include a financial projection from an expert (e.g. accountant). 

The main point with the financial analysis though is to provide your readers with your extensive research and why they may wish to invest in your business.

Sometimes, investors are happy to receive a small return in the short term if they can see a clear plan.

In fact, some investors are even happy to accept a loss on their investment in the short term if it is incredibly clear that the research and business plan projects large returns over the course of several years.

Once again though, you may wish to get an expert like an accountant involved who will be able to reaffirm your projections based on the numbers.

While you may believe you have done enough research, it’s always more reassuring to investors with expert confirmation.

Frequently Asked Questions 

We will now cover your most frequently asked questions. Hopefully we answer everything you were looking for.

How Long Should My Business Plan Be?

There’s no hard and fast rule here. However, your plan must include these points above and be as detailed, yet concise as possible. 

Is A Business Plan Necessary?

Absolutely. It’s critical to your success as a business and will provide a better direction for you.

Not only this, but you are much more likely to gain investment, customers and employees with a clear business plan.

Who Might Ask For My Business Plan?

Sometimes a bank will ask for your business plan for the purposes of a loan application or even if you are planning to open a business account.

Additionally, accountants and even the IRS may ask for your business plan. 

Final Thoughts 

Business plans are critical and you absolutely must include these 5 things into your business plan.

However, you must remember that you are writing this plan in a clear, concise way that  is easily and clearly understood.

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