The Complete Guide: How To Write A Professional Business Plan

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The Best Business Plan Writers Will Custom Make Your Business Plan And Organize The Business Plan Content Around Four Main Areas

Writing A Professional Business Plan Is One Of The Most Important Things A Business Owner Can Do

Learning how to write a business plan is a critical step on your journey to starting a business. A large majority of new businesses tend to fail because a comprehensive assessment of the business model and competitive environment never occurred.

These entrepreneurs were not able to anticipate bottlenecks, respond to competitive threats, value customer acquisition costs, reach new customers, price their products properly, source materials efficiently, secure the appropriate funding from banks, or manage the cost structure.

In this guide, we will provide guidance on the key pieces of a proper business plan and share best practices to help you and your team develop a robust and action-oriented business plan that helps you avoid the mistakes made by so many others.

Writing A Strong Executive Overview Helps The Business Plan Attract Immediate Attention 

Major categories that need discussion include:

1. Opportunity

2. Solution

3. Business Model

4. Value Proposition

5. Financial Review

All strong business plans will open with a one to two page Executive Overview that introduces the audience to the nature of the business. The business opportunity must be succinctly explained. Why does this business need to exist? What problem does this business solve? Clear answers to these questions help tee up the entire business plan.


People start businesses because they potentially have identified an untapped market need. There is a looming consumer problem in need of a solution. The solution itself doesn't have to be product oriented. Rather, some companies are highly successful because they out-service the competition and this service is desired by end consumers. This distinction speaks to the importance of conveying your company's value proposition. 
 

The financial review should address the revenue model, cost structure, and capital requirements to launch the business. Sharing in brief language what the business plans to monetize and how much it costs to do so is important. Readers of the business plan will need to know very quickly what the financial ask is and how the business model will work to service the debt obligations. Questions of business continuity and sustainability will surface at this time as businesses cannot rely on debt forever to finance overhead and operations. 

Learning About The External Environment Is A Key Part of Writing A Business Plan

Major categories that need discussion include:

1. Macro Environment

2. Industry Factors

3. Buyers

4. Sellers

5. Substitutes

6. New Entrants

7. Competitive Analysis

8. Market Sizing

9. Success Factors

 

No matter the industry, the economy will always play a role in the performance of a business. The broader macroeconomic environment influences interest rates, and thus the cost of capital. Consumer confidence and employment levels fuel or slow consumer spending and retail sales. The price of gasoline and other transport-related costs are influential for companies involved in logistics and transportation. A strong business plan will expand upon these economic impactors and how they will affect the financial results of the business. Some industries, e.g. car dealerships, are more susceptible to economic downturns while others, e.g., liquor retail store front, have proven more recession proof.


As a startup begins the work of forming a business, there are several helpful tools to analyze the overall attractiveness of an industry. Michael Porter's five forces framework is an excellent choice for determining whether or not to enter an industry. In fact, some startups change gears completely after doing a thorough assessment of the industry. Studying the buyers and sellers reveals who the key stakeholders are and how much force each side exerts on the main industry players. Careful attention should be given to the threat of substitutes and new entrants as either scenario has implications for the proposed business.


Market sizing is a vital step in preparing a business plan. This analytical exercise helps identify the amount of capacity a business must have in order to fulfill the market demand. Further, market sizing plays an integral role in the development of the proforma financial projections. There are entire books and some very helpful articles devoted to this practice. The most astute business owners want to know the size of the market and also quantify the size of the prize.

Looking Inward and Structuring Your Business Is Key To Writing A Business Plan

Major categories that need discussion include:

1. Team

2. Mission

3. Vision

4. Goals

5. Positioning

6. Resources

7. Capabilities

8. Product

9. Target Market

10. Marketing Plan

11. Advantages

12. Traction

13. Risks

14. Contingency Plans

This portion of the business plan takes an inward view of the business and begins to address, organize, and structure the makeup of the company. The management team will be introduced with their qualifications and experiences. Lenders and other investors are particularly interested in the capabilities of the proposed management team. Why will this individual or group of individuals be successful managing the proposed business? A well written management profile helps strengthen the business's credibility and improve the likelihood the business is awarded funding.


Writing a mission and vision statement is fundamental and will always precede any discussion of goal setting. The mission captures the primary purpose of the business. It seeks to answer this question: why does this business exist? The vision should speak to the intentions of the business. What the business plans to accomplish and by when should be clearly expressed in the vision statement. 


Competitive positioning is at the heart of corporate strategy. At its most basic level a company can differentiate its offering or compete on cost. Strategies that blend the two create earnings headwinds. Resources are channeled inefficiently. The productivity of the strategy is maximized when a company is solely a differentiator or a cost leader. Michael Porter refers to this as competitive positioning.


From here, the business plan should move into an exhaustive review of the product, target market, and marketing plan. While the Executive Overview introduced these elements, this section should go into great detail about what the product is, how it works, and why someone would be willing to pay for it. Trying to reach a broad audience typically is poor marketing. A segmentation should be done as to break down the target population into groups which simplifies the marketing communications and lead generation processes. A deep dive into how the company will reach its target audience should conclude this section. This will involve granular discussions of the website, social media marketing, search engine optimization, pay-per-click advertising, and other lead generation activities. 

A Business Plan Should Include A Thorough Review Of The Financial Plan

Major categories that need discussion include:

1. Cost Structure

2. Revenue Model

3. Profit & Loss

4. Balance Sheet

5. Cash Flows

6. B/E Analysis

7. Formation Budget

 

Bankers, investors, zoning officials, and other public servants are objective people. These individuals are less concerned with the owners' intuition about the viability of the business and are more interested in the financial composition of the company. In this section the business plan should prepare three year financial projections. Back of the envelope math is not sufficient here. Tremendous effort and analytical rigor should be put into developing these projections.

 
The financial plans for the best business plans we have seen are composed of a cost structure overview, profit & loss, balance sheet, cash flow statement, breakeven analysis, sensitivity analysis, and a thorough revealing of the underlying assumptions of the financial model. Again, there are endless resources on the web and we highly recommend working with a professional with proven experience compiling these critical pieces of the business plan.