6 Ways To Make A Business Plan For Your Startup

Starting a new business is no small feat. From ideation and market research to securing capital and building a team, the challenges are numerous and can often feel overwhelming. One essential element that can make this journey smoother is to make a business plan. A business plan serves as a roadmap, offering detailed guidance on what your business aims to achieve and how it plans to do so.

Moreover, if you’re looking to secure any kind of funding or investment, presenting a comprehensive business plan is usually non-negotiable. Not only does it show potential investors that you’re serious, but it also provides them with a detailed outline of where their money will be going and how they can expect a return on their investment.

But how do you go about creating a business plan that stands out? That’s what this article aims to help you with. We will walk you through 6 unique approaches to building a robust business plan for your startup. Whether you’re a solo entrepreneur or have a full team behind you, whether you’re bootstrapping or have some initial capital to invest, these methods will guide you in crafting a plan that’s tailored to your needs. So, read on and take that crucial step toward making your startup dream a reality.

Why Business Plans are Important Today?

The idea of having a business plan may sound old-school to some, especially in a fast-paced startup culture where agility and quick decisions are prized. However, the significance of a well-thought-out business plan can’t be overstated, even today. Let’s dive into some key reasons why a business plan remains an indispensable tool in the modern startup ecosystem.

• Strategic Alignment: The first benefit of a business plan is that it provides a strategic framework for your startup. It helps align your team’s activities with your vision and mission. With a plan in hand, every team member is on the same page, knowing exactly what needs to be done to achieve the company’s goals.
• Helps Set Priorities: With countless tasks demanding your attention, it’s easy to get sidetracked. A business plan assists you in setting priorities so that you can focus on activities that offer the maximum value. Knowing what to tackle first and what can wait is invaluable in a startup setting.
• Cash Flow Management: One of the biggest challenges for startups is managing cash flow. A detailed business plan helps you forecast income, expenditures, and when you might expect to break even. It’s an essential tool for ensuring your startup remains financially viable in the long term.

• Goal Setting: Every startup needs milestones to track its progress. A business plan lets you set these objectives in a quantifiable manner. These could be financial goals, such as revenue targets, or operational goals, like customer acquisition rates.
• Crucial for Securing Funds: Whether you’re seeking venture capital, a bank loan, or even crowd-funding, potential investors will want to see a business plan. It assures them that you have a strategy in place and offers a clear picture of how their funds will contribute to your startup’s success. Read more on: How to Find the Perfect Investor: 15 Practical Tips for Startups
• Keeps You Focused: It’s easy to lose your way when you’re immersed in the day-to-day grind of running a startup. A business plan serves as a continuous reference point, helping you stay focused on your overarching goals and objectives.

6 Ways to Make a Business Plan

1. Hire Freelancers

One of the simplest and often most effective ways to get your business plan ready is by hiring experienced freelancers who specialize in this area. This option is particularly useful for those who may not have the expertise or time to write a comprehensive plan.

Benefits of Hiring Freelancers:

• Expertise: A freelancer specializing in business plan writing is likely to have worked on similar projects in your industry, giving you the advantage of their specialized skills and experience.
• Cost-Effective: Freelancers usually charge per project or per hour, allowing you to manage your budget better. Plus, freelancers often cost less than agencies.
• Flexibility: You can choose to hire a freelancer for just this specific task rather than employing a full-time staffer, giving you flexibility in managing your startup’s resources.
• Time-saving: While the freelancer works on the business plan, you and your team can focus on other critical areas of your business like product development, marketing, or customer engagement.

Pros	Cons
Specialized expertise	Costs may vary widely
Cost-effective compared to agencies	Quality may differ between freelancers
Flexibility in hiring	You must manage another external relationship
Saves you time	Limited to their area of expertise and schedule

Hiring a freelancer can be an efficient way to get your business plan off the ground. You can benefit from their specialized skills and potentially save both time and money. However, the approach does require budgeting for the freelancer’s fees and effective management to ensure quality output.

2. Partner with Consultancies

Consultancies offer another avenue for creating a business plan. Unlike freelancers, consultancies usually come as a package, offering a team of experts with diversified skills. This option may be preferable if your startup is complex and requires a multifaceted plan involving different expertise like marketing, finance, and operational planning.

How Consultancies Differ from Freelancers:

• Level of Expertise: Consultancies often have teams of experts in various fields. This can provide a multi-dimensional perspective that a freelancer might not offer.
• Scale: Consultancies can handle more extensive and complicated projects due to a larger resource pool.
• Expense: Consultancies are generally more expensive than freelancers because you’re paying for an entire team of experts and their overhead costs.
• Accountability and Credibility: Consultancies often have a reputation and a portfolio you can check, providing an extra layer of security and credibility.

Pros	Cons
Multi-disciplinary expertise	More expensive than freelancers
Can handle larger and more complex projects	May be overkill for simpler projects
Established credibility	Potential for less personalized attention
Structured project management	Longer decision-making processes

3. Utilize Business Plan Tools

In the digital age, technology offers yet another solution for drafting a business plan: specialized software tools. These platforms are designed to guide you through the process, providing templates and step-by-step instructions to help you focus on your strategy rather than the formatting.

Features of Business Plan Tools:

• Templates: Most tools come with a variety of templates catering to different industries and needs.
• Financial Calculators: Many software options offer built-in calculators to help you project expenses, profits, and cash flow.
• Guidance and Tips: These tools often include tutorials, FAQs, and other resources to guide you through the planning process.

Benefits	Drawbacks
Cost-effective compared to hiring experts	Limited customization options
Quick and straightforward to use	Might lack depth in financial planning
Access to a variety of templates	May not offer industry-specific guidance
Allows for easy revisions	Limited scope for creativity and originality

4. The Lean Business Plan

The lean business plan, often condensed to just a single page, is a streamlined approach to traditional business planning. It focuses on the essential elements like your business idea, target market, revenue streams, and primary expenses. This format is meant to provide a “snapshot” of your startup, giving a quick overview without getting into granular details.

Advantages of the Lean Business Plan

• Ease of Creation: One of the biggest advantages is the speed and simplicity of drafting a lean business plan. You don’t need extensive market research or elaborate financial forecasts to get started.
• Clarity: By stripping down the plan to its most essential components, you eliminate any fluff, making it easier to understand for everyone involved.
• Flexibility: Given its concise format, a lean business plan is easier to update and adapt as you gain more insights into your market or face new challenges.
• Investor-Friendly: At the early stages, investors might not require a comprehensive plan. A lean plan gives them just enough to gauge interest.

Disadvantages of the Lean Business Plan

• Lack of Detail: While its simplicity is a strength, it’s also a weakness. A one-page plan won’t provide in-depth information like market trends, customer behavior, or detailed financial projections.
• Potential for Oversimplification: There’s a risk that you may oversimplify complex aspects of your business, which can lead to misguided decisions or strategies.
• Limited Use for Funding: If you’re seeking significant investment or applying for business loans, you’ll often need a more detailed plan.
• May Not Cover All Bases: Due to the limited scope, a lean plan might miss out on identifying potential challenges or opportunities that would be evident in a full-fledged business plan.

A lean business plan serves as a great starting point and is especially useful for small startups or businesses in the ideation stage. However, as your startup grows, you’ll likely need to develop a more detailed plan to meet the demands of investors, stakeholders, and your expanding operations.

5. Research-First Approach

Before you put pen to paper – or fingers to keyboard – it’s imperative to conduct thorough research. A well-researched business plan is more likely to succeed than one based on assumptions or gut feeling. The research-first approach is about equipping yourself with data, insights, and evidence that will help you make informed decisions.

Areas to Focus On

• Market Research: Understand the size and potential of your market. Know who your customers are, what they want, and how much they are willing to pay for it. This will help you define your value proposition and pricing strategy.
• Competitor Analysis: Who are your main competitors? What do they offer, and how do you differ from them? Knowing your competition will help you identify gaps in the market and opportunities for differentiation.
• Financial Data: Gather information on potential revenue streams, costs, and profit margins. A robust financial model can guide your business and help you avoid cash flow problems.
• Customer Preferences: Consumer tastes and preferences can change frequently. Being up-to-date with these can help you tailor your product or service offering more effectively.
• Regulatory Environment: Are there any legal or regulatory constraints that could impact your business? Understanding the legal landscape is crucial to ensuring your business operates within the bounds of the law and avoids any future hiccups.

By taking a research-first approach, you prepare a fertile ground on which to build your business plan. This makes your plan more realistic, focused, and adaptable, which in turn makes it more appealing to stakeholders and investors.

6. DIY – Do It Yourself

For those who are comfortable taking the reins, writing a business plan yourself can be a fulfilling experience. The DIY approach allows you the freedom to customize each section according to your business’s unique needs and nuances. Here’s a suggested step-by-step guide for drafting a plan:

Step 1: Executive Summary

Begin with an executive summary that outlines what your business is about. This should include your mission statement, the problem you’re solving, and a brief overview of your solution.

Step 2: Business Description

Describe your business in detail. This section should include the type of business, its organizational structure, and a background on the industry.

Step 3: Market Research

Dive into extensive market research to justify your business idea. This should cover your target audience, market size, and how you stack up against competitors.

Step 4: Operational Plan

Detail how your business will operate. This includes your location, equipment, supply chain, and operational milestones.

Step 5: Marketing & Sales Strategy

Develop a robust marketing and sales plan. Lay out your pricing strategy, sales tactics, and a marketing plan that explains how you’ll reach your target audience.

Step 6: Financial Projections

Build a financial model to project your business’s economic viability. Include a balance sheet, income statement, and cash flow statement.

Tips for DIYers:

• Use Templates: If you’re new to business planning, consider starting with a template to guide you through the structure of a business plan.
• Spreading the Workload: Don’t try to complete the plan in one sitting. Spread out the workload over a period to give yourself time to think, research, and refine.
• Seek Feedback: Once your draft is complete, seek feedback from trusted mentors, peers, or business consultants to refine your plan further.

Why Getting Your Plan Reviewed is Important?

One of the most important steps in creating a business plan that many entrepreneurs overlook is having it reviewed by a third party. No matter how thorough you are, a fresh pair of eyes can offer invaluable insights and catch errors or gaps that you may have missed.

Having your business plan reviewed is crucial for several reasons. First, expert feedback from professionals like accountants or business mentors can provide invaluable constructive criticism that can refine your plan and make it more compelling. They bring an expertise that can guide you through complex issues, helping you make informed decisions. Second, obtaining an objective analysis is essential. 

When you’re deeply involved in your startup, it’s easy to become emotionally invested, which can cloud your judgment. A neutral review offers a fresh, unbiased perspective that can help you see the full potential and pitfalls of your business. Third, error detection is another vital aspect of a thorough review. Even a minor mistake in calculations or assumptions can result in significant missteps when you move to the execution phase. 

A meticulous review can identify these errors, helping you to avoid costly mistakes down the line. Therefore, skipping the review stage is not an option if you want to increase your startup’s chances for success.

Bonus Networking Tip: 

Don’t miss the opportunity to network while getting your business plan reviewed. Handing out business cards to the professionals who review your plan not only leaves a lasting impression but can also open new doors for your startup. It’s a simple yet effective way to expand your business contacts and possibly gain valuable partnerships or funding sources.

Conclusion 

The step to make a business plan is more than just a formality; it’s a roadmap that guides your startup toward success. From strategic alignment to securing funding, the benefits are manifold. Whether you choose to hire freelancers, consult with experts, or do it yourself, the key is to create a plan that’s both comprehensive and flexible. Don’t forget the importance of a thorough review to ensure your plan stands up to scrutiny. By following our 6 methods, you’ll be well on your way to launching a successful startup.