Free template: How to write a business plan

Whether you are starting a business or planning to expand, having a business plan can help you follow through and gain insight into your ideas.

However, research often shows that many businesses are missing one: Grow London Local’s 2025 survey of more than 800 entrepreneurs found that more than half (54%) of London’s budding business owners operate without a business plan. It added that 59% of small business employers nationwide do not have one.

There are many useful tools that you must have if you want your business to be successful. Although one of those is accounting software, so you can track your business administrator (predict your cash flow, manage your invoices, and more), another business program.

So what are the benefits of business planning and how can it help your business succeed? Read this article to find out more.

Here’s what we’re up to:

What is a business plan?

There are many reasons why you might want to start a business.

You may have a good idea. Maybe you’ve always wanted to run your own company. Or maybe you’re exhausted and ready to take the plunge into business.

But for your business to be successful, your passion, enthusiasm, hard work and skills must be built on a framework that works. And that’s true whether it’s a new business or an existing one.

This is where your business plan comes in.

An important part of that effective framework, the business plan is a document that outlines your company’s mission, what it does and its strategic goals, among other things.

Creating a business plan for your company will guide you in defining your unique selling proposition (USP), and clarify the market place you wish to operate in and the competition your business will face.

You will use your business plan to work on a series of key steps that will help you grow your company.

But your business plan shouldn’t be a static document. You should update it regularly as your company changes, to ensure that things are running smoothly.

Benefits of writing a business plan

Jennifer O’Toole, director at accountancy firm Thomas R Dixon, says, “A business plan is like an airplane’s runway.

“Being able to identify potential threats, problem areas that may impact the business, and being able to develop strategies to deal with the situation in a proactive way instead of taking action, is the key to the survival of the business.”

It’s also a great way to share information about your business, develop your thinking and test cases before making any changes (like quitting your job and going solo), and gives you a way to gauge how things are going when you first start.

And if you want finance, a business plan can make the difference.

Rebecca McNeil previously worked as a chief operating officer at Barclays. He is now a partner at Manchester Square Partners.

He says, “A strong system can help finance applications from business loans to other forms of finance and investment.”

Reasons why people skip business planning

If it is so useful, why don’t more people choose to have it? Here are some of the common challenges:

• Time. If you have thought about your business, it shouldn’t take long to create your business plan. Keep it short and simple and choose a format that works for you.
• Uncertainty. It’s true that you don’t know what will happen until you start a business but a plan can help you identify potential pitfalls and help you understand the finances behind your idea.
• Lack of agility. Some people think that business planning stops businesses from growing, but a good business plan should be current and adaptable as you test and learn. It needs to be part of the business, not left in a drawer.

The best format for your business plan

Many people think that a business plan is going to be a big document that contains a lot of facts and figures, but it doesn’t have to be that way. The key is to choose a format that works for you and your business. That would be:

• One to use. Something that can be part of your daily business rather than something that you will not refer to. Have your business plan on the wall as a manifesto or mind map, make a presentation or create a visual guide – whatever works for you.
• One that makes it easy to express your ideas. If you’re a writer, you might be excited about text, a designer might like a visual medium. Your business plan should be fun and inspiring, so choose a format that allows you to do that.
• One shared. A business plan will be seen by many people, from your bank manager and accountant to potential investors or employees, so choose a format that makes it easy to share.

What you should include in your business plan

What should be included in the business plan? Every program may be different but there are common pieces of information that are often included:

• Business overview. What does it do and what makes it different?
• Goals. What does the business want to achieve? This should set specific SMART (Specific, Measurable, Attainable, Relevant and Timed) goals that will be immediately realized if the business is successful.
• Your audience and market. Who will serve your business and how will it reach them? What is the market size and who are your main competitors?
• Products and prices. What will you be selling and how will your prices be set? How does this compare to your competitors?
• Who is involved. Many investors say they invest as much in people as they do in business. Share specific information about people’s roles, knowledge and interests.
• Finance. Provide information about auctions, costs, exchange points and where the investment will come from. If you are looking for people to invest, you should include information about the potential return. If you’re looking for ways to finance your business, crowdfunding, alternative financing and government funding are a good place to start. British Business Bank is a good place to start, too – they offer loans with free training included.

Some business plans will include other sections, such as a SWOT (strengths, weaknesses, opportunities, threats) analysis or a full marketing plan.

You may find these useful for your business, so feel free to include them again if you like.

How to implement your business plan

Many business owners spend time developing a business plan and then never look at it again.

While it’s important to clarify your ideas and test your thinking before you start your business, it’s even better if it’s embedded in your day-to-day business.

As Jennifer says, “Business planning is an ongoing process—from the beginning of any business to the second phase of developing and growing existing sales and developing new revenue streams.

“As advanced businesses grow and diversify, business planning continues to play a critical role in ensuring that the company’s long-term strategies are achieved.”

Here are some ways your business plan can work for you:

• Take sales, cash flow and expense forecasts and measure them against your actual figures to improve budgeting and spend management. This helps you see if you are on track and if things need updating.
• Revisit your goals every month to see how you’re progressing.
• Keep updating it to include customer input and quotes. Real feedback is essential to keeping a business on track.
• Revisit it once a year to see if changes in the market, technology or competition have had an impact. Businesses need to continue to evolve in order to survive in the long term.

Final thoughts: Where to get help with your business plan

Sometimes you will need more information to compile your plan. You may:

• Talk to your accountant. They don’t just help you with finances or accounting software, they can also give you advice on how to organize your business.
• Talk to your bank. Many have small business experts who can help.
• Use business planning templates. Our free, easy-to-follow Word template will help simplify the process.
• Use AI to communicate your ideasand ask it to challenge you on the details of the business plan.

Editor’s note: This article was originally published in October 2017 and has been updated for relevance.

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