Learn what’s in a business plan, why you need one, and how to write a business plan with this helpful guide.
Think of a business plan as your small business’s roadmap to success and a must-have for new business owners. This document breaks down key business plan details like your business structure, goals, product offerings, and financial projections.
Getting a business off the ground is no easy feat, but having a plan makes it easier to navigate unexpected challenges. If you’ve never written one before, here’s how to write a business plan for small businesses so you include everything you need.
Jump to:
- What is a business plan, and why do you need it?
- 7 key items your business plan must include
- Starting your business with the right tools
- FAQ
What is a business plan, and why do you need it?
A business plan is a document that outlines exactly what your business will look like and how it will operate. It includes details about your goals, your business model, your products or services, and your target market— to name a few key points.
This plan is something you and your team can reference when making important decisions about your day-to-day operations, marketing strategy, and finances. It helps keep things on track during the tumultuous early stages of your business.
Plus, having a business plan shows lenders and investors that you’re planning for the future. The more detailed the plan, the more it signals that your business is being set up for success, which can encourage funding.
7 key items your business plan must include
Here’s what constitutes a business plan and seven essential sections to include. Although your industry or target audience might lead you to include other sections, these are the ones you’ll definitely need.
1. Executive summary
The executive summary is the first section of any business plan. It’s a 1–3 page overview of who you are, what your business is, and what your business goals are. This gives readers an idea of what to expect from the following sections.
The executive summary should open with your business’s name, location, and mission statement. From there, provide a quick breakdown of the story behind your business. Focus on capturing the reader’s attention and highlighting what makes your business different from what’s already on the market. What inspired you to get started? What problems will your business solve? The executive summary should answer these questions concisely.
Then, include information about your target market, the products and services you’re offering, the team involved, and a basic overview of your business’s finances. You don’t need to go too far into detail here, as you’ll expand on these concepts further in later sections. Remember: This is a summary.
2. Company description
In this section, detail what your company does and what you hope to achieve. Expand on the mission statement you shared in the first section and include a breakdown of your company’s value proposition and main goals.
Once your operations are in full swing, you can reference this section when making business decisions. These values and overarching goals should inform decisions about new product releases, marketing campaigns, or customer service strategies.
3. Market analysis
A market analysis is one of the most important sections to include when preparing a business plan.
Strong product offerings are just one part of business success—you also need a way to differentiate your brand from competitors, which means conducting thorough market research.
This section should start with a brief overview of your industry, including the industry’s total size and projected growth rate. Identify your top competitors, making note of their strengths and weaknesses. Then, describe what makes your business different from competitors and how you’ll capitalize on current market opportunities.
Your market analysis should also include a detailed breakdown of who your target audience is. Include a profile of your target customer, including their demographics, interests, and pain points.
4. Services and offerings
Every business proposal or plan should include a detailed list of the services and offerings you plan to offer. For each, list the features, benefits, pricing structure, and any customization options you plan to provide.
Be sure to highlight what makes your services different from competitors and how your offerings address customer pain points. If you plan on expanding service offerings in the future, include a timeline for new releases. If your business also offers physical or digital products alongside services, include a clear list of those as well, outlining key features, benefits, pricing, and any customization or tiered options available.
This section is also a great place to define your customer service strategy. For example, if your service agreement includes free consultations or responses within a certain time frame, specify that here. Highlight any AI tools or other programs you’ll use to provide that level of service.
5. Marketing and sales strategy
Every small business plan should include a marketing and sales strategy.
This section should open with a short brand guide that includes your logo, colors, and fonts, as well as any taglines or other messaging you plan to use.
Then, include a marketing plan that specifies the channels and strategies you will use to connect with your target audience right from the beginning. This could include digital advertising, SEO, social media marketing, print marketing, event marketing—anything that resonates with your target audience.
Next, provide an overview of your sales strategy. While marketing focuses on attracting leads, sales turns those leads into paying customers. If you plan on offering special discounts or promotions to close deals, mention them in this section.
6. Financial projections
When you plan for a business launch, it’s important to consider your finances so you can make responsible spending decisions. While it’s impossible to predict exactly how much money you’ll make, you can estimate based on your pricing structure and market research.
Your financial plan should start by breaking down your startup costs and your expected sources of capital, whether that’s a loan, investments, savings, or something else. There are many resources for small business owners that can help you find funding and make accurate projections.
Then, include a projected revenue statement, a list of your estimated expenses, and an estimated balance sheet for the next 3–5 years. This should include a cash flow statement, which shows how cash will flow in and out of your account.
If you’re writing a business plan specifically to attract investors or lenders, this section is most important. That’s because a detailed financial plan helps you forecast when your business will start to profit, and investors want to know when they’ll see a return.
7. Management and organization
This section outlines how your business will operate on a day-to-day basis. Start by specifying which type of legal structure your business will have. This could be a sole proprietorship, partnership, LLC, or corporation.
Then, highlight the key leadership roles in the organization and who will fill them. Discuss their background and qualifications, as well as their daily responsibilities and tasks. If you’re running a sole proprietorship, this might be just you to start. However, if you plan on hiring more team members as your business grows, specify that here.
Starting your business with the right tools
Now that you know what to include on a business plan, it’s time to take the next step toward your goals. For entrepreneurs and small business owners, having a great business idea is just one part of the puzzle. You also need the right tools to make those ideas a reality.
That’s where HoneyBook comes in. HoneyBook’s AI-powered client management platform helps you manage every project from start to finish. You can track every lead and client in HoneyBook’s CRM, build proposals, contracts, and invoices with HoneyBook’s template library, and process payments through your client portal. With HoneyBook automations, you can put everything from client onboarding to project delivery on autopilot.
Try HoneyBook for free today to make launching your business easy.
FAQ
What are common mistakes in business plans?
The most common mistakes when writing a business plan are including vague or inaccurate financial forecasts, not conducting detailed market research, or focusing on the wrong target market. Spelling, grammar, and formatting errors can also cause problems, as they can make your business plan look unprofessional.
What should not be included in a business plan?
Business plans should not include long, multi-page financial documents or marketing reports. Your business plan should be an overview of your operations, and you can go further into detail with future reports. You should also avoid vague statements or overestimations—claims should be grounded in market research.
How long should a business plan be?
Most business plans are 15–20 pages long, excluding any appendices. However, the exact length of the document will vary depending on your business concept.
Can I write a business plan myself?
Yes, you can write a business plan yourself. There are many templates for startups and small businesses that make the process easier. However, it may be helpful to work with a professional for your financial projections to ensure they are accurate.
