Are you planning to start a business? Creating a business plan is the first thing you need to do, as it sets the stage for a successful, well-planned business. However, developing a business plan can be intimidating, especially if you have never created one before. This simple business plan example will help.
So, let’s discuss the importance of business plans for startups, along with an example.
Table of Contents
What Is a Business Plan (with a Simple Business Plan Example)?
Do you have a business idea in mind, along with a strategy to raise funding, get customers, generate revenue, and become profitable? Write it down on paper in a well-structured and formatted manner. That’s it. You have a business plan.
By definition, a business plan is a written document mentioning a new business’s objective and roadmap from financial, operational, and marketing standpoints. A business plan is often the first thing to create when you start a new business. It lays out how you will go about your business in terms of budget and planning.
A good business plan can help you create a strong foundation for your new business. It can also help you attract new investors and raise funding. Most investors look at a company’s business plan to decide whether to invest.
Why Do You Need a Business Plan?
A business plan is important because it enables you to set realistic goals and make informed business decisions. It also paves the way for competitive analysis, customer segmentation, and marketing, increasing the chances of business success.
Let’s look at the importance of a business plan.
- Critical Decision-Making: Successfully running a business involves making crucial decisions. A business plan enables accurate decision-making based on facts and strategy.
- Strategic Business Approach: Companies need to ensure that they don’t deviate from their goals. A business plan acts as a guiding light, helping you stay focused on your goals.
- Avoid Big Mistakes: More than 90% of businesses fail. Some common reasons for failure include no market need, lack of capital, inadequate team, stiff competition, and improper pricing. A business plan helps you identify and overcome these challenges.
- Make Your Business Viable: Passion is essential for launching and running a business, but it isn’t enough. Your business needs to be viable. A business plan enables you to prove the viability of your business and turn your idea into a realistic business roadmap.
- Objectives and Benchmarks: Setting goals and objectives is an essential aspect of running a successful business. However, if you set goals that are too small, you may not achieve much. And if you set unrealistic goals, you may never achieve them. A business plan helps you set data-driven goals and benchmarks.
- Secure Financing: Securing financing is an essential task for any new business. A well-developed business plan goes a long way in convincing investors. It can help build trust in your business, which is essential for attracting funding.
Key Components of a Business Plan
In the previous section, we discussed the importance of a business plan. In this section, let’s look at the key elements every business plan should have. Your business plan must have these components regardless of your business size, type, and industry. These include:
- Executive Summary to outline the company’s vision, mission, and objective
- Offerings: Products/Services, along with pricing and pricing models
- Market analysis to describe the target market, including customers and competition
- Financial Planning to attract investors and raise funding
- Budget to cover the cost of staffing, development, and manufacturing
- Marketing Strategy to reach customers, generate leads, and make sales
Simple Business Plan Example
Having discussed the meaning, importance, and components of a business plan, let’s now look at a simple business plan example to enhance your understanding. Moreover, we’ll use the components mentioned in the previous section to create a business plan from scratch.
Excited? Let’s get started.
Simple Business Plan Example: The Business
Firstly, we need to have a business. Let’s say you are a SaaS company that offers enterprise resource planning (ERP) software to small and medium businesses (SMBs). You have a monthly subscription model, and your product will help businesses increase their operational efficiency. The name of your hypothetical business is OperateX.
Executive Summary
An executive summary for your business could look something like this:
“OperateX is a consumer-centric digital solutions provider that offers feature-rich and easy-to-use ERP software for SMBs. Thus, our solution enables seamless integration and customization, backed with top-notch customer service.”
Offerings: Product/Service
This section, as discussed, would include the product or service you offer. You can also include pricing in this section. For instance, suppose you have three plans for your ERP software:
- OperateEasy: {List of Features}: Free
- OperateStandard: {List of Features}: $5 per month per user
- OperatePro: {List of Features}: $10 per month per user
- OperateEnterprise: {On-Demand Features}: Pricing on request
Market Analysis
Here, you’ll need to have two sections. The first will include the characteristics of your ideal customer (also known as a buyer persona). These could be:
- Age: 30-45 years
- Location: USA, Europe, Asia Pacific
- Revenue: $10 million+
- Industry: N/A
- Challenges: Lack of operational efficiency, increased costs
The second section will include the name of your competitors, and therefore, it will entirely depend on your business.
Financial Planning
This section will include all the relevant finances, such as:
- Total budget: $5 million
- Projected revenue in the first year: $1 million
- Total funds raised: $3 million
- Total debt: N/A
Budget
This section will include the total funds you have, and moreover, how you intend to spend them.
- Total budget: $5 million
- Projected staffing costs: $1 million
- Projected infrastructure costs: $1.5 million
- Other expenses: $1 million
Marketing Strategy: Simple Business Plan Example
Lastly, you need to come up with a marketing strategy. This will include the channels you’ll leverage to reach customers.
- Website, blogging, and search engine optimization
- Paid ads on search engines and social media
- Content marketing on social media and other platforms
- Guest blogging to boost SEO
- Cold calling and emails
Conclusion: Simple Business Plan Example
Creating a business plan is the first step to take when starting a new business. It paves the way for a successful company that raises funds, makes sales, and stays profitable. Also, if you are new to developing business plans, the simple business plan example discussed above can act as a starting point for you.
