Have you ever found it difficult to get other people to agree to your entrepreneurial ideas? If so, consider writing a business plan. We’ve created a business plan template to help you meet your business goals, but it makes sense to give some background information.
I (Brandon Boushy) grew up in a unique family. I was the oldest of six kids and my parents are highly successful. One of the things I had to do growing up was write business proposals for anything that was different from the standard operating procedure. (Yes, our family ran like a business.)
That made me pretty proficient at creating a business plan format. We’re going to share some of the lessons I learned growing up with a dad that managed a multi-billion dollar merger and a mom that had a double major in psychology and philosophy. Along the way, we hope to help you understand what people look for in a business plan.
What makes a good business plan template?
A business plan template should be based on your audience. If it’s just you, then it needs to be enough to keep you honest and focused on your goals, but if there are other people who will be viewing it, it should give them enough information to buy into the business plans.
Whether you use ours, someone else’s, or make your own template, you’ll want to make sure a business plan template includes the following:
- An executive summary
- Your mission and goals
- Your strategies
- Your strengths and weaknesses
- How you fit in the external environment
- Call to Action
If you’re interested just in a template, you may download it here.
This outline is partially inspired by the book Writing Winning Business Plans by Garrett Sutton, Esq.
If you prefer YouTube videos, check out our interview with Mike about how to create a business plan:
Let’s look at how each of these plays into a great business plan template.
The Executive Summary in a Business Plan Template
A good business plan should start with a story. All stories have three major parts:
- A hero
- A problem
- A solution
That’s what your executive summary will be. It will be your story. It will basically tell why your company exists. The sole purpose of the executive summary is to get your audience to say:
“I want to know more.”
If you look at UpFlip’s YouTube page, you can see our story right at the top.
When you write a business plan, you want the executive summary to be as easy to digest as possible. If this were in an actual business plan, it would look something like this:
We’ve all heard the statistics that eight out of 10 businesses fail in the first five years. Can you imagine what the world would be like if we flipped those numbers?
That’s our goal at UpFlip. Make it where 80% of businesses succeed. To do that, business owners need the best information possible in the format that they prefer. That’s what we’re doing.
UpFlip is a team of business owners who believe in educating and inspiring people to achieve success. UpFlip does this by using content marketing best practices, case studies, and data analysis to bring business owners content that helps them succeed.
Do you want to hear more?
You might want to include a couple of paragraphs about the team, the market, where the business is now, and how you are going to accomplish the goals. At this point, it’s just high-level ideas to get them interested.
You also want to include what you’re asking for in the executive summary. That will change based on the viewer. Here are some common requests:
- Looking for funding: How much? Do you want a loan or to sell equity?
- Looking for employees: What do you want from them? What values should they hold dear to their hearts?
- Looking for a partnership with another company: Why would the two be a good fit?
- Just for you: An executive summary might be enough.
While this will be the first thing the viewer sees, it will normally be the last thing you write.
The next section of our business plan template is the company description. It covers the following:
- Your company mission and goals: Why does your company matter?
- Your product and target market: What are you selling and to whom?
- Your team: Who is going to help you succeed? You might want to create an organizational chart with your management team, including their skill sets and the gaps you need to fill.
- Your legal structure: Will how you’re structured lead you to succeed? Don’t even bother applying for financing if you are a sole proprietorship. They won’t take you seriously. Register as an LLC or a Corporation.
Your mission and goals
These are the high-end goals of a business. The mission statement is simply what you want to achieve. For instance, Boxabl has the mission to, “Significantly lower the cost of homeownership for everyone.”
Your goals should be highly measurable. They should be focused on accomplishing your mission and should be:
- Specific: What are you trying to achieve? In Boxabl’s case, it is lowering the cost of homeownership for everyone.
- Measurable: How can you measure it? With Boxabl, you might measure against HomeAdvisor’s estimate to build in an area and the median home sale price in the area.
- Achievable: Can it be done? For Boxabl, their factory claims to have a production capacity of 30,000 homes annually for $50,000 each (plus land costs). That’s a substantial savings, but it only covers .5% of the US housing sales in 2021.
- Realistic: Can you actually do what needs to be done? In Boxabl’s case, it could reduce the costs in a single city based on current capacity. 30,000 sales would be equal to 60% of Las Vegas home sales in 2021.
- Time-Oriented: How long will it take? With Boxabl’s design, it could dramatically lower rates in Las Vegas in a year but would need to ramp up production to meet the nationwide levels. It would need to ramp up 120X capacity to reach 60% of all home sales. That means years down the road.
You might want to have a roadmap or graphics in this section to help people visualize them. Here’s an example of what a good roadmap looks like:
You can see the rest of it on Presearch’s website.
Notice how many references I have in this section. A well documented business plan will be full of references because you have to prove all assumptions are reasonable.
With a business plan someone views online, you can use hyperlinks. Otherwise, you’ll want to include your links in an appendix or as footnotes. I recommend using IBIS World for most of your statistics because many banks use them to analyze how accurate your reports are. I’ll cover this more in the section on documentation.
How you fit in the external environment
This section of our business plan template focuses on the industry. You’ll want to start at the highest macroeconomic level and work your way down to the company level. This will include aspects like:
- Whole Economy: Consider GDP growth or shrinkage, interest rates, consumer spending, and anything else that has the ability to impact your business from the highest market analysis standpoint.
- Industry: What is the industry outlook over the next five to 10 years? How many total businesses are in your industry (both nationwide and locally)? Who are the major players? What percent of the market do the major players service? How much is left for smaller players? How is the industry changing?
- Individual Companies: What are they doing? What gaps are they leaving? What can you do better? What do their 401K and quarterly reports show?
All this data matters; it shows whether you know what you are talking about or whether you are just chasing dreams. Don’t get me wrong it’s fun to chase dreams, but it’s better if your management team knows what it is talking about.
If you’re focused on local work, you might want to include a map of all your competitors in this section, for instance, the picture below is a map from Gas Buddy of all the local gas stations in a city. You’ll want to update it with opportunities for locations in the next section on strengths and weaknesses.
Next, you’ll want to compare your experience with this information.
Include strengths and weaknesses in a business plan template
You’ll want to perform a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis. This section of our business plan template includes questions about:
- Your team: Include an organizational chart that outlines your management team, their skill sets, and the gaps you need to fill.
- Divisions: Do you have divisions that are really strong or weak? How are you going to fix this?
- Funding: How are your monetary or cash flow scenarios?
- Vendors: Do you have special vendor scenarios that give you an advantage or disadvantage?
- Industry: Do you have competitive advantages or disadvantages that other companies don’t have? Does that leave holes for you to fill a service area? Check out the map below for potential holes in the market for gas stations:
Opportunities For Gas Stations
Check out this video by Project Manager to understand SWOT analysis better.
Your strategies (Operations)
This section details how you plan to meet the goals you have set. The business strategies section includes concepts like:
- Risk Management
- Mergers and Acquisitions
Logistics show that you’ve really thought about how you plan to achieve your goal. I think the history of Ford, ExxonMobil, Tesla Motors, and previous electric vehicles really shows how the logistics of something matter.
Before the Model T, the majority of cars were electric vehicles. Unfortunately, it was far easier to go to a gas station than to have to charge your electric car. It still is, but part of Elon Musk’s plan to make electric vehicles achievable was nationwide charging stations.
He had to start by strategically placing them so that a Tesla wouldn’t have to risk running out of power while traveling along major highways. If his business plan hadn’t included over 3,000 superchargers, do you think they’d have sold over 3.23 million vehicles?
Of course not. You have to think about what can go wrong and how you’ll address it. That’s how logistics work in your favor––before you have a problem.
This section of the business plan should be focused on what you’ll be doing to get word out about your products and services. This section should include:
- Target market data
- Brand assets like logos
- How you’ll be communicating with potential customers
- Your marketing channels and budget
- Examples of your ads if they are truly impressive
Financial History and Projections
Lenders, equity providers, and governments offering you relocation initiatives will care about the financial prospects. They’ll want to know the following:
- Your assumptions
- Your past performance
- Your current year forecast
- Longer-term outlook (three, five or ten-year outlook)
Even if you’re not trying to make a deal, these can help you plan better. Let’s look at each.
You’ll want to start the financial projections section with a list of assumptions that are backed by valid resources. Assumptions are everything that could go wrong. They may include:
- Wage growth
- Industry growth
- Market share growth
- Financing rates
- Production timelines
- Marketing metrics
- And more
Anticipating everything that could go wrong helps you be prepared and shows your willingness to problem-solve. In Writing Winning Business Plans, the author recommends reviewing the SEC forward-looking statement guidelines because investors are used to reading them. I’d also recommend reading some 401Ks on EDGAR.
Your past performance
If you’re an existing business, you’ll also want to show the past history according to your tax returns for at least two years, but three to five years is better. This lets others see whether growth is steady, accelerating, or slowing.
Don’t try to minimize your taxes if you are trying to get a loan. Try to maximize your net income and cash flow. Think ahead and make it easy for the people to approve you. Also, remember that asset-light businesses have higher profit margins than if you have a billion-dollar plant (it might help with secured loans, though).
Your current year forecast
Create financial projections for the current year. These will show whether or not you have a solid business plan that can actually take on business loans or get equity investors. You’ll want to include at least:
- Profit & Loss Statement: This is similar to a Net Income Statement but is made up. It’s for a one-year minimum and may be called a P&L statement.
- Cash Flow Statement: Here you will show the annual flow of funds in and out of the business.
- Balance Sheet: Give a comparison of the assets and receivables to the liabilities and owners’ equity.
I normally start with monthly spreadsheets because it makes it easier to predict where cash flow imbalances will occur.
Longer-term outlook (three, five, or ten-year outlook)
In addition, you may want to create three-year, five-year, or ten-year projections. Be careful with these, though. The economic environment can change fairly quickly, and in 30 to 90 days a lot of economic reports are released.
Call to Action
This part should change based on who will be viewing it, but it should stay similar. A call to action may be:
- A request for financing for equipment, inventory, or other business needs
- An offer to schedule a meeting to discuss equity purchases
- Linking to employment applications for applicants
- A link to a quiz to make sure employees processed the information
- A request for a tax subsidy from a government
Each of these should stay true to the rest of the document, but you’ll only want to include a call to action for that specific goal. I would suggest saving a separate copy of the template for each type of action.
Here’s what the Appendix will look like for APA-style references. You can use online citation-creating sites like Purdue Owl to create them.
About Us. (n.d.). Retrieved May 17, 2022, from https://www.boxabl.com/about-us
A Better Search Engine for We the People. (n.d.). Retrieved May 17, 2022, from https://presearch.io/roadmap
Brewer, R. (2022, January 06). Record number of homes sold in 2021 in Las Vegas Area. Retrieved May 17, 2022, from https://vegasinc.lasvegassun.com/business/real-estate/2022/jan/06/record-number-of-homes-sold-in-2021-in-las-vegas-a/
Business Plan Template. (2021, April 19). Retrieved May 17, 2022, from https://www.upflip.com/learn/business-plan-template
Published by Statista Research Department, & 4, A. (2022, April 04). Total home sales in the United States from 2011 to 2021 with a forecast for 2022 and 2023. Retrieved May 17, 2022, from https://www.statista.com/statistics/275156/total-home-sales-in-the-united-states-from-2009/
Research and Documentation
Now that we’ve covered the sections of our business plan template, let’s discuss how to research and document your findings. We can all use Google search, but will it give you the best answer?
Maybe, maybe not.
You have to use real data, and there are two ways to get it. You can either go directly to the source or you can buy it.
Get the Primary Data Set
For anyone on a budget or who might prefer to do data analysis themselves, this section is for you. You’ll need the data for many of the sections of your business plan, primarily the industry analysis and the financial modeling.
If you’ve never downloaded a massive dataset, you should try it sometime. They are huge and hard to process. Start by downloading the 50.4 MB spreadsheet to analyze your NAICS code from census.gov. It’s a pain. I’ve had one nearly crash my computer.
After you get the data, you’ll have to process it, create graphs, and cite it in your Appendix. If you have time to do all that, awesome! You’ll want to get data from .gov sites or major organizations. Check out this list of free datasets.
If that sounds like a lot of work, try buying the data from trusted sources instead.
Buy the Processed Data from a Trusted Source
Fortunately, there are plenty of great resources that make it easy to document your statistics in a business plan. You have to pay for them, but they are worth it. Two of the ones I really like are IBIS World and Statista.
They do the research for every NAICS code and all you have to do is buy their report. It even comes with sourced charts for you to use. If you think you’ll need the data long-term, I suggest getting one of their subscriptions.
You’ll be able to pull everything you need out of it and package it nicely in your business plan. Be sure to add your citations into our business plan template, though.
Add Citations to the Business Plan Template
There are a variety of ways to add citations to a business plan, but the most common are:
- Appendix: Save the documents and add them at the end of your business plan. Make sure you label them well. You might want to use this in combination with footnotes to mark which citation goes with which statement.
- Footnotes: You’ll want to add a footnote, then put the reference at the bottom of the page using The Chicago Manual of Style. Check the footnote below for how it looks.
- Hyperlinks: These only work for digital copies, but they send the reader right to the website where the information was retrieved. Just make sure it’s not pay protected. Use these in conjunction with an appendix so you can use the same business plan for both print and digital.
I’ve put all the references to this blog in the Appendix section to give you an easy example.
In addition to The Chicago Manual of Style, you can also use:
- American Psychological Association Style
- Modern Language Association Style
I personally like the APA style, but everyone has their preferences. Just make sure you stay consistent throughout your business plan. Use Purdue Owl if you aren’t familiar with research and citation rules.
Free Business Plan Templates
There are a lot of places where you can get a business plan template. Some of the best places are:
- UpFlip: Download the template that follows this blog.
- Score: View three Score templates.
- Oprah: Oprah offers three templates for business owners.
- My Own Business Institute: (That’s the name; I don’t own it.) Other than ours, I like this free business plan best. Check it out.
- BizGym: Want a lean business plan, BizGym is a good one.
In any of them you’ll want to make sure it has something comparable to the parts in our list. All of them do, but rearrange the order.
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