A business plan should include the information necessary to explain a business opportunity, its proposed method of operation, its market, its strategy and its financial requirements. There is no universally mandatory structure for every business plan, because requirements differ according to whether the document is intended for internal planning, a bank, an investor, a grant application, a partner or another stakeholder.
Nevertheless, comprehensive plans commonly contain an executive summary, business description, products or services, market analysis, competitor analysis, target customers, marketing and sales strategy, operations, management and organisation, legal or regulatory considerations, risk analysis, financial forecasts and funding requirements. Supporting material can be placed in appendices. The contents should be connected logically rather than functioning as unrelated descriptions. A financial forecast, for example, should derive from the sales and operating assumptions described elsewhere in the plan.
The executive summary provides a concise overview of the complete plan. It normally identifies the business, its purpose, principal products or services, target market, business model, competitive context, objectives and major financial requirements. If external funding is sought, it should indicate the amount required and the intended use of funds. Although it appears near the beginning, it is usually most effective when written after the rest of the plan because it summarises information established through the detailed analysis.
The summary should distinguish established facts from forecasts and assumptions. A claim that the business will capture a particular market share, for instance, is a projection rather than an existing fact. The executive summary should give readers enough information to understand the commercial proposition without requiring them to interpret the entire document first.
The business description should explain what the business is, what it does, who owns or controls it, where it operates and what objectives it is pursuing. It can describe the legal structure, ownership, history where relevant, mission or purpose, principal activities and development stage. For an existing business, useful information can include trading history, major achievements, current revenue, customer base and operational capacity.
For a new venture, the section can explain the origin of the idea and the problem being addressed. The description should avoid unnecessary background that does not affect the business case. Its main function is to establish the identity and circumstances of the enterprise so that subsequent sections can be understood in context.
The products or services section should describe what customers will receive, how it works, why it is valuable and how it differs from alternatives. Relevant details can include features, specifications, development status, production processes, suppliers, intellectual property, pricing and future product plans. If the business provides a service, the plan can explain the service process, delivery standards, personnel requirements and capacity.
If the product is still being developed, the plan should state what remains to be completed and what evidence supports the expectation that development can be achieved. Technical businesses may need to explain technology dependencies, infrastructure, security or integration requirements. The appropriate level of technical detail depends on the audience, but the plan should provide sufficient information to establish that the proposed offering can actually be delivered.
Market and competitor analysis should explain the commercial environment in which the business will operate. Market analysis can cover customer segments, demand, market size, purchasing behaviour, industry trends and relevant economic or regulatory factors. Competitor analysis should identify direct competitors and substitutes and compare meaningful factors such as price, product capabilities, reputation, distribution, customer service and target audience. The plan should explain the basis for any market-size estimates and distinguish addressable markets from the portion the business could realistically reach. Competitive analysis is not simply a list of company names; it should explain why customers might choose the proposed business instead and what barriers could prevent competitors from responding.
Marketing and sales strategy should explain how awareness will be generated, how prospects will become customers and how customers will be retained. It can cover positioning, pricing, branding, promotional channels, sales methods, distribution, partnerships and customer service. The strategy should identify measurable assumptions where possible. For example, a forecast may depend on a particular number of visitors, leads, conversion rate and average order value.
Business-to-business sales may require account management, demonstrations, proposals and contract negotiation, whereas consumer businesses may rely more heavily on self-service purchasing and digital marketing. The plan should also identify the resources and personnel needed to execute the strategy and explain how marketing expenditure relates to expected revenue.
Operations, management and risk sections should explain how the business will function and how significant threats will be managed. Operations can cover premises, equipment, suppliers, inventory, technology, production, logistics, quality assurance, staffing, customer support and business continuity. Management information should identify relevant founders and key personnel, their responsibilities and any important skills gaps. Risk analysis can address financial, operational, legal, regulatory, market, cybersecurity, supplier, reputational and personnel risks. The plan should describe practical mitigation measures rather than merely listing risks. Insurance, contractual protections, diversification, backups, contingency arrangements and alternative suppliers can all form part of risk management depending on the business.
Financial information should normally include startup costs, revenue assumptions, operating expenses, projected profit and loss, cash-flow forecasts and funding requirements, with additional financial statements where appropriate. The forecasts should cover a sufficiently useful period and explain the assumptions underlying major figures. Break-even analysis can show the volume of sales required to cover costs, while sensitivity analysis can demonstrate the effect of changes in important variables.
Funding requests should specify how much capital is required, why it is required and how it will be used. Appendices can contain detailed financial models, market research, product specifications, management biographies, licences, technical documents or other supporting evidence. The exact contents should be adapted to the purpose of the plan, but a comprehensive plan should allow a reader to connect the business proposition with its market opportunity, operating requirements, risks and financial consequences.
