1. Overview

Planning what you want to do in your business is an important part of making your business a success. A business plan is your roadmap, guiding the direction your business takes, and helping to keep you on track and measure your success. This section provides you with a business plan template and takes you step-by-step through the process of preparing a business plan.

2. Why do I need a business plan

Your business plan defines exactly what you want to achieve and how you plan to do it. It is the roadmap for your business and helps to keep you focused on your goals.

A good business plan sets out:

  • your key objectives for the next two to three years
  • the strategies you plan to use to achieve your objectives, and
  • your priorities.

You can then plan, implement and measure what you are doing against your business plan, making adjustments to ensure you achieve what you set out to do.

Many people think of a business plan as a document used to secure external funding. This is important because potential investors, including banks, may invest in your idea, work with you or lend you money as a result of the strength of your plan.

The following people or institutions may request to see your business plan at some stage:

  • banks
  • external investors - whether this is a friend, a venture capitalist firm or a business angel
  • grant providers
  • anyone interested in buying your business
  • potential partners

It is also an excellent tool for giving others an overview of your business and to demonstrate how you are performing. This is why most banks or investors ask for a business plan.

Unfortunately too many businesses only do a business plan when they have to. They often claim they don’t have enough time to plan as they are too busy getting things done. However, the busier you are, the more likely you are to need a plan. Otherwise, you could find that you are chasing your tail and going down dead ends, instead of heading in the right direction and following your roadmap.

3. Business plan template

Business plans generally follow the same structure. Here is an outline you can follow:

1. Executive Summary

The executive summary is a synopsis of the key points of your entire plan. It should include highlights from each section of the rest of the document - from the key features of the business opportunity through to the elements of the financial forecasts.

Its purpose is to explain the basics of your business in a way that both informs and interests the reader. If, after reading the executive summary, an investor or manager understands what the business is about and is keen to know more, it has done its job.

It should be concise - no longer than 2 pages at most - and interesting. It's advisable to write this section of your plan after you have completed the rest.

What is it not?

  • a brief description of the business and its products. It's a synopsis of the entire plan

2. Introduction and Company Overview

A short description of the business opportunity - who you are, what you plan to sell or offer, why and to whom.

Start with an overview of your business:

  • when you started or intend to start trading and the progress and investment you have made to date
  • the type of business and the sector it is in
  • any relevant history - for example, if you acquired the business, who owned it originally and what they achieved with it
  • the current legal structure
  • your vision for the future

Then describe your products or services as simply as possible, defining:

  • what makes it different
  • what benefits it offers
  • why customers would buy it from you instead of your competitors
  • how you plan to develop your products or services
  • whether you hold any patents, trade marks or design registration
  • the key features and success factors of your industry or sector

Remember that the person reading the plan may not understand your business and its products, services or processes as well as you do, so try to avoid jargon.

3. Market and Competitors

In this section you should define your market, your position in it and outline who your competitors are. In order to do this you should refer to any market research you have carried out. You need to demonstrate that you're fully aware of the marketplace you're planning to operate in and that you understand any important trends and drivers.

You should also be able to show that your business will be able to attract customers in a growing market despite the competition.

Key areas to cover include:

  • your market - its size, historical data about its development and key current issues
  • your target customer base - who they are and how you know they will be interested in your products or services
  • your competitors - who they are, how they work and the share of the market they hold
  • the future - anticipated changes in the market and how you expect your business and your competitors to react to them

For further information, see marketing website

It is important to know your competitors' strengths and weaknesses as compared to your own - and it is good practice to do a competitor analysis of each one. Remember that the market is not static - your customers' needs and your competitors can change. So, as well as showing the competitor analyses you have undertaken, you should also demonstrate that you have considered and drawn up contingency plans to cover alternative scenarios.

4. Sales and Marketing Strategy

Why you think people will buy what you want to sell and how you plan to sell to them.

Describe the specific activities you intend to use to promote and sell your products and services. It's often the weak link in business plans so it's worth spending time on it to make sure it's both realistic and achievable.

Your plan will need to provide answers to these questions:

  • how do you plan to position your product or service in the market place? For further information, see Understanding your market  
  • who are your customers? Include details of customers who have shown an interest in your product or service and explain how you plan to go about attracting new customers. See more on: Researching your market 
  • what is your pricing policy? How much will you charge for different customer segments, quantities, etc?
  • how will you promote your product or service? Identify your sales process methods, eg direct marketing, advertising, PR, email, e-sales, social marketing. See more on sales and marketing
  • how will you reach your customers? What channels will you use? Which partners will be needed in your distribution channels?
  • how will you do your selling? Do you have a sales plan? Have you considered which sales method will be the most effective and most appropriate for your market, such as selling by phone, over the internet, face-to-face or through retail outlets? Are your proposed sales methods consistent with your marketing plan? And do you have the right skills to secure the sales you need? See more on: Your sales strategy

5. Operations

Your business plan also needs to outline your premises, production facilities, your management information systems and IT. There are certain areas you should focus on.


  • do you have any business property?
  • what are your long-term commitments to the property?
  • do you own or rent it?
  • what are the advantages and disadvantages of your current location?

Producing your goods and services

  • do you need your own production facilities or would it be cheaper to outsource any manufacturing processes?
  • if you do have your own facilities, how modern are they?
  • what is the capacity compared with existing and forecasted demand?
  • will any investment be needed?
  • who will be your suppliers?

Management-information systems

  • have you got established procedures for stock control, management accounts and quality control?
  • can they cope with any proposed expansion?

Information technology

IT is a key factor in most businesses, so include your strengths and weaknesses in this area.
Outline the reliability and the planned development of your systems.
For more information, see IT and e-commerce.

6. Financial Information

This section translates everything you have said in the previous sections into numbers.

You will need to look carefully at:

  • how much capital you need if you are seeking external funding
  • the security you can offer lenders
  • how you plan to repay any borrowings
  • sources of revenue and income

You may also want to include your personal finances as part of the plan at this stage.

Financial planning

Your forecasts should run for the next 3 (or even 5) years and their level of sophistication should reflect the sophistication of your business. However, the first 12 months' forecasts should have the most detail associated with them.

Include the assumptions behind your projection with your figures, both in terms of costs and revenues so investors can clearly see the thinking behind the numbers.

What your forecasts should include

Cashflow statements - your cash balance and monthly cashflow patterns for at least the first 12 to 18 months. The aim is to show that your business will have enough working capital to survive so make sure you have considered the key factors such as the timing of sales and salaries. See our guide on Cashflow forecast

Profit and loss forecast - a statement of the trading position of the business: the level of profit you expect to make, given your projected sales and the costs of providing goods and services and your overheads.

Your forecasts should cover a range of scenarios. New businesses often forecast over-optimistic sales and most external readers will take this into account. It is sensible to include subsidiary forecasts based on sales being significantly slower than you are actually predicting, with 1 for sales starting 3 months later than expected, and another forecasting a 20% lower level of sales.

Risk analysis

Alongside your financial forecasts it is good practice to show that you have reviewed the risks your business could be faced with, and that you have looked at contingencies and insurance to cover these. Risks can include:

  • competitor action
  • commercial issues - sales, prices, deliveries
  • operations - IT, technology or production failure
  • staff - skills, availability and costs
  • acts of God - fire or flood

7. Appendices

Use this business plan template (MS Word 17kb) to guide you through the process of building your business plan.

4. Business plan checklist

Your business plan is a comprehensive document about your business. It is quite usual to work on each section independently and this may not be in the same order as the final document. Other people, such as members of your team, your business adviser or accountant, may also contribute to the final plan.

Use this business plan checklist (MS Word 13kb) to keep track of your progress.

5. Presenting your business plan

To make sure your business plan has maximum impact, there are a number of points to observe.

Keep the plan short - it's more likely to be read if it's a manageable length. Think about the presentation and keep it professional - even if you only intend to use the plan in-house. Remember, a well-presented plan will reinforce the positive impression you want to create of your business.

Tips for presenting your plan

  • include a cover or binding and a contents page with page and section numbering
  • start with the executive summary
  • ensure it's legible - make sure the type is 10 point or above
  • you may want to email it, so ensure you use email-friendly formatting
  • even if it's for internal use only, write the plan as if it's intended for an external audience
  • edit the plan carefully - get at least 2 people to read it and check that it makes sense
  • show the plan to expert advisers - such as your accountant - and ask for feedback. Redraft sections they say are difficult to understand
  • avoid jargon and put detailed information - such as market research data or balance sheets - in an appendix at the back
  • you may have detailed plans for specific areas of your business, such as a sales plan or a staff training plan, but it is best not to include these, though it is good practice to mention that they exist

While it is sensible to seek advice from external advisers, it is not a good idea to get them to write the plan for you. Investors and lenders need to have confidence that you personally understand your business plan and are committed to the vision for the business.

Make sure your plan is realistic. Once you have prepared your plan, use it. If you update it regularly, it will help you keep track of your business' development.

If you'd like more advice on creating a business plan, then take a look at this BOSS course.

(BOSS Digital courses created by Business Wales to support starting and running a business. Sign in/Registration is required).