What office equipment will you need? In fact, your company may not be even profitable for the first couple of years. Discuss how the business will be organized. Plus, it’s very specific. As long as you’re being honest with yourself and potential investors, your financial plan will cover your break-even analysis. We’ll cover both of those topics shortly. If you’ve never written a business plan, use this post as a guide for what you should include. Describe what the business will produce or sell. This is arguably the most important part of launching a startup company. While I understand you may need to give up some equity in your startup to get off the ground, I recommend keeping the power in your hands. If so, who will maintain it? But turning an idea into a viable business is a different ballgame. What production process will be used? They're here for you. That’s great news, and you should be excited about it. It’s clear who is in charge of specific people and departments. Writing a formal plan increases your chances of success by 16%. You will need to prepare a startup balance sheet, showing assets, liabilities, and owner's equity as of the date of the startup. These projections should cover the first three to five years of your startup. If it’s a small company with just you and maybe one or two business partners, this should be easy. It just won't be as helpful, since each business is unique. Open a word processing document and set the font to Times New Roman or Garamond. FOR FREE! If you take your business plan to a lender or investor, you will also be asked to provide personal financial information. If you have an idea for a startup company but not sure how to get started with a business plan, I’ll help you out. Create a Startup Business Plan in Easy Steps, Begin with a General Description of Your Business, Specific Plan for Your Products or Services, Describe the Competition for Your Products or Services, Necessary Financial Statements for Business Startup, 6 Key Small Business Financial Statements for Startup Financing, Business Plan Tips: How to Write a Winning Executive Summary, Here's What Your Coffee Shop Business Plan Should Look Like, The Sections a Winning Business Plan Has to Have, Use This Template to Write a Simple Business Plan, One-Page Business Plan Templates for Entrepreneurs, 5 Easy Steps to Creating a Break-Even Analysis, How to Develop a Strong Online Presence for Your Startup, Planning & Financing a Startup in the COVID-19 Era. Your business isn’t for everyone. In addition to researching your target market, you need to conduct a competitive analysis as well. Choose the language and output format. Finally, you will need to create a management plan (who's running this company), an operating plan (how is it being run), and an executive summary. Include the reasons for going into business. This category only includes cookies that ensures basic functionalities and security features of the website. Create an Executive Summary Corporations are legal entities that keep the business and personal liability separated. What computer hardware and the software will be used? A startup business should show monthly projections for the first year of business, along with quarterly information for the next two years. You don’t want to dump your entire marketing budget into one strategy. Even before your company officially launches, you can start building your website and social media profiles. Preparing this information for inclusion in your business plan will help you gain the trust of these individuals. For a startup business, creating a business plan is like creating a game plan in sports. Start with the basics like: Here’s an example of what this will look like in your business plan: These numbers need to be accurate. Launching a startup company is exciting. Click “Insert” to open the business plan template PDF with the program. 5. … This website uses cookies to improve your experience while you navigate through the website. If you’re planning to sell jeans for $50, you won’t be competing with designer brands selling jeans for $750. It is mandatory to procure user consent prior to running these cookies on your website. Describe how your accounting, billing and collections, and other financial operations will be conducted. Every tech startup is different, with each company specializing in one thing that’s fairly different from the other. This will help you stay organized and focused. This section will also take the most time and effort. Going through the process of writing a formal business plan will increase your chances of securing an investment and also improve your potential growth rate. Getting lost in rehashing and dragging out a business plan for a year or more can cost your startup the optimal moment to get to market and the best funding opportunities. However, you can still make projections. Others cost us tens of thousands in lost revenue. Things don’t always go according to plan. This document summarizes the business plan information and is placed at the beginning of the document. But there’s no right or wrong way to approach this for your startup company. The most important step in the process of creating your business plan is the creation of your financial documents. It'll make your life so much easier as you build your business. Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. Follow my tips for best practices. The executive summary is, without a doubt, the most critical element of your tech startup business... 2. … The types of paid advertising you will use to promote your products and services. Save your business plan progress in one place across all the document apps you use. Before you start seeking legal advice, renting office space, or forming an LLC, you need to put your thoughts on paper. Include a discussion of the computer and technological systems in your business. Include a detailed statement (sometimes called a "cash flow statement")showing month-by-month sales and collections, along with all monthly business expenses. Describe the key management positions you will require; if you have any of these key positions filled, discuss the qualifications of the people who will fill them. To run a successful business, you must adapt to changing situations. Having a business plan also gives you a better chance of raising capital for your startup company. Consider everything. The executive summary doesn’t need to be lengthy and tedious; around two to … Or you can base your price differentiation on what you learned about your target market. Although you may think everyone will love your idea, that’s not a viable business strategy. But this information will be based on your target market. This description should be as complete as possible. One of the key benefits of writing a business plan … How will you separate yourself from the crowd? Add a cover page to your document. The realization of the business plan is an essential step for any entrepreneur. Taking the time to sort your budget out before you launch will minimize that risk. 11. From there, you’ll be able to identify your competitors. When writing a company description, make sure it’s not ambiguous. What hours will you be open? If you are providing services, describe these services in detail, including: Create a description of your target market. This will be a very brief description; you'll be doing a more detailed management plan in a later section. Again, this is completely fine as long as you’re planning and budgeting accordingly. Don’t just say you’ll make $10 million in your first year. The final aim is to make potential investors quickly grasp the concept of the business and its value proposition. 4. Business Description. So, you need to plan, set goals, and above all, know your business plan. Describe the owners and management of the business, along with the expected number and types of employees who will be working in the business. Seeking funding from lenders and investors for your start-up can be an arduous task. Just don’t try to bite off more than you can chew. The market research you’ll need to conduct in order to write this plan will also help you determine whether this is a viable business venture to proceed with. Here is what you should bring with you to all owners for the last three years. Don’t use slang terminology. You can title it “[Company Name]’s Business Plan” or “Business Plan … 10 Essential Elements of a Tech Startup Business Plan. Make the business plan look as professional as possible. For example, let’s say you’re opening a restaurant. In addition to creating a business plan to use for getting startup financing, there are other good reasons to create a plan. Figure out exactly how much money you need to start the business and stay operational; otherwise, you’ll run out of money. The types of materials (brochures, flyers, web site)you will use to promote your new products and services. Here are the points you should emphasize in your Executive Summary: Now that you have completed writing your startup business plan, one more important task is ahead. This section should be pretty concise and no more than three or four paragraphs. What Is a Community Development Financial Institution (CDFI)? The last thing you want is for consumers to find out about your brand but then be unable to find your website or contact information. Describe what type of business you are starting, retail, manufacturing, industrial, construction, or some other type of services. When writing a company description, make sure it’s not ambiguous. Here’s an example of what your organizational chart may look like: It’s really important to have this hierarchy in place before you get started. Appendix. Then, contact your local SCORE mentor to review and refine your plan either online or in person… You will need to prepare a pro forma (projected) income statement (P&L) for the first three years of operations, showing income and expenses, along with pre-tax income, tax liability, and after-tax income for each of these years. Here’s what you need to know to get started. First and foremost, the business plan of your startup should convince you that your idea for a business is not just a dream, but can be a viable reality. Once you figure out who your competitors are, it will be easier to determine how your company will be different from them. You can get an MBA in digital marketing just by studying these guides. If there’s no market for your business, the company will fail. Create a description of the management of your business, including: Describe the backgrounds and qualifications of the individuals who will own the company and make top-level decisions. Thoroughly writing out your plan accomplishes several things. This description should include: Create a description of the competition for your products or services within your target market, including: The next step is creating a strategy for marketing and promoting your company's products or services to this market. Learn from our hard-won experience on which tools can be trusted: Over 500 guides across 10 subjects. In the example above, although the total startup expenses are less than $28k, it may not be a bad idea to raise $40k or even $50k. But as you continue going through your market research, you can get even more specific. Create a Management and Operations Plan 2. To startup, it is important to make a startup business plan. You’ll use this target market in other sections of the business plan as well when you discuss future projections and your marketing strategy. You need to have all your numbers in order when you’re writing a business plan, especially if you’re planning on securing investment funding. When you’re writing a business plan, your startup doesn’t exist yet. I could sit here and talk about different marketing strategies all day. … Your Executive Summary is important! The best place to start is to … … These cookies will be stored in your browser only with your consent. If you put too many layers of managers, directors, and supervisors between the top of the chart and the bottom of the chart, things can get confusing. It should also be written cleanly and professionally. You need to scout out all the information to create a winning strategy for the game. You don’t want any instructions or assignments to get lost in translation between levels. Nobody knows about you. We also use third-party cookies that help us analyze and understand how you use this website. If it doesn’t work, you’ve got nothing to fall back on. The first step in writing a startup business plan for your new tech business is to create an executive summary. We’ve put together our best tips on how to create a website, finding the best web hosting provider, and in-depth digital marketing guides. Is your company local, regional, national, or international? Keep in mind that your business plan is a living, breathing document. Make sure they are reasonable. You also have the option to opt-out of these cookies. Your business plan should also cover the organizational structure of your startup. The top three ways in which you will initially inform your target market about the existence of your products and services. Here is the information you need to include in your financial plan: This financial statement should include all of the equipment, supplies, and other items you will need to purchase for the startup, as well as fees and licenses, deposits, initial expenditures for advisers, and costs for creating your business structure. What Are Commercial and Industrial (C&I) Loans? Or worse, get directed to a website that’s broken or unfinished. How to Write a Business Plan for Your Startup Make sure your company has a clear objective. This exercise helps you distill your vision and will focus many other portions of your startup plan. To figure out your target market, start with broad assumptions and slowly narrow it down. You can target customers living in New England, for example. Our content is reader-supported, which means that if you click on some of our links that we may earn a commission. You’ll use this information to create your brand differentiation strategy. A business plan is a written description of your business's future, a document that tells what you plan to do and how you plan to do it. If you have superior quality, there is a market for that as well. Common Mistakes in Creating a Business Plan and How to Fix Them, The Balance Small Business is part of the, The pricing structure of this product and whether you will have different prices for various markets, Whether you will produce this product or purchase from a wholesaler to resell to your customers, A general description of each type of service and how it will be performed, Pricing for the various services you will be providing. By the time you’re finished, the target market could look something like this: This profile encompasses all four demographic segments I mentioned earlier. Take it from me: as someone who has founded several startup companies, I know what it takes to be successful in this space. Your business plan shouldn't just be a quick(ish) read -- it should be easy to skim, too. Describe the owners and management of the business, along with the expected number and types of employees who will be working in the business. My recommendation would be to stay as cost-effective as possible. Make sure your business plan is 100% perfect. Be versatile and well-balanced too. 6 Essential Parts of a Retail Business Plan. Typically, the best way to segment your audience is using these four categories: As I said earlier, start broadly. What will you do to market and sell products and services? The ways in which you will use publicity to promote your products and services. I’ve talked about many different components of your business plan. If you have an expansion strategy in mind, this would also be outlined in your financial projections. To write a business plan for a small business, start by writing an executive summary that briefly outlines your business. Some of them drove our revenue sky-high. Customers won’t have a reason to switch to your brand if it’s the same as the company they already know and trust. Small business expert Susan Ward suggests creating goals for each section of your business plan and making an action plan to achieve each one of those goals. If you are selling products, you should create a break-even analysis, showing the point at which you expect to break even on product sales. One of the first steps to launching a successful business is clearly identifying the target market of your startup. Learn how to write a business plan quickly and efficiently with a business plan template. A limited liability company (LLC) is another way to separate business interests from personal. Take the time to research your options. A business plan can make or break a small business. For example, if you’re planning to expand to a new location in year four, your financial projections need to be adjusted accordingly. If you have not selected some of these individuals, discuss the qualifications you will be looking for to fill these positions. Come out fast. But opting out of some of these cookies may affect your browsing experience. Both of these fall under the market research category of your business plan. Here are some items this marketing and promotion plan should include: Along with your marketing and promotion strategies, you will need to create a budget for all of these activities, for the first three years of your business. A description of your "ideal" customer in terms of this person or company's characteristics, attitudes, and buying behaviors. No banks or investors will give you a dollar if you don’t have a solid business plan. A typical business plan consists of the following elements: You can use this business plan template that will help guide you through structuring your business plan in the proper way. Include the square footage and a layout of the business, if this is available. While it’s reasonable to expect your sales revenue to increase each year, you still need to take all factors into consideration. Amidst that rush, the idea of writing a good business plan—much less following a business plan … Include Your Personal Financial Information in Your Business Plan 1. A completely optional section of your startup business plan… The structure you choose will have legal and tax implications so, be sure you research and choose carefully. The Executive Summary should be interesting to your reader and provide basic information about the business. Your business plan should talk about the research you conducted to identify this market. You also don’t want anyone to be confused about who is in charge. This shouldn’t be a 100-page dissertation. When in doubt, estimate higher. Get started by using this business plan template to create your perfect business plan today. Open the editable version of your … As a matter of the fact, a mission statement should explain a company’s purpose in one compelling sentence. 3. You may wish to talk to an accountant as you learn about which form your company will take. Discuss whether this location will be purchased or rented and the terms for purchase or rental. Include information about the key advisers for your business, including consultants, your CPA or financial advisor, attorney, insurance agent, and banker. That way, you’d have some extra cash in the bank in case something comes up. In particular, the Executive Summary is intended to summarize your financial needs for startup or purchase. This strategy needs to be aligned with your budget and financial projections as well. For example, you may start by saying your target market lives in North America, and then narrow it down to the United States. Take these categories into consideration when you’re coming up with a marketing plan: Before you try anything too crazy, get the basics sorted out first: Don’t ease into this one step at a time. You definitely want it to be detailed and thorough, but don’t go overboard. The template will help you make sure all areas are covered, so your startup goes more smoothly. It’s as simple as that. Review your startup business plan to narrow down what exit strategy suits your business’ interests better. It may sound overwhelming, but don’t be alarmed. A recent credit report, showing credit score, A personal financial statement -- you can use the. Your business plan is the foundation of your business. This will be a very brief description; you'll … Jean Murray, MBA, Ph.D., is an experienced business writer and teacher. The financial statements are a key part of this plan… Entrepreneurs are by nature positive, confident, and can-do people. Keep everything within reason. Whether you’re a seasoned business owner or just beginning to think about starting a business, demands come at you fast.Tasks, to-do lists, meetings, and more. Obviously, you won’t have any income statements, balance sheets, cash flow reports, or other accounting documents if you’re not fully operational. Your marketing plan relies on everything else I’ve talked about so far. You don’t want poor budgeting to be the reason for your startup’s failure. 8 Easy Steps for Starting Your Own Business Create a business plan. We’re here to help you grow your business online and get more traffic. That way, there’s no debate over who reports to which position. Another example of a goal could be launching an ecommerce store in addition to your brick-and-mortar locations. Talk about the data you collected from surveys and interviews. If your prices are significantly lower, that can be your niche in the industry. What will your phone system look like? Good luck! The type of company you have and how you will operate should be obvious to anyone who reads it. Every startup and small business is unique, so you'll want to avoid copying a sample plan word for word. The last step in preparing your business plan is to create an Executive Summary. Attend a business assistance and training. Instead, identify who you are and when you plan on going into business. Let’s continue talking about your financials. Your business isn’t for everyone. Proofread it for grammatical and spelling errors. Complete the Business Plan Template for a Startup Business to create a working business plan for your startup. Describe the facility you will use for your business, including an address and information about the area. State what kinds of products or services you’ll be offering and in what industry. A strong, detailed plan provides a clear road map for the future, forces you to think through the validity of a business idea, and can give … The first step is to write a general description of your business. First, it gives you a much better understanding of your business. Now that we have the rules of writing a business plan out of the way, let’s dive into the elements that you’ll include in it.The rest of this article will delve into the specifics of what you should include in your business plan, what you should skip, the critical financial projections, and links to additional resources that can help jump-start your plan.Remember, your business plan is a tool to help you build a better business, not just a homework assignment. Running out of cash is one of the most common reasons why startup companies fail. Use a business plan template to look at all the areas of your most standard businesses. Remember, you may need to use this to raise capital. For example, let’s say you’re in the clothing industry. There’s no exact number of pages it should be, but have at least one page per section.