Blog>Trade>Starting a Business>How to write a business plan
Last updated: 1 November 2023
How to write a business plan
A business plan is key to success. But knowing how to write a business plan, and what to include in a business plan, might seem hard if you’ve never created one.
Why use a business plan for a small business?
Every business needs to create a business plan. But what is it?
A business plan is a written document that outlines:
Where you are now
Where you want your business to be in the future
How you're going to get there.
A clear business plan will allow you to:
Set out your business idea, goals, and objectives clearly.
Be well-organised and make informed decisions.
Make more efficient and productive plans.
Understand how your business is performing against your targets
Avoid costly mistakes.
Start building your business plan with a free business plan template here:
Diversify your business plan
A lot of successful businesses start out doing one thing and end up doing another.
This happens when an owner, or a member of staff, spots an opportunity in a related field. And this will be one where there’s more opportunity to grow/earn revenue.
Tradespeople are not excluded from this opportunity. Plus, there are several ways in which businesses in this sector change tack or expand into new markets.
One is bolting on additional services as you grow, as this gives a business a ‘full-service’ edge. Also, it lets people book your team to work on bigger and more complicated projects.
To learn more about this topic, read a snippet of the free Accelerate eBook .
What to include in a business plan
When you create a business plan, it will be split into a few key areas, which we'll cover below.
Wondering what to include in a business plan? These are the 7 things you’ll need:
1. An executive summary
This is one of the most important parts of your business plan as it's the first part that will be read.
Looking for funding or investment? Initial judgements can be made based on the executive summary alone.
The executive summary is an introductory overview of your business. It should state what your business is and why it'll be successful.
Nervous about money?
Check out our cash flow advice
2. A business description
Include more detail about your business and why it exists in this section.
Remember, your business plan should be easy to read and understand.
Use an appendix if you need to add more information, such as financial forecasts.
3. Competitor analysis
This is a section that looks at the market you're entering, and competitors within that space.
Define the segment of the market your business wants to target. You could target a particular area, customer demographic, or industry. This will just depend on the product or service your business offers.
With your target market set, make sure you research the existing competitors trading in that space. It's often helpful to do a SWOT analysis. Just note down the strengths, weaknesses, opportunities, and threats for both your business and your competitors.
4. Your services
What type of jobs will your business be taking on? And what size jobs are realistic with the resources you have right now and in the future?
Does your business offer a range of services? For example, building and construction. Or, will you provide a niche service, like insulated conservatory roof panels?
What makes your service different? What benefits does it offer the customer?
5. Marketing plans and budgets for your new business
Your marketing strategy will include how you're going to promote your business, and how you'll stand out from the competition.
It's important to create a website as part of your business plan and/or
It's important to create a website as part of your business plan and/or social media accounts for your new business.
This will help attract new enquiries, as many consumers research tradespeople online.
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6. Operations and management plans
This section on your business plan template should focus on the operational resources. It should also outline the current and future structure of your business.
Some of the questions to ask yourself include:
Who works in your business? Is it just you, or will you have a small team?
What roles does each person take on and do they require specialist skills in a specific trade?
How many employees do you need to offer the services you intend to offer as you scale up? And will any training be required?
Will you or your team require training to expand the services you offer?
Will you need business premises to work from or store materials?
What technology do you need to operate your business effectively? If it's just you, this might be a mobile phone. Whereas if you employ others, you'll need to consider payroll etc.
This part of your business plan helps to maintain and increase morale, using investment in growth and training.
Also, it will help with your decision-making, and your ability to mitigate risks.
7. Finances
"Money makes the world go round", and never has a truer word been spoken when it comes to new business.
Poor cash flow management is one of the main reasons for startups failing.
So, make sure when you create a business plan, you’ve included a cash flow forecast. This lets you plan for what's ahead and develop a strategy to manage it.
Some of the other essentials you need to tick off the list include:
Opening a new business bank account
Getting the right new business insurance
Knowing how to set up wholesale accounts
Setting up and running a business is costly. As standard, you’ll have fixed overheads to work with, like the cost of tools, materials, and workwear.
So, you’ll need to budget for everything you might need when you create a business plan.
How much should you spend on advertising a new business?
As a rule of thumb, small businesses spend between 3-5% of their revenue on advertising.
This is dependent on how quickly you want it to grow, and how competitive the market is.
A quick business plan summary
Creating a business plan is essential because it defines your objectives. And this document helps you plan how to achieve your business goals.
It’s broken down into 7 key areas:
An executive summary
Business description
Competitor analysis
Your services
Marketing plan and budget
Operations and management plan
Finances
Use our free business plan template
Whether you're setting up a new startup, are self-employed, or you’re a small business, our free business plan template will help.
So, let us help you create your business plan with confidence!
Download our free business plan template here:
