A business plan is a document describing a business, any products or services, how it intends to earns money, who is on the leadership team and staffing plans, financing, operations model, and what happens when it all doesn’t work as planned.
The main point of a business plan is to attract funding. If you know your business and you’re not intending to attract external funding, then you’ve no need for a business plan. Most “lifestyle” businesses fit into this category. A plumber or a hairdresser doesn’t need a business plan – but they may be encouraged to write one.
Public sector bodies love business plans. It is a voluminous exercise in vanity and, to be honest, creative writing, to complete everything in a business plan. To be able to address every particular demand or ask from an investor who may have a technical background, a marketing background, a retail background or a finance background. But that’s the function. How you write the plan to satisfy the needs of a public servant who’s never run a business in their lives? Well, that’s a dark art (and I would generally encourage you to avoid that exercise in frustration if at all possible).
How long should your business plan be? Well. You need to communicate your idea and your process. You need to give enough information that any potential investor will find the answers to any questions raised by your Pitch Deck (or your pitch at the elevator, bar or golf club). We can help you put together the basics that you need in the pages ratios that we think works – so you’re communicating your financials (even if you’re pre-revenue), your metrics (as much as they’re worth) and your risks (as much as you’re able to foresee them). You’ll be judged on all of these.
Business Plans for Simple Folk
So for most businesses, the plan is very simple:
- What you do
- How you’re going to do it
- What happens when that doesn’t work
This sort of business plan can fit on a page.
So, if a business plan is simply to attract funding, then once you have it, you can burn it, right?
The Operations Plan
You do need some sort of plan, if only to use to communicate the mission and vision and operations of the company to new members of the team; be they investor, shareholder, C-level or employee. But for all intents and purposes, a ceremonial burning of the business plan is a fitting end to that document.
Take what you need from it and feed it into the operations plan. This is a much more practical “living” document which forms the very basis of the company.
We’ll cover the construction of the Operations Plan in a later post.