Traditional Business Plan

A business plan is a formal document that outlines the key elements of your new business. Primarily, its purpose is to detail the mission and goals of your business, as well as the operational and financial strategy that will allow your business to achieve these goals. This not only helps you stay focused and organized, but it also helps you attract the right employees, investors, partners, and lenders.

When the term “business plan” is used, it usually refers to a traditional business plan, which uses a standardized structure and provides intricate details about the business. Traditional business plans may be used as supporting documentation for potential lenders and investors.

The Traditional Business Plan Structure and Template

The following is a comprehensive list of sections that may be included in the traditional business plan. However, business plans are fluid and may change over time depending on the direction you want to take your business. Do not hesitate to exclude sections which are not applicable to your business or situation.

1. Executive Summary

The executive summary is the first section of your business plan. It provides a high-level overview of your business, summarizing the key points from each section of the plan. You might think of it as the thesis of your business plan. Similar to actual theses, experts recommend writing your executive summary last, after you have detailed each section fully and identified the most critical information to include.

2. Business Description

This section provides a detailed look at your business. Explain what your business does, who it serves, and what sets it apart.

3. Operations and Management

This section outlines your business’s structure and leadership. Highlight the people (including yourself!) who will drive your business to success.

4. Target Market Analysis

Understanding your market is critical for success. The market analysis section demonstrates your knowledge of the industry and your target audience.

5. Products or Services

Explain what you sell and how it addresses your customers’ needs. You should give more detail to the USP you described in the executive summary.

As you discuss your products and services, try to illustrate how your specific offerings align best with your mission statement and overall strategy. Because this can be difficult to do, I will briefly provide an example.

6. Marketing and Sales Strategy

This section outlines how you plan to attract and retain customers. Be specific about your tactics and channels.

7. Goals

Your goals section outlines the short-term milestones and long-term vision for your business. It functions as a roadmap, reminding you to remain focused on the critical activities your business must perform to achieve them. Your goals might be financial, operational, or customer-focused and should align strongly with the company’s mission and values.

Including a goals section motivates stakeholders and provides a framework for evaluating progress and adapting strategies as needed. This section shows that the business has a clear direction and is prepared to measure its success systematically.

8. Financial Plan

Your financial plan is one of the most critical parts of your business plan and perhaps one of the most time-intensive sections, too. It gives potential lenders and investors a snapshot of your business’s projected financial health, which allows them to evaluate your creditworthiness (lenders) and return on equity (investors).

9. Funding Request

If you’re seeking funding from a bank or investor, explain how much money you need and how you plan to use it. Be specific and transparent.

For clarity’s sake, it is important that you make sure your funding request aligns with your financial projections. You do not want to confuse readers by creating contradicting sections.

10. Appendix

The appendix is the final section of your business plan. View it as the final touch of professionalism and transparency on a complete report. The appendix should be used to provide raw data from research, legal documents, and supporting information. The reader should be able to gain a complete understanding of your business without ever referencing the appendix.