Write a Business Plan: 10 Steps for a Bank-Ready Plan
Writing a business plan is a crucial step for entrepreneurs who want to start a new business or expand an existing one. When you write a business plan, you create a roadmap that explains your goals, your strategy, and how you will achieve them—without guessing. You also build a document lenders and investors can actually trust.
A lot of "plans" fail because they sound nice but prove nothing. This guide fixes that. It includes every essential section, plus the missing components that many templates skip: employees, business operations, market tests, lead time, sales activities, promotions, financial strategies, and budgetary plans.
🧭 What “write a business plan” really means
A business plan is not a motivational poster. It's a working tool you can use to make decisions and win support.
When you write a business plan, you're doing three things at once:
- Explaining the business (what you sell, who you serve, why you exist)
- Proving the business (market demand, competition reality, financial logic)
- Running the business (operations, staffing, sales actions, budgets)
If you plan to seek financing, you'll usually need a "traditional" plan with standard sections like executive summary, market analysis, marketing and sales, funding request, financial projections, and an appendix. (sba.gov)
🧾 Step 1: Executive Summary when you write a business plan
Purpose: Give a brief, high-level overview of your business, including your business idea, key objectives, and how you plan to achieve them.
What to include (no fluff):
- Business name + location
- Mission statement (why you exist)
- Products/services offered (what you sell)
- Key objectives (what you must accomplish in the next 12–24 months)
- Leadership team (who runs it)
- Employees (current headcount + planned hires)
- Business operations (how the business runs day-to-day, in one paragraph)
- Summary of financial projections (high-level: revenue, profit, cash needs)
- Funding requirements (if applicable)
Pro tip that actually matters: write this section last. The executive summary comes first, but it's easier when the rest is finished. (gov.bc.ca)
Quick reality check: if your executive summary can't explain the business in 1–2 pages, the business is too complicated (or you're hiding weak parts).
🏢 Step 2: Company Description
Purpose: Provide detailed information about your business, the problems it solves, and why it is unique.
Core components to cover:
- Business history (how it started, and why)
- Nature of the business (what kind of company is it: retail, service, SaaS, trades, manufacturing)
- Target market (who you serve)
- Problem(s) you solve (pain points in plain language)
- Unique Selling Proposition (USP) (why customers choose you)
Keep it simple. A strong company description reads like: "We help this group solve this problem using this approach, and we're different because this."
Also call out your legal structure (sole proprietorship, partnership, corporation, etc.). Government resources can help you confirm ownership options and planning basics. (Canada)
🔎 Step 3: Market Analysis when you write a business plan
Purpose: Show your knowledge of the industry, market trends, target market segments, and competitor analysis.
Include these items (yes, all of them):
- Industry description and outlook (what's happening in the industry and why)
- Target market demographics and needs (who they are and what they care about)
- Target market segments (personas or buyer groups)
- Market trends (what is changing—pricing, tech, regulation, behavior)
- Market test results (proof people want this)
- Lead time (time to deliver or fulfill: suppliers, production, shipping, sales cycle)
- Evaluation of your competition (direct + indirect)
🧍 Build customer personas (fast, but useful)
A persona is not "women, 25–45." That's lazy. Your persona should answer:
- What triggers the purchase?
- What stops the purchase?
- Where do they look for options?
- What does "success" look like after they buy?
When you write a business plan, your market analysis should show you understand buyers better than your competitors do.
🥊 Evaluate your competition without ego
List competitors and compare them on what buyers actually choose:
- Price range
- Speed / lead time
- Quality / warranties
- Reviews / reputation
- Location / coverage
- Brand trust
- Convenience (ordering, delivery, support)
If you claim "no competitors," lenders will assume you didn't research. Or worse, you don't understand the market.
🧩 Step 4: Organization and Management
Purpose: Describe your company's organizational structure, ownership details, and profiles of your management team.
Must-have components:
- Organizational structure diagram (or a clear written structure)
- Ownership information (who owns what percentage)
- Management team profiles (what they do, and why they're qualified)
- Advisory board members and roles (if applicable)
Don't write biographies like a dating profile. Tie people to outcomes:
- "Managed inventory" → "reduced stockouts and shrink"
- "Led sales team" → "hit quota for 8 straight quarters"
🧾 Simple org chart rule
If a role is critical to operations or revenue, it belongs on the org chart. If it's "nice to have," keep it as a future hire.
🛍️ Step 5: Services or Products Line
Purpose: Outline your products or services, their life cycle, benefits to customers, and your progress on development.
Include:
- Detailed description of products/services (features, scope, options)
- Benefits (value to the customer, not just features)
- Lifecycle (launch, growth, mature, seasonal, replacement cycle)
- Development stage / progress (what's built now, what's next)
- Research and development activities (what you're improving and why)
The SBA specifically calls out describing the product/service, customer benefit, lifecycle, and any IP and R&D plans. (sba.gov)
🧪 If you have intellectual property
List what you have (trademarks, patents, copyrighted materials) and what you plan to protect.
📣 Step 6: Marketing and Sales Strategy when you write a business plan
Purpose: Describe how you plan to attract and retain customers.
Required components:
- Marketing strategy
- Sales plan
- Sales activities
- Pricing plan
- Advertising
- Promotions
- Distribution methods / channels
📣 Marketing strategy (how people find you)
Pick channels you can actually execute:
- SEO + content (slow start, strong long-term)
- Paid ads (fast, but can burn cash)
- Social media (works if you can stand out consistently)
- Partnerships (high trust, slower build)
- Local marketing (events, referrals, community groups)
Your job is not to be everywhere. Your job is to win where your customers already pay attention.
🤝 Sales plan and sales activities (how you close)
Write down your sales process step-by-step:
- Lead comes in (from where?)
- Response time target (how fast?)
- Qualification questions (do they fit?)
- Offer + pricing (what do you propose?)
- Follow-ups (how many, how often?)
- Close and onboarding
- Retention and upsell
Then list actual sales activities, such as:
- Cold outreach (email/phone/DM) targets per week
- Discovery calls per week
- Demos or estimates per week
- Follow-up sequences
- Referral asks
- Review requests after delivery
If you want lenders to trust your revenue forecast, show them the actions that produce sales.
🏷️ Pricing plan, advertising, promotions, distribution
Spell this out clearly:
- Pricing model: hourly, project-based, subscription, bundles, tiers
- Advertising: what platforms, monthly spend, and expected lead cost range
- Promotions: launch offer, seasonal promo, referral program, limited bundles
- Distribution: online store, retail, wholesale, direct sales, delivery partners
Promotions are not "discounts forever." They should have a purpose (trial, awareness, repeat purchase).
⚙️ Business Operations and Employees
Even if you don't label this as a separate "operations plan," your plan must explain how the business runs. Your executive summary also needs basic business operations and employee information.
Include:
- Day-to-day operations: how you deliver the service or fulfill orders
- Facilities and equipment: what you require to operate
- Suppliers and lead time: how long inputs take to arrive
- Inventory approach: made-to-order vs stocked items, reorder triggers
- Technology: POS, CRM, accounting, scheduling, support tools
- Employees: roles, headcount, hiring timeline, training plan
If you're in a service business, define the "production process" as delivery steps:
- intake → quote → work → QA → handoff → support
When you write a business plan, operations is where you prove you can execute, not just dream.
💰 Step 7: Funding Request
Purpose: If you are seeking funding, specify your requirements.
Include:
- Current funding requirements (how much you need now)
- Future funding requirements (next five years)
- Use of funds (where it goes and why)
- Financial strategies (how you will stay healthy and grow financially)
💡 Strong “use of funds” looks like this
Instead of "marketing," write:
- "$12,000 for lead generation testing across X and Y channels"
- "$8,000 for essential equipment that increases capacity by Z%"
- "$15,000 working capital to cover inventory lead time and payroll gap"
🧠 Financial strategies (the part most people forget)
Examples of real financial strategies you can include:
- Keep a 3–6 month cash buffer once stable
- Use a line of credit only for short gaps, not long-term losses
- Reinvest a fixed percentage of profits into growth
- Reduce risk by diversifying suppliers and channels
- Tighten terms: deposits, milestone billing, or faster payment methods
📊 Step 8: Financial Projections when you write a business plan
Purpose: Provide financial forecasts that show lenders and investors the company's profitability.
Include (3–5 years):
- Income statements
- Cash flow statements
- Balance sheets
- Budgetary plans (monthly/quarterly budgets and spending controls)
A cash flow statement shows how cash moves in and out of the business and typically breaks cash activity into operating, investing, and financing categories. (SEC)
🧾 Key assumptions (don’t hide the math)
Your projections need a "key assumptions" section. Put it in writing:
- Average sale price
- Sales volume by month
- Refund rate (if relevant)
- Ad spend and estimated cost per lead
- Conversion rate (lead → customer)
- Payroll timeline
- Supplier cost changes
- Lead time impact (cash tied up in inventory or work-in-progress)
🧮 Budgetary Plans and Break-even
Budgetary plans are your "guardrails." They stop you from spending like a lottery winner.
🧮 Build a simple operating budget
Set targets for:
- Marketing spend
- Payroll
- Software/tools
- Rent/utilities
- Inventory or supplies
- Insurance and professional fees
Then decide:
- What is fixed?
- What can shrink in a bad month?
- What must grow to hit targets?
⚖️ Break-even analysis (when you stop losing money)
Break-even is when revenue equals costs—no profit and no loss. (sba.gov)
To calculate break-even, you need:
- Fixed costs per month
- Variable cost per unit/job
- Contribution margin
If you can't explain your break-even point, your plan is not lender-ready.
📎 Step 9: Appendix
Purpose: An optional section to provide supporting documents.
Include:
- Resumes
- Permits and licenses
- Lease agreements
- Legal documentation
- Product photos or service screenshots
- Market research notes
- Vendor quotes
- Insurance documents
- Any other proof that supports your claims
Keep it organized. Label everything. Make it easy to verify.
🧱 Business Plan Template (Adaptable, Not Robotic)
Use this template as a structure. Customize it to match your industry and audience.
[Your Business Name]
[Your Business Logo]
Date:
Executive Summary
- Business Name:
- Location:
- Products/Services Offered:
- Mission Statement:
- Vision Statement:
- Key Objectives:
- Leadership Team:
- Employees: (current + planned)
- Business Operations: (how the business runs day-to-day)
- Summary of Financial Projections:
- Funding Requirements:
Company Description
- Business Background:
- Nature of Your Business:
- Business Goals: (short-term + long-term)
- Target Market:
- Problem Solved:
- Unique Selling Proposition:
Market Analysis
- Industry Overview:
- Industry Outlook:
- Target Market Demographics and Needs:
- Target Market Segments:
- Market Test Results:
- Lead Time: (supply chain + delivery + sales cycle)
- Competitive Analysis: (competitors, strategies, strengths, weaknesses)
- Market Trends:
Organization and Management
- Organizational Structure: (diagram or description)
- Ownership Information:
- Management Team:
- Advisory Board: (names + roles, if applicable)
Services or Products Line
- Products/Services:
- Development Stage / Progress:
- Benefits:
- Lifecycle:
- Research and Development:
- Production Process: (if applicable)
Marketing and Sales Strategy
- Marketing Strategy:
- Sales Strategy:
- Sales Plan:
- Sales Activities:
- Pricing Plan:
- Advertising:
- Promotional Plan:
- Distribution Channels / Methods:
Funding Request
- Current Funding Requirements:
- Future Funding Requirements (5 Years):
- Intended Use of Funds:
- Financial Strategies:
Financial Projections
- Income Statements (3–5 years):
- Cash Flow Statements (3–5 years):
- Balance Sheets (3–5 years):
- Budgetary Plans:
- Break-even Analysis:
Appendix
- Supporting Documents:
🚧 Common mistakes that weaken a business plan
If you want to write a business plan that gets taken seriously, avoid these:
- Vague target market ("everyone" is not a strategy)
- No market tests (you need proof, not hope)
- Ignoring lead time (cash gets trapped in delays)
- Missing sales activities (strategy without actions is fantasy)
- Skipping budgetary plans (no guardrails = overspending)
- Wild projections with no assumptions (lenders see right through it)
Here is a specific example of a Key Assumptions section.
This section is vital because numbers in a spreadsheet are just guesses until you explain the logic behind them. Investors and lenders check this section to see if you are being realistic or overly optimistic.
I have created an example for a fictional business called "MiltonMarketing Subscription Box" (an e-commerce business), as this model highlights unit economics clearly.
Section: Financial Assumptions
Business Name: GreenLeaf Eco-Box Forecast Period: Years 1–3
1. General & Macro-Economic Assumptions
These assumptions cover the broader economic environment in which we operate.
-
Corporate Tax Rate: Calculated at 21% (Federal + State/Provincial).
-
Inflation Rate: Operating expenses are projected to increase by 3% annually to account for inflation.
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Cash Flow: We assume all sales are credit card transactions settled within 2 days; we assume Accounts Payable (payments to suppliers) are on Net-30 terms.
2. Revenue Assumptions
Our revenue projections are based on the "Active Subscriber" count multiplied by the average order value.
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Customer Acquisition Cost (CAC): We assume a CAC of $25.00 per customer based on initial Facebook Ad testing conducted in Q4.
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Churn Rate (Cancellations): We have modeled a 5% monthly churn rate, which is standard for the lifestyle subscription box industry.
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Average Order Value (AOV): $45.00 per box. We assume no price increase in Year 1, with a 5% price increase modeled in Year 2.
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Growth Rate:
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Months 1–6: Conservative growth of 10% month-over-month as we optimize marketing.
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Months 7–12: Accelerated growth of 15% month-over-month due to influencer partnership launches.
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3. Expense (COGS & OpEx) Assumptions
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Cost of Goods Sold (COGS):
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Product Cost: 35% of the sales price ($15.75 per box).
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Shipping & Fulfillment: Flat rate of $6.00 per unit (negotiated contract with carrier).
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Total COGS: Estimated at roughly 48% of total revenue.
-
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Labor Costs:
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Founder salary deferred until Month 6.
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One part-time customer support agent hired in Month 4 at $20/hr.
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Salary increases modeled at 4% annually.
-
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Marketing Budget: Fixed at 20% of projected gross revenue to sustain growth.
4. Capital Expenditures (CapEx)
-
Initial Setup: $15,000 upfront for website development and initial inventory deposits.
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Warehousing: We assume no warehousing costs for Year 1 (utilizing garage/home office) until subscriber count exceeds 500 units, at which point we have budgeted $2,000/month for a 3PL (Third Party Logistics) provider starting in Year 2.
Why this example works:
-
It shows the "Unit Economics": You didn't just say "we will make $100k." You explained how (Cost of customer acquisition vs. Lifetime value).
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It admits "Weaknesses": By listing a Churn Rate (customers quitting), you show investors you are realistic about losing customers, which makes the rest of your numbers more trustworthy.
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It connects to the Timeline: Mentions like "Founder salary deferred until Month 6" show you have a specific operational plan tied to your cash flow.
❓ Frequently Asked Questions
❓ Do I really need to write a business plan if I'm not seeking funding?
Yes. It helps you set priorities, test assumptions, and track progress.
❓ How long should it take to write a business plan?
Most people need several focused sessions. Research and financials take the longest.
❓ What's the best length for an executive summary?
Usually 1–2 pages. It should stay short and sharp. (gov.bc.ca)
❓ What are "market test results" in a business plan?
They are proof of demand, like pre-orders, pilots, waitlists, or paid trials.
❓ What does lead time mean in a business plan?
It's the time to get inputs and deliver outputs—supplier delays, production time, shipping time, and even sales cycle time.
❓ How do I describe employees in my executive summary?
State current roles, headcount, and planned hires tied to growth milestones.
❓ What should I include in competitive analysis?
Competitors, their pricing, strengths/weaknesses, and where you win.
❓ What's the difference between marketing strategy and sales activities?
Marketing attracts attention. Sales activities convert it into revenue.
❓ Do I need advertising and promotions listed separately?
Yes. Advertising is paid exposure. Promotions are offers that push action.
❓ What financial statements should my plan include?
Income statement, cash flow statement, and balance sheet. (sba.gov)
❓ Why do lenders care so much about cash flow?
Because cash timing decides whether you can pay bills, even if you show "profit" on paper. (SEC)
❓ What are budgetary plans in financial projections?
Simple budgets that set spending limits by category and month.
❓ What is break-even analysis?
It shows when revenue covers costs and the business stops losing money. (sba.gov)
❓ What does a funding request section need to include?
How much you need now, future needs, use of funds, and financial strategies.
❓ How often should I update my business plan?
Treat it like a living document. Update it when pricing, costs, or strategy changes. (gov.bc.ca)
🚀 Conclusion
If you want to write a business plan that actually works, focus on proof and execution. Show your market tests. Explain lead time. List sales activities. Build budgetary plans. Then make your projections match reality instead of wishful thinking.
If you want help tightening the strategy, cleaning up the structure, or turning rough notes into a lender-ready plan, use Helpdesk Support or reach out via Contact. If stress is piling up while you build, bookmark Health too.
Sources & References
- SBA: Write your business plan (sba.gov)
- Government of Canada: Planning a business (Canada)
- SEC: What is a statement of cash flows? (SEC)
- Government of BC: Write a business plan (gov.bc.ca)
