You know you need a business plan if you want funding. And you know you should have and follow a plan to grow your business. But oftentimes creating a business plan takes too long.
Below are some tips to help you complete a great business plan faster:
1. Start at the End.
Before you write a single word of your business plan, think about where you’d like your business to be in 5 or more years. Think about how many employees you have, what your revenues will be, etc.
Then work backwards. Specifically, identify what you must accomplish this year to put your company on the trajectory to accomplish your long-term goals. Then break it down further. What must you accomplish this quarter and this month? Document these milestones in the Operations section of your plan.
2. Identify Why Your Business is Unique.
The best business plans start with two things. First is a concise explanation of your business so the reader can better visualize the opportunity. Second is an explanation of why your business is uniquely qualified to succeed.
For example, do you have unique intellectual property? Do you or your management team have special skills? Have you forged long-term agreements with partners or customers? Do you have a unique location that enables you to better serve customers?
Importantly, it’s hard to build a successful business when there’s nothing unique about your company, since at the first sign of your success, others will copy you. So, you should always be thinking about additional ways to make yourself unique. And once you identify these ways, add them as future milestones in your business plan.
3. Use a Business Plan Template.
There’s no need to re-invent the wheel with your business plan. Rather you should just focus on answering just the questions you know must be in the plan. Such as describing your unique qualifications, your marketing strategy, who’s on your management team, your future milestones, and describing your key products or services.
Don’t copy another business plan (since then you can’t show how and why your company is unique), but copy the format and the questions answered. This will save you time and optimize your results.
4. Create Realistic Financial Projections.
Nothing makes an investor or lender cringe more than seeing an interesting business with unrealistic financials. An extreme example is a company that expects to grow from $0 to $100 million in a year. This simply never happens.
But there are also less extreme examples that are equally unrealistic. Such as, can you really triple your sales while not adding employees?
Creating a realistic financial model requires research and introspection. You need to think through what assets and expenses your business must have and incur to grow, as well as what price points the market will accept.
Fortunately, there are often public companies in your industry whose financials are readily available. While you will have very different sales and expenses than them, their ratios (for example, their Cost of Goods Sold percentage) can serve as a good guide.
5. Budget the Appropriate Time to Develop Your Business Plan.
Budgeting time, in many cases, is challenging since there are so many other tasks you need to complete in your business. But it must be done.
Assuming your plan will take 40 hours to complete, I suggest scheduling twenty 2-hour blocks. If you schedule one per day, within 3 weeks your plan will be completed. Importantly, I have found 2-hour blocks to be an optimal time as any shorter periods require too much time to figure out where you last left off.
Follow these tips to save time and create a business plan that will help your company grow.
Dave Lavinsky is a serial entrepreneur and the president and founder of Growthink. Dave and his company have written business plans for over 4,000 entrepreneurs, and his business plan template has been downloaded and used by over 100,000 others. Dave is also the founder of BusinessPlanTemplate.com which provides templates for specific niches ranging from restaurants to internet businesses.