Business Planning

Your business plan is a living document. Think of it as a map for starting and running a successful business.

Start your business plan as soon as you decide to go into business. Do not expect to complete it entirely until much later on.

Below is a guide to help you create your own business plan.

 

How Long Should a Business Plan Be?

In general the document is 20 to 30 pages long

  • Add a cover that contains your business name, your name, contact information, and date
  • Make it long enough to provide a solid overview of everything you intend to do, why you want to do it, how you are going to do it, and what you expect the outcome to be.

 

What Kind of Language Should I Use?

Use formal language in your business plan. For example:

  • Refer to both yourself and your business in the third person as “the owner” and “the business” (avoid the pronouns I and we in the plan)
  • Use subheadings in each section to help organize your thoughts and to make the plan easier for other people to understand
  • Ensure your business plan is free of spelling, grammatical, and punctuation mistakes

Have someone else review it before you begin to use it. Even the best writers need editors to look over their work.

 

Business Plan sections

 

Executive Summary

This section gives a brief overview of your whole plan. Even though it is the first section in a business plan, it is easiest to write it last. It summarizes your entire plan. This section should be no longer than one page.

 

Table of Contents

The table of contents is a separate page after the cover page and executive summary. It lists all
headings and subheadings and the page on which the reader can find each.

 

Project Costs and Funding

This section demonstrates specific dollar amounts on how much:

  • You expect to spend
  • Funding you have now
  • You think you will need in the future

 

Products or Services

  • Your products and services
  • What makes it special
  • Why people will buy from you
  • Whether you offer guarantees or warranties on your products or services
  • Patent and licensing information as well as any other intellectual property (IP) you may have

 

Market Share

The market share section states how many people will be interested in your product or service as well as details on your competition and how they will react to your business. It shows how many people might buy your product or service.

  • Your clients’ or customers’ needs
  • How you intend to catch clients’ attention (for example, through packaging, location, advertising, or a combination)
  • Your research into pricing
  • Your prices and profit margins

 

Operational Requirements

This is where you outline what assets you require to operate your business. Identify:

  • The type of space your business needs (for example, a storefront, or online)
  • Any special requirements such as extra electricity, air conditioning or drainage
  • The permits and licenses required to operate your business. For information on what licenses and permits you need, go to BizPal. You should attach copies of the required documents you have obtained in an appendix to your business plan.

 

Management

In this section, provide information on owners and managers:

  • Detail the company structure, such as whether it is a sole proprietorship, partnership, or corporation (more on business structures page 47-50)
  • Explain who they are and how their education and experience makes them good candidates for their positions
  • For a larger business, show the proposed organization chart of the company, and include a brief job description of each position. For a smaller business with three employees or less, you do not usually need to prepare an organization chart.

 

Personnel

Include this section if you plan to hire employees. Indicate for each position:

  • The job descriptions
  • Whether the position is full-time or part-time, and seasonal or temporary
  • Skills and training needed
  • How you will pay employees (for example, hourly wage or commission)

 

Financial Projections

This section includes:

  • A 3-year cash flow (report detailing the total amount of money being transferred into and out of a business)
  • Balance sheet (a statement of the assets, liabilities, and capital of a business or other organization at a particular point in time)
  • Profit or loss statement (also known as an income statement, this is a financial statement that reports a company’s financial performance over a specific period)

These documents are standard in Canadian financial reporting.

 

Appendix

In this section, attach any supporting documentation for your business not included elsewhere in the document. For example, most organizations that give loans to businesses in Canada ask for a copy of your résumé, along with a “statement of personal net worth” with any loan application. A statement of personal net worth is a document, which lists the realistic value of the assets you own, and the debts you owe as an individual rather than related to a business. Find example templates online at no cost.

 

References

This section includes references from people like your accountant, consultant, insurance company, lawyer, and banker.