How to write a simple business plan

A business plan involves answering some key questions about your business:

• Your objectives – where do you want your business to go?
• Your tactics – how will it get there? 
• Your budget – what will it cost?

There’s no one set way to write a business plan. The trick is to keep it short and simple. 

A business plan gives you direction, challenges you to really think through your ideas, helps you prioritise scarce resources, and builds your credibility.

In fact, having a business plan can mean the difference between success and failure. Research published in the Harvard Business Review shows that start-up businesses with a written business plan were 16% more likely to succeed than those without one—.

Our business plan template makes it easier to write your business plan. It breaks your plan down into sections, with tips and examples at each stage. You can enter information as you go and save your plan to print out and update later.

Below we’ll explain the key information you should include in your business plan, using the structure in our template as a guide.

Think of this as your ‘elevator pitch’. Imagine you’re in an elevator with someone you want to invest in your business, and you only have until the elevator gets to their floor to convince them. You need to get straight to the point and describe what your business (or business idea) is about in no more than three or four short paragraphs.

People usually write this section last once they’ve thought through all the other aspects of their business plan.

Write down where your business is going and what you want to achieve. Your objectives should be realistic, otherwise you’ll lose motivation. 

They should also be SMART:

• Specific – if the goal is too general, you will lose focus
• Measurable – so you can tell whether you’re on track or need to make changes
• Achievable – large goals can seem daunting, so break them down into smaller steps
• Relevant – your objectives should directly contribute to your overall business goals
• Time framed – having a deadline provides urgency and focus.

Examples of SMART goals might include:

• Financial – to achieve turnover of $x and profits of $y by the end of the financial year.
• Strategic – to gain two corporate customers by the end of the year.
• Operational – to increase productivity by 20% by the end of the second year.
• Sales – to increase e-commerce sales by 10% by 1 June next year.

Once you’ve established your goals, identify who is responsible for achieving them.

Describe exactly what you’re offering, the key features of your products or services, and how they compare with what your competitors are offering. 

Pricing is key. Consider and explain how you’ll price your offering. This figure shouldn’t be plucked out of thin air – it should be based on solid research.

A SWOT analysis outlines your:

• Strengths
• Weaknesses
• Opportunities 
• Threats

This helps you compare your business against your competitors, build on your strengths and opportunities, and mitigate your weaknesses and threats.

When you’re doing your SWOT analysis think about both internal factors (such as staffing) and external factors (like market or demographic trends). Above all, be honest.

This is also a good time to think about your competitive advantage. Determine why customers should choose your business over competitors. Are you competing on price, service, aftersales support, unique knowledge and expertise, or a distinct brand proposition? It’s important to be aware of your competitive edge, as your customers will not know if you don’t know either.

Who are you targeting your products or services at? How old are they, where do they live, and what are their interests? Understanding your customer will help you shape your products and marketing in a way that is most likely to reach them and appeal to them.

Consider how you will promote your business and what you offer. Will this be through advertising, direct marketing, social media, PR campaigns, or a combination of these methods? Determine how they can buy from you, such as online, through distributors, or at your own retail outlet.

Set some sales targets and develop a strategy to achieve them. For example, decide if you’ll focus on selling to new customers, or increasing sales to existing customers. Determine if training your staff in new sales methods is required. 

Set a budget for achieving your sales plan and be clear about how you’ll measure success.

Determine what assets or equipment you will need to get your business up and running, and keep it operating. These one-time expenses are also known as capital costs, and include purchases of buildings, land, vehicles, machinery, and equipment.

Your financial forecasts are one of the most important parts of your business plan. They show how much money you need to make to cover your operating expenses and make a profit. They’re also critical if you’re approaching investors. 

At a minimum, your business plan should include a cash flow forecast and a balance sheet forecast. Your accountant or an ANZ Business Specialist can help you review your financial assumptions and help ensure they’re realistic.

Great people are key to the success of any business. How will you attract, train, retain, and reward the right people – and ensure you get the best from them?

No market stays the same – your business will face different challenges and opportunities over time. That’s why it’s essential that you regularly review and update your business plan. Annually is a good rule of thumb.