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Last updated 10th February 2021

Why BusinessPlan.co.uk?

We aim to help business owners move from here to there on their business journey by seeing business differently and, therefore, doing business differently. We'll do this by creating wonderful content that will mobilise you. By visiting BusinessPlan.co.uk you'll see behind the scenes business video tours with successful entrepreneurs going inside their businesses, a qualified and vetted experts' section with supporting articles and videos along with the opportunity to take part in online discussions. It's aimed at individuals who have been in business at least 2-years and experienced growing pains, owner-managed businesses, SMEs and any project managers or leaders, who are creating / delivering project plans. We want you to visit BusinessPlan.co.uk and watch our personally shot and edited videos and have that trigger thoughts of, "How can I apply this to MY business?"

What is a business plan?

A business plan can simply be defined as a document setting out the business journey, it’s future objectives and strategies for achieving them.

A business plan is a formal written document containing business goals, the methods on how these goals can be attained, and the time frame within which these goals need to be achieved. It also describes the nature of the business, background information on the organisation, the organisation's financial projections, and the strategies it intends to implement to achieve the stated targets. In its entirety, this document serves as a road map that provides direction to the business

Creating a business plan for your company will guide you in defining your unique selling proposition (USP) and give you clarity of the marketplace you wish to operate in and understand the competition your business will be up against.

You will use your business plan to work towards a series of milestones that will help you to grow your company, monitor and measure your movement from ‘here to there’.

Your business plan shouldn’t be a static document. You should update it regularly as your company evolves, so you can ensure things are moving in the right direction. As you grow, you plan will morph.

Why you need a business plan

According to a government website, a business plan is a written document that describes your business. It covers objectives, strategies, sales, marketing and financial forecasts. Therefore a business plan helps you to:

Clarify your business idea
Understand the market
Spot potential problems
Set out your goals
Plot the journey
Measure your progress

Whether you’re starting a business or planning to expand, having a business plan can help to get you on track and get some detail behind your ideas.

You’ll need a business plan if you want to secure investment or a loan from a bank. It can also help to convince customers, suppliers and potential employees to support you.

However, research from Barclays shows that one in four businesses don’t have a business plan. Developing a business plan is a vital tool for any business so it might come as a shock to hear that whopping 1 in 4 SMEs in the UK don’t bother to use a business plan, leaving them in danger of losing direction and having no plan or strategy at all to get their business to the next stage of growth.
Less than half (47%) of the UK’s small businesses have a formal business plan in place that is written down or recorded, while the remaining 25% have an informal, verbal plan. Furthermore, only one in two (49%) UK small businesses have a succession plan in place.

Rebecca McNeil, MD for Business Lending and Enterprise at Barclays, commented, “Having a business plan is fundamental for a small business. It defines exactly what you want to achieve, how you plan to achieve it across a set time period, and is a sure fire way to ensure that growth targets and plans are being met. Business plans are dynamic documents – meaning they should be revisited and adjusted as the business develops. In addition, a strong plan can help applications for finance from a business loan to alternative forms of finance and investment.”

She continued; “Importantly, when a business is in trouble, having a solid plan can help to steer it back to good health. A lack of succession plan can put the future success of a business at risk, so this needs to be considered far earlier and more formally than the results show. What’s important is that small businesses feel confident about their future and have the necessary tools in place for growth.”

Barclays are not the only bank, and these are not the only statistics

What types of business plan are there?

There are whole raft of business plan variations and some are simply subsets of the overall plan. When deciding what type of plan you need and the depth of information you require, you need to know what you want the plan to do for you.

Types of business plans include, but are not limited to:

Start-Up Business Plans.
Internal Business Plans.
Financial Plans.
Strategic Business Plans.
Feasibility Business Plans.
Operations Business Plans.
Growth Business Plans.
Project Plans.
90-day Plans.

Business plans can be divided roughly into four distinct types. There are very short plans, or miniplans, presentation plans, working plans, and what-if plans. They each require very different amounts of investment and resources to create, and the effort you expend is not always proportional to the value it adds. I have seen fantastically crafted business plans that were works of art (or fantasy) almost unusable. 

Equally I have seen short, well understood plans that delivered significant value. Success depends on various factors and whether the right plan is used in the right setting. For example, a new hire may not want to read the same, elaborate version of your plan that might be important to a potential investor.

Have you ever heard the saying 'Those who fail to plan, plan to fail'? While I can't speak to all facets of life, this is certainly true in business. Managers find themselves planning for all sorts of things. So much so, that planning is one of the four major functions of management. In doing so, a manager can be certain that he or she is working toward some organisation goal.

There are three main types of plans that a manager will use in pursuit of company goals, which include: operational, tactical and strategic. If you think about these three types of plans as stepping stones, you can see how their relationship to one another enables the achievement of organisational goals.

Operational plans are necessary to attain tactical plans and tactical plans lead to the achievement of strategic plans. Then, in true planning fashion, there are also plans to backup plans that fail. These are known as contingency plans.
Benefits of writing a business plan

The act of writing a plan is as important – if not more so – than the plan itself. That’s why we don’t write plans for people. The action of writing the plan builds understanding, mental muscle, commitment and learning. Writing a plan gives you deeper insight into the opportunities and hurdles to might encounter.

Writing your own business plan increases ownership of that plan.

A business plan is often said to be like a flight plan. It lets you know where you want to go, what you want to achieve, what you have to do in order to achieve your goals and probably most importantly what problems you can expect along the way.
“Being able to identify potential threats, problem areas that could affect the business, and to be able to develop coping strategies in a proactive manner rather than in a reactive stance, is key to business survival,” noted one senior partner of an accountancy firm.
It’s also a great way to share information about your business, to develop your thinking and test scenarios before you make any changes (like leaving your job and going it alone- especially at this time), and it gives you a way to measure how things go when you do start up.

If you want finance, then a good plan can make all the difference. Rebecca McNeil, MD for Business Lending and Enterprise at Barclays, says: “A strong plan can help applications for finance from a business loan to alternative forms of finance and investment.” Just remember that many bank managers have never had a business, never written a plan or gone through the highs and lows of a business owner. Getting finance is only one benefit of writing a plan.

How long should a business plan be?

This is one of the most common questions asked by new entrepreneurs and business owners. The answer is simple, as it ‘depends.’
Most business experts and consultants suggest a business plan needs to be 30 to 50 pages, as a minimum, while others may say even less or more than this depending on their own personal perspective.

I have seen a beautiful business plan written by consultants for a local SME, which weighted 1.5 Kgs and was beautifully bound. When I asked how often they referred to it, they said ‘never’, but the Bank loved it. ( I expect the Bank never read it, and wouldn’t understand it anyway) .

I’m a fan of having a version that’s easy to read, easily understood, can be shared and lived. Consider having a Plan on a Page that everyone can access and connect with.

In short, you need a couple of plans, the over arching business plan, shorter concise plans for specific use like raising finance, briefing marketeers and exciting staff.

How long does it take to write a business plan?

How long should it take to write a business plan? When it comes to how long founders should devote to writing a plan, Greene and Hopp found that three months was the optimal time, increasing the chances of creating a viable venture by 12%. “Spending any longer than this was futile, mostly because the information used to inform the plan loses its currency,” they write.

What should a business plan include?

What should your business plan include? When creating a business plan, it should include:

An outline of your business, its aims and objectives and whatever products or services you provide – this is called an executive summary.
An overview of the market in which you operate.
Who is involved in your business.
Your short term and longer-term objectives.
Your resources and any need for external funding.
Your strategies for selling your product/service.
Your strategies for marketing your product/service.
Financial forecasts.

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