One most common question that strikes in the mind of almost all new entrepreneurs is, “how long should a business plan be”.
Some experts suggest business plans be detailed with just everything that you need to present your business idea, the revenue model, and the projections. On the other hand, some insist not to be too much stuff!
How long is a business plan?
Well, business plans today are way too different than that of what they looked like ten years ago, but today’s trend still follows those fundamentals, i.e. good projections and solid analysis and easy & quick to read. So, the crux is to keep the business plan simple, i.e. from wording and formatting to the stats and graphical presentations.
Writing a Simple Business Plan
Now, the problem happens when people confuse simple wording and formats with simple thinking and assume that a complex business model cannot have a short and simple business plan.
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Anything of 20 to 30 pages long with 10 pages for appendices is an ideal length of a business plan for a complex business model. The length may be trimmed for simple business ideas.
Writing a simple business plan for a simple business model is easy, but entrepreneurs with complex business ideas find it difficult to make it happen. This article will help you to make your complex business idea comprehensible to a layman.
Quick Guidelines to Keep the Business Plan Simple:
- Avoid long complicated sentences.
- Avoid buzzwords, jargon, and acronyms; you know that KISS stands for “keep it simple, stupid,” but don’t assume anybody else does.
- Avoid verbose text.
- Keep the text style the same throughout the business plan.
- Avoid text size lesser than 11 and greater than 13 for paragraphs and note more than 18 for headings.
- Use page breaks to separate sections and to separate charts from text and to highlight tables.
- Be creative with explanations and use imagery, charts, diagrams, and more visuals that can explain the plan in less time.
The graphical business plans are more effective than any other type, however, they require more effort and development time. Hiring an experienced business plan writer is the best idea, however, if you want to do it yourself, you may need the help of a designer or graphic tools to develop a solid business plan for your startup.
Here are some more tips to utilize the graphics more effectively.
- Make your important numbers easy to find with summary tables and simple business charts. And provide related details easy to find in the appendices.
- Bar charts can serve best for yearly data, i.e. sales, profits, cash flow and net worth etc.
- Pie charts work great for presenting market share and analysis of segments.
- Action plans and milestones should be presented horizontally with labels on the left and dates along the top or bottom.
- Don’t use a graphic without referencing it in the text.
And finally, always proofread your text to make sure that everything is in order!
Overview of the Key Sections:
So, now that you know exactly how long your business plan should be, let’s review what you need to include. If your business plan is the right length, but it’s missing important information, this article will have been for nothing! Here are the general sections of your business plan and what they entail:
1. Executive Summary
So, this is technically the last step of the business plan. However, you’ll put it at the front so that the reader can gain some extra context before jumping in. This section summarizes the following sections, and should typically be about 2 pages maximum.
2. A Description of the Company
Here’s where you get into the details of what your company does. What are the vision and mission statements? What problem is your business going to solve? You should keep this part lean and without fluff, approximately 3 pages.
3. Products & Offerings
This section is the descriptor of what your company has to offer. In the previous section, you detailed what your product will solve, but now you have to show how you’ll do that, and how you’ll make money with your products. This section length will depend on how many products you have but shouldn’t take up more than 15% of the report.
4. Competitive Market Analysis
This section will be one of the longer ones, about 4-5 pages. You’ll really need to emphasize why your company will survive amidst its competition. Detail your competitors and analyze them closely and realistically in this section. Find what your competitive advantage is in the process.
5. Business Strategy Report
Now that you’ve found your competitive edge, detail it in this section. Another long one, this one shouldn’t exceed 6 pages. However, this is one of the most important sections, second only to the financial plan. Investors want to see that you know where you’re going in the long run and how you’ll get there.
6. Team Overview
Here, you will describe the management team and provide an overview of your employees. The organization structure should also be present in this section, as it lets potential investors predict your success more easily. This section will also depend on your company’s size, but again, shouldn’t take up more than 15% of the total length.
7. Financial Plan & Targets
Here is the section that investors need to see in order to make their final decision—the financials. Without this section, there would be no investment potential. Make realistic capital requirements, analyze overhead costs, and make humble but firm projections. Don’t give any half-truths or misinformation here; it will come back to haunt you. Make sure you know your stuff and that this section receives special attention. In all, this section should be one of the longer ones.
The Bottom Line:
Whether you are a first time entrepreneur or someone who has already launched a few ventures, having an authentic business coach on board can help you develop a solid business plan. A business coach can help you get a deep understanding of the business, pinpoint areas to improve and thus you get the confidence to be bold and take the right business decisions. With the help of a solid coaching program like Titaniums success, you can develop a success-oriented business plan, generate hard, measurable results, get the faster execution of strategies done, and build a better business in less time.