Business planning – all you need to know, from concept to execution

Rarely is business success achieved by chance – it’s usually a product of careful planning and organisation; a strategic approach to reach an agreed direction and set of objectives. A clear and concise business plan comprises all of the above. It helps you define your vision, reach your goals and – importantly – communicate your aims and business strengths to other stakeholders, like investors. Essentially, it’s a tool that will help you to tackle the numerous challenges you’ll face when running your business. The following article on business plan development is especially designed for small businesses and SMEs. No matter the stage of business you’re at, our guide is as useful for established enterprises as it is for startups.

Step 1: Drafting your business plan

It can feel like a daunting task, starting your business plan development, but breaking it down into a number of stages can make it feel less intimidating. Before you start putting pen to paper, be sure to research and analyse your market, customers, and understand what your competitors are doing in the same space. Armed with that knowledge, you can get started, and there’s a tried and tested template that can help to get you started:

1. Executive summary: This is a summary of what your business is and does. You should outline key services or products and introduce key team members. But keep in mind it should be reasonably brief.
2. The business vision: Provide more detail about what the business does, what its goals are, and any growth ambitions. Outline your USPs, and then provide a SWOT analysis (outline the strengths, weaknesses, opportunities and threats) for your business. You also might want to highlight any legal requirements or obligations in this section.
3. Marketing: Show that you’ve researched the market and industry by summarising your findings. Use statistics and evidence to back up any statements you make about market size and the opportunity. This is also the place to include any competitor analysis you’ve completed. You then also want to explain more about how you make sales, how you will market your product, and pricing.
4. Running the business: This is yet another level of detail about your business, focused around the day-to-day operation. Here you might want to talk about the expertise in your wider team, any premises you have, suppliers, equipment and ways of working so that the reader has a holistic idea of how your business is run. This is also the place to convey how you manage operational risks as well as any fair work and sustainability credentials you have.
5. Financial Appendices: This is where you put the financial information that backs up everything you’ve said in the previous sections. You should include sales projections, cashflow, profit and loss, your balance sheet, and any finance you’ve sourced or are looking to source, if appropriate.

Step 2: Financial forecasting

Every effective business plan should be partnered with a series of in depth and conscientious financial forecasts – a summary of which you have to include in the business plan itself.

Financial forecasting plays a critical role in strategic business planning, providing a forward-looking assessment of a business’s financial future to support decision-making and strategic direction. By projecting revenues, expenses, and cash flow, financial forecasting allows businesses to anticipate financial needs, identify potential challenges, and seize opportunities. It helps in budgeting, resource allocation, and setting realistic goals based on anticipated financial outcomes.

Forecasting also supports risk management by allowing businesses to prepare for various scenarios, such as economic downturns or shifts in consumer demand. By exploring best-case, worst-case, and most likely financial outcomes, businesses can create contingency plans that reduce financial uncertainty. For businesses seeking funding, a solid financial forecast demonstrates to investors or lenders that the company has a clear plan for achieving profitability, making it easier to secure external financing.

Step 3: Implementing the plan

With your business plan drafted and financial forecasts completed, it’s time to put the plan into practice. Begin by assigning roles and responsibilities, making sure every team member knows which part they’re responsible for, and similarly, make sure each part of the plan sits within someone’s remit. Monitor progress against outlined goals and measure performance to be sure delivery is as efficient as it can be.

A good approach to this, is to set milestones. By doing this, you create actionable steps from broader goals and provide a roadmap to achieving your aims. Break down each goal into manageable phases, allocate resources and prioritise tasks – there are lots of different programmes and tools available to help you do this. You can then evaluate progress in a manageable and accurate way, knowing that you have a tangible way to reach the ‘big picture’ objectives set out in your business plan.  

Step 4: Review and refine

Your Business Plan shouldn’t be a static entity you revisit once or twice a year, instead it should be a living, breathing document. Something that helps you to continually improve, whilst staying on track strategically.

Schedule regular reviews and use the information gathered at these reviews to review and refine the overarching plan. Markets, customer preferences, economic conditions, and the competitive landscape you operate in are always shifting, and your Business Plan should also evolve in response to these changes.

Outline a number of Key Performance Indicators (KPIs) that help you to measure progress and assess against these at each review. Involve other members of your team, those with allocated responsibilities and bring them on the journey – this will help you to create a workplace culture that is focused on continuous improvement.

Top tips for effective business plan development and implementation

1. Carry out in-depth research to inform your business plan
2. Use the tried and tested format to draft your plan
3. Carry out accompanying financial forecasting
4. Set clear and achievable milestones (with accompanying KPIs)
5. Assign clear roles and responsibilities
6. Regularly review and adapt your plan in line with business reality
7. Create a workplace culture of continuous improvement
8. Empower your team

By following these key points, you’ll not only draft an impressive business plan, but create a roadmap for your business and its journey to growth. If you’d like to find out more about developing a business plan, or expert guidance on how to refine an existing plan to work better for your business, get in touch with our team at operations@cjmlumina.co.uk or give us a call.