business plan product description

How to describe your product and service in a business plan like a pro

It’s deceiving.

You’d think that this part of a business plan does exactly what it says on the tin–describe your product & service offering– right ?

And yes, you are partially right. 

But there’s a very specific way in which this description should be written to make sure that your business has the best chance of succeeding – in real life and under the eagle eye of a potential backer (if you’re preparing a business plan for external financing purposes).

Keep reading to find out the secret sauce to writing a winning product and service description:

WHAT is the Product and Service Description in a Business Plan?

This business plan section is also known as:

• Product and/or Service Overview

HOW Do You Write a Product and Service Description in a Business Plan?

So, what should a good product/service overview contain?

Here are some items to consider including into this section:

1.     Portfolio:

The range of products and/or services that a business offers to potential and current customers.

2.     Features and benefits (value proposition):

Explain what the product/service does and how it works.

3.     Problem and solution (value proposition cont.):

The problem(s) the product or service solves. Every business needs to solve a problem that its customers face. Explain what the problem is and how the product or service solves it.

4.     Innovation:

If the company is doing something new and different, explain why the world needs the innovation.

5.     Proprietary advantages:

Any proprietary features that contribute to a competitive advantage. This could include: intellectual property (e.g., copyright, trademark, patent filings, trade secret), exclusive agreements with suppliers or vendors, exclusive licenses (e.g., for a product, service or technology), company’s own research and development activities.

6.     Development stage:

Current stage of development of the product / service (e.g., idea, development, testing, prototype, already on the market).

7.     Product life-cycle:

Estimate the life span of the product or service.

Specify whether the product or service under consideration is a short-lived fad or has a long-term potential.

8.     Future:

Mention plans for changes and new additions to the current portfolio of products / services.

Describe any plans to move into new markets in the future (e.g., serving different types or sizes of customers, industries, geographic areas).

Make your best guess at when the business will be ready to address these markets and what it needs to do first to be ready.

9.     Limitations:

If applicable, explain any risks or limitations associated with the product (e.g., liability issues like guarantees or returns), along with any legal advice received regarding these issues.

10.  Visual aids:

Use photos, images, diagrams and other graphics to help the reader visualize and learn about the products / services.

If the business is tackling several distinct problems through different products / services, describe the solutions individually .

However, for a large line of products / services, there is no need to list each one, just identifying the general categories will suffice.

How LONG Is the Product and Service Chapter of a Business Plan?

This part of a business plan can be very short, just a couple of paragraphs, or it can spread over multiple pages, depending on how many products/services you offer and how much explanation they require.

If your products or services are particularly complex , technical , innovative , or proprietary , you will want to provide more information and spend considerable time describing them.

This is especially true if you are seeking funding for a new product or service, particularly one that is not immediately understandable to the business plan readers, and if potential funders are likely to be motivated by the specifics.

In any case, when describing a product or service, provide just enough information to paint a clear picture of what it is and does . A brief explanation of what you will be making, selling or doing is appropriate here.

Excessive detail makes this section cumbersome for a reader to wade through. Reserve detailed descriptions (e.g., production processes) for the Appendix.

In any case, it is a good idea to first summarize the value proposition of each product or service into a one short sentence, and only then continue with a more detailed description of the product or service.

If any images or graphics are available that would contribute to the understanding of the product or service, the writers of a business plan should use them.

Otherwise, include any product or service details , such as technical specifications, drawings, photos, patent documents and other support information, in the Appendix section of the business plan document.

TOP 4 TIPS for Writing a Product and Service Overview

Tip #1: features v. benefits.

Don’t just list the features of the product / service.

Instead, describe the specific benefits it will offer to customers – from their perspective.

Make it clear what your customers will gain through buying your product or service. Include information about the specific benefits of your product or service – from your customers’ perspective.

Features are not the same thing as benefits. And you need to understand both.

Confused? Let’s clarify:

What Is the Difference Between Features and Benefits?

Tip #2: Problem v. Solution

If at all possible, present the information in the Problem >> Solution format.

Start by describing the key problem that your customers have, immediately followed by the solution with which you will address this need for your target market.

Tip #3: Competitive Advantage

You should also comment on your ability to meet consumers’ key problems or unmet needs in a way that brings your product or service advantages over the competition.

For example:

• If you have a common business, such as a restaurant:

Explain why your customers need your particular restaurant. Do you offer lower prices? More convenient hours? A better location? A different concept, such as a vegan ice-cream pop up store? A specialty that is not otherwise available in your area, such as a Peruvian ceviche or Hungarian goulash?

• If your company is doing something new and innovative :

What is it about the existing solutions that is subpar? Maybe you are improving on a mediocre product category, such as creating better medical uniforms for healthcare workers (e.g., more flattering cut, trendy designs, sustainable materials). Or perhaps your new blockchain solution has the potential to entirely eliminate the middle-men in an entire industry.

Although the subject of competitive advantage regarding the business as a whole will be fully explored in the Market and Competitor Analysis part of a business plan, it is advisable to touch on it here also – in the context of the company’s products and service.

Tip #4: Validating the Problem and Solution

Speaking of which, when you are doing market research and analysis for your business plan, remember to validate the problem and solution your product or service is addressing.

There is a plethora of minor issues out there that people are perfectly fine with just tolerating. To build a solid business, though, you need a problem that a sufficient number of people are motivated to solve. That is, that they recognize it as a problem that’s worth paying you to solve. Even if they didn’t realize it was solvable until they were presented with your solution.

So, how do you get evidence that prospects are willing to pay for your solution?

Validation of Problem

Describe what you’ve done so far to confirm that the problem you are focused on is a real problem for your customers.

• Existing Business:

For an established business, this is probably just a matter of recapping your success in the marketplace. Your customers have already voted with their wallets.

• New Business:

For a startup, it is important to survey and have conversations with as many potential customers as possible about where they are having problems, how they solve them today, and validate that they are interested enough in addressing those problems to pay for a good solution.

Validation of Solution

Describe how you have tested your ideas with existing or potential customers to confirm that there is a good market for the products or services you plan to offer. Summarize the positive customer feedback or market traction that you have achieved with your solution so far.

For an established business, the answers probably lie in your paying customer base – their existence itself, combined with their repeat business, word-of-mouth referrals, follow-up customer surveys, and other indicators of customer satisfaction.

For a new business, you can start validating your solution immediately by trying it out with potential customers, even informally or at no charge, to get their opinion. If your product or service does not exist yet, talk to prospects about what you plan to offer and measure their feedback.

In summary, this section should answer the million dollar question:

What makes you think that people will buy, be satisfied with, and recommend your products or services?

Related Questions

What are products and services.

Products and services are items that businesses offer for sale to a market. While services are intangible, meaning that they do not exist in a physical form, products are of tangible nature, in other words – you can touch them.

What is a Product Line?

Product line is a group of related products that are all produced or sold by one entity and typically marketed under one brand name.

What is a Service Line?

Service line is a group of related services that are all produced or sold by one entity and typically marketed under one brand name.

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How to Describe your Product in a Business Plan

The product or products your business intends to produce or offer will have to be described in the product description section of your business plan. This section of your business plan is meant to explain how your product will stand out from comparable items in the market.

You have to clearly explain its concept, coupled with all aspects of purchasing, manufacturing, packaging, and distribution. You should also identify your suppliers, costs, and how the product you are offering fits into the current market.

Note that the product description in your business plan is more than a simple listing of product features. In this section, you will need to highlight your product’s most unique characteristics that will ensure it stands out in the marketplace and attract buyers who won’t mind paying your price.

Note that a properly written product description in your business plan can entice investors and help your business grow. Make sure you describe what you are offering in layman’s terms, to guarantee that someone who isn’t conversant with your business will grasp and be excited about it.

It may also be necessary to provide some basic background if this is an area or industry that people are not so familiar with. While you write up the Products and Services description section of your business plan, always keep your reader in mind.

What to Include in the Products and Services Description Section of Your Business Plan

Just as was noted above, the products and services section of your business plan will have to explain in detail your product or service, its demand in your market, and how it intends to compete with other businesses selling the same or similar products or services. Nonetheless, the product and services description section of your business plan is expected to include:

The Product or Service Description

It is important the product description section of your business plan clearly explains the concept of your product, coupled with all aspects of purchasing, manufacturing, packaging, and distribution. What are your product and service, and how does it work? How will this product benefit your customers? How do you plan to make it or how do you intend to get it made?

Product Comparison

This section of your business plan will also have to explain how your product compares with similar products in the market. What makes this product or service unique or better than what’s already obtainable in the market? Why would anyone prefer your product or do business with you?

You will need to describe how and why you are competitive. How do you stand out, and why do your business and everything it offers have such a viable chance at succeeding? In talking about your product or service, always try to answer why a client would want it and how it can make their lives better or more profitable?

Accreditations/Intellectual Property

For businesses that have had their product tested by industry experts, you must include this information when describing your product. Don’t forget to highlight any certifications, trademarks, copyrights, or patents.

Have it in mind that these added advantages or achievements can give you and your product an upper hand. Verified patents and trademarks can also heighten the value of your product especially since it shows that only your company can manufacture the product for the life of the patent.

Have it in mind that a product’s life cycle includes the idea, prototype, and expansion stages. If you are still in the idea stage, you must buttress in your description how you intend to get the product made and why your product matters.

If you maybe already have a prototype, outline your plans for evaluating the prototype and manufacturing your product. If your business has been making the product but is looking to expand to keep up with demand, ensure you explain this when describing your product in your business plan.

You will also want to include the cost of your product and how that cost aligns with other comparable products on the market. In very concise detail, explain how you came to this price, including the cost to manufacture, selling price, and profit margin.

Sales and Distribution Strategy

Also, take your time to explain how and where you will sell your product. Have in mind that your options may include online stores, brick-and-mortar locations, and vendors. If you already have vendors selling your product, ensure to note who they are and their locations in this section of your business plan.

Fulfillment

When describing your product in your business plan, it is also important you describe your plan to ensure your product gets to the intended customers. This should include manufacturing details and delivery specifics. If you plan to outsource the production of your goods, don’t forget to note manufacturer specifics such as location and production time. Also, remember to include the approximate delivery times and methods.

Requirements

Will you require any special equipment or technology to provide your product or service? Also explain if any specialized technology, materials, or equipment will be required to manufacture your product.

You will also have to explain your plans for product development and introduction especially as your business grows.

Photos or Brochures

Also, make sure that your potential investors can get a good insight into your product through photos and brochures. Don’t forget that your business plan is expected to have an appendix for photos and brochures. Also, don’t forget to refer to them in the product description section.

Tips for Writing a Product Description

To ensure you describe your product thoroughly, here are some vital tips to guide you;

• Always remember the reader. The product description section of your business plan must note your product’s most vital information. Always remember to make this section very easy to read and understand. Consider making it better by leveraging numbered lists and bullets.
• Focus on benefits. When describing your product, you must explain how its features can provide value to consumers. Translate your features into benefits, and remember that the aim is to describe how your product or service will be a solution to a problem or improve a client or customer’s life.
• Highlight the features of your product or service. To attain substantial success in any business, your business will need the ability to set itself apart from other businesses that offer or sell the same products and services. Take your time to analyze key features, such as price point or level of service, or anything that makes your product unique in the market.
• Show off a little. Don’t forget that you are selling a product and also selling yourself as the most viable provider of that product. Ensure to include all vital educational or industry-specific experiences and awards in this section. If you have endorsements or testimonials specific to your product, include them as well.
• Show the need for your product. Also make sure you explain how your product will cater to a need or improve life, showing why your product is very necessary to the consumer. This is very pertinent if your product has no current market.

The product and services description section of your business plan is meant to provide the reader with an explicit understanding of why you are in business, what you sell, how you will compete with what’s already available, or how you intend to fill a niche that no one else is currently meeting. Noted above are things you need to consider when creating the product description section of your business plan to ensure that it will indeed grab your readers’ attention.

More on Business Plans

Expert business plan and financial models

Products & Services Section in a Business Plan (+ Examples)

• September 4, 2024
• Business Plan , How to Write

In this blog post, we’ll guide you through writing the products and services section of your business plan. We’ll cover how to describe what you’re selling and why it’s important in your business plan.

Whether you’re launching a new startup or creating a business plan for an existing business, this section is crucial for showing the value you bring to customers. Let’s get started!

Why do we include them in a business plan?

The products and services section of a business plan is more than just a list of what a company sells; it’s a vital narrative that tells the story of the business’s core offerings and their significance to the market.

This section is paramount for readers (especially potential investors) to grasp the essence of what the business is about, the unique problems it solves, or the specific needs it addresses.

A meticulously crafted products and services segment does much more than describe offerings. Indeed, it lays the groundwork for comprehensive marketing strategies , informs operational planning, and financial projections.

Moreover, understanding the business’s offerings in depth enables stakeholders to envision the company’s value proposition and competitive edge.

Where should you include them?

In a business plan, the Products and Services section is typically included within the business overview section.

This allows you to first introduce the business model and what it offers to customers. Only after this you can provide more details of the products and services.

The Products and Services section should clearly detail what you are selling, highlight the unique value proposition . It should also ideally explain how it meets the needs of your target market if it isn’t obvious. T

What to include: 2 Examples

Begin with a clear, engaging description of each product or service you offer. For services, describe the process, customer experience, and outcome. For products, discuss the materials, technology, and any unique features.

Services example: a Cryotherapy business plan

Products example: a Brewery business plan

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The Products and Services Section in a Business Plan

How to Write the Business Plan Products and Services Section

• The Products and Services Section
• What to Include
• Tips on Writing the Section

The products and services section of your business plan is more than just a list of what your business is going to provide. This section of your business plan should include details about how you'll price products and services, how you'll fulfill orders, and other details that investors need to hear before you can get funding .

Additionally, it should outline the unique selling points of your offerings and explain how they stand out from competitors. Providing information on awards received, potential suppliers, and manufacturing processes can also strengthen this section and build investor confidence. Learn more with the guide below.

Key Takeaways

• Business plans include details about the products and services you'll offer, including exactly how you plan to market, sell, and deliver on customer orders.
• The best business plans are clear and concise.
• The products and services section of your plan should show why your product or service is needed.
• The products and services section should also convey the expertise and experience you have to succeed.

Why You Need a Products and Services Section in a Business Plan

The business plan products and services section is the centerpiece of your plan. While other sections of your business plan are important, the products and services section is the essence of your business and the point around which every other part of the business plan is built .

What to Include in a Products and Services Section

The products and services section of your business plan outlines your product or service, why it's needed by your market, and how it will compete with other businesses selling the same or similar products and services.

Your products and services section should include a description of the products or services you are offering or plan to offer (including future products or services). You should explain how your products and services will be priced and a comparison of the products or services your competitors offer in relation to yours.

You should also include the sales literature you plan to use. Detail your marketing materials, and clarify the role your website will play in your sales efforts.

The products and services section will include a paragraph or so on how orders from your customers will be processed or fulfilled, as well as any needs you have to create or deliver your products, such as partnerships, up-to-date computer equipment, or manufacturing processes. If your process depends on intellectual property or legal issues, such as trademarks , then those need to be addressed.

Tips on Writing the Products and Services Section

This section of your business plan should excite those you're hoping will fund your business or work with you. To that end, here are a few tips to create a products and services section that appeals to the reader.

Indicate Why Your Product or Service Is Needed

Especially if you're venturing into a new concept or invention, or a place where there is no current market, you need to explain the need for your product or service.

Highlight the Features of Your Product or Service

A crucial part of business success is the ability to set yourself apart from other businesses that sell the same or similar products and services. What features, such as price point or level of service, do you offer that are unique to you?

Focus on Benefits

Unique features are important, but even more vital is how those features provide value to consumers. Translate your features (i.e., faster or cheaper) into benefits (i.e., get it now or save money). The goal is to highlight how your product or service will fix a problem or improve a client or customer's life.

Be Clear and Concise

Don't let your business plan get bogged down in too much description and information. Use bullets or numbered lists to quickly and easily highlight important information.

Show Off Expertise, Experience, and Accolades

You not only want to describe your products and services but also share why you're the best person to provide them. Include anything in your education or experience that makes you an expert in this business. If you have testimonials, awards, or endorsements, share those. Finally, if you've applied for a patent, copyright, or trademark, include that as well.

Be the Expert, But Use Layman's Terms

You should know your product, service, and industry well, but don't expect your potential funders and partners to have the same level of knowledge. Assume the reader doesn't know as much as you when you explain what you're offering.

Avoid acronyms and jargon when outlining your products and services.

Indicate What's Special About Your Products or Services

Will you be offering a special guarantee or refund policy? Do you have a quicker or more unique way of delivering your product or service? 

Speak to Your Customer

While you don't want to write an advertorial, you do want to be customer-oriented when you write your products and services section.

Examples of a Products and Services Section

The Small Business Administration offers business plan examples that you can draw from to help guide your writing. Here's an example of a products section for someone creating "Wooden Grain Toys."

Wooden Grain Toys will sell wooden toys made from solid hardwoods (maple, beech, birch, cherry, and oak) and steel rivets. The toys are handcrafted and designed for small children to easily use. Our line currently includes the following nine models:

• All-Purpose Pick-Up Truck w/movable doors and tailgate
• Dump Truck w/functioning dumping mechanism and box
• Biplane (two-seater) w/movable propeller
• Steam engine with coal tender - additional cars available separately: caboose, flat car w/logs, box car, tank car, coal car
• Flat-Bed Truck w/logs

Wooden Grain Toys will offer its products for the following prices:

• All-Purpose Pick-Up Truck w/movable doors and tailgate - $25
• Dump Truck w/functioning dumping mechanism and box - $30
• Biplane (two-seater) w/movable propeller - $20
• Additional train cars (single car) - $5
• Additional train cars (three cars) - $12
• City Bus - $12
• Tow Truck - $18
• Flat-Bed Truck w/logs - $35
• Sports Car - $20
• Sedan - $20

What is the products and services section in a business plan?

A products and services section of a business plan clarifies exactly what your business will produce , how much it'll sell for, and other details along those lines.

What are examples of products and services?

A product or service can be anything a business creates to turn a profit. Some businesses have both products and services. For example, a restaurant's services include cooking for and serving customers. The restaurant's products are the dishes and drinks it creates.

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• How to Write a Great Business Plan: Products and Services

The fourth in a comprehensive series to help you craft the perfect business plan for your startup.

This article is part of a series on  how to write a great business plan .

In the Products and Services section of your business plan, you will clearly describe--yep--the products and services your business will provide.

Keep in mind that highly detailed or technical descriptions are not necessary and definitely not recommended. Use simple terms and avoid industry buzzwords so your readers can easily understand.

On the other hand, describing how the company's products and services will differ from the competition is critical. So is describing why your products and services are needed if no market currently exists. (For example, before there was Federal Express, overnight delivery was a niche business served by small companies. FedEx had to define the opportunity for a new, large-scale service and justify why customers needed--and would actually use --that service.)

Patents, copyrights, and trademarks you own or have applied for should also be listed in this section.

Depending on the nature of your business, your Products and Services section could be very long or relatively short. If your business is product-focused, you will want to spend more time describing those products.

If you plan to sell a commodity item and the key to your success lies in, say, competitive pricing, you probably don't need to provide significant product detail. Or if you plan to sell a commodity readily available in a variety of outlets, the key to your business may not be the commodity itself but your ability to market in a more cost-effective way than your competition.

But if you're creating a new product (or service), make sure you thoroughly explain the nature of the product, its uses, and its value, etc.--otherwise your readers will not have enough information to evaluate your business.

Key questions to answer:

• Are products or services in development or existing (and on the market)?
• What is the timeline for bringing new products and services to market?
• What makes your products or services different? Are there competitive advantages compared with offerings from other competitors? Are there competitive disadvantages you will need to overcome? (And if so, how?)
• Is price an issue? Will your operating costs be low enough to allow a reasonable profit margin?
• How will you acquire your products? Are you the manufacturer? Do you assemble products using components provided by others? Do you purchase products from suppliers or wholesalers? If your business takes off, is a steady supply of products available?

In the cycling rental business example we've been using, products and services could be a relatively simple section to complete or it could be fairly involved. It depends on the nature of the products the company plans to rent to customers.

If Blue Mountain Cycling Rentals plans to market itself as a provider of high-end bikes, describing those bikes--and the sources for those bikes--is important, since "high-end cycling rentals" is intended to be a market differentiation. If the company plans to be the low-cost provider, then describing specific brands of equipment is probably not necessary.

Also, keep in mind that if a supplier runs out of capacity--or goes out of business altogether--you may not have a sufficient supply to meet your demand. Plan to set up multiple vendor or supplier relationships, and describe those relationships fully. 

Remember, the primary goal of your business plan is to convince you that the business is viable--and to create a road map for you to follow.

The Products and Services section for our cycling rental business could start something like this:

Product Description

Blue Mountain Cycle Rentals will provide a comprehensive line of bicycles and cycling equipment for all ages and levels of ability. Since the typical customer seeks medium-quality equipment and excellent services at competitive prices, we will focus on providing brands like Trek bikes, Shimano footwear, and Giro helmets. These manufacturers have a widespread reputation as mid- to high-level quality, unlike equipment typically found in the rental market.

The following is a breakdown of anticipated rental price points, per day and per week:

Bicycle $30 $120

Helmet $6 $30

• Customers can extend the rental term online without visiting the store.
• A grace period of two hours will be applied to all rentals; customers who return equipment within that two-hour period will not be charged an additional fee.

Competition

Blue Mountain Cycle Rentals will have clear advantages over its primary competitors, the bike shops located in Harrisonburg, Virginia:

• Newer equipment inventory with higher perceived quality
• Price points 15 percent below the competition
• Online renewals offering greater convenience
• A liberal return grace period that will reinforce our reputation as a customer-friendly rental experience

Future Products

Expansion will allow us to move product offerings into new equipment sales. We will also explore maintenance and fitting services, leveraging our existing maintenance staff to provide value-added services at a premium price.

(And so on...)

When you draft your Products and Services section, think of your reader as a person who knows little to nothing about your business. Be clear and to the point.

Think of it this way: The Products and Services section answers the "what" question for your business. Make sure you fully understand the "what" factor; you may run the business, but your products and services are its lifeblood.

Now let's take a look at the next major section of your business plan: the Market Opportunities .

More in this series:

• How to Write a Great Business Plan: Key Concepts
• How to Write a Great Business Plan: the Executive Summary
• How to Write a Great Business Plan: Overview and Objectives
• How to Write a Great Business Plan: Market Opportunities
• How to Write a Great Business Plan: Sales and Marketing
• How to Write a Great Business Plan: Competitive Analysis
• How to Write a Great Business Plan: Operations
• How to Write a Great Business Plan: Management Team
• How to Write a Great Business Plan: Financial Analysis

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How to Write a Business Plan for a Small Business

Noah Parsons

24 min. read

Updated September 2, 2024

Writing a business plan doesn’t have to be complicated. 

In this step-by-step guide, you’ll learn how to write a business plan that’s detailed enough to impress bankers and potential investors, while giving you the tools to start, run, and grow a successful business.

• The basics of writing a business plan

If you’re reading this guide, then you already know why you need a business plan . 

You understand that writing a business plan helps you: 

• Raise money
• Grow strategically
• Keep your business on the right track 

As you start to write your business plan, it’s useful to zoom out and remember what a business plan is .

At its core, a business plan is an overview of the products and services you sell, and the customers that you sell to. It explains your business strategy: how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

Most business plans also include financial forecasts for the future. These set sales goals, budget for expenses, and predict profits and cash flow. 

A good business plan is much more than just a document that you write once and forget about. It’s also a guide that helps you outline and achieve your goals. 

After writing your business plan, you can use it as a management tool to track your progress toward your goals. Updating and adjusting your forecasts and budgets as you go is one of the most important steps you can take to run a healthier, smarter business. 

We’ll dive into how to use your plan later in this article.

There are many different types of plans , but we’ll go over the most common type here, which includes everything you need for an investor-ready plan. However, if you’re just starting out and are looking for something simpler—I recommend starting with a one-page business plan . It’s faster and easier to create. 

It’s also the perfect place to start if you’re just figuring out your idea, or need a simple strategic plan to use inside your business.

Dig deeper : How to write a one-page business plan

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• What to include in your business plan

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally just one to two pages. Most people write it last because it’s a summary of the complete business plan.

Ideally, the executive summary can act as a stand-alone document that covers the highlights of your detailed plan. 

In fact, it’s common for investors to ask only for the executive summary when evaluating your business. If they like what they see in the executive summary, they’ll often follow up with a request for a complete plan, a pitch presentation , or more in-depth financial forecasts .

Your executive summary should include:

• A summary of the problem you are solving
• A description of your product or service
• An overview of your target market
• A brief description of your team
• A summary of your financials
• Your funding requirements (if you are raising money)

Dig Deeper: How to write an effective executive summary

Products and services description

When writing a business plan, the produces and services section is where you describe exactly what you’re selling, and how it solves a problem for your target market. The best way to organize this part of your plan is to start by describing the problem that exists for your customers. After that, you can describe how you plan to solve that problem with your product or service. 

This is usually called a problem and solution statement .

To truly showcase the value of your products and services, you need to craft a compelling narrative around your offerings. How will your product or service transform your customers’ lives or jobs? A strong narrative will draw in your readers.

This is also the part of the business plan to discuss any competitive advantages you may have, like specific intellectual property or patents that protect your product. If you have any initial sales, contracts, or other evidence that your product or service is likely to sell, include that information as well. It will show that your idea has traction , which can help convince readers that your plan has a high chance of success.

Market analysis

Your target market is a description of the type of people that you plan to sell to. You might even have multiple target markets, depending on your business. 

A market analysis is the part of your plan where you bring together all of the information you know about your target market. Basically, it’s a thorough description of who your customers are and why they need what you’re selling. You’ll also include information about the growth of your market and your industry .

Try to be as specific as possible when you describe your market. 

Include information such as age, income level, and location—these are what’s called “demographics.” If you can, also describe your market’s interests and habits as they relate to your business—these are “psychographics.” 

Related: Target market examples

Essentially, you want to include any knowledge you have about your customers that is relevant to how your product or service is right for them. With a solid target market, it will be easier to create a sales and marketing plan that will reach your customers. That’s because you know who they are, what they like to do, and the best ways to reach them.

Next, provide any additional information you have about your market. 

What is the size of your market ? Is the market growing or shrinking? Ideally, you’ll want to demonstrate that your market is growing over time, and also explain how your business is positioned to take advantage of any expected changes in your industry.

Dig Deeper: Learn how to write a market analysis

Competitive analysis

Part of defining your business opportunity is determining what your competitive advantage is. To do this effectively, you need to know as much about your competitors as your target customers. 

Every business has some form of competition. If you don’t think you have competitors, then explore what alternatives there are in the market for your product or service. 

For example: In the early years of cars, their main competition was horses. For social media, the early competition was reading books, watching TV, and talking on the phone.

A good competitive analysis fully lays out the competitive landscape and then explains how your business is different. Maybe your products are better made, or cheaper, or your customer service is superior. Maybe your competitive advantage is your location – a wide variety of factors can ultimately give you an advantage.

Dig Deeper: How to write a competitive analysis for your business plan

Marketing and sales plan

The marketing and sales plan covers how you will position your product or service in the market, the marketing channels and messaging you will use, and your sales tactics. 

The best place to start with a marketing plan is with a positioning statement . 

This explains how your business fits into the overall market, and how you will explain the advantages of your product or service to customers. You’ll use the information from your competitive analysis to help you with your positioning. 

For example: You might position your company as the premium, most expensive but the highest quality option in the market. Or your positioning might focus on being locally owned and that shoppers support the local economy by buying your products.

Once you understand your positioning, you’ll bring this together with the information about your target market to create your marketing strategy . 

This is how you plan to communicate your message to potential customers. Depending on who your customers are and how they purchase products like yours, you might use many different strategies, from social media advertising to creating a podcast. Your marketing plan is all about how your customers discover who you are and why they should consider your products and services. 

While your marketing plan is about reaching your customers—your sales plan will describe the actual sales process once a customer has decided that they’re interested in what you have to offer. 

If your business requires salespeople and a long sales process, describe that in this section. If your customers can “self-serve” and just make purchases quickly on your website, describe that process. 

A good sales plan picks up where your marketing plan leaves off. The marketing plan brings customers in the door and the sales plan is how you close the deal.

Together, these specific plans paint a picture of how you will connect with your target audience, and how you will turn them into paying customers.

Dig deeper: What to include in your sales and marketing plan

Business operations

When writing a business plan, the operations section describes the necessary requirements for your business to run smoothly. It’s where you talk about how your business works and what day-to-day operations look like. 

Depending on how your business is structured, your operations plan may include elements of the business like:

• Supply chain management
• Manufacturing processes
• Equipment and technology
• Distribution

Some businesses distribute their products and reach their customers through large retailers like Amazon.com, Walmart, Target, and grocery store chains. 

These businesses should review how this part of their business works. The plan should discuss the logistics and costs of getting products onto store shelves and any potential hurdles the business may have to overcome.

If your business is much simpler than this, that’s OK. This section of your business plan can be either extremely short or more detailed, depending on the type of business you are building.

For businesses selling services, such as physical therapy or online software, you can use this section to describe the technology you’ll leverage, what goes into your service, and who you will partner with to deliver your services.

Dig Deeper: Learn how to write the operations chapter of your plan

Key milestones and metrics

Although it’s not required to complete your business plan, mapping out key business milestones and the metrics can be incredibly useful for measuring your success.

Good milestones clearly lay out the parameters of the task and set expectations for their execution. You’ll want to include:

• A description of each task
• The proposed due date
• Who is responsible for each task

If you have a budget, you can include projected costs to hit each milestone. You don’t need extensive project planning in this section—just list key milestones you want to hit and when you plan to hit them. This is your overall business roadmap. 

Possible milestones might be:

• Website launch date
• Store or office opening date
• First significant sales
• Break even date
• Business licenses and approvals

You should also discuss the key numbers you will track to determine your success. Some common metrics worth tracking include:

• Conversion rates
• Customer acquisition costs
• Profit per customer
• Repeat purchases

It’s perfectly fine to start with just a few metrics and grow the number you are tracking over time. You also may find that some metrics simply aren’t relevant to your business and can narrow down what you’re tracking.

Dig Deeper: How to use milestones in your business plan

Organization and management team

Investors don’t just look for great ideas—they want to find great teams. Use this chapter to describe your current team and who you need to hire . You should also provide a quick overview of your location and history if you’re already up and running.

Briefly highlight the relevant experiences of each key team member in the company. It’s important to make the case for why yours is the right team to turn an idea into a reality. 

Do they have the right industry experience and background? Have members of the team had entrepreneurial successes before? 

If you still need to hire key team members, that’s OK. Just note those gaps in this section.

Your company overview should also include a summary of your company’s current business structure . The most common business structures include:

• Sole proprietor
• Partnership

Be sure to provide an overview of how the business is owned as well. Does each business partner own an equal portion of the business? How is ownership divided? 

Potential lenders and investors will want to know the structure of the business before they will consider a loan or investment.

Dig Deeper: How to write about your company structure and team

Financial plan

The last section of your business plan is your financial plan and forecasts. 

Entrepreneurs often find this section the most daunting. But, business financials for most startups are less complicated than you think, and a business degree is certainly not required to build a solid financial forecast. 

A typical financial forecast in a business plan includes the following:

• Sales forecast : An estimate of the sales expected over a given period. You’ll break down your forecast into the key revenue streams that you expect to have.
• Expense budget : Your planned spending such as personnel costs , marketing expenses, and taxes.
• Profit & Loss : Brings together your sales and expenses and helps you calculate planned profits.
• Cash Flow : Shows how cash moves into and out of your business. It can predict how much cash you’ll have on hand at any given point in the future.
• Balance Sheet : A list of the assets, liabilities, and equity in your company. In short, it provides an overview of the financial health of your business. 

A strong business plan will include a description of assumptions about the future, and potential risks that could impact the financial plan. Including those will be especially important if you’re writing a business plan to pursue a loan or other investment.

Dig Deeper: How to create financial forecasts and budgets

This is the place for additional data, charts, or other information that supports your plan.

Including an appendix can significantly enhance the credibility of your plan by showing readers that you’ve thoroughly considered the details of your business idea, and are backing your ideas up with solid data.

Just remember that the information in the appendix is meant to be supplementary. Your business plan should stand on its own, even if the reader skips this section.

Dig Deeper : What to include in your business plan appendix

Optional: Business plan cover page

Adding a business plan cover page can make your plan, and by extension your business, seem more professional in the eyes of potential investors, lenders, and partners. It serves as the introduction to your document and provides necessary contact information for stakeholders to reference.

Your cover page should be simple and include:

• Company logo
• Business name
• Value proposition (optional)
• Business plan title
• Completion and/or update date
• Address and contact information
• Confidentiality statement

Just remember, the cover page is optional. If you decide to include it, keep it very simple and only spend a short amount of time putting it together.

Dig Deeper: How to create a business plan cover page

How to use AI to help write your business plan

Generative AI tools such as ChatGPT can speed up the business plan writing process and help you think through concepts like market segmentation and competition. These tools are especially useful for taking ideas that you provide and converting them into polished text for your business plan.

The best way to use AI to write a business plan is to leverage it as a collaborator , not a replacement for human creative thinking and ingenuity. 

AI can come up with lots of ideas and act as a brainstorming partner. It’s up to you to filter through those ideas and figure out which ones are realistic enough to resonate with your customers. 

There are pros and cons of using AI to help with your business plan . So, spend some time understanding how it can be most helpful before just outsourcing the job to AI.

Learn more: 10 AI prompts you need to write a business plan

• Writing tips and strategies

To help streamline the business plan writing process, here are a few tips and key questions to answer to make sure you get the most out of your plan and avoid common mistakes .  

Determine why you are writing a business plan

Knowing why you are writing a business plan will determine your approach to your planning project. 

For example: If you are writing a business plan for yourself, or just to use inside your own business , you can probably skip the section about your team and organizational structure. 

If you’re raising money, you’ll want to spend more time explaining why you’re looking to raise the funds and exactly how you will use them.

Regardless of how you intend to use your business plan , think about why you are writing and what you’re trying to get out of the process before you begin.

Keep things concise

Probably the most important tip is to keep your business plan short and simple. There are no prizes for long business plans . The longer your plan is, the less likely people are to read it. 

So focus on trimming things down to the essentials your readers need to know. Skip the extended, wordy descriptions and instead focus on creating a plan that is easy to read —using bullets and short sentences whenever possible.

Have someone review your business plan

Writing a business plan in a vacuum is never a good idea. Sometimes it’s helpful to zoom out and check if your plan makes sense to someone else. You also want to make sure that it’s easy to read and understand.

Don’t wait until your plan is “done” to get a second look. Start sharing your plan early, and find out from readers what questions your plan leaves unanswered. This early review cycle will help you spot shortcomings in your plan and address them quickly, rather than finding out about them right before you present your plan to a lender or investor.

If you need a more detailed review, you may want to explore hiring a professional plan writer to thoroughly examine it.

Use a free business plan template and business plan examples to get started

Knowing what information to include in a business plan is sometimes not quite enough. If you’re struggling to get started or need additional guidance, it may be worth using a business plan template. 

There are plenty of great options available (we’ve rounded up our 8 favorites to streamline your search).

But, if you’re looking for a free downloadable business plan template , you can get one right now; download the template used by more than 1 million businesses. 

Or, if you just want to see what a completed business plan looks like, check out our library of over 550 free business plan examples . 

We even have a growing list of industry business planning guides with tips for what to focus on depending on your business type.

Common pitfalls and how to avoid them

It’s easy to make mistakes when you’re writing your business plan. Some entrepreneurs get sucked into the writing and research process, and don’t focus enough on actually getting their business started. 

Here are a few common mistakes and how to avoid them:

Not talking to your customers : This is one of the most common mistakes. It’s easy to assume that your product or service is something that people want. Before you invest too much in your business and too much in the planning process, make sure you talk to your prospective customers and have a good understanding of their needs.

• Overly optimistic sales and profit forecasts: By nature, entrepreneurs are optimistic about the future. But it’s good to temper that optimism a little when you’re planning, and make sure your forecasts are grounded in reality. 
• Spending too much time planning: Yes, planning is crucial. But you also need to get out and talk to customers, build prototypes of your product and figure out if there’s a market for your idea. Make sure to balance planning with building.
• Not revising the plan: Planning is useful, but nothing ever goes exactly as planned. As you learn more about what’s working and what’s not—revise your plan, your budgets, and your revenue forecast. Doing so will provide a more realistic picture of where your business is going, and what your financial needs will be moving forward.
• Not using the plan to manage your business: A good business plan is a management tool. Don’t just write it and put it on the shelf to collect dust – use it to track your progress and help you reach your goals.
• Presenting your business plan

The planning process forces you to think through every aspect of your business and answer questions that you may not have thought of. That’s the real benefit of writing a business plan – the knowledge you gain about your business that you may not have been able to discover otherwise.

With all of this knowledge, you’re well prepared to convert your business plan into a pitch presentation to present your ideas. 

A pitch presentation is a summary of your plan, just hitting the highlights and key points. It’s the best way to present your business plan to investors and team members.

Dig Deeper: Learn what key slides should be included in your pitch deck

Use your business plan to manage your business

One of the biggest benefits of planning is that it gives you a tool to manage your business better. With a revenue forecast, expense budget, and projected cash flow, you know your targets and where you are headed.

And yet, nothing ever goes exactly as planned – it’s the nature of business.

That’s where using your plan as a management tool comes in. The key to leveraging it for your business is to review it periodically and compare your forecasts and projections to your actual results.

Start by setting up a regular time to review the plan – a monthly review is a good starting point. During this review, answer questions like:

• Did you meet your sales goals?
• Is spending following your budget?
• Has anything gone differently than what you expected?

Now that you see whether you’re meeting your goals or are off track, you can make adjustments and set new targets. 

Maybe you’re exceeding your sales goals and should set new, more aggressive goals. In that case, maybe you should also explore more spending or hiring more employees. 

Or maybe expenses are rising faster than you projected. If that’s the case, you would need to look at where you can cut costs.

A plan, and a method for comparing your plan to your actual results , is the tool you need to steer your business toward success.

Learn More: How to run a regular plan review

How to write a business plan FAQ

What is a business plan?

A document that describes your business , the products and services you sell, and the customers that you sell to. It explains your business strategy, how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

What are the benefits of writing a business plan?

A business plan helps you understand where you want to go with your business and what it will take to get there. It reduces your overall risk, helps you uncover your business’s potential, attracts investors, and identifies areas for growth.

Writing a business plan ultimately makes you more confident as a business owner and more likely to succeed for a longer period of time.

What are the 7 steps of writing a business plan?

The seven steps to writing a business plan include:

• Write a brief executive summary
• Describe your products and services.
• Conduct market research and compile data into a cohesive market analysis.
• Describe your marketing and sales strategy.
• Outline your organizational structure and management team.
• Develop financial projections for sales, revenue, and cash flow.
• Add any additional documents to your appendix.

What are the 5 most common business plan mistakes?

There are plenty of mistakes that can be made when writing a business plan. However, these are the 5 most common that you should do your best to avoid:

• 1. Not taking the planning process seriously.
• Having unrealistic financial projections or incomplete financial information.
• Inconsistent information or simple mistakes.
• Failing to establish a sound business model.
• Not having a defined purpose for your business plan.

What questions should be answered in a business plan?

Writing a business plan is all about asking yourself questions about your business and being able to answer them through the planning process. You’ll likely be asking dozens and dozens of questions for each section of your plan.

However, these are the key questions you should ask and answer with your business plan:

• How will your business make money?
• Is there a need for your product or service?
• Who are your customers?
• How are you different from the competition?
• How will you reach your customers?
• How will you measure success?

How long should a business plan be?

The length of your business plan fully depends on what you intend to do with it. From the SBA and traditional lender point of view, a business plan needs to be whatever length necessary to fully explain your business. This means that you prove the viability of your business, show that you understand the market, and have a detailed strategy in place.

If you intend to use your business plan for internal management purposes, you don’t necessarily need a full 25-50 page business plan. Instead, you can start with a one-page plan to get all of the necessary information in place.

What are the different types of business plans?

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. Here are a few common business plan types worth considering.

Traditional business plan: The tried-and-true traditional business plan is a formal document meant to be used when applying for funding or pitching to investors. This type of business plan follows the outline above and can be anywhere from 10-50 pages depending on the amount of detail included, the complexity of your business, and what you include in your appendix.

Business model canvas: The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea.

One-page business plan: This format is a simplified version of the traditional plan that focuses on the core aspects of your business. You’ll typically stick with bullet points and single sentences. It’s most useful for those exploring ideas, needing to validate their business model, or who need an internal plan to help them run and manage their business.

Lean Plan: The Lean Plan is less of a specific document type and more of a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, test, review, refine, and take action based on performance. It’s faster, keeps your plan concise, and ensures that your plan is always up-to-date.

What’s the difference between a business plan and a strategic plan?

A business plan covers the “who” and “what” of your business. It explains what your business is doing right now and how it functions. The strategic plan explores long-term goals and explains “how” the business will get there. It encourages you to look more intently toward the future and how you will achieve your vision.

However, when approached correctly, your business plan can actually function as a strategic plan as well. If kept lean, you can define your business, outline strategic steps, and track ongoing operations all with a single plan.

Noah is the COO at Palo Alto Software, makers of the online business plan app LivePlan. He started his career at Yahoo! and then helped start the user review site Epinions.com. From there he started a software distribution business in the UK before coming to Palo Alto Software to run the marketing and product teams.

Table of Contents

• Use AI to help write your plan
• Common planning mistakes
• Manage with your business plan

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How to Craft a Detailed Product Description in Business Plan

Table of Contents

A well-written product description in your business plan has the potential to attract investors and aid in the expansion of your company. 

In addition to describing your manufactured goods, your product description should emphasize the benefits of the goods. These benefits must align with your business. 

This article discusses developing a product description for a business plan and offers writing advice to help you craft your own.

What Is a Product Description in Business Plan?

The product description in the business plan describes all the products the company produces . 

A business plan product description describes a product or service, the firm supplying it, the problem it answers, the price, and the target market. Your product description should explain how your products differ from similar ones on the market or why they’re needed if no market exists.

Product descriptions should be factual and not promotional or salesy. As with other business papers, a product description should be in the first person, so it doesn’t appear overly promotional.

A product description in a business plan should be understandable, so the value of your products is clear.

What Does a Product Description Entail?

A product description introduces your product to potential investors and customers. The following items below should be included in the document when presenting your product to potential investors and customers.

1. Features and Benefits of the Product

Describe the features and benefits of your product. If your product addresses a problem for customers, this section should convey that information.

2. Your Product Vs. Competition

Take a look at the competition and see how your product stacks up. Make a case for why your product is better than your competition’s offerings.

3. Price of Product

Include the price of your product and how it compares to other similar products on the market in your pitch. The cost of production, the selling price, and the profit margin all need to be discussed.

4. Trademarks

You should add this information if you’ve had your product tested by professionals in the field. Including any certifications, intellectual property, copyrights, or patents is also a good idea. 

These awards and honors bolster your product’s credibility. As a result of being awarded patents and trademarks, your company is the only one that can make this product. This increases the product’s worth.

5. the Life Cycle of the Product

The idea, prototype, and expansion stages are part of a product’s life cycle. If you’re still in the concept stage, use this section to explain how you’ll build the product and why it’s necessary.

If you already have a prototype, discuss how you intend to evaluate it and manufacture your product. Include it here if you have been producing your product but need to grow to meet demand.

6. Distribution and Sales Strategy

Describe your product’s distribution strategy, including how and where it will be sold. Vendors, brick-and-mortar stores, and online retailers are examples of possible sales channels. If you already have a list of suppliers selling your goods, insert their names and addresses here.

7. Product Delivery to Final Consumer

How do you intend to get your product into the hands of your clients? All the manufacturing and shipping details should be included here. Include information on the manufacturer, such as their location and manufacturing time. It is advisable to outsource the production of your goods, including delivery schedules and methods.

8. Resources

Identify any unique equipment, materials, or technology required to produce your product.

9. Future Expansion Projections

As your firm grows, describe your product development and introduction plans.

10. Evidence in the Form of Photos and Brochures

Photos and brochures can help investors visualize your goods. Include pictures and brochures in an appendix to your business plan, but reference them in the product description.

With a business plan product description, you’ll enlighten the reader about the firm, the product, and its market .

A product description tells the reader what the product is. It also explains how it works, how it benefits the company and consumers, and how much it costs.

Abir Ghenaiet

Abir is a data analyst and researcher. Among her interests are artificial intelligence, machine learning, and natural language processing. As a humanitarian and educator, she actively supports women in tech and promotes diversity.

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How to Write a Business Plan in 9 Steps (+ Template and Examples)

Every successful business has one thing in common, a good and well-executed business plan. A business plan is more than a document, it is a complete guide that outlines the goals your business wants to achieve, including its financial goals . It helps you analyze results, make strategic decisions, show your business operations and growth.

If you want to start a business or already have one and need to pitch it to investors for funding, writing a good business plan improves your chances of attracting financiers. As a startup, if you want to secure loans from financial institutions, part of the requirements involve submitting your business plan.

Writing a business plan does not have to be a complicated or time-consuming process. In this article, you will learn the step-by-step process for writing a successful business plan.

You will also learn what you need a business plan for, tips and strategies for writing a convincing business plan, business plan examples and templates that will save you tons of time, and the alternatives to the traditional business plan.

Let’s get started.

What Do You Need A Business Plan For?

Businesses create business plans for different purposes such as to secure funds, monitor business growth, measure your marketing strategies, and measure your business success.

1. Secure Funds

One of the primary reasons for writing a business plan is to secure funds, either from financial institutions/agencies or investors.

For you to effectively acquire funds, your business plan must contain the key elements of your business plan . For example, your business plan should include your growth plans, goals you want to achieve, and milestones you have recorded.

A business plan can also attract new business partners that are willing to contribute financially and intellectually. If you are writing a business plan to a bank, your project must show your traction , that is, the proof that you can pay back any loan borrowed.

Also, if you are writing to an investor, your plan must contain evidence that you can effectively utilize the funds you want them to invest in your business. Here, you are using your business plan to persuade a group or an individual that your business is a source of a good investment.

2. Monitor Business Growth

A business plan can help you track cash flows in your business. It steers your business to greater heights. A business plan capable of tracking business growth should contain:

• The business goals
• Methods to achieve the goals
• Time-frame for attaining those goals

A good business plan should guide you through every step in achieving your goals. It can also track the allocation of assets to every aspect of the business. You can tell when you are spending more than you should on a project.

You can compare a business plan to a written GPS. It helps you manage your business and hints at the right time to expand your business.

3. Measure Business Success

A business plan can help you measure your business success rate. Some small-scale businesses are thriving better than more prominent companies because of their track record of success.

Right from the onset of your business operation, set goals and work towards them. Write a plan to guide you through your procedures. Use your plan to measure how much you have achieved and how much is left to attain.

You can also weigh your success by monitoring the position of your brand relative to competitors. On the other hand, a business plan can also show you why you have not achieved a goal. It can tell if you have elapsed the time frame you set to attain a goal.

4. Document Your Marketing Strategies

You can use a business plan to document your marketing plans. Every business should have an effective marketing plan.

Competition mandates every business owner to go the extraordinary mile to remain relevant in the market. Your business plan should contain your marketing strategies that work. You can measure the success rate of your marketing plans.

In your business plan, your marketing strategy must answer the questions:

• How do you want to reach your target audience?
• How do you plan to retain your customers?
• What is/are your pricing plans?
• What is your budget for marketing?

How to Write a Business Plan Step-by-Step

1. create your executive summary.

The executive summary is a snapshot of your business or a high-level overview of your business purposes and plans . Although the executive summary is the first section in your business plan, most people write it last. The length of the executive summary is not more than two pages.

Generally, there are nine sections in a business plan, the executive summary should condense essential ideas from the other eight sections.

A good executive summary should do the following:

• A Snapshot of Growth Potential. Briefly inform the reader about your company and why it will be successful)
• Contain your Mission Statement which explains what the main objective or focus of your business is.
• Product Description and Differentiation. Brief description of your products or services and why it is different from other solutions in the market.
• The Team. Basic information about your company’s leadership team and employees
• Business Concept. A solid description of what your business does.
• Target Market. The customers you plan to sell to.
• Marketing Strategy. Your plans on reaching and selling to your customers
• Current Financial State. Brief information about what revenue your business currently generates.
• Projected Financial State. Brief information about what you foresee your business revenue to be in the future.

The executive summary is the make-or-break section of your business plan. If your summary cannot in less than two pages cannot clearly describe how your business will solve a particular problem of your target audience and make a profit, your business plan is set on a faulty foundation.

Avoid using the executive summary to hype your business, instead, focus on helping the reader understand the what and how of your plan.

View the executive summary as an opportunity to introduce your vision for your company. You know your executive summary is powerful when it can answer these key questions:

• Who is your target audience?
• What sector or industry are you in?
• What are your products and services?
• What is the future of your industry?
• Is your company scaleable?
• Who are the owners and leaders of your company? What are their backgrounds and experience levels?
• What is the motivation for starting your company?
• What are the next steps?

Writing the executive summary last although it is the most important section of your business plan is an excellent idea. The reason why is because it is a high-level overview of your business plan. It is the section that determines whether potential investors and lenders will read further or not.

The executive summary can be a stand-alone document that covers everything in your business plan. It is not uncommon for investors to request only the executive summary when evaluating your business. If the information in the executive summary impresses them, they will ask for the complete business plan.

If you are writing your business plan for your planning purposes, you do not need to write the executive summary.

2. Add Your Company Overview

The company overview or description is the next section in your business plan after the executive summary. It describes what your business does.

Adding your company overview can be tricky especially when your business is still in the planning stages. Existing businesses can easily summarize their current operations but may encounter difficulties trying to explain what they plan to become.

Your company overview should contain the following:

• What products and services you will provide
• Geographical markets and locations your company have a presence
• What you need to run your business
• Who your target audience or customers are
• Who will service your customers
• Your company’s purpose, mission, and vision
• Information about your company’s founders
• Who the founders are
• Notable achievements of your company so far

When creating a company overview, you have to focus on three basics: identifying your industry, identifying your customer, and explaining the problem you solve.

If you are stuck when creating your company overview, try to answer some of these questions that pertain to you.

• Who are you targeting? (The answer is not everyone)
• What pain point does your product or service solve for your customers that they will be willing to spend money on resolving?
• How does your product or service overcome that pain point?
• Where is the location of your business?
• What products, equipment, and services do you need to run your business?
• How is your company’s product or service different from your competition in the eyes of your customers?
• How many employees do you need and what skills do you require them to have?

After answering some or all of these questions, you will get more than enough information you need to write your company overview or description section. When writing this section, describe what your company does for your customers.

The company description or overview section contains three elements: mission statement, history, and objectives.

• Mission Statement

The mission statement refers to the reason why your business or company is existing. It goes beyond what you do or sell, it is about the ‘why’. A good mission statement should be emotional and inspirational.

Your mission statement should follow the KISS rule (Keep It Simple, Stupid). For example, Shopify’s mission statement is “Make commerce better for everyone.”

When describing your company’s history, make it simple and avoid the temptation of tying it to a defensive narrative. Write it in the manner you would a profile. Your company’s history should include the following information:

• Founding Date
• Major Milestones
• Location(s)
• Flagship Products or Services
• Number of Employees
• Executive Leadership Roles

When you fill in this information, you use it to write one or two paragraphs about your company’s history.

Business Objectives

Your business objective must be SMART (specific, measurable, achievable, realistic, and time-bound.) Failure to clearly identify your business objectives does not inspire confidence and makes it hard for your team members to work towards a common purpose.

3. Perform Market and Competitive Analyses to Proof a Big Enough Business Opportunity

The third step in writing a business plan is the market and competitive analysis section. Every business, no matter the size, needs to perform comprehensive market and competitive analyses before it enters into a market.

Performing market and competitive analyses are critical for the success of your business. It helps you avoid entering the right market with the wrong product, or vice versa. Anyone reading your business plans, especially financiers and financial institutions will want to see proof that there is a big enough business opportunity you are targeting.

This section is where you describe the market and industry you want to operate in and show the big opportunities in the market that your business can leverage to make a profit. If you noticed any unique trends when doing your research, show them in this section.

Market analysis alone is not enough, you have to add competitive analysis to strengthen this section. There are already businesses in the industry or market, how do you plan to take a share of the market from them?

You have to clearly illustrate the competitive landscape in your business plan. Are there areas your competitors are doing well? Are there areas where they are not doing so well? Show it.

Make it clear in this section why you are moving into the industry and what weaknesses are present there that you plan to explain. How are your competitors going to react to your market entry? How do you plan to get customers? Do you plan on taking your competitors' competitors, tap into other sources for customers, or both?

Illustrate the competitive landscape as well. What are your competitors doing well and not so well?

Answering these questions and thoughts will aid your market and competitive analysis of the opportunities in your space. Depending on how sophisticated your industry is, or the expectations of your financiers, you may need to carry out a more comprehensive market and competitive analysis to prove that big business opportunity.

Instead of looking at the market and competitive analyses as one entity, separating them will make the research even more comprehensive.

Market Analysis

Market analysis, boarding speaking, refers to research a business carried out on its industry, market, and competitors. It helps businesses gain a good understanding of their target market and the outlook of their industry. Before starting a company, it is vital to carry out market research to find out if the market is viable.

The market analysis section is a key part of the business plan. It is the section where you identify who your best clients or customers are. You cannot omit this section, without it your business plan is incomplete.

A good market analysis will tell your readers how you fit into the existing market and what makes you stand out. This section requires in-depth research, it will probably be the most time-consuming part of the business plan to write.

• Market Research

To create a compelling market analysis that will win over investors and financial institutions, you have to carry out thorough market research . Your market research should be targeted at your primary target market for your products or services. Here is what you want to find out about your target market.

• Your target market’s needs or pain points
• The existing solutions for their pain points
• Geographic Location
• Demographics

The purpose of carrying out a marketing analysis is to get all the information you need to show that you have a solid and thorough understanding of your target audience.

Only after you have fully understood the people you plan to sell your products or services to, can you evaluate correctly if your target market will be interested in your products or services.

You can easily convince interested parties to invest in your business if you can show them you thoroughly understand the market and show them that there is a market for your products or services.

How to Quantify Your Target Market

One of the goals of your marketing research is to understand who your ideal customers are and their purchasing power. To quantify your target market, you have to determine the following:

• Your Potential Customers: They are the people you plan to target. For example, if you sell accounting software for small businesses , then anyone who runs an enterprise or large business is unlikely to be your customers. Also, individuals who do not have a business will most likely not be interested in your product.
• Total Households: If you are selling household products such as heating and air conditioning systems, determining the number of total households is more important than finding out the total population in the area you want to sell to. The logic is simple, people buy the product but it is the household that uses it.
• Median Income: You need to know the median income of your target market. If you target a market that cannot afford to buy your products and services, your business will not last long.
• Income by Demographics: If your potential customers belong to a certain age group or gender, determining income levels by demographics is necessary. For example, if you sell men's clothes, your target audience is men.

What Does a Good Market Analysis Entail?

Your business does not exist on its own, it can only flourish within an industry and alongside competitors. Market analysis takes into consideration your industry, target market, and competitors. Understanding these three entities will drastically improve your company’s chances of success.

You can view your market analysis as an examination of the market you want to break into and an education on the emerging trends and themes in that market. Good market analyses include the following:

• Industry Description. You find out about the history of your industry, the current and future market size, and who the largest players/companies are in your industry.
• Overview of Target Market. You research your target market and its characteristics. Who are you targeting? Note, it cannot be everyone, it has to be a specific group. You also have to find out all information possible about your customers that can help you understand how and why they make buying decisions.
• Size of Target Market: You need to know the size of your target market, how frequently they buy, and the expected quantity they buy so you do not risk overproducing and having lots of bad inventory. Researching the size of your target market will help you determine if it is big enough for sustained business or not.
• Growth Potential: Before picking a target market, you want to be sure there are lots of potential for future growth. You want to avoid going for an industry that is declining slowly or rapidly with almost zero growth potential.
• Market Share Potential: Does your business stand a good chance of taking a good share of the market?
• Market Pricing and Promotional Strategies: Your market analysis should give you an idea of the price point you can expect to charge for your products and services. Researching your target market will also give you ideas of pricing strategies you can implement to break into the market or to enjoy maximum profits.
• Potential Barriers to Entry: One of the biggest benefits of conducting market analysis is that it shows you every potential barrier to entry your business will likely encounter. It is a good idea to discuss potential barriers to entry such as changing technology. It informs readers of your business plan that you understand the market.
• Research on Competitors: You need to know the strengths and weaknesses of your competitors and how you can exploit them for the benefit of your business. Find patterns and trends among your competitors that make them successful, discover what works and what doesn’t, and see what you can do better.

The market analysis section is not just for talking about your target market, industry, and competitors. You also have to explain how your company can fill the hole you have identified in the market.

Here are some questions you can answer that can help you position your product or service in a positive light to your readers.

• Is your product or service of superior quality?
• What additional features do you offer that your competitors do not offer?
• Are you targeting a ‘new’ market?

Basically, your market analysis should include an analysis of what already exists in the market and an explanation of how your company fits into the market.

Competitive Analysis

In the competitive analysis section, y ou have to understand who your direct and indirect competitions are, and how successful they are in the marketplace. It is the section where you assess the strengths and weaknesses of your competitors, the advantage(s) they possess in the market and show the unique features or qualities that make you different from your competitors.

Many businesses do market analysis and competitive analysis together. However, to fully understand what the competitive analysis entails, it is essential to separate it from the market analysis.

Competitive analysis for your business can also include analysis on how to overcome barriers to entry in your target market.

The primary goal of conducting a competitive analysis is to distinguish your business from your competitors. A strong competitive analysis is essential if you want to convince potential funding sources to invest in your business. You have to show potential investors and lenders that your business has what it takes to compete in the marketplace successfully.

Competitive analysis will s how you what the strengths of your competition are and what they are doing to maintain that advantage.

When doing your competitive research, you first have to identify your competitor and then get all the information you can about them. The idea of spending time to identify your competitor and learn everything about them may seem daunting but it is well worth it.

Find answers to the following questions after you have identified who your competitors are.

• What are your successful competitors doing?
• Why is what they are doing working?
• Can your business do it better?
• What are the weaknesses of your successful competitors?
• What are they not doing well?
• Can your business turn its weaknesses into strengths?
• How good is your competitors’ customer service?
• Where do your competitors invest in advertising?
• What sales and pricing strategies are they using?
• What marketing strategies are they using?
• What kind of press coverage do they get?
• What are their customers saying about your competitors (both the positive and negative)?

If your competitors have a website, it is a good idea to visit their websites for more competitors’ research. Check their “About Us” page for more information.

If you are presenting your business plan to investors, you need to clearly distinguish yourself from your competitors. Investors can easily tell when you have not properly researched your competitors.

Take time to think about what unique qualities or features set you apart from your competitors. If you do not have any direct competition offering your product to the market, it does not mean you leave out the competitor analysis section blank. Instead research on other companies that are providing a similar product, or whose product is solving the problem your product solves.

The next step is to create a table listing the top competitors you want to include in your business plan. Ensure you list your business as the last and on the right. What you just created is known as the competitor analysis table.

Direct vs Indirect Competition

You cannot know if your product or service will be a fit for your target market if you have not understood your business and the competitive landscape.

There is no market you want to target where you will not encounter competition, even if your product is innovative. Including competitive analysis in your business plan is essential.

If you are entering an established market, you need to explain how you plan to differentiate your products from the available options in the market. Also, include a list of few companies that you view as your direct competitors The competition you face in an established market is your direct competition.

In situations where you are entering a market with no direct competition, it does not mean there is no competition there. Consider your indirect competition that offers substitutes for the products or services you offer.

For example, if you sell an innovative SaaS product, let us say a project management software , a company offering time management software is your indirect competition.

There is an easy way to find out who your indirect competitors are in the absence of no direct competitors. You simply have to research how your potential customers are solving the problems that your product or service seeks to solve. That is your direct competition.

Factors that Differentiate Your Business from the Competition

There are three main factors that any business can use to differentiate itself from its competition. They are cost leadership, product differentiation, and market segmentation.

1. Cost Leadership

A strategy you can impose to maximize your profits and gain an edge over your competitors. It involves offering lower prices than what the majority of your competitors are offering.

A common practice among businesses looking to enter into a market where there are dominant players is to use free trials or pricing to attract as many customers as possible to their offer.

2. Product Differentiation

Your product or service should have a unique selling proposition (USP) that your competitors do not have or do not stress in their marketing.

Part of the marketing strategy should involve making your products unique and different from your competitors. It does not have to be different from your competitors, it can be the addition to a feature or benefit that your competitors do not currently have.

3. Market Segmentation

As a new business seeking to break into an industry, you will gain more success from focusing on a specific niche or target market, and not the whole industry.

If your competitors are focused on a general need or target market, you can differentiate yourself from them by having a small and hyper-targeted audience. For example, if your competitors are selling men’s clothes in their online stores , you can sell hoodies for men.

4. Define Your Business and Management Structure

The next step in your business plan is your business and management structure. It is the section where you describe the legal structure of your business and the team running it.

Your business is only as good as the management team that runs it, while the management team can only strive when there is a proper business and management structure in place.

If your company is a sole proprietor or a limited liability company (LLC), a general or limited partnership, or a C or an S corporation, state it clearly in this section.

Use an organizational chart to show the management structure in your business. Clearly show who is in charge of what area in your company. It is where you show how each key manager or team leader’s unique experience can contribute immensely to the success of your company. You can also opt to add the resumes and CVs of the key players in your company.

The business and management structure section should show who the owner is, and other owners of the businesses (if the business has other owners). For businesses or companies with multiple owners, include the percent ownership of the various owners and clearly show the extent of each others’ involvement in the company.

Investors want to know who is behind the company and the team running it to determine if it has the right management to achieve its set goals.

Management Team

The management team section is where you show that you have the right team in place to successfully execute the business operations and ideas. Take time to create the management structure for your business. Think about all the important roles and responsibilities that you need managers for to grow your business.

Include brief bios of each key team member and ensure you highlight only the relevant information that is needed. If your team members have background industry experience or have held top positions for other companies and achieved success while filling that role, highlight it in this section.

A common mistake that many startups make is assigning C-level titles such as (CMO and CEO) to everyone on their team. It is unrealistic for a small business to have those titles. While it may look good on paper for the ego of your team members, it can prevent investors from investing in your business.

Instead of building an unrealistic management structure that does not fit your business reality, it is best to allow business titles to grow as the business grows. Starting everyone at the top leaves no room for future change or growth, which is bad for productivity.

Your management team does not have to be complete before you start writing your business plan. You can have a complete business plan even when there are managerial positions that are empty and need filling.

If you have management gaps in your team, simply show the gaps and indicate you are searching for the right candidates for the role(s). Investors do not expect you to have a full management team when you are just starting your business.

Key Questions to Answer When Structuring Your Management Team

• Who are the key leaders?
• What experiences, skills, and educational backgrounds do you expect your key leaders to have?
• Do your key leaders have industry experience?
• What positions will they fill and what duties will they perform in those positions?
• What level of authority do the key leaders have and what are their responsibilities?
• What is the salary for the various management positions that will attract the ideal candidates?

Additional Tips for Writing the Management Structure Section

1. Avoid Adding ‘Ghost’ Names to Your Management Team

There is always that temptation to include a ‘ghost’ name to your management team to attract and influence investors to invest in your business. Although the presence of these celebrity management team members may attract the attention of investors, it can cause your business to lose any credibility if you get found out.

Seasoned investors will investigate further the members of your management team before committing fully to your business If they find out that the celebrity name used does not play any actual role in your business, they will not invest and may write you off as dishonest.

2. Focus on Credentials But Pay Extra Attention to the Roles

Investors want to know the experience that your key team members have to determine if they can successfully reach the company’s growth and financial goals.

While it is an excellent boost for your key management team to have the right credentials, you also want to pay extra attention to the roles they will play in your company.

Organizational Chart

Adding an organizational chart in this section of your business plan is not necessary, you can do it in your business plan’s appendix.

If you are exploring funding options, it is not uncommon to get asked for your organizational chart. The function of an organizational chart goes beyond raising money, you can also use it as a useful planning tool for your business.

An organizational chart can help you identify how best to structure your management team for maximum productivity and point you towards key roles you need to fill in the future.

You can use the organizational chart to show your company’s internal management structure such as the roles and responsibilities of your management team, and relationships that exist between them.

5. Describe Your Product and Service Offering

In your business plan, you have to describe what you sell or the service you plan to offer. It is the next step after defining your business and management structure. The products and services section is where you sell the benefits of your business.

Here you have to explain how your product or service will benefit your customers and describe your product lifecycle. It is also the section where you write down your plans for intellectual property like patent filings and copyrighting.

The research and development that you are undertaking for your product or service need to be explained in detail in this section. However, do not get too technical, sell the general idea and its benefits.

If you have any diagrams or intricate designs of your product or service, do not include them in the products and services section. Instead, leave them for the addendum page. Also, if you are leaving out diagrams or designs for the addendum, ensure you add this phrase “For more detail, visit the addendum Page #.”

Your product and service section in your business plan should include the following:

• A detailed explanation that clearly shows how your product or service works.
• The pricing model for your product or service.
• Your business’ sales and distribution strategy.
• The ideal customers that want your product or service.
• The benefits of your products and services.
• Reason(s) why your product or service is a better alternative to what your competitors are currently offering in the market.
• Plans for filling the orders you receive
• If you have current or pending patents, copyrights, and trademarks for your product or service, you can also discuss them in this section.

What to Focus On When Describing the Benefits, Lifecycle, and Production Process of Your Products or Services

In the products and services section, you have to distill the benefits, lifecycle, and production process of your products and services.

When describing the benefits of your products or services, here are some key factors to focus on.

• Unique features
• Translating the unique features into benefits
• The emotional, psychological, and practical payoffs to attract customers
• Intellectual property rights or any patents

When describing the product life cycle of your products or services, here are some key factors to focus on.

• Upsells, cross-sells, and down-sells
• Time between purchases
• Plans for research and development.

When describing the production process for your products or services, you need to think about the following:

• The creation of new or existing products and services.
• The sources for the raw materials or components you need for production.
• Assembling the products
• Maintaining quality control
• Supply-chain logistics (receiving the raw materials and delivering the finished products)
• The day-to-day management of the production processes, bookkeeping, and inventory.

Tips for Writing the Products or Services Section of Your Business Plan

1. Avoid Technical Descriptions and Industry Buzzwords

The products and services section of your business plan should clearly describe the products and services that your company provides. However, it is not a section to include technical jargons that anyone outside your industry will not understand.

A good practice is to remove highly detailed or technical descriptions in favor of simple terms. Industry buzzwords are not necessary, if there are simpler terms you can use, then use them. If you plan to use your business plan to source funds, making the product or service section so technical will do you no favors.

2. Describe How Your Products or Services Differ from Your Competitors

When potential investors look at your business plan, they want to know how the products and services you are offering differ from that of your competition. Differentiating your products or services from your competition in a way that makes your solution more attractive is critical.

If you are going the innovative path and there is no market currently for your product or service, you need to describe in this section why the market needs your product or service.

For example, overnight delivery was a niche business that only a few companies were participating in. Federal Express (FedEx) had to show in its business plan that there was a large opportunity for that service and they justified why the market needed that service.

3. Long or Short Products or Services Section

Should your products or services section be short? Does the long products or services section attract more investors?

There are no straightforward answers to these questions. Whether your products or services section should be long or relatively short depends on the nature of your business.

If your business is product-focused, then automatically you need to use more space to describe the details of your products. However, if the product your business sells is a commodity item that relies on competitive pricing or other pricing strategies, you do not have to use up so much space to provide significant details about the product.

Likewise, if you are selling a commodity that is available in numerous outlets, then you do not have to spend time on writing a long products or services section.

The key to the success of your business is most likely the effectiveness of your marketing strategies compared to your competitors. Use more space to address that section.

If you are creating a new product or service that the market does not know about, your products or services section can be lengthy. The reason why is because you need to explain everything about the product or service such as the nature of the product, its use case, and values.

A short products or services section for an innovative product or service will not give the readers enough information to properly evaluate your business.

4. Describe Your Relationships with Vendors or Suppliers

Your business will rely on vendors or suppliers to supply raw materials or the components needed to make your products. In your products and services section, describe your relationships with your vendors and suppliers fully.

Avoid the mistake of relying on only one supplier or vendor. If that supplier or vendor fails to supply or goes out of business, you can easily face supply problems and struggle to meet your demands. Plan to set up multiple vendor or supplier relationships for better business stability.

5. Your Primary Goal Is to Convince Your Readers

The primary goal of your business plan is to convince your readers that your business is viable and to create a guide for your business to follow. It applies to the products and services section.

When drafting this section, think like the reader. See your reader as someone who has no idea about your products and services. You are using the products and services section to provide the needed information to help your reader understand your products and services. As a result, you have to be clear and to the point.

While you want to educate your readers about your products or services, you also do not want to bore them with lots of technical details. Show your products and services and not your fancy choice of words.

Your products and services section should provide the answer to the “what” question for your business. You and your management team may run the business, but it is your products and services that are the lifeblood of the business.

Key Questions to Answer When Writing your Products and Services Section

Answering these questions can help you write your products and services section quickly and in a way that will appeal to your readers.

• Are your products existing on the market or are they still in the development stage?
• What is your timeline for adding new products and services to the market?
• What are the positives that make your products and services different from your competitors?
• Do your products and services have any competitive advantage that your competitors’ products and services do not currently have?
• Do your products or services have any competitive disadvantages that you need to overcome to compete with your competitors? If your answer is yes, state how you plan to overcome them,
• How much does it cost to produce your products or services? How much do you plan to sell it for?
• What is the price for your products and services compared to your competitors? Is pricing an issue?
• What are your operating costs and will it be low enough for you to compete with your competitors and still take home a reasonable profit margin?
• What is your plan for acquiring your products? Are you involved in the production of your products or services?
• Are you the manufacturer and produce all the components you need to create your products? Do you assemble your products by using components supplied by other manufacturers? Do you purchase your products directly from suppliers or wholesalers?
• Do you have a steady supply of products that you need to start your business? (If your business is yet to kick-off)
• How do you plan to distribute your products or services to the market?

You can also hint at the marketing or promotion plans you have for your products or services such as how you plan to build awareness or retain customers. The next section is where you can go fully into details about your business’s marketing and sales plan.

6. Show and Explain Your Marketing and Sales Plan

Providing great products and services is wonderful, but it means nothing if you do not have a marketing and sales plan to inform your customers about them. Your marketing and sales plan is critical to the success of your business.

The sales and marketing section is where you show and offer a detailed explanation of your marketing and sales plan and how you plan to execute it. It covers your pricing plan, proposed advertising and promotion activities, activities and partnerships you need to make your business a success, and the benefits of your products and services.

There are several ways you can approach your marketing and sales strategy. Ideally, your marketing and sales strategy has to fit the unique needs of your business.

In this section, you describe how the plans your business has for attracting and retaining customers, and the exact process for making a sale happen. It is essential to thoroughly describe your complete marketing and sales plans because you are still going to reference this section when you are making financial projections for your business.

Outline Your Business’ Unique Selling Proposition (USP)

The sales and marketing section is where you outline your business’s unique selling proposition (USP). When you are developing your unique selling proposition, think about the strongest reasons why people should buy from you over your competition. That reason(s) is most likely a good fit to serve as your unique selling proposition (USP).

Target Market and Target Audience

Plans on how to get your products or services to your target market and how to get your target audience to buy them go into this section. You also highlight the strengths of your business here, particularly what sets them apart from your competition.

Before you start writing your marketing and sales plan, you need to have properly defined your target audience and fleshed out your buyer persona. If you do not first understand the individual you are marketing to, your marketing and sales plan will lack any substance and easily fall.

Creating a Smart Marketing and Sales Plan

Marketing your products and services is an investment that requires you to spend money. Like any other investment, you have to generate a good return on investment (ROI) to justify using that marketing and sales plan. Good marketing and sales plans bring in high sales and profits to your company.

Avoid spending money on unproductive marketing channels. Do your research and find out the best marketing and sales plan that works best for your company.

Your marketing and sales plan can be broken into different parts: your positioning statement, pricing, promotion, packaging, advertising, public relations, content marketing, social media, and strategic alliances.

Your Positioning Statement

Your positioning statement is the first part of your marketing and sales plan. It refers to the way you present your company to your customers.

Are you the premium solution, the low-price solution, or are you the intermediary between the two extremes in the market? What do you offer that your competitors do not that can give you leverage in the market?

Before you start writing your positioning statement, you need to spend some time evaluating the current market conditions. Here are some questions that can help you to evaluate the market

• What are the unique features or benefits that you offer that your competitors lack?
• What are your customers’ primary needs and wants?
• Why should a customer choose you over your competition? How do you plan to differentiate yourself from the competition?
• How does your company’s solution compare with other solutions in the market?

After answering these questions, then you can start writing your positioning statement. Your positioning statement does not have to be in-depth or too long.

All you need to explain with your positioning statement are two focus areas. The first is the position of your company within the competitive landscape. The other focus area is the core value proposition that sets your company apart from other alternatives that your ideal customer might consider.

Here is a simple template you can use to develop a positioning statement.

For [description of target market] who [need of target market], [product or service] [how it meets the need]. Unlike [top competition], it [most essential distinguishing feature].

For example, let’s create the positioning statement for fictional accounting software and QuickBooks alternative , TBooks.

“For small business owners who need accounting services, TBooks is an accounting software that helps small businesses handle their small business bookkeeping basics quickly and easily. Unlike Wave, TBooks gives small businesses access to live sessions with top accountants.”

You can edit this positioning statement sample and fill it with your business details.

After writing your positioning statement, the next step is the pricing of your offerings. The overall positioning strategy you set in your positioning statement will often determine how you price your products or services.

Pricing is a powerful tool that sends a strong message to your customers. Failure to get your pricing strategy right can make or mar your business. If you are targeting a low-income audience, setting a premium price can result in low sales.

You can use pricing to communicate your positioning to your customers. For example, if you are offering a product at a premium price, you are sending a message to your customers that the product belongs to the premium category.

Basic Rules to Follow When Pricing Your Offering

Setting a price for your offering involves more than just putting a price tag on it. Deciding on the right pricing for your offering requires following some basic rules. They include covering your costs, primary and secondary profit center pricing, and matching the market rate.

• Covering Your Costs: The price you set for your products or service should be more than it costs you to produce and deliver them. Every business has the same goal, to make a profit. Depending on the strategy you want to use, there are exceptions to this rule. However, the vast majority of businesses follow this rule.
• Primary and Secondary Profit Center Pricing: When a company sets its price above the cost of production, it is making that product its primary profit center. A company can also decide not to make its initial price its primary profit center by selling below or at even with its production cost. It rather depends on the support product or even maintenance that is associated with the initial purchase to make its profit. The initial price thus became its secondary profit center.
• Matching the Market Rate: A good rule to follow when pricing your products or services is to match your pricing with consumer demand and expectations. If you price your products or services beyond the price your customer perceives as the ideal price range, you may end up with no customers. Pricing your products too low below what your customer perceives as the ideal price range may lead to them undervaluing your offering.

Pricing Strategy

Your pricing strategy influences the price of your offering. There are several pricing strategies available for you to choose from when examining the right pricing strategy for your business. They include cost-plus pricing, market-based pricing, value pricing, and more.

• Cost-plus Pricing: This strategy is one of the simplest and oldest pricing strategies. Here you consider the cost of producing a unit of your product and then add a profit to it to arrive at your market price. It is an effective pricing strategy for manufacturers because it helps them cover their initial costs. Another name for the cost-plus pricing strategy is the markup pricing strategy.
• Market-based Pricing: This pricing strategy analyses the market including competitors’ pricing and then sets a price based on what the market is expecting. With this pricing strategy, you can either set your price at the low-end or high-end of the market.
• Value Pricing: This pricing strategy involves setting a price based on the value you are providing to your customer. When adopting a value-based pricing strategy, you have to set a price that your customers are willing to pay. Service-based businesses such as small business insurance providers , luxury goods sellers, and the fashion industry use this pricing strategy.

After carefully sorting out your positioning statement and pricing, the next item to look at is your promotional strategy. Your promotional strategy explains how you plan on communicating with your customers and prospects.

As a business, you must measure all your costs, including the cost of your promotions. You also want to measure how much sales your promotions bring for your business to determine its usefulness. Promotional strategies or programs that do not lead to profit need to be removed.

There are different types of promotional strategies you can adopt for your business, they include advertising, public relations, and content marketing.

Advertising

Your business plan should include your advertising plan which can be found in the marketing and sales plan section. You need to include an overview of your advertising plans such as the areas you plan to spend money on to advertise your business and offers.

Ensure that you make it clear in this section if your business will be advertising online or using the more traditional offline media, or the combination of both online and offline media. You can also include the advertising medium you want to use to raise awareness about your business and offers.

Some common online advertising mediums you can use include social media ads, landing pages, sales pages, SEO, Pay-Per-Click, emails, Google Ads, and others. Some common traditional and offline advertising mediums include word of mouth, radios, direct mail, televisions, flyers, billboards, posters, and others.

A key component of your advertising strategy is how you plan to measure the effectiveness and success of your advertising campaign. There is no point in sticking with an advertising plan or medium that does not produce results for your business in the long run.

Public Relations

A great way to reach your customers is to get the media to cover your business or product. Publicity, especially good ones, should be a part of your marketing and sales plan. In this section, show your plans for getting prominent reviews of your product from reputable publications and sources.

Your business needs that exposure to grow. If public relations is a crucial part of your promotional strategy, provide details about your public relations plan here.

Content Marketing

Content marketing is a popular promotional strategy used by businesses to inform and attract their customers. It is about teaching and educating your prospects on various topics of interest in your niche, it does not just involve informing them about the benefits and features of the products and services you have,

Businesses publish content usually for free where they provide useful information, tips, and advice so that their target market can be made aware of the importance of their products and services. Content marketing strategies seek to nurture prospects into buyers over time by simply providing value.

Your company can create a blog where it will be publishing content for its target market. You will need to use the best website builder such as Wix and Squarespace and the best web hosting services such as Bluehost, Hostinger, and other Bluehost alternatives to create a functional blog or website.

If content marketing is a crucial part of your promotional strategy (as it should be), detail your plans under promotions.

Including high-quality images of the packaging of your product in your business plan is a lovely idea. You can add the images of the packaging of that product in the marketing and sales plan section. If you are not selling a product, then you do not need to include any worry about the physical packaging of your product.

When organizing the packaging section of your business plan, you can answer the following questions to make maximum use of this section.

• Is your choice of packaging consistent with your positioning strategy?
• What key value proposition does your packaging communicate? (It should reflect the key value proposition of your business)
• How does your packaging compare to that of your competitors?

Social Media

Your 21st-century business needs to have a good social media presence. Not having one is leaving out opportunities for growth and reaching out to your prospect.

You do not have to join the thousands of social media platforms out there. What you need to do is join the ones that your customers are active on and be active there.

Businesses use social media to provide information about their products such as promotions, discounts, the benefits of their products, and content on their blogs.

Social media is also a platform for engaging with your customers and getting feedback about your products or services. Make no mistake, more and more of your prospects are using social media channels to find more information about companies.

You need to consider the social media channels you want to prioritize your business (prioritize the ones your customers are active in) and your branding plans in this section.

Strategic Alliances

If your company plans to work closely with other companies as part of your sales and marketing plan, include it in this section. Prove details about those partnerships in your business plan if you have already established them.

Strategic alliances can be beneficial for all parties involved including your company. Working closely with another company in the form of a partnership can provide access to a different target market segment for your company.

The company you are partnering with may also gain access to your target market or simply offer a new product or service (that of your company) to its customers.

Mutually beneficial partnerships can cover the weaknesses of one company with the strength of another. You should consider strategic alliances with companies that sell complimentary products to yours. For example, if you provide printers, you can partner with a company that produces ink since the customers that buy printers from you will also need inks for printing.

Steps Involved in Creating a Marketing and Sales Plan

1. Focus on Your Target Market

Identify who your customers are, the market you want to target. Then determine the best ways to get your products or services to your potential customers.

2. Evaluate Your Competition

One of the goals of having a marketing plan is to distinguish yourself from your competition. You cannot stand out from them without first knowing them in and out.

You can know your competitors by gathering information about their products, pricing, service, and advertising campaigns.

These questions can help you know your competition.

• What makes your competition successful?
• What are their weaknesses?
• What are customers saying about your competition?

3. Consider Your Brand

Customers' perception of your brand has a strong impact on your sales. Your marketing and sales plan should seek to bolster the image of your brand. Before you start marketing your business, think about the message you want to pass across about your business and your products and services.

4. Focus on Benefits

The majority of your customers do not view your product in terms of features, what they want to know is the benefits and solutions your product offers. Think about the problems your product solves and the benefits it delivers, and use it to create the right sales and marketing message.

Your marketing plan should focus on what you want your customer to get instead of what you provide. Identify those benefits in your marketing and sales plan.

5. Focus on Differentiation

Your marketing and sales plan should look for a unique angle they can take that differentiates your business from the competition, even if the products offered are similar. Some good areas of differentiation you can use are your benefits, pricing, and features.

Key Questions to Answer When Writing Your Marketing and Sales Plan

• What is your company’s budget for sales and marketing campaigns?
• What key metrics will you use to determine if your marketing plans are successful?
• What are your alternatives if your initial marketing efforts do not succeed?
• Who are the sales representatives you need to promote your products or services?
• What are the marketing and sales channels you plan to use? How do you plan to get your products in front of your ideal customers?
• Where will you sell your products?

You may want to include samples of marketing materials you plan to use such as print ads, website descriptions, and social media ads. While it is not compulsory to include these samples, it can help you better communicate your marketing and sales plan and objectives.

The purpose of the marketing and sales section is to answer this question “How will you reach your customers?” If you cannot convincingly provide an answer to this question, you need to rework your marketing and sales section.

7. Clearly Show Your Funding Request

If you are writing your business plan to ask for funding from investors or financial institutions, the funding request section is where you will outline your funding requirements. The funding request section should answer the question ‘How much money will your business need in the near future (3 to 5 years)?’

A good funding request section will clearly outline and explain the amount of funding your business needs over the next five years. You need to know the amount of money your business needs to make an accurate funding request.

Also, when writing your funding request, provide details of how the funds will be used over the period. Specify if you want to use the funds to buy raw materials or machinery, pay salaries, pay for advertisements, and cover specific bills such as rent and electricity.

In addition to explaining what you want to use the funds requested for, you need to clearly state the projected return on investment (ROI) . Investors and creditors want to know if your business can generate profit for them if they put funds into it.

Ensure you do not inflate the figures and stay as realistic as possible. Investors and financial institutions you are seeking funds from will do their research before investing money in your business.

If you are not sure of an exact number to request from, you can use some range of numbers as rough estimates. Add a best-case scenario and a work-case scenario to your funding request. Also, include a description of your strategic future financial plans such as selling your business or paying off debts.

Funding Request: Debt or Equity?

When making your funding request, specify the type of funding you want. Do you want debt or equity? Draw out the terms that will be applicable for the funding, and the length of time the funding request will cover.

Case for Equity

If your new business has not yet started generating profits, you are most likely preparing to sell equity in your business to raise capital at the early stage. Equity here refers to ownership. In this case, you are selling a portion of your company to raise capital.

Although this method of raising capital for your business does not put your business in debt, keep in mind that an equity owner may expect to play a key role in company decisions even if he does not hold a major stake in the company.

Most equity sales for startups are usually private transactions . If you are making a funding request by offering equity in exchange for funding, let the investor know that they will be paid a dividend (a share of the company’s profit). Also, let the investor know the process for selling their equity in your business.

Case for Debt

You may decide not to offer equity in exchange for funds, instead, you make a funding request with the promise to pay back the money borrowed at the agreed time frame.

When making a funding request with an agreement to pay back, note that you will have to repay your creditors both the principal amount borrowed and the interest on it. Financial institutions offer this type of funding for businesses.

Large companies combine both equity and debt in their capital structure. When drafting your business plan, decide if you want to offer both or one over the other.

Before you sell equity in exchange for funding in your business, consider if you are willing to accept not being in total control of your business. Also, before you seek loans in your funding request section, ensure that the terms of repayment are favorable.

You should set a clear timeline in your funding request so that potential investors and creditors can know what you are expecting. Some investors and creditors may agree to your funding request and then delay payment for longer than 30 days, meanwhile, your business needs an immediate cash injection to operate efficiently.

Additional Tips for Writing the Funding Request Section of your Business Plan

The funding request section is not necessary for every business, it is only needed by businesses who plan to use their business plan to secure funding.

If you are adding the funding request section to your business plan, provide an itemized summary of how you plan to use the funds requested. Hiring a lawyer, accountant, or other professionals may be necessary for the proper development of this section.

You should also gather and use financial statements that add credibility and support to your funding requests. Ensure that the financial statements you use should include your projected financial data such as projected cash flows, forecast statements, and expenditure budgets.

If you are an existing business, include all historical financial statements such as cash flow statements, balance sheets and income statements .

Provide monthly and quarterly financial statements for a year. If your business has records that date back beyond the one-year mark, add the yearly statements of those years. These documents are for the appendix section of your business plan.

8. Detail Your Financial Plan, Metrics, and Projections

If you used the funding request section in your business plan, supplement it with a financial plan, metrics, and projections. This section paints a picture of the past performance of your business and then goes ahead to make an informed projection about its future.

The goal of this section is to convince readers that your business is going to be a financial success. It outlines your business plan to generate enough profit to repay the loan (with interest if applicable) and to generate a decent return on investment for investors.

If you have an existing business already in operation, use this section to demonstrate stability through finance. This section should include your cash flow statements, balance sheets, and income statements covering the last three to five years. If your business has some acceptable collateral that you can use to acquire loans, list it in the financial plan, metrics, and projection section.

Apart from current financial statements, this section should also contain a prospective financial outlook that spans the next five years. Include forecasted income statements, cash flow statements, balance sheets, and capital expenditure budget.

If your business is new and is not yet generating profit, use clear and realistic projections to show the potentials of your business.

When drafting this section, research industry norms and the performance of comparable businesses. Your financial projections should cover at least five years. State the logic behind your financial projections. Remember you can always make adjustments to this section as the variables change.

The financial plan, metrics, and projection section create a baseline which your business can either exceed or fail to reach. If your business fails to reach your projections in this section, you need to understand why it failed.

Investors and loan managers spend a lot of time going through the financial plan, metrics, and projection section compared to other parts of the business plan. Ensure you spend time creating credible financial analyses for your business in this section.

Many entrepreneurs find this section daunting to write. You do not need a business degree to create a solid financial forecast for your business. Business finances, especially for startups, are not as complicated as they seem. There are several online tools and templates that make writing this section so much easier.

Use Graphs and Charts

The financial plan, metrics, and projection section is a great place to use graphs and charts to tell the financial story of your business. Charts and images make it easier to communicate your finances.

Accuracy in this section is key, ensure you carefully analyze your past financial statements properly before making financial projects.

Address the Risk Factors and Show Realistic Financial Projections

Keep your financial plan, metrics, and projection realistic. It is okay to be optimistic in your financial projection, however, you have to justify it.

You should also address the various risk factors associated with your business in this section. Investors want to know the potential risks involved, show them. You should also show your plans for mitigating those risks.

What You Should In The Financial Plan, Metrics, and Projection Section of Your Business Plan

The financial plan, metrics, and projection section of your business plan should have monthly sales and revenue forecasts for the first year. It should also include annual projections that cover 3 to 5 years.

A three-year projection is a basic requirement to have in your business plan. However, some investors may request a five-year forecast.

Your business plan should include the following financial statements: sales forecast, personnel plan, income statement, income statement, cash flow statement, balance sheet, and an exit strategy.

1. Sales Forecast

Sales forecast refers to your projections about the number of sales your business is going to record over the next few years. It is typically broken into several rows, with each row assigned to a core product or service that your business is offering.

One common mistake people make in their business plan is to break down the sales forecast section into long details. A sales forecast should forecast the high-level details.

For example, if you are forecasting sales for a payroll software provider, you could break down your forecast into target market segments or subscription categories.

Your sales forecast section should also have a corresponding row for each sales row to cover the direct cost or Cost of Goods Sold (COGS). The objective of these rows is to show the expenses that your business incurs in making and delivering your product or service.

Note that your Cost of Goods Sold (COGS) should only cover those direct costs incurred when making your products. Other indirect expenses such as insurance, salaries, payroll tax, and rent should not be included.

For example, the Cost of Goods Sold (COGS) for a restaurant is the cost of ingredients while for a consulting company it will be the cost of paper and other presentation materials.

2. Personnel Plan

The personnel plan section is where you provide details about the payment plan for your employees. For a small business, you can easily list every position in your company and how much you plan to pay in the personnel plan.

However, for larger businesses, you have to break the personnel plan into functional groups such as sales and marketing.

The personnel plan will also include the cost of an employee beyond salary, commonly referred to as the employee burden. These costs include insurance, payroll taxes , and other essential costs incurred monthly as a result of having employees on your payroll.

3. Income Statement

The income statement section shows if your business is making a profit or taking a loss. Another name for the income statement is the profit and loss (P&L). It takes data from your sales forecast and personnel plan and adds other ongoing expenses you incur while running your business.

Every business plan should have an income statement. It subtracts your business expenses from its earnings to show if your business is generating profit or incurring losses.

The income statement has the following items: sales, Cost of Goods Sold (COGS), gross margin, operating expenses, total operating expenses, operating income , total expenses, and net profit.

• Sales refer to the revenue your business generates from selling its products or services. Other names for sales are income or revenue.
• Cost of Goods Sold (COGS) refers to the total cost of selling your products. Other names for COGS are direct costs or cost of sales. Manufacturing businesses use the Costs of Goods Manufactured (COGM) .
• Gross Margin is the figure you get when you subtract your COGS from your sales. In your income statement, you can express it as a percentage of total sales (Gross margin / Sales = Gross Margin Percent).
• Operating Expenses refer to all the expenses you incur from running your business. It exempts the COGS because it stands alone as a core part of your income statement. You also have to exclude taxes, depreciation, and amortization. Your operating expenses include salaries, marketing expenses, research and development (R&D) expenses, and other expenses.
• Total Operating Expenses refers to the sum of all your operating expenses including those exemptions named above under operating expenses.
• Operating Income refers to earnings before interest, taxes, depreciation, and amortization. It is simply known as the acronym EBITDA (earnings before interest, taxes, depreciation, and amortization). Calculating your operating income is simple, all you need to do is to subtract your COGS and total operating expenses from your sales.
• Total Expenses refer to the sum of your operating expenses and your business’ interest, taxes, depreciation, and amortization.
• Net profit shows whether your business has made a profit or taken a loss during a given timeframe.

4. Cash Flow Statement

The cash flow statement tracks the money you have in the bank at any given point. It is often confused with the income statement or the profit and loss statement. They are both different types of financial statements. The income statement calculates your profits and losses while the cash flow statement shows you how much you have in the bank.

5. Balance Sheet

The balance sheet is a financial statement that provides an overview of the financial health of your business. It contains information about the assets and liabilities of your company, and owner’s or shareholders’ equity.

You can get the net worth of your company by subtracting your company’s liabilities from its assets.

6. Exit Strategy

The exit strategy refers to a probable plan for selling your business either to the public in an IPO or to another company. It is the last thing you include in the financial plan, metrics, and projection section.

You can choose to omit the exit strategy from your business plan if you plan to maintain full ownership of your business and do not plan on seeking angel investment or virtual capitalist (VC) funding.

Investors may want to know what your exit plan is. They invest in your business to get a good return on investment.

Your exit strategy does not have to include long and boring details. Ensure you identify some interested parties who may be interested in buying the company if it becomes a success.

Key Questions to Answer with Your Financial Plan, Metrics, and Projection

Your financial plan, metrics, and projection section helps investors, creditors, or your internal managers to understand what your expenses are, the amount of cash you need, and what it takes to make your company profitable. It also shows what you will be doing with any funding.

You do not need to show actual financial data if you do not have one. Adding forecasts and projections to your financial statements is added proof that your strategy is feasible and shows investors you have planned properly.

Here are some key questions to answer to help you develop this section.

• What is your sales forecast for the next year?
• When will your company achieve a positive cash flow?
• What are the core expenses you need to operate?
• How much money do you need upfront to operate or grow your company?
• How will you use the loans or investments?

9. Add an Appendix to Your Business Plan

Adding an appendix to your business plan is optional. It is a useful place to put any charts, tables, legal notes, definitions, permits, résumés, and other critical information that do not fit into other sections of your business plan.

The appendix section is where you would want to include details of a patent or patent-pending if you have one. You can always add illustrations or images of your products here. It is the last section of your business plan.

When writing your business plan, there are details you cut short or remove to prevent the entire section from becoming too lengthy. There are also details you want to include in the business plan but are not a good fit for any of the previous sections. You can add that additional information to the appendix section.

Businesses also use the appendix section to include supporting documents or other materials specially requested by investors or lenders.

You can include just about any information that supports the assumptions and statements you made in the business plan under the appendix. It is the one place in the business plan where unrelated data and information can coexist amicably.

If your appendix section is lengthy, try organizing it by adding a table of contents at the beginning of the appendix section. It is also advisable to group similar information to make it easier for the reader to access them.

A well-organized appendix section makes it easier to share your information clearly and concisely. Add footnotes throughout the rest of the business plan or make references in the plan to the documents in the appendix.

The appendix section is usually only necessary if you are seeking funding from investors or lenders, or hoping to attract partners.

People reading business plans do not want to spend time going through a heap of backup information, numbers, and charts. Keep these documents or information in the Appendix section in case the reader wants to dig deeper.

Common Items to Include in the Appendix Section of Your Business Plan

The appendix section includes documents that supplement or support the information or claims given in other sections of the business plans. Common items you can include in the appendix section include:

• Additional data about the process of manufacturing or creation
• Additional description of products or services such as product schematics
• Additional financial documents or projections
• Articles of incorporation and status
• Backup for market research or competitive analysis
• Bank statements
• Business registries
• Client testimonials (if your business is already running)
• Copies of insurances
• Credit histories (personal or/and business)
• Deeds and permits
• Equipment leases
• Examples of marketing and advertising collateral
• Industry associations and memberships
• Images of product
• Intellectual property
• Key customer contracts
• Legal documents and other contracts
• Letters of reference
• Links to references
• Market research data
• Organizational charts
• Photographs of potential facilities
• Professional licenses pertaining to your legal structure or type of business
• Purchase orders
• Resumes of the founder(s) and key managers
• State and federal identification numbers or codes
• Trademarks or patents’ registrations

Avoid using the appendix section as a place to dump any document or information you feel like adding. Only add documents or information that you support or increase the credibility of your business plan.

Tips and Strategies for Writing a Convincing Business Plan

To achieve a perfect business plan, you need to consider some key tips and strategies. These tips will raise the efficiency of your business plan above average.

1. Know Your Audience

When writing a business plan, you need to know your audience . Business owners write business plans for different reasons. Your business plan has to be specific. For example, you can write business plans to potential investors, banks, and even fellow board members of the company.

The audience you are writing to determines the structure of the business plan. As a business owner, you have to know your audience. Not everyone will be your audience. Knowing your audience will help you to narrow the scope of your business plan.

Consider what your audience wants to see in your projects, the likely questions they might ask, and what interests them.

• A business plan used to address a company's board members will center on its employment schemes, internal affairs, projects, stakeholders, etc.
• A business plan for financial institutions will talk about the size of your market and the chances for you to pay back any loans you demand.
• A business plan for investors will show proof that you can return the investment capital within a specific time. In addition, it discusses your financial projections, tractions, and market size.

2. Get Inspiration from People

Writing a business plan from scratch as an entrepreneur can be daunting. That is why you need the right inspiration to push you to write one. You can gain inspiration from the successful business plans of other businesses. Look at their business plans, the style they use, the structure of the project, etc.

To make your business plan easier to create, search companies related to your business to get an exact copy of what you need to create an effective business plan. You can also make references while citing examples in your business plans.

When drafting your business plan, get as much help from others as you possibly can. By getting inspiration from people, you can create something better than what they have.

3. Avoid Being Over Optimistic

Many business owners make use of strong adjectives to qualify their content. One of the big mistakes entrepreneurs make when preparing a business plan is promising too much.

The use of superlatives and over-optimistic claims can prepare the audience for more than you can offer. In the end, you disappoint the confidence they have in you.

In most cases, the best option is to be realistic with your claims and statistics. Most of the investors can sense a bit of incompetency from the overuse of superlatives. As a new entrepreneur, do not be tempted to over-promise to get the interests of investors.

The concept of entrepreneurship centers on risks, nothing is certain when you make future analyses. What separates the best is the ability to do careful research and work towards achieving that, not promising more than you can achieve.

To make an excellent first impression as an entrepreneur, replace superlatives with compelling data-driven content. In this way, you are more specific than someone promising a huge ROI from an investment.

4. Keep it Simple and Short

When writing business plans, ensure you keep them simple throughout. Irrespective of the purpose of the business plan, your goal is to convince the audience.

One way to achieve this goal is to make them understand your proposal. Therefore, it would be best if you avoid the use of complex grammar to express yourself. It would be a huge turn-off if the people you want to convince are not familiar with your use of words.

Another thing to note is the length of your business plan. It would be best if you made it as brief as possible.

You hardly see investors or agencies that read through an extremely long document. In that case, if your first few pages can’t convince them, then you have lost it. The more pages you write, the higher the chances of you derailing from the essential contents.

To ensure your business plan has a high conversion rate, you need to dispose of every unnecessary information. For example, if you have a strategy that you are not sure of, it would be best to leave it out of the plan.

5. Make an Outline and Follow Through

A perfect business plan must have touched every part needed to convince the audience. Business owners get easily tempted to concentrate more on their products than on other sections. Doing this can be detrimental to the efficiency of the business plan.

For example, imagine you talking about a product but omitting or providing very little information about the target audience. You will leave your clients confused.

To ensure that your business plan communicates your full business model to readers, you have to input all the necessary information in it. One of the best ways to achieve this is to design a structure and stick to it.

This structure is what guides you throughout the writing. To make your work easier, you can assign an estimated word count or page limit to every section to avoid making it too bulky for easy reading. As a guide, the necessary things your business plan must contain are:

• Table of contents
• Introduction
• Product or service description
• Target audience
• Market size
• Competition analysis
• Financial projections

Some specific businesses can include some other essential sections, but these are the key sections that must be in every business plan.

6. Ask a Professional to Proofread

When writing a business plan, you must tie all loose ends to get a perfect result. When you are done with writing, call a professional to go through the document for you. You are bound to make mistakes, and the way to correct them is to get external help.

You should get a professional in your field who can relate to every section of your business plan. It would be easier for the professional to notice the inner flaws in the document than an editor with no knowledge of your business.

In addition to getting a professional to proofread, get an editor to proofread and edit your document. The editor will help you identify grammatical errors, spelling mistakes, and inappropriate writing styles.

Writing a business plan can be daunting, but you can surmount that obstacle and get the best out of it with these tips.

Business Plan Examples and Templates That’ll Save You Tons of Time

1. hubspot's one-page business plan.

The one-page business plan template by HubSpot is the perfect guide for businesses of any size, irrespective of their business strategy. Although the template is condensed into a page, your final business plan should not be a page long! The template is designed to ask helpful questions that can help you develop your business plan.

Hubspot’s one-page business plan template is divided into nine fields:

• Business opportunity
• Company description
• Industry analysis
• Target market
• Implementation timeline
• Marketing plan
• Financial summary
• Funding required

2. Bplan’s Free Business Plan Template

Bplans' free business plan template is investor-approved. It is a rich template used by prestigious educational institutions such as Babson College and Princeton University to teach entrepreneurs how to create a business plan.

The template has six sections: the executive summary, opportunity, execution, company, financial plan, and appendix. There is a step-by-step guide for writing every little detail in the business plan. Follow the instructions each step of the way and you will create a business plan that impresses investors or lenders easily.

3. HubSpot's Downloadable Business Plan Template

HubSpot’s downloadable business plan template is a more comprehensive option compared to the one-page business template by HubSpot. This free and downloadable business plan template is designed for entrepreneurs.

The template is a comprehensive guide and checklist for business owners just starting their businesses. It tells you everything you need to fill in each section of the business plan and how to do it.

There are nine sections in this business plan template: an executive summary, company and business description, product and services line, market analysis, marketing plan, sales plan, legal notes, financial considerations, and appendix.

4. Business Plan by My Own Business Institute

My Own Business Institute (MOBI) which is a part of Santa Clara University's Center for Innovation and Entrepreneurship offers a free business plan template. You can either copy the free business template from the link provided above or download it as a Word document.

The comprehensive template consists of a whopping 15 sections.

• The Business Profile
• The Vision and the People
• Home-Based Business and Freelance Business Opportunities
• Organization
• Licenses and Permits
• Business Insurance
• Communication Tools
• Acquisitions
• Location and Leasing
• Accounting and Cash Flow
• Opening and Marketing
• Managing Employees
• Expanding and Handling Problems

There are lots of helpful tips on how to fill each section in the free business plan template by MOBI.

5. Score's Business Plan Template for Startups

Score is an American nonprofit organization that helps entrepreneurs build successful companies. This business plan template for startups by Score is available for free download. The business plan template asks a whooping 150 generic questions that help entrepreneurs from different fields to set up the perfect business plan.

The business plan template for startups contains clear instructions and worksheets, all you have to do is answer the questions and fill the worksheets.

There are nine sections in the business plan template: executive summary, company description, products and services, marketing plan, operational plan, management and organization, startup expenses and capitalization, financial plan, and appendices.

The ‘refining the plan’ resource contains instructions that help you modify your business plan to suit your specific needs, industry, and target audience. After you have completed Score’s business plan template, you can work with a SCORE mentor for expert advice in business planning.

6. Minimalist Architecture Business Plan Template by Venngage

The minimalist architecture business plan template is a simple template by Venngage that you can customize to suit your business needs .

There are five sections in the template: an executive summary, statement of problem, approach and methodology, qualifications, and schedule and benchmark. The business plan template has instructions that guide users on what to fill in each section.

7. Small Business Administration Free Business Plan Template

The Small Business Administration (SBA) offers two free business plan templates, filled with practical real-life examples that you can model to create your business plan. Both free business plan templates are written by fictional business owners: Rebecca who owns a consulting firm, and Andrew who owns a toy company.

There are five sections in the two SBA’s free business plan templates.

• Executive Summary
• Company Description
• Service Line
• Marketing and Sales

8. The $100 Startup's One-Page Business Plan

The one-page business plan by the $100 startup is a simple business plan template for entrepreneurs who do not want to create a long and complicated plan . You can include more details in the appendices for funders who want more information beyond what you can put in the one-page business plan.

There are five sections in the one-page business plan such as overview, ka-ching, hustling, success, and obstacles or challenges or open questions. You can answer all the questions using one or two sentences.

9. PandaDoc’s Free Business Plan Template

The free business plan template by PandaDoc is a comprehensive 15-page document that describes the information you should include in every section.

There are 11 sections in PandaDoc’s free business plan template.

• Executive summary
• Business description
• Products and services
• Operations plan
• Management organization
• Financial plan
• Conclusion / Call to action
• Confidentiality statement

You have to sign up for its 14-day free trial to access the template. You will find different business plan templates on PandaDoc once you sign up (including templates for general businesses and specific businesses such as bakeries, startups, restaurants, salons, hotels, and coffee shops)

PandaDoc allows you to customize its business plan templates to fit the needs of your business. After editing the template, you can send it to interested parties and track opens and views through PandaDoc.

10. Invoiceberry Templates for Word, Open Office, Excel, or PPT

InvoiceBerry is a U.K based online invoicing and tracking platform that offers free business plan templates in .docx, .odt, .xlsx, and .pptx formats for freelancers and small businesses.

Before you can download the free business plan template, it will ask you to give it your email address. After you complete the little task, it will send the download link to your inbox for you to download. It also provides a business plan checklist in .xlsx file format that ensures you add the right information to the business plan.

Alternatives to the Traditional Business Plan

A business plan is very important in mapping out how one expects their business to grow over a set number of years, particularly when they need external investment in their business. However, many investors do not have the time to watch you present your business plan. It is a long and boring read.

Luckily, there are three alternatives to the traditional business plan (the Business Model Canvas, Lean Canvas, and Startup Pitch Deck). These alternatives are less laborious and easier and quicker to present to investors.

Business Model Canvas (BMC)

The business model canvas is a business tool used to present all the important components of setting up a business, such as customers, route to market, value proposition, and finance in a single sheet. It provides a very focused blueprint that defines your business initially which you can later expand on if needed.

The sheet is divided mainly into company, industry, and consumer models that are interconnected in how they find problems and proffer solutions.

Segments of the Business Model Canvas

The business model canvas was developed by founder Alexander Osterwalder to answer important business questions. It contains nine segments.

• Key Partners: Who will be occupying important executive positions in your business? What do they bring to the table? Will there be a third party involved with the company?
• Key Activities: What important activities will production entail? What activities will be carried out to ensure the smooth running of the company?
• The Product’s Value Propositions: What does your product do? How will it be different from other products?
• Customer Segments: What demography of consumers are you targeting? What are the habits of these consumers? Who are the MVPs of your target consumers?
• Customer Relationships: How will the team support and work with its customer base? How do you intend to build and maintain trust with the customer?
• Key Resources: What type of personnel and tools will be needed? What size of the budget will they need access to?
• Channels: How do you plan to create awareness of your products? How do you intend to transport your product to the customer?
• Cost Structure: What is the estimated cost of production? How much will distribution cost?
• Revenue Streams: For what value are customers willing to pay? How do they prefer to pay for the product? Are there any external revenues attached apart from the main source? How do the revenue streams contribute to the overall revenue?

Lean Canvas

The lean canvas is a problem-oriented alternative to the standard business model canvas. It was proposed by Ash Maurya, creator of Lean Stack as a development of the business model generation. It uses a more problem-focused approach and it majorly targets entrepreneurs and startup businesses.

Lean Canvas uses the same 9 blocks concept as the business model canvas, however, they have been modified slightly to suit the needs and purpose of a small startup. The key partners, key activities, customer relationships, and key resources are replaced by new segments which are:

• Problem: Simple and straightforward number of problems you have identified, ideally three.
• Solution: The solutions to each problem.
• Unfair Advantage: Something you possess that can't be easily bought or replicated.
• Key Metrics: Important numbers that will tell how your business is doing.

Startup Pitch Deck

While the business model canvas compresses into a factual sheet, startup pitch decks expand flamboyantly.

Pitch decks, through slides, convey your business plan, often through graphs and images used to emphasize estimations and observations in your presentation. Entrepreneurs often use pitch decks to fully convince their target audience of their plans before discussing funding arrangements.

Considering the likelihood of it being used in a small time frame, a good startup pitch deck should ideally contain 20 slides or less to have enough time to answer questions from the audience.

Unlike the standard and lean business model canvases, a pitch deck doesn't have a set template on how to present your business plan but there are still important components to it. These components often mirror those of the business model canvas except that they are in slide form and contain more details.

Using Airbnb (one of the most successful start-ups in recent history) for reference, the important components of a good slide are listed below.

• Cover/Introduction Slide: Here, you should include your company's name and mission statement. Your mission statement should be a very catchy tagline. Also, include personal information and contact details to provide an easy link for potential investors.
• Problem Slide: This slide requires you to create a connection with the audience or the investor that you are pitching. For example in their pitch, Airbnb summarized the most important problems it would solve in three brief points – pricing of hotels, disconnection from city culture, and connection problems for local bookings.
• Solution Slide: This slide includes your core value proposition. List simple and direct solutions to the problems you have mentioned
• Customer Analysis: Here you will provide information on the customers you will be offering your service to. The identity of your customers plays an important part in fundraising as well as the long-run viability of the business.
• Market Validation: Use competitive analysis to show numbers that prove the presence of a market for your product, industry behavior in the present and the long run, as well as the percentage of the market you aim to attract. It shows that you understand your competitors and customers and convinces investors of the opportunities presented in the market.
• Business Model: Your business model is the hook of your presentation. It may vary in complexity but it should generally include a pricing system informed by your market analysis. The goal of the slide is to confirm your business model is easy to implement.
• Marketing Strategy: This slide should summarize a few customer acquisition methods that you plan to use to grow the business.
• Competitive Advantage: What this slide will do is provide information on what will set you apart and make you a more attractive option to customers. It could be the possession of technology that is not widely known in the market.
• Team Slide: Here you will give a brief description of your team. Include your key management personnel here and their specific roles in the company. Include their educational background, job history, and skillsets. Also, talk about their accomplishments in their careers so far to build investors' confidence in members of your team.
• Traction Slide: This validates the company’s business model by showing growth through early sales and support. The slide aims to reduce any lingering fears in potential investors by showing realistic periodic milestones and profit margins. It can include current sales, growth, valuable customers, pre-orders, or data from surveys outlining current consumer interest.
• Funding Slide: This slide is popularly referred to as ‘the ask'. Here you will include important details like how much is needed to get your business off the ground and how the funding will be spent to help the company reach its goals.
• Appendix Slides: Your pitch deck appendix should always be included alongside a standard pitch presentation. It consists of additional slides you could not show in the pitch deck but you need to complement your presentation.

It is important to support your calculations with pictorial renditions. Infographics, such as pie charts or bar graphs, will be more effective in presenting the information than just listing numbers. For example, a six-month graph that shows rising profit margins will easily look more impressive than merely writing it.

Lastly, since a pitch deck is primarily used to secure meetings and you may be sharing your pitch with several investors, it is advisable to keep a separate public version that doesn't include financials. Only disclose the one with projections once you have secured a link with an investor.

Advantages of the Business Model Canvas, Lean Canvas, and Startup Pitch Deck over the Traditional Business Plan

• Time-Saving: Writing a detailed traditional business plan could take weeks or months. On the other hand, all three alternatives can be done in a few days or even one night of brainstorming if you have a comprehensive understanding of your business.
• Easier to Understand: Since the information presented is almost entirely factual, it puts focus on what is most important in running the business. They cut away the excess pages of fillers in a traditional business plan and allow investors to see what is driving the business and what is getting in the way.
• Easy to Update: Businesses typically present their business plans to many potential investors before they secure funding. What this means is that you may regularly have to amend your presentation to update statistics or adjust to audience-specific needs. For a traditional business plan, this could mean rewriting a whole section of your plan. For the three alternatives, updating is much easier because they are not voluminous.
• Guide for a More In-depth Business Plan: All three alternatives have the added benefit of being able to double as a sketch of your business plan if the need to create one arises in the future.

Business Plan FAQ

Business plans are important for any entrepreneur who is looking for a framework to run their company over some time or seeking external support. Although they are essential for new businesses, every company should ideally have a business plan to track their growth from time to time.  They can be used by startups seeking investments or loans to convey their business ideas or an employee to convince his boss of the feasibility of starting a new project. They can also be used by companies seeking to recruit high-profile employee targets into key positions or trying to secure partnerships with other firms.

Business plans often vary depending on your target audience, the scope, and the goals for the plan. Startup plans are the most common among the different types of business plans.  A start-up plan is used by a new business to present all the necessary information to help get the business up and running. They are usually used by entrepreneurs who are seeking funding from investors or bank loans. The established company alternative to a start-up plan is a feasibility plan. A feasibility plan is often used by an established company looking for new business opportunities. They are used to show the upsides of creating a new product for a consumer base. Because the audience is usually company people, it requires less company analysis. The third type of business plan is the lean business plan. A lean business plan is a brief, straight-to-the-point breakdown of your ideas and analysis for your business. It does not contain details of your proposal and can be written on one page. Finally, you have the what-if plan. As it implies, a what-if plan is a preparation for the worst-case scenario. You must always be prepared for the possibility of your original plan being rejected. A good what-if plan will serve as a good plan B to the original.

A good business plan has 10 key components. They include an executive plan, product analysis, desired customer base, company analysis, industry analysis, marketing strategy, sales strategy, financial projection, funding, and appendix. Executive Plan Your business should begin with your executive plan. An executive plan will provide early insight into what you are planning to achieve with your business. It should include your mission statement and highlight some of the important points which you will explain later. Product Analysis The next component of your business plan is your product analysis. A key part of this section is explaining the type of item or service you are going to offer as well as the market problems your product will solve. Desired Consumer Base Your product analysis should be supplemented with a detailed breakdown of your desired consumer base. Investors are always interested in knowing the economic power of your market as well as potential MVP customers. Company Analysis The next component of your business plan is your company analysis. Here, you explain how you want to run your business. It will include your operational strategy, an insight into the workforce needed to keep the company running, and important executive positions. It will also provide a calculation of expected operational costs.  Industry Analysis A good business plan should also contain well laid out industry analysis. It is important to convince potential investors you know the companies you will be competing with, as well as your plans to gain an edge on the competition. Marketing Strategy Your business plan should also include your marketing strategy. This is how you intend to spread awareness of your product. It should include a detailed explanation of the company brand as well as your advertising methods. Sales Strategy Your sales strategy comes after the market strategy. Here you give an overview of your company's pricing strategy and how you aim to maximize profits. You can also explain how your prices will adapt to market behaviors. Financial Projection The financial projection is the next component of your business plan. It explains your company's expected running cost and revenue earned during the tenure of the business plan. Financial projection gives a clear idea of how your company will develop in the future. Funding The next component of your business plan is funding. You have to detail how much external investment you need to get your business idea off the ground here. Appendix The last component of your plan is the appendix. This is where you put licenses, graphs, or key information that does not fit in any of the other components.

The business model canvas is a business management tool used to quickly define your business idea and model. It is often used when investors need you to pitch your business idea during a brief window.

A pitch deck is similar to a business model canvas except that it makes use of slides in its presentation. A pitch is not primarily used to secure funding, rather its main purpose is to entice potential investors by selling a very optimistic outlook on the business.

Business plan competitions help you evaluate the strength of your business plan. By participating in business plan competitions, you are improving your experience. The experience provides you with a degree of validation while practicing important skills. The main motivation for entering into the competitions is often to secure funding by finishing in podium positions. There is also the chance that you may catch the eye of a casual observer outside of the competition. These competitions also provide good networking opportunities. You could meet mentors who will take a keen interest in guiding you in your business journey. You also have the opportunity to meet other entrepreneurs whose ideas can complement yours.

Exlore Further

• 12 Key Elements of a Business Plan (Top Components Explained)
• 13 Sources of Business Finance For Companies & Sole Traders
• 5 Common Types of Business Structures (+ Pros & Cons)
• How to Buy a Business in 8 Steps (+ Due Diligence Checklist)

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Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

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How to Write Good Product Descriptions [With Examples]

• by Lightspeed

minute read

A product description is more than just a few words about the products you sell in your online shop. A good product description informs shoppers and can persuade them to pull the trigger on a purchase.

If you don’t consider yourself a wordsmith, there’s no need to stress. You don’t need to be Shakespeare to write product descriptions that drive sales. In this guide to writing product descriptions you’ll learn: 

• What a product description is and why it’s important

How to write good product descriptions

• 3 product description examples to inspire you
• How a commerce platform can help drive sales

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What is a product description and why is it important?

A product description provides consumers with practical information about a product’s benefits, measurements and specifications, composition, use cases and more. Detailed product descriptions are a critical part of selling online . Product descriptions can be found on product pages, typically below a product’s name and price. They’re usually no longer than 300 words.

If you need to write a longer product description, such as for a highly technical product, consider linking to product manuals or adding other sections to your product pages, such as a reviews section, sizing chart or specifications section.

Let’s take a look at a product description example from boutique Le Brow Bar ’s website. 

The description for this hat can be found in two places on the product page: below the price and below the main product information panel. The description includes details about the hat’s trendiness, as well as specifications such as measurements and materials. It’s a good example of how to write product descriptions for clothing and accessories.

So, what’s the fuss about product descriptions anyways? An effective product description can improve conversion rates. When you use the description to give examples of use cases, provide specifications and practical information, or use emotional language to appeal to target customers, you can turn more online “window shoppers” into paying customers. An effective description can make a customer fall in love with a product, or simply decide that it meets their needs.

And, when you incorporate search engine optimization (SEO) keywords into descriptions, you make it easier for customers to find your products on Google and other search engines. This aspect of product descriptions can be particularly useful if, for example, you want to start a boutique and give your products creative names, rather than descriptive ones. By implementing SEO in your description, your “Kelly Dress” can appear in search engine results pages (SERPs) for a keyword like “green maxi milkmaid dress.”

If you’re looking for other resources for opening a boutique, check out our clothing store business plan guide. 

So, do you think you’re ready to tackle your product descriptions? Here are five best practices for writing product descriptions that can make a sale.

1. Start with SEO

Identify a descriptive SEO keyword or keywords that you want your product to rank for on SERPs. You can read up on SEO best practices and use a tool like Moz or Ahrefs to identify target keywords, or outsource SEO to a marketing agency.

In general, your target keyword should appear in several places on each product page, including in the:

• Product description
• Product name (ex: “Purple Hat with Cheetah Print”)
• Product page’s URL (ex: sampleboutique.com/purple-hat-cheetah-print)
• Alt text of each product image

2. Keep your audience in mind 

Remember to write for the customers you’re trying to attract, and not just for robots (i.e., Google’s search algorithm). Put yourself in your customers’ shoes and think about what they’d need to know to make a purchase, and what emotional language would tug on their irrational side and drive an impulse buy.

On the practical side, technical specifications can help make a sale. For example, a size guide on a clothing store’s website can help shoppers find the right fit. On the psychological side, explaining how popular or in-demand a product is can create a sense of urgency (more on this later).

3. Maintain your brand voice

As you write for your audience, remember to maintain your brand voice. A product description is an extension of your brand, so follow your style guide’s rules and voice and tone guidelines to create a consistent customer experience. 

4. Focus on conversions 

Instead of just using flowery language in product descriptions, make sure to also include practical information that helps increase conversions . Here are some ways to do that:

• Share use-case ideas . A product description example for a dress could include, “this day-to-night dress is great to wear to the office with a blazer, and turns into the perfect date night outfit with a pair of heels.” This description takes a simple garment and turns it into a multi-purpose piece.
• Create a sense of urgency . Phrases like “limited edition,” “limited time,” or “it sold out in three days last time” in the description help create a sense of urgency that plays into retail psychology and encourages customers to make a purchase now so they don’t miss out. A product description example that employs these tactics might say, “When we first released this jacket, it sold out in less than a week. We’ve released a limited number of jackets for our anniversary sale, and after they sell out, they’re gone for good.”

5. Leverage social proof

Consumers are more likely to listen to their peers’ opinions than to marketing messages. Leveraging customer reviews, press mentions and other forms of social proof in your product descriptions can drive sales.

A product description example of this strategy could be something as simple as, “this purse has been shared more than 35,000 times on social media.” 

3 Product description examples

Take inspiration from these product description examples before taking a pass at crafting your own.

1. Clothing product description example

The description for this linen shirt from Le Brow Bar is a good example of how to write product descriptions for clothing. 

The primary product description begins with, “your summer wardrobe staple,” which appeals to the target audience’s emotions. Then it shares practical details about the item’s composition.

2. Beauty product description example

When you’re selling something that is difficult to comprehend online, like perfume, a product description has to do the heavy lifting to make a sale. Luxury cosmetics boutique Etiket shows how that’s done with their product description for this perfume . 

“Phi is a luxurious scent, inspired by a natural extract of roses produced in Afghanistan’s rose region, Nangarhar,” the description reads. It appeals to the emotions of luxury-seeking customers by explaining the exotic origin of the perfume’s scent.

“This rose oil is extremely rare and of highest quality. Inspired by these roses, growing in a dry and rough land, Phi is a rare gem, complementing contrasting lines, rich in natural raw materials that add depth and authenticity,” reads the secondary description.

It further explains the exclusivity of the scent, then it describes the scent’s notes in detail, to help convey in writing what can usually only be understood through smell:

“ Phi starts with a rich fruity line of Apricot. An all natural apricot extract with its surprising richness enchants and blends into a Cinnamon line and hints of bitter almond, softened by Bergamot essential oil.”

3. Technical product description example

The product description for this camera lens from YM Camera shows just how detailed you can be when you’re selling a highly technical product. It breaks the 300-word rule to share critical information that both highlights product specifications and educates customers with what they need to look for in a lens. 

Specifically, the product description includes information about the technology behind the lens, how image stabilization works, the benefits of the lens’ light weight, and accessory compatibility. This merchant goes above and beyond with the product description by using it to educate customers on the product they’re buying. 

How a commerce platform can help

A  retail POS system that comes with ecommerce functionality can help you create an omnichannel retail experience. With ecommerce built into your POS, product descriptions are synced to your online store and brick-and-mortar inventory.

With an omnichannel commerce platform like Lightspeed, your inventory is automatically updated whether you make a sale online or in store. 

“I feel confident that the inventory levels that I and my sales associates see on the POS and that customers see online are accurate. [Lightspeed is] super user-friendly,” says Tori Erickson of Loyal Tee Boutique .

When both your staff and customers can access the most accurate inventory information , you’ll avoid stockouts and frustrating, time-consuming customer service problems.

Plus, an omnichannel commerce platform gives you powerful insights into every aspect of your business. With access to advanced reporting about your online and retail sales, you’ll be able to make informed business decisions.

Ready to get started with product descriptions that drive sales? Lightspeed’s omnichannel POS and ecommerce platform can help. Talk to us today.

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Lightspeed is a cloud-based commerce platform powering small and medium-sized businesses in over 100 countries around the world. With smart, scalable and dependable point of sale systems, it's an all-in-one solution that helps restaurants and retailers sell across channels, manage operations, engage with consumers, accept payments and grow their business.

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How to write a business plan (with template)

We all know that as a product manager you’re also the CEO of the product. While you own the product backlog, you’re also responsible for expanding the product and adding new features to increase value for users and the business. Whether you work in a start-up or are a PM in a large organization, creating a business plan is crucial before pitching in any new idea.

What is a business plan?

A business plan is a comprehensive document that outlines the problem, the solution, market outreach possibilities, potential threats, a clear goal, and a measurable return on investment with a year-on-year growth strategy.

Significance of a business plan

All product organizations have started seeing the importance of a business plan before approving a new product idea. A good business plan has numerous benefits, the most fundamental being an opportunity to think through the idea before investing time and resources.

The following are the key traits of a good business plan.

Clarity of vision

Taking the time to write down an idea can bring greater clarity to your vision. It allows you to better understand the problem at hand and reveal all possible solutions. This is because writing forces you to slow down and think everything through, resulting in a more evident thought process.

Strategic guidance

When creating a business plan, including financial projections and forecasts is useful. This helps develop a strategic plan by considering marketing strategies, launch plans, development costs, and expected return on investment. However, conducting proper research and due diligence is crucial to ensure that the predictions are as accurate as possible. This process can lead to gaining more insights, taking necessary steps beforehand, and fostering collaboration.

Risk management

A business plan is crucial as it allows you to identify potential risks beforehand. As part of creating a business plan, conducting a competitor analysis, identifying your target market, performing a SWOT analysis (focusing on strengths, weaknesses, opportunities, and threats), and determining your unique selling points is essential. By analyzing these factors, you can gain valuable insights into potential risks and market trends and create an effective risk management plan to ensure success.

Operational planning

While creating a business plan, it becomes essential to forecast, plan milestones, and produce a roadmap. This involves looking into the development timeline, launch plan, and marketing strategies. By doing so, you can outline an operational plan and calculate the resources required to complete the project within a specified deadline. Measuring the rollout plan and determining the appropriate launch plan is crucial.

Measurable objectives and milestones

In addition to a roadmap and milestones, it’s essential to provide critical metrics to measure success. This will help product teams clearly understand the overall roadmap and milestones and ensure that the key results are defined to determine if the product is successful.

Components of a business plan

The business plan will look different for different products depending on the business, product area, and other factors. Still, a few common elements must be a part of each business plan.

Problem statement

Defining the problem in the right way is the most crucial thing. While defining the problem, always consider backing up the claims by data. Use surveys and user testimonies to construct the problem statement in the most relatable manner:

Solution description / mission statement

When presenting a solution, it’s important to avoid using technical jargon and instead describe it in a way that’s easy to understand for anyone, regardless of their technical background. If specific technical details need to be included, put them in an appendix for those who want to read more.

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Creating a clear mission statement outlining what you aim to achieve with your solution is also essential. Avoid using vague language and be as specific and straightforward as possible. The more specific your goal, the better.

Market analysis

This section requires a comprehensive and detailed analysis of various aspects crucial to any product’s success in the market. The four main areas addressed are product-market fit , target customers, total market share, and unique selling proposition (USP).

Product-market fit is about identifying the gap that exists in the market and how your product can bridge that gap.

Defining target customers includes understanding their demographics, behavior, preferences, and needs. It’s also essential to identify any secondary customer base that can be targeted, which can help expand the product’s reach and appeal:

Total market share, or the total available market, refers to the overall revenue opportunity available for a product or service if 100 percent market share is achieved. It gives a clear idea of the scope of expansion for the product after launch.

Unique selling proposition (USP) is a critical aspect of any product’s success that defines why customers should choose your product over others. It’s what sets your product apart from the competition and makes it stand out. Identifying and promoting your USP can help to differentiate your product and create a sense of confidence among sponsors.

Competitor analysis

When analyzing competitors, people tend only to consider direct competitors. However, a great product stands out by taking customers away from even indirect competitors. For example, TikTok and Reels are taking up viewership time that Netflix and other streaming services previously held. Therefore, Netflix’s competitors are not limited to other streaming services but include other platforms providing quick and engaging content:

Projection and forecast

Creating a comprehensive and effective business plan, including a detailed projection of operational costs and a sales and revenue generation forecast is crucial. You can enhance the plan by providing a summarized version of the roadmap and revenue plan and giving sponsors a quick overview of the expected development time, launch dates, and other essential details. Doing so can ensure that your business plan is constructive and comprehensive, in turn laying out a clear path to success.

This is a section of the business plan where you can finally reveal your expectations towards the sponsor or the investors. You have established a business model and the effect of your product. Now, it’s time to be clear and specific about the investment required to reach the goal, including the expected time frame.

The aim is to clearly outline the expected returns so that any potential sponsor or investor can decide whether the opportunity aligns with their goals. This is a mutually beneficial partnership; you can establish a foundation for a good relationship with transparency.

Business plan template

Here’s a one-pager template for a business plan that suits most products:

Here you can find the full PPT template for the business plan, including all the components.

Final thoughts

A business plan is a crucial document that outlines the entire product lifecycle from inception to launch. It aims to align stakeholders, minimize uncertainties, and increase the likelihood of product success in the market. Effective business plans are those that demonstrate a compelling opportunity backed by thorough research and a clear strategy for execution and growth.

These templates can make your next pitch easier!

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• Entrepreneurship

How to Write a Product Description for a Business Plan?

As a business owner, you know that a well-written business plan is essential to the success of your venture. Your business plan should include a product description that is clear, concise, and compelling. A good product description will help potential investors and customers understand what your product is, how it works, and why it is valuable. In this article, we will guide you through the process of writing a product description for your business plan.

1. Define your target audience

The first step in writing a product description is to define your target audience. Who is your product for? What problem does it solve for them? What benefits will they get from using it? The more specific you can be about your target audience, the better you can tailor your product description to their needs.

When defining your target audience, consider factors such as age, gender, income, education level, and lifestyle. Research your target audience to understand their pain points, desires, and motivations.

2. Describe the problem your product solves

In this section, you need to clearly describe the problem your product solves. Explain the pain points of your target audience and how your product addresses those pain points. Use concrete examples and data to illustrate the problem.

For instance, if you are selling a productivity app, you might describe the problem of having too many tasks to complete in a day and not enough time to complete them. You could then explain how your app helps users prioritize their tasks, set reminders, and track their progress.

3. Explain how your product works

Once you have described the problem your product solves, it’s time to explain how your product works. Be specific and use simple language that your target audience will understand. You should also include any technical details that are relevant to your product.

Consider creating a table to illustrate the features and benefits of your product. This will make it easy for potential investors and customers to understand what your product does and how it works.

4. Highlight the benefits of your product

In this section, you need to highlight the benefits of your product. What makes it unique? What advantages does it have over competitors? How will it improve the lives of your target audience?

Use specific examples and data to illustrate the benefits of your product. Consider creating a list of benefits in HTML format to make it easy for readers to scan.

5. Describe your pricing strategy

Your product description should include a pricing strategy. Explain how you will price your product and what factors you have considered. Will you offer discounts or promotions? What is your profit margin?

Consider creating a table to illustrate your pricing strategy. This will make it easy for potential investors and customers to understand your pricing model.

6. Outline your marketing strategy

Your product description should also include a marketing strategy. Explain how you plan to promote your product and reach your target audience. What channels will you use? How will you measure the success of your marketing efforts?

Consider creating a list of marketing channels in HTML format to make it easy for readers to scan.

7. Include a competitive analysis

Your product description should include a competitive analysis. Research your competitors and explain how your product is different. What advantages does your product have over competitors? What are the weaknesses of your competitors?

Consider creating a table to compare your product to your competitors. This will make it easy for potential investors and customers to understand how your product stacks up.

8. Discuss your team and resources

Your product description should also include information about your team and resources. Explain who will be responsible for developing and marketing your product. What skills and experience do they have? What resources do you have available?

Consider creating a table to illustrate your team and resources. This will make it easy for potential investors and customers to understand your capabilities.

9. Include a timeline

Your product description should include a timeline. Explain when you plan to launch your product and what milestones you need to achieve along the way. What are the risks and challenges you need to overcome?

Consider creating a timeline in HTML format to make it easy for readers to understand your plan.

10. Summarize your product description

Finally, you should summarize your product description. Use a concise statement to describe your product and its benefits. This will make it easy for potential investors and customers to remember what your product is all about.

Consider using bullet points to summarize your product description in HTML format. This will make it easy for readers to scan and remember your key points.

In conclusion, writing a product description for your business plan is an important step in launching a successful venture. By following the steps outlined in this article, you can create a product description that is clear, concise, and compelling. Remember to tailor your product description to your target audience and use concrete examples and data to illustrate your points.

Frequently Asked Questions

Here are some common questions and answers about writing a product description for a business plan.

What is the purpose of a product description in a business plan?

A product description in a business plan is a brief overview of the product or service that your business offers. The purpose of this section is to provide potential investors or lenders with a clear understanding of what your product is, how it works, and what makes it unique. A well-written product description can help convince investors that your business is worth investing in.

When writing a product description, it’s important to be as specific and detailed as possible. Include information about the product’s features, benefits, and how it solves a problem for your target audience. Use language that is clear and easy to understand, and avoid technical jargon or industry-specific terms that may confuse investors who are not familiar with your field.

What should be included in a product description?

A product description should include a brief overview of the product, its key features and benefits, and how it solves a problem for your target audience. You should also include information about the product’s target market and any relevant industry trends or market data that supports your business case.

When writing a product description, be sure to use language that is clear and concise. Avoid using technical jargon or industry-specific terms that may be confusing to investors who are not familiar with your field. Use bullet points to break up long paragraphs and make the description more readable.

How long should a product description be?

A product description should be concise and to the point. Ideally, it should be no longer than one or two paragraphs. However, if there are multiple features or benefits that you want to highlight, it may be necessary to use bullet points or subheadings to break up the content and make it more readable.

Remember, investors are busy people and don’t have time to read lengthy product descriptions. Keep your description short and sweet, but make sure it includes all the key information that investors need to know.

What are some tips for writing a compelling product description?

When writing a product description, it’s important to focus on the benefits of the product rather than just its features. Highlight how the product solves a problem for your target audience and why it’s better than competing products on the market.

Use language that is clear and concise, and avoid technical jargon or industry-specific terms that may be confusing to investors who are not familiar with your field. Finally, be sure to proofread your product description carefully to ensure that there are no typos or grammatical errors.

Where should the product description be placed in a business plan?

The product description should be placed early in the business plan, after the executive summary and company overview sections. This allows investors to quickly understand what your business does and how it adds value to the market.

It’s also a good idea to include the product description in any marketing materials or pitch decks that you create for your business. This will help you communicate the value of your product to potential investors and customers in a clear and concise way.

How to Write Company Description for your Business Plan?

Remember to focus on the problem your product solves, highlight its key features and benefits, and use clear and concise language that resonates with your target audience. Additionally, make sure to showcase any relevant data, such as market analysis or customer feedback, that supports the viability and potential success of your product.

With a well-crafted product description, you can not only attract investors and customers but also gain a deeper understanding of your own product and its place in the market. So take the time to research, write, and refine your description, and watch as your business plan takes shape and your product rises to the top of its industry.

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9 Business Plan Examples to Inspire Your Own (2024)

Need support creating your business plan? Check out these business plan examples for inspiration and guidance.

Any aspiring entrepreneur researching how to start a business will likely be advised to write a business plan. But few resources provide business plan examples to really guide you through writing one of your own.

Here are some real-world and illustrative business plan examples to help you craft your business plan .

Business plan format: 9 examples

The business plan examples in this article follow this template:

• Executive summary
• Company description
• Market analysis
• Products and services
• Marketing plan
• Logistics and operations plan
• Financial plan
• Customer segmentation

1. Executive summary

Your executive summary is a page that gives a high-level overview of the rest of your business plan. While it appears at the beginning, it’s easiest to write this section last, as there are details further in the report you’ll need to include here.

In this free business plan template , the executive summary is four paragraphs and takes a little over half a page. It clearly and efficiently communicates what the business does and what it plans to do, including its business model and target customers.

2. Company description

You might repurpose your company description elsewhere, like on your About page , social media profile pages, or other properties that require a boilerplate description of your small business.

Soap brand ORRIS has a blurb on its About page that could easily be repurposed for the company description section of its business plan.

You can also go more in-depth with your company overview and include the following sections, like in this business plan example for Paw Print Post:

Business structure

This section outlines how you registered your business —as an LLC , sole proprietorship, corporation, or other business type : “Paw Print Post will operate as a sole proprietorship run by the owner, Jane Matthews.”

Nature of the business

“Paw Print Post sells unique, one-of-a-kind digitally printed cards that are customized with a pet’s unique paw prints.”

“Paw Print Post operates primarily in the pet industry and sells goods that could also be categorized as part of the greeting card industry.”

Background information

“Jane Matthews, the founder of Paw Print Post, has a long history in the pet industry and working with animals, and was recently trained as a graphic designer. She’s combining those two loves to capture a niche in the market: unique greeting cards customized with a pet’s paw prints, without needing to resort to the traditional (and messy) options of casting your pet’s prints in plaster or using pet-safe ink to have them stamp their ’signature.’”

Business objectives

“Jane will have Paw Print Post ready to launch at the Big Important Pet Expo in Toronto to get the word out among industry players and consumers alike. After two years in business, Jane aims to drive $150,000 in annual revenue from the sale of Paw Print Post’s signature greeting cards and to have expanded into two new product categories.”

“Jane Matthews is the sole full-time employee of Paw Print Post but hires contractors as needed to support her workflow and fill gaps in her skill set. Notably, Paw Print Post has a standing contract for five hours a week of virtual assistant support with Virtual Assistants Pro.”

Your mission statement may also make an appearance here. Passionfruit shares its mission statement on its company website, and it would also work well in its example business plan.

3. Market analysis

The market analysis consists of research about supply and demand , your target demographics, industry trends, and the competitive landscape. You might run a SWOT analysis and include that in your business plan. 

Here’s an example SWOT analysis for an online tailored-shirt business:

You’ll also want to do a competitive analysis as part of the market research component of your business plan. This will tell you which businesses you’re up against and give you ideas on how to differentiate your brand. A broad competitive analysis might include:

• Target customers
• Unique value proposition , or what sets the products apart
• Sales pitch
• Price points for products
• Shipping policy

4. Products and services

This section of your business plan describes your offerings—which products and services do you sell to your customers? Here’s an example for Paw Print Post that explains its line of custom greeting cards, along with details on what makes its products unique.

5. Marketing plan

It’s always a good idea to develop a marketing plan before you launch your business. Your marketing plan shows how you’ll get the word out about your business, and it’s an essential component of your business plan as well.

The Paw Print Post focuses on four Ps: price, product, promotion, and place. However, you can take a different approach with your marketing plan. Maybe you can pull from your existing marketing strategy , or maybe you break it down by the different marketing channels. Whatever approach you take, your marketing plan should describe how you intend to promote your business and offerings to potential customers.

6. Logistics and operations plan

The Paw Print Post example considered suppliers, production, facilities, equipment, shipping and fulfillment, and inventory. This includes any raw materials needed to produce the products.

7. Financial plan

The financial plan provides a breakdown of sales, revenue, profit, expenses, and other relevant financial metrics related to funding and profiting from your business.

Ecommerce brand Nature’s Candy’s financial plan breaks down predicted revenue, expenses, and net profit in graphs.

It then dives deeper into the financials to include:

• Funding needs
• Projected profit-and-loss statement
• Projected balance sheet
• Projected cash-flow statement

You can use a financial plan spreadsheet to build your own financial statements, including income statement, balance sheet, and cash-flow statement.

8. Customer segmentation

Customer segmentation means dividing your target market into groups based on specific characteristics. These characteristics can be demographics, psychographics, behavior, or geography. Your business plan will provide detailed information on each segment, like its size and growth potential, so you can show why they are valuable to your business. 

Airsign , an eco-friendly vacuum cleaner company, faced the challenge of building a sustainable business model in the competitive home appliance market. They identified three key customer personas to target:

• Design-oriented urban dwellers
• Millennials moving to suburbs
• Older consumers seeking high-quality appliances

The company utilized Shopify’s customer segmentation tools to gain insights and take action to target them. Airsign created targeted segments for specific marketing initiatives.

Put your customer data to work with Shopify’s customer segmentation

Shopify’s built-in segmentation tools help you discover insights about your customers, build segments as targeted as your marketing plans with filters based on your customers’ demographic and behavioral data, and drive sales with timely and personalized emails.

9. Appendix

The appendix provides in-depth data, research, or documentation that supports the claims and projections made in the main business plan. It includes things like market research, finance, résumés, product specs, and legal documents. 

Readers can access detailed info in the appendix, but the main plan stays focused and easy to read. Here’s an example from a fictional clothing brand called Bloom:

Appendix: Bloom Business Plan

Types of business plans, and what to include for each

This lean business plan is meant to be high level and easy to understand at a glance. You’ll want to include all of the same sections in one-page business plan, but make sure they’re truncated and summarized:

• Executive summary: truncated
• Market analysis: summarized
• Products and services: summarized
• Marketing plan: summarized
• Logistics and operations plan: summarized
• Financials: summarized

A startup business plan is for a new business. Typically, these plans are developed and shared to secure funding . As such, there’s a bigger focus on the financials, as well as on other sections that determine viability of your business idea—market research, for example:

• Market analysis: in-depth
• Financials: in-depth

Your internal business plan is meant to keep your team on the same page and aligned toward the same goal:

A strategic, or growth, business plan is a big-picture, long-term look at your business. As such, the forecasts tend to look further into the future, and growth and revenue goals may be higher. Essentially, you want to use all the sections you would in a normal business plan and build upon each:

• Market analysis: comprehensive outlook
• Products and services: for launch and expansion
• Marketing plan: comprehensive outlook
• Logistics and operations plan: comprehensive outlook
• Financials: comprehensive outlook

Feasibility

Your feasibility business plan is sort of a pre-business plan—many refer to it as simply a feasibility study. This plan essentially lays the groundwork and validates that it’s worth the effort to make a full business plan for your idea. As such, it’s mostly centered around research:

Nonprofit business plans are used to attract donors, grants, and partnerships. They focus on what their mission is, how they measure success, and how they get funded. You’ll want to include the following sections in addition to a traditional business plan:

• Organization description
• Need statement
• Programs and services
• Fundraising plan
• Partnerships and collaborations
• Impact measurement

Set yourself up for success as a business owner

Building a good business plan serves as a roadmap you can use for your ecommerce business at launch and as you reach each of your business goals. Business plans create accountability for entrepreneurs and synergy among teams, regardless of your business model .

Kickstart your ecommerce business and set yourself up for success with an intentional business planning process—and with the sample business plans above to guide your own path.

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Business plan examples FAQ

How do i write a simple business plan.

To write a simple business plan, begin with an executive summary that outlines your business and your plans. Follow this with sections detailing your company description, market analysis, organization and management structure, product or service, marketing and sales strategy, and financial projections. Each section should be concise and clearly illustrate your strategies and goals.

What is the best format to write a business plan?

The best business plan format presents your plan in a clear, organized manner, making it easier for potential investors to understand your business model and goals. Always begin with the executive summary and end with financial information or appendices for any additional data.

What are the 4 key elements of a business plan?

• Executive summary: A concise overview of the company’s mission, goals, target audience, and financial objectives.
• Business description: A description of the company’s purpose, operations, products and services, target markets, and competitive landscape.
• Market analysis: An analysis of the industry, market trends, potential customers, and competitors.
• Financial plan: A detailed description of the company’s financial forecasts and strategies.

What are the 3 main points of a business plan?

• Concept: Your concept should explain the purpose of your business and provide an overall summary of what you intend to accomplish.
• Contents: Your content should include details about the products and services you provide, your target market, and your competition.
• Cash flow: Your cash flow section should include information about your expected cash inflows and outflows, such as capital investments, operating costs, and revenue projections.

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How To Write the Products and Services of a Business Plan

Crucial to business plans designed to secure funding or partnerships, your products and services section needs to showcase the quality, value, and benefits your business offers.

It’s not just a list of what your business is going to produce or provide. Instead, it outlines what you make or do, why your market needs your products or services, how you will compete with other companies selling the same or similar products or services, and what you will charge.

What To Include In The Products and Services Section

When looking at how to write the Products and Services section of your plan, be sure to include:

• A description of the products or services you offer or plan to offer
• A pricing model for your products or service, including how you set your prices and how you will make a profit. Include a breakdown of your Costs of Goods (COG) and Costs of Services (COS), what your contingency plan is in the event of a shift in market conditions, changes to laws, or availability of supplies, and your markup strategy.
• A comparison of your competitors’ products or services against yours, including a survey of what your competitors charge for similar items, along with a discussion explaining your pricing strategy
• Any sales literature or marketing materials you will use, including your website’s role in your sales efforts.
• An outline of how your orders will be processed or fulfilled.
• Any needs required to create or deliver your products (for example, up-to-date computer equipment)
• Any intellectual property (trademarks) or legal issues needing to be addressed.
• Future product or services

How to Make The Products & Service Section Appealing

Ideally, this section should elicit excitement in your reader and entice them to fund your business or work with you.

Here are few ways to accomplish this when deciding how to write the Products and Services section of your business plan:

• Showcase why there is a need for your product or service. Doing so is especially important if you’re introducing a new concept or invention or introducing your product or service into a place where there is currently no market for it.
• Emphasize the features of your product or service. How does it differ from that of your competitors in terms of make, shape, form, or appearance? Or price point? Or the level of service? What makes it unique?
• Focus on benefits. Once you’ve identified what features make your product unique, it’s vital to show how those features provide value to consumers. Is your product cheaper? Is your service faster? You want to clearly indicate how your product or service will fix a problem or improve a client or customer’s life.
• Be clear and concise and talk in layman’s terms. Avoid getting bogged down in lengthy descriptions or unnecessary details. Use bullet points and numbered lists to highlight important information. Don’t assume that your potential funders, partners, or customers have the same level of knowledge. Instead, consider the reader doesn’t know as much as you do when explaining your offering. Stay away from acronyms, jargon, industry buzzwords, and aim to be customer-oriented. If you have to use acronyms or jargon, always provide a definition.
• “ Why are you the best person to provide your products and services?”
• “What education or experience do you have that makes you qualified to provide them?”

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Don’t forget to include any testimonials, awards, or accolades you’ve received as well as any patents, copyrights, or trademarks you own or have applications for. Have you had the product tested or certified? Gotten approvals from industry experts? Including these details adds credibility to your overall business plan.

• Identify any liability issues: A liability lawsuit can significantly change the landscape of your business. Even if you don’t foresee any liability issues, include a statement to that effect rather than not address it at all. If there is a liability issue, real or apparent, acknowledge it and describe how you’ll deal with it. Let the reader know you will take all necessary steps to protect your business, your products, and yourself from litigation.
• Be precise in your product or service descriptions. For example, you don’t want only to say, “I sell shoes.” You want instead to say, “I sell leather boots targeted at women aged 16 – 25 who buy online”. Wherever possible, also include pictures of your products.

Questions to Answer in Your Products & Services Section

• Are your products or services in development or existing and on the market?
• If they currently aren’t on the market, what is the timeline for bringing them to it? Do you have a prototype?
• What makes your product or service different? What are your competitive advantages? What are your competitive disadvantages, and how will you overcome them?
• Is your pricing an issue? Are your operating costs low enough to allow for a reasonable profit margin?
• Where are you acquiring your products? Do you manufacture them, or do you assemble them using third-party components? Do you purchase from suppliers or wholesalers? If demand increases, do you have a steady supply of products available?
• How are you going to sell your product or service? Will it be available online or in retail stores? Do you have any vendors lined up?

Once you’ve answered these questions, stop and reread the section. Ask yourself if you’ve tried to answer why a client would want your product or service. Consider whether your offering will make your customers’ lives better or more accretive.

Examine the need you are fulfilling or the problem you are solving. More importantly, does the section give the reader a clear understanding of why you’re in business, what you sell, and how you differ from your competitors?

After completing this exercise, if you’re still unsure or would like more support about how to write the Products and Services section of your business plan, we invite you to reach out to our team at Bsbcon.

We are available to help small-medium-sized enterprises worldwide tackle their most critical challenges and capture their most significant opportunities.  We make a point to understand new trends, digital options, and partnerships that help our clients today and tomorrow. Call us toll-free at 1(888) 880-1898, write [email protected] , or fill out our contact form here .

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How to Describe the Product in a Business Plan

by Charles Crawford

Published on 1 Jan 2021

The reader of a business plan should come away with an understanding of what the company's product line is, what it does and how it functions. The same is true if the company offers a service. If pictures and other images contribute to this understanding of the product, the writers of the plan should use them. The business plan should tell about problems the product solves, the needs it meets and the benefits it gives to consumers. The plan should also address any liability issues associated with the product.

Explain what the product does, how it works, and how it can be put to commercial or consumer use.

Write a description of the product's physical characteristics, including colors, finishes, sizes, specifications and ingredients. Use photographs, diagrams and other graphics to help the reader learn about the product.

Compare the product to those of competitors. Tell how the company's product is better than competing products. Discuss its potential in the marketplace. Include the results of any market trials, surveys or focus groups.

Describe the product's benefits to the customer. For example, if the product reduces wrinkles on the face, saves money or increases efficiency, explain in detail how it does each of these things. If there is a family of products, discuss the customer benefits of each one.

Explain any liability issues associated with the product, if applicable. If you have consulted with a lawyer about these issues, provide a summary of those discussions in the business plan.

Remember that the business plan often becomes a sales document for the company. When writing about the company's product, keep sales in mind.

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How to Excite Readers With Your Business Plan's Product Section. (Yes, Seriously.) Product descriptions can be as dry as toast--or as exciting as a roller coaster ride. Here's how to craft one that keeps people reading.

By Teresa Ciulla Dec 18, 2014

Opinions expressed by Entrepreneur contributors are their own.

In their book Write Your Business Plan , the staff of Entrepreneur Media offer an in-depth understanding of what's essential to any business plan, what's appropriate for your venture, and what it takes to ensure success. In this edited excerpt, the authors offer a look at 15 factors you can use to make your product or service stand out from the pack.

In your plan, it's important to be able to build a convincing case for the product or service upon which your business will be built. The product description section is where you do that. In this section, you'll describe your product in terms of several characteristics, including cost, features, distribution, target market, competition and production concerns.

A product description is more than a mere listing of product features, however. You have to highlight your product's most compelling characteristics, such as low cost or uniquely high quality, that will make it stand out in the marketplace and attract buyers willing to pay your price. Even the simplest product has a number of unique potential selling strengths.

Many of the common unique selling strengths are seemingly contradictory. How can both mass popularity and exclusive distribution be strengths? The explanation is that it depends on your market and what its buyers want.

Here are the things you'll want to consider when creating the product section of your business plan that will help grab your readers' attention:

Features. If your product is faster, bigger or smaller, or comes in more colors, sizes and configurations than others on the market, you have a powerful selling strength. In fact, if you can't offer some combination of features that sets you apart, you'll have difficulty writing a convincing plan.

Price. Everybody wants to pay less for a product. If you can position yourself as the low-cost provider (and make money at these rock-bottom prices), you have a powerful selling advantage. Conversely, high-priced products may appeal to many markets for their better-quality, high-end value. People with discerning tastes want quality and don't buy based solely on price points, so saving money isn't always the issue. Price is also dependent on other issues such as service. People will pay more for good customer service.

Time savings. People buy products to help them expedite a process. If yours is faster and can help them get out of the office and on their way home more quickly, they want it. Today, everyone is looking to save time, so products and services that help people do that are valuable.

Ease of transport. The mobile world has taken over. People are using their mobile phones to go online as much if not more than their laptops. How mobile is your product? Today's consumers like to take things with them—they want apps and gadgets that are portable.

Availability. Typically, the more easily accessible your products are, the better it is for business. In most cases, you want to have products and services that people can get quickly. Today, thanks to the Internet, you no longer need brick-and-mortar locations in many communities. Scarcity, however, can also generate a higher demand, so you may have a marketing plan to release products at intervals and let the demand—and the desire—build. Scarcity doesn't mean that you'll be running out anytime soon. For service providers, availability means a good location or locations that are easy to get to.

Cutting edge/new . If you have something to offer that's not on the market, this is a major selling point or competitive edge. Get out there and patent it, market it and sell it before someone comes along and steals your thunder. You can also utilize technology to build upon products or services you already provide, such as an app.

Training and support . These are components of service that have become increasingly important, particularly for high-technology products. For many sophisticated software products and electronic devices, a seller who can't provide tech support to buyers will have no chance of success.

Financing . Whether you "tote the note" and guarantee credit to anyone, offer innovative leasing, do buybacks or have other financing alternatives, you'll find that giving people different, more convenient ways to pay can lend your product a convincing strength.

Customer service . Excellent service is perhaps the most important thing you can add to any product or service today. In a world where word travels fast through social media, you want to provide top-notch customer service. The shoe giant Zappos has built its reputation by providing excellent customer service. Make this a top priority.

Reputation . Why do people pay $10,000 for a Rolex? The Rolex reputation is the reason. At its most extreme, reputation can literally keep you in business, as is the case with many companies, such as IBM and WalMart, whose well-developed reputations have tided them over in hard times.

Knowledge . Your knowledge and the means you have of imparting that to customers is an important part of your total offering. Retailers of auto parts, home improvement supplies and all sorts of other goods have found that simply having knowledgeable salespeople who know how to replace the water pump in a '95 Chevy will lure customers in and encourage them to buy.

Experience. "We've been there. We've done thousands of installations like yours, and there's no doubt we can make this one work as well." Nothing could be more soothing to a skeptical sales prospect than to learn that the seller has vast experience at what he's doing. If you have ample experience, make it part of your selling proposition.

Fast delivery . Nobody wants to wait for anything anymore. If you can offer overnight shipping, on-site service or 24/7 availability, it can turn an otherwise unremarkable product or service into a very attractive one.

Endorsements . There's a reason Peyton Manning makes millions of dollars a year from endorsements. People want to relate to Peyton and share his aura, if only obliquely.

Other factors . There are many wild cards unique to particular products, or perhaps simply little used in particular industries, with which you can make your product stand out. For instance, consider a service agreement guarantee. When consumers know they can get a product repaired under a service guarantee or return a faulty product for a refund, they're often more likely to buy it over otherwise superior competitors offering less powerful warranties.

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What Is a Business Plan?

Understanding business plans, how to write a business plan, common elements of a business plan, the bottom line, business plan: what it is, what's included, and how to write one.

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

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A business plan is a document that outlines a company's goals and the strategies to achieve them. It's valuable for both startups and established companies. For startups, a well-crafted business plan is crucial for attracting potential lenders and investors. Established businesses use business plans to stay on track and aligned with their growth objectives. This article will explain the key components of an effective business plan and guidance on how to write one.

Key Takeaways

• A business plan is a document detailing a company's business activities and strategies for achieving its goals.
• Startup companies use business plans to launch their venture and to attract outside investors.
• For established companies, a business plan helps keep the executive team focused on short- and long-term objectives.
• There's no single required format for a business plan, but certain key elements are essential for most companies.

Investopedia / Ryan Oakley

Any new business should have a business plan in place before beginning operations. Banks and venture capital firms often want to see a business plan before considering making a loan or providing capital to new businesses.

Even if a company doesn't need additional funding, having a business plan helps it stay focused on its goals. Research from the University of Oregon shows that businesses with a plan are significantly more likely to secure funding than those without one. Moreover, companies with a business plan grow 30% faster than those that don't plan. According to a Harvard Business Review article, entrepreneurs who write formal plans are 16% more likely to achieve viability than those who don't.

A business plan should ideally be reviewed and updated periodically to reflect achieved goals or changes in direction. An established business moving in a new direction might even create an entirely new plan.

There are numerous benefits to creating (and sticking to) a well-conceived business plan. It allows for careful consideration of ideas before significant investment, highlights potential obstacles to success, and provides a tool for seeking objective feedback from trusted outsiders. A business plan may also help ensure that a company’s executive team remains aligned on strategic action items and priorities.

While business plans vary widely, even among competitors in the same industry, they often share basic elements detailed below.

A well-crafted business plan is essential for attracting investors and guiding a company's strategic growth. It should address market needs and investor requirements and provide clear financial projections.

While there are any number of templates that you can use to write a business plan, it's best to try to avoid producing a generic-looking one. Let your plan reflect the unique personality of your business.

Many business plans use some combination of the sections below, with varying levels of detail, depending on the company.

The length of a business plan can vary greatly from business to business. Regardless, gathering the basic information into a 15- to 25-page document is best. Any additional crucial elements, such as patent applications, can be referenced in the main document and included as appendices.

Common elements in many business plans include:

• Executive summary : This section introduces the company and includes its mission statement along with relevant information about the company's leadership, employees, operations, and locations.
• Products and services : Describe the products and services the company offers or plans to introduce. Include details on pricing, product lifespan, and unique consumer benefits. Mention production and manufacturing processes, relevant patents , proprietary technology , and research and development (R&D) information.
• Market analysis : Explain the current state of the industry and the competition. Detail where the company fits in, the types of customers it plans to target, and how it plans to capture market share from competitors.
• Marketing strategy : Outline the company's plans to attract and retain customers, including anticipated advertising and marketing campaigns. Describe the distribution channels that will be used to deliver products or services to consumers.
• Financial plans and projections : Established businesses should include financial statements, balance sheets, and other relevant financial information. New businesses should provide financial targets and estimates for the first few years. This section may also include any funding requests.

Investors want to see a clear exit strategy, expected returns, and a timeline for cashing out. It's likely a good idea to provide five-year profitability forecasts and realistic financial estimates.

2 Types of Business Plans

Business plans can vary in format, often categorized into traditional and lean startup plans. According to the U.S. Small Business Administration (SBA) , the traditional business plan is the more common of the two.

• Traditional business plans : These are detailed and lengthy, requiring more effort to create but offering comprehensive information that can be persuasive to potential investors.
• Lean startup business plans : These are concise, sometimes just one page, and focus on key elements. While they save time, companies should be ready to provide additional details if requested by investors or lenders.

Why Do Business Plans Fail?

A business plan isn't a surefire recipe for success. The plan may have been unrealistic in its assumptions and projections. Markets and the economy might change in ways that couldn't have been foreseen. A competitor might introduce a revolutionary new product or service. All this calls for building flexibility into your plan, so you can pivot to a new course if needed.

How Often Should a Business Plan Be Updated?

How frequently a business plan needs to be revised will depend on its nature. Updating your business plan is crucial due to changes in external factors (market trends, competition, and regulations) and internal developments (like employee growth and new products). While a well-established business might want to review its plan once a year and make changes if necessary, a new or fast-growing business in a fiercely competitive market might want to revise it more often, such as quarterly.

What Does a Lean Startup Business Plan Include?

The lean startup business plan is ideal for quickly explaining a business, especially for new companies that don't have much information yet. Key sections may include a value proposition , major activities and advantages, resources (staff, intellectual property, and capital), partnerships, customer segments, and revenue sources.

A well-crafted business plan is crucial for any company, whether it's a startup looking for investment or an established business wanting to stay on course. It outlines goals and strategies, boosting a company's chances of securing funding and achieving growth.

As your business and the market change, update your business plan regularly. This keeps it relevant and aligned with your current goals and conditions. Think of your business plan as a living document that evolves with your company, not something carved in stone.

University of Oregon Department of Economics. " Evaluation of the Effectiveness of Business Planning Using Palo Alto's Business Plan Pro ." Eason Ding & Tim Hursey.

Bplans. " Do You Need a Business Plan? Scientific Research Says Yes ."

Harvard Business Review. " Research: Writing a Business Plan Makes Your Startup More Likely to Succeed ."

Harvard Business Review. " How to Write a Winning Business Plan ."

U.S. Small Business Administration. " Write Your Business Plan ."

SCORE. " When and Why Should You Review Your Business Plan? "

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How to Write Products and Services Section of Business Plan

Business plan products and services section  gives details of your product or service, how it is different and if you have a reliable manufacturing or sourcing system for the product. 

Show competitive advantages of your product or service. Convince investors or lenders that you can outperform competition; you’ll likely get the funding you need. 

Use this article as a guide when writing the product and service section of your business plan.

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How do you write the business plan products and services section.

Your goal in writing the business plan products and services section should be to explain your offering in simple, layman’s terms. 

Anyone reading about your products or services should be able to understand:

• what you are offering
• what is the unique value you are offering
• how will you do quality assurance 
• How will you meet the increased demand?

The product service plan section should include the following.

Explain Your Products or Services

Explain your product or service in detail. Try to include a brief about all the aspects of your product or service that will improve the consumers’ lives or increase business efficiency. 

Show why your Product is Unique 

Talk about the distinctive features of your product. Show what competitors are offering and explain how your offer is unique and better. 

Emphasize the Benefits 

Your hopes of capturing a share of the market depend on the benefits your product or service provides. Describe the benefits in terms customers can relate to. 

For example, if you are offering the same features as the competitors but at a low price, highlight the low price.

Manufacturing, Sourcing, and Fulfillment 

Explain if you will manufacture your products or you’ll source. If you are going to source the product from a manufacturer, how will you select the manufacturer?

Also, briefly explain the product supply chain and fulfillment process. Potential lenders may want to know if your supply chain and fulfillment system can handle high demand. 

Be Short and Concise 

Keep to the point. The Product service section in a business plan is about introducing your offering with a fair amount of detail. However, don’t make it lengthy.

You will discuss your product or service in every section of the business plan one way or another.

Show your Expertise 

A product coming from an acknowledged expert gets more acceptance in the market. 

Show your education or experience with the offering. If your business has any patents, trademarks, or special permits, make sure you showcase them. That way, you can establish yourself as an authority. 

For a sole proprietor, you can include your experience or education. For example, when an athlete starts a fitness brand, it becomes a quick success. However, other similar businesses face struggles at the start. 

Explain in Simple Language 

Make a detailed plan of product service but explain everything in simple language. 

Every industry has its jargon and buzzwords. People familiar with your product can understand the technical details, but the lenders or investors may not know much about your industry.  

Here is a pro tip for this. When you have written the product or service description, ask a trusted friend or family member to read it and explain your product to you. That way, you can know if your product service part of the business plan is generally understandable. 

What is your Exclusive Advantage? 

Your exclusive advantage is what makes you stand out. You spotted your exclusive advantage when you developed your product or service offering. Explain that exclusive advantage here. 

If you think there is no exclusive advantage, see if you can lower your price or provide better after-sale support. Even if your exclusive advantage is indirectly related to your product, it can help you get ahead fast. 

Assume you are talking to the customer

When you walk into the customer’s shoes, you can understand their needs better. 

Assume you are talking to an actual customer and convincing them to buy from you. They know your competition and they know what they need. You will have to talk in layman’s terms without missing any important details. You will need to focus on your competitive advantage. 

You will write an excellent product or service section when you think you are explaining it to a potential customer.

Key Questions to Answer in the Business Plan Products and Services Section

• Do you have a ready product or an under-development product?
• When will you bring new products or services to the market?
• What is the unique advantage of your product or service?
• What are the competitive advantages of your product or service?
• Does your product or service have any competitive disadvantages?
• Are you bound to charge a price in a short range, or can you charge a different price with a better offer?
• Are your business operating costs reasonable?
• Will you manufacture your products or buy from a supplier? 
• Do you sub-contract the parts of your product to different manufacturers and assemble the product at your facility?
• Will you be able to keep a steady and reliable supply chain for your product when demand rises?

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In the products and services section, describe your offerings in detail, including their features, benefits, and uniqueness. Include information on pricing, any proprietary technology or intellectual property, and how your products or services meet customer needs.

Differentiate your products or services from competitors by highlighting their unique selling points, such as superior quality, innovative features, customizable options, or exceptional customer service. Explain how these differentiators give you a competitive advantage.

Yes, it’s important to outline your pricing strategy in the products and services section. Explain your pricing model, whether it’s based on cost-plus, value-based, or market-based pricing. Justify your pricing strategy by considering factors such as market demand, competitors’ pricing, and perceived value.

Demonstrate the market need for your products or services by providing market research and analysis. Include data on customer demographics, target market size, and any trends or consumer preferences that support the demand for your offerings.

Yes, you can mention future product or service expansion plans in the products and services section. Briefly outline your growth strategy, such as introducing new product lines, expanding into new markets, or offering additional services. However, focus primarily on your current offerings and their value proposition.

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How to Describe your Product in a Business Plan

By: Author Tony Martins Ajaero

Home » Business Plans

The product or products your business intends to produce or offer will have to be described in the product description section of your business plan. This section of your business plan is meant to explain how your product will stand out from comparable items in the market.

You have to clearly explain its concept, coupled with all aspects of purchasing, manufacturing, packaging, and distribution. You should also identify your suppliers, costs, and how the product you are offering fits into the current market.

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Note that the product description in your business plan is more than a simple listing of product features. In this section, you will need to highlight your product’s most unique characteristics that will ensure it stands out in the marketplace and attract buyers who won’t mind paying your price.

Note that a properly written product description in your business plan can entice investors and help your business grow. Make sure you describe what you are offering in layman’s terms, to guarantee that someone who isn’t conversant with your business will grasp and be excited about it.

It may also be necessary to provide some basic background if this is an area or industry that people are not so familiar with. While you write up the Products and Services description section of your business plan, always keep your reader in mind.

What to Include in the Products and Services Description Section of Your Business Plan

Just as was noted above, the products and services section of your business plan will have to explain in detail your product or service, its demand in your market, and how it intends to compete with other businesses selling the same or similar products or services. Nonetheless, the product and services description section of your business plan is expected to include:

The Product or Service Description

It is important the product description section of your business plan clearly explains the concept of your product, coupled with all aspects of purchasing, manufacturing, packaging, and distribution. What are your product and service, and how does it work? How will this product benefit your customers? How do you plan to make it or how do you intend to get it made?

Product Comparison

This section of your business plan will also have to explain how your product compares with similar products in the market. What makes this product or service unique or better than what’s already obtainable in the market? Why would anyone prefer your product or do business with you?

You will need to describe how and why you are competitive. How do you stand out, and why do your business and everything it offers have such a viable chance at succeeding? In talking about your product or service, always try to answer why a client would want it and how it can make their lives better or more profitable?

Accreditations/Intellectual Property

For businesses that have had their product tested by industry experts, you must include this information when describing your product. Don’t forget to highlight any certifications, trademarks, copyrights, or patents.

Have it in mind that these added advantages or achievements can give you and your product an upper hand. Verified patents and trademarks can also heighten the value of your product especially since it shows that only your company can manufacture the product for the life of the patent.

Have it in mind that a product’s life cycle includes the idea, prototype, and expansion stages. If you are still in the idea stage, you must buttress in your description how you intend to get the product made and why your product matters.

If you maybe already have a prototype, outline your plans for evaluating the prototype and manufacturing your product. If your business has been making the product but is looking to expand to keep up with demand, ensure you explain this when describing your product in your business plan.

You will also want to include the cost of your product and how that cost aligns with other comparable products on the market. In very concise detail, explain how you came to this price, including the cost to manufacture, selling price, and profit margin.

Sales and Distribution Strategy

Also, take your time to explain how and where you will sell your product. Have in mind that your options may include online stores, brick-and-mortar locations, and vendors. If you already have vendors selling your product, ensure to note who they are and their locations in this section of your business plan.

Fulfillment

When describing your product in your business plan, it is also important you describe your plan to ensure your product gets to the intended customers. This should include manufacturing details and delivery specifics. If you plan to outsource the production of your goods, don’t forget to note manufacturer specifics such as location and production time. Also, remember to include the approximate delivery times and methods.

Requirements

Will you require any special equipment or technology to provide your product or service? Also explain if any specialized technology, materials, or equipment will be required to manufacture your product.

You will also have to explain your plans for product development and introduction especially as your business grows.

Photos or Brochures

Also, make sure that your potential investors can get a good insight into your product through photos and brochures. Don’t forget that your business plan is expected to have an appendix for photos and brochures. Also, don’t forget to refer to them in the product description section.

Tips for Writing a Product Description

To ensure you describe your product thoroughly, here are some vital tips to guide you;

• Always remember the reader. The product description section of your business plan must note your product’s most vital information. Always remember to make this section very easy to read and understand. Consider making it better by leveraging numbered lists and bullets.
• Focus on benefits. When describing your product, you must explain how its features can provide value to consumers. Translate your features into benefits, and remember that the aim is to describe how your product or service will be a solution to a problem or improve a client or customer’s life.
• Highlight the features of your product or service. To attain substantial success in any business, your business will need the ability to set itself apart from other businesses that offer or sell the same products and services. Take your time to analyze key features, such as price point or level of service, or anything that makes your product unique in the market.
• Show off a little. Don’t forget that you are selling a product and also selling yourself as the most viable provider of that product. Ensure to include all vital educational or industry-specific experiences and awards in this section. If you have endorsements or testimonials specific to your product, include them as well.
• Show the need for your product. Also make sure you explain how your product will cater to a need or improve life, showing why your product is very necessary to the consumer. This is very pertinent if your product has no current market.

The product and services description section of your business plan is meant to provide the reader with an explicit understanding of why you are in business, what you sell, how you will compete with what’s already available, or how you intend to fill a niche that no one else is currently meeting. Noted above are things you need to consider when creating the product description section of your business plan to ensure that it will indeed grab your readers’ attention.