questions to ask for a business plan

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6 Critical Questions Your Business Plan Must Answer If you want to lay the groundwork for a stable business and attract investors, make sure you're hitting these points.

By Larry Alton • Mar 18, 2015

Opinions expressed by Entrepreneur contributors are their own.

Never underestimate the importance of your business plan . It is the backbone of your company, a foundational pillar from which your enterprise will be built. It's going to serve as the first impression for countless potential partners and investors, and it's going to serve as a roadmap for your whole business -- at least for the first several years.

In some ways, writing a business plan is easy -- there are no rules or requirements for length, format, presentation, or even subject matter. But finding the right answers to the right questions is critical if you want to lay the groundwork for a stable business and attract sufficient attention from investors.

Related: 25 Common Characteristics of Successful Entrepreneurs

1. What need are you addressing?

This is an important question because it extends beyond the simple "What does your business do?" It's one thing to outline your business in general, describing what products you make or what services you offer, but if you want a solid business plan you have to take it to the next level.

It's nice to imagine your business as providing something useful, and if you're excited about the idea, it's that much easier to think about people buying it. But you need to be logical and critical when you consider the driving force behind your customers' purchasing decisions: what fundamental customer need is your business addressing? You'll want to back this up with research that shows the need actually exists.

2. What makes you different?

It's a big world out there, and startups are constantly coming on and off the radar. Chances are, there are multiple businesses out there who are already serving the crucial need you outlined from question one. That doesn't mean you can't serve it better, or serve it in a different way, but therein lies the challenge—figuring out what makes you different.

First, you'll need to acknowledge all the major players in your space, and this is going to require some research. Acknowledge what they're doing right, what they're doing wrong, and how they're going about their business. Identify the differentiating factor that will allow you to stand out, and emphasize it.

Related: Struggling to Define Your Business Goals? Ask Yourself These Questions.

3. Who is your audience?

Here's a hint: the answer can't be "everybody." No matter how useful or practical your product or service is, there's no way you're going to be able to sell to everyone in the world. Think about factors like age, sex, education, geographic location, working status, marital status, and perform some preliminary market research to determine the best path forward.

Your key demographic may evolve over time, so don't stay too committed to one niche. Also remember, that it's easy to expand to other markets once you've established yourself in one, so if you have multiple key demographics, it may be wise to focus on one to start things off.

4. How is your business going to make money?

This seems like an obvious question to answer, but you'd be surprised how many entrepreneurs fail to elaborate on their plan. The brief answer to this question is "sell products/services," but how are you going to sell? Where are you going to sell? How much are you going to sell for?

The other side of the question is what are your operating expenses? Who are you going to pay? What services or partners will you need to pay for? And ultimately, will the amount you sell be able to surpass the amount you owe? When will you break even?

5. How will you promote your business?

Promoting your business is just as important as creating it. Otherwise, people will never know who you are. Your marketing strategy should start off based on what similar businesses before you have done. Do they rely on traditional advertising or online marketing? Do they attend tradeshows and local events, or use technology to spread the word about their existence?

Related: The Ultimate Guide to Writing a Business Plan

6. What do you need to get started?

For many potential partners and investors, this is the bottom line. All businesses have to start somewhere, but that starting line varies dramatically from industry to industry and from entrepreneur to entrepreneur. Do you need any advanced equipment? Who will you need to hire? How much will you need for an initial run? These questions should give you an idea exactly how much capital and what resources you need initially.

It may seem counterintuitive, but answering these questions isn't a one-time process. Your business plan should be a living, changing document that evolves along with your company. Throughout your course of entrepreneurship, you're going to encounter new challenges, new opportunities, and hundreds of factors you never considered as significant to your business when you were writing the initial plan. To survive, you're going to have to revise your answers to these questions and update your business plan accordingly.

Related: The Essential Ingredients to Startup Success

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50 Questions Your Business Plan Should Answer

S adly, most investors don't read business plans. However, writing one is the only way you will be able to answer the following 50 questions which an investor will ask you:

1. What is the price of your product or service and why?

2. How much capital is required to execute your business plan?

3. How much is the company is worth?

4. What existing products/services does your company provide?

5. What is the use of the proceeds?

6. On a summary basis, what is the historical financial performance of the company (even if, and perhaps particularly if, you have no revenues)?

7. On a summary basis, what is the projected financial performance of the company?

8. What new products/services are being developed and when will they be ready for market?

9. What is the size of the market for your product in dollars?

10. What is the size of the market in terms of units?

11. How has the market for the product/service changed over the past 5 years and why?

12. How do you anticipate it will change going forward?

13. At what rate is the market for your product growing?

14. Is the competition highly concentrated or highly fragmented?

15. What is your distribution channel and why is it the best one?

16. On a broad level, what are the elements of your marketing strategy?

17. What does it cost to generate a lead, and what is the ratio of leads to sales?

18. What funding is being allocated to new product development from the financing and from ongoing operations?

19. How many potential customers have you talked to?

20. What are the gross and margins on your product/service? Why are they superior or inferior to a competitor?

21. What is your assumptions on the bad debt and collection period for outstanding receivables?

22. What are your working capital needs once sales take off and how will these needs be addressed?

23. What will happen to gross and operating margins as sales rise and why?

24. What percentage of your sales are recurring?

25. Who are your top five executives and what is their professional and educational background?

26. What regulatory or legal threats are present?

27. Are there international markets for this product and is the company positioned to take advantage of them?

28. Who is the largest competitor in your industry?

29. What criteria will be used to choose locations for geographic expansion?

30. How will you get this product into mass market distribution channels?

31. Is the product/service patented?

32. Who are your suppliers and or vendors?

33. Do you have more than one for each supplier/vendor of your basic raw materials or services?

34. What are your payment terms with vendors or suppliers?

35. What will cause gross and operating margins to improve as volume increases or decreases?

36. Where is the company located and how many square feet does it lease or own?

37. What is the length of the sales cycle?

38. How did you estimate returns and allowances?

39. How are sales personnel compensated? Incentivized?

40. What, as a percentage of sales, is the industry norm for R&D expenditures?

41. What is the earnings multiple of public companies like yours?

42. What is your immediate marketing objectives?

43. Does the company have a board of directors or advisors?

44. What is the ownership structure of the company? Who else is an owner?

45. How has the company been financed to date? What other financial transactions have occurred in the past?

46. Has the product generated any publicity? Where?

47. How old are the current liabilities on the balance sheet?

48. Who has prepared the historical financial statements and have they been compiled, reviewed or audited?

49. Is there any cyclically in sales?

50. What are the competitive advantages of your products?

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

David Evanson

David R. Evanson has more than 30 years working in the media, on Wall Street and in media relations. He has worked with investment banks, asset managers, private equity investors and institutional brokers on a variety of marketing and communications challenges. David is also a recognized financial writer, having authored five books on finance and economics, and articles in Barron’s, Forbes, Investment Dealers’ Digest, On Wall Street, Financial Planning and Entrepreneur, among others. David brings to the table a well-developed understanding of the capital markets, investments and corporate finance, and a talent for creating targeted media communications programs for financial services providers.

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30+ Business Plan Questions & Step-By-Step Business Plan Guide

25 April 2024

Table Of Contents

• 30+ Business Plan Question s

8 Steps to Creating a Full-Proof Business Plan

• SurveySparrow: The Best Business Plan Tool

Whether in business, marketing, or sales, you know how crucial a solid business plan is to your success. It’s not just about getting started—it’s about setting a clear direction for growth and innovation. This blog is your first step toward clarity and strategy.

Creating a comprehensive business plan is critical for entrepreneurs and business owners. It serves as a roadmap for your business and helps secure funding from investors and banks.

A well-crafted business plan should address key areas of your business, providing a detailed overview of its objectives, strategies, and financial projections.

Here’s a guide structured around crucial categories, each followed by pertinent business plan questions that will help in developing a robust business plan

30 Critical Business Plan Questions to Ask

Whether you’re steering a startup toward uncharted territories, aiming to elevate an established brand, or driving relentless sales growth, your business plan is the compass that guides your strategy, operations, and financial foresight.

Understanding this, we’ve compiled 30 questions designed to ignite your planning process and refine your business strategy.

Here we go.

Executive Summary

• What is your business’s mission statement?
• What products or services does your business offer?
• Who are the founders, and what is their background?
• What is the current stage of the business (concept, start-up, expansion)?
• What are the key financial highlights?

Market Analysis

6. Who is your target market, and how large is it? 7. What are the current trends and growth in your industry? 8. Who are your competitors, and what are their strengths and weaknesses? 9. How does your business fit into the market? 10. What is your unique value proposition?

Wait, wouldn’t you need a survey to run these questions and gather feedback? What if I told you that you can do that easily with Surveysparrow .

If you’re ready to chart your business path, grab our Free Business Plan Questionnaire Template . Begin your journey to success now.

Sign up for free with your email and start using it right away.

 Marketing and Sales Strategy

11. How will you reach your target market (marketing channels)? 12. What is your pricing strategy? 13. How do you plan to sell your product or service? 14. What is your sales forecast for the first year? 15. How will you measure the success of your marketing efforts?

Operations Plan

16. What is the location of your business, and why? 17. What facilities and equipment do you need? 18. Who are your suppliers, and what are your supply chain logistics? 19. What is the production process? 20. How will you ensure quality control and customer service?

Management and Organization

21. Who makes up the management team, and what are their roles? 22. How does your organizational structure look? 23. What are the backgrounds of your team members? 24. What gaps in expertise or knowledge exist in your team? 25. How will you fill these gaps (hiring, advisors, etc.)?

Financial Plan

26. What are your startup costs? 27. What is your break-even analysis? 28. What are your projected profit and loss statements for the first 1-3 years? 29. What are your cash flow projections? 30. What are the assumptions underlying your financial projections?

By carefully answering these questions, you can construct a thorough business plan that addresses all the critical components needed for your business’s success. Remember, a business plan is not a static document; it should evolve as your business grows and adapts to market changes.

• A Journey Begins: Identifying the Problem
• The Voyage of Discovery: Defining Your Customers
• The Battle Plan: Reaching Your Customers
• Understanding the Landscape: Identifying Your Competitors
• The Strategy Map: Outlining Your Operational Plan
• Charting the Course: Defining Your Business Structure
• The Guardian of Your Venture: Creating a Risk Management Plan
• Calculating the Costs: Budgeting and Financial Projections

1. Identify the Problem

Just as any memorable journey starts with a step, every successful business starts with identifying a problem.

The burning question to answer here is: what problem is your business attempting to solve? Remember, the more specific the issue, the better your chances of designing a unique solution that customers will flock to.

2. Define Your Customers

Identifying your target customer is crucial in the business planning process. This involves understanding and defining your potential customers’ specific demographics, psychographics, behaviors, and needs.

By doing this, you can tailor your products, services, and marketing strategies to meet their specific needs. The more precisely you can define your target audience , the more effectively you can serve them and set your business up for success.

3. Reach Your Customers

Now that You’ve discovered your target customers. Now comes the next challenge: How do you reach them?

Consider all possible marketing channels. Will it be social media? Email newsletters? Influencer partnerships? The choice is yours, but ensure it aligns with where your customers spend their time. After all, there’s no point in sending smoke signals if your customers are tuned into the radio.

 4. Identify Your Competitors

Now you have your bearings; it’s time to study the lay of the land. This means understanding your competition. The question is: Who are they, and how do they solve the same problem?

Understanding your competitors will help you differentiate your business and position it uniquely in the market. After all, in the quest for customer loyalty, your unique selling proposition (USP) is your Excalibur.

 5. Outline Your Operational Plan

So, you’ve identified the problem, defined your customers, planned your marketing, and sized up the competition. You’re almost ready to set sail. But first, there’s another significant piece of the business puzzle to put in place: your operational plan.

Your operational plan should include a detailed plan for sourcing deals. Using the Grata data deal sourcing platform can further help streamline this process and ensure you have access to the most relevant and up-to-date information.

How will your business function day-to-day? What resources will you need? Answering these business plan questions will help you create a clear blueprint of your business operations, ensuring your venture runs as smoothly as a well-oiled machine.

6. Define Your Business Structure

One question that’s often overlooked in the excitement of crafting business plans is this: What is your business structure? Sole proprietorship, partnership, corporation, or LLC ?

Your business structure will significantly affect taxation, liability, and other legalities. It’s like choosing the right ship for your journey – you need one that will safely weather the storms of your entrepreneurial voyage.

7. Create a Risk Management Plan

In the entrepreneurship journey, bumps and detours are part of the course. Having a risk management plan is essential. The business plan question is: What potential obstacles might you face, and how will you mitigate them?

A well-thought-out risk management plan ensures you’re prepared for the challenges ahead.

8. Create Budget and Financial Projections

Now, onto the numbers. What will be the cost of starting and running your business? How soon before you break even? Financial forecasts might seem as daunting as navigating uncharted waters, but they’re vital in answering the essential business-related question : Will your venture be financially viable?

How Can SurveySparrow Help You in Critical Business Planning

With SurveySparrow by your side, you’re never alone in your business planning journey. Its extensive suite of customer and employee experience tools offers invaluable insights to help answer all these key questions in your business plan.

Use SurveySparrow to conduct comprehensive market research, understand customer behavior, and even keep tabs on employee satisfaction. With this trusty tool, you’re well-equipped to answer all your business plan questions, ensuring your entrepreneurial journey is successful.

Here’s how you can do it.

Market Research : SurveySparrow allows you to design and distribute surveys to gather insights about your market. You can explore potential customer needs, preferences, and pain points and evaluate market trends and size, all of which are critical inputs for your business plan.

Customer Segmentation and Profiling : Using SurveySparrow, you can categorize your potential customers based on their preferences, behavior, demographics, and more. This can help you define your target market, tailor your offerings, and devise effective marketing strategies.

Competitor Analysis : By surveying consumers, you can gain insights about your competitors – their strengths, weaknesses, and what customers think of them. This data can be vital in positioning your business uniquely in the market.

Pricing Strategy : You can use surveys to understand what customers are willing to pay for your product or service, helping you devise a suitable pricing strategy.

Risk Assessment : Use surveys to gather feedback about potential risks or barriers to your business. Understanding these risks in advance can help you form strategies to mitigate them.

Employee Engagement : If you plan to have employees, understanding their needs and expectations is crucial for crafting your operations plan and culture. SurveySparrow can assist with gathering employee feedback and gauging engagement .

Product Testing : Before launching, you can use SurveySparrow to get feedback on your product or service. This can help you fine-tune it according to your target market’s needs and preferences.

Financial Projections : The data you gather from customer and market surveys can help inform your sales forecasts and financial projections, key business plan components .

In short, SurveySparrow can offer a wealth of information, helping you answer the critical questions in your business plan. You’re better equipped to create a robust, data-driven business plan by leveraging these tools.

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That’s All of It.

Remember, every successful business starts with a comprehensive business plan. And every comprehensive business plan starts with answering the right questions. So, go ahead and take the plunge. Your entrepreneurial journey awaits, and with SurveySparrow as your co-pilot, you’re set for an exciting voyage.

After all, the sky’s the limit regarding what you can achieve in the business world. Onwards and upwards, future tycoons!

Passionate, eidetic, and a writer at large.

Growth Marketer at SurveySparrow

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6 Questions Every Business Plan Should Answer

Table of Contents

An actionable business plan is crucial, whether your business is brand-new or an established player in its field. A business plan is especially vital for SMBs, which often must contend with lower name recognition, fewer loyal customers and other typical business challenges. While it doesn’t guarantee success, creating a business plan with research and care can help a business prepare for any future uncertainties.

Entrepreneurs and small business owners must ensure their business plans address six primary questions. Thinking through these questions and developing potential solutions helps set up your venture for success. 

What is a business plan, and why does it matter?

A business plan is a formal document designed to help you set achievable business goals and outline how you’ll accomplish them. The business plan should include various road maps dedicated to the following operational elements:

• Product creation
• Operational goals

A business plan is a valuable tool internally and externally.

• Internal business plan functions: Internally, a business plan helps align its decisions with an overall road map to help it stay on track. Businesses can also use road maps to help think through difficult choices, such as headcount decisions.
• External business plan functions: Externally, a road map is critical for securing funding from outside investors like angel investors . A business must demonstrate to investors that it has a solid business plan with achievable goals and a road map to success. 

What should a business plan include?

Typically, a business plan should include the following elements: 

• Executive summary. An executive summary highlights a business plan’s essential elements. Readers should be able to understand your business plan by reading your executive summary, even if they don’t read the rest of the document.
• Budget. A small business budget should include overall operational and personnel costs. Consider your payroll budget , marketing budget and other departmental budgets.
• Market analysis. A market analysis should include a thorough market assessment that identifies competitors, your target customer , customer buying habits, marketing demographics and what customers are willing to pay. A market analysis may include a competitive analysis that dives more deeply into direct and indirect competitors.
• Product analysis. A product analysis outlines decisions about optimal product pricing. While you want to sell as many products as possible, low prices can scare off customers and eat into your profit margins, while prices that are too high will have customers turning to your competitors. 
• Marketing strategy. Your marketing plan should outline how best to market the business and its products or services. Consider digital marketing targeted to specific online and social platforms, email marketing and local marketing. 

Business plans vary in length depending on your business’s size, industry and scope. An SMB typically has a shorter and more succinct business plan than a larger, established business that operates across industries. 

Questions every business plan should answer

We spoke with six business leaders who shared their thoughts on the crucial questions a business plan should answer. Consider these six essential questions to optimize your business plan.

1. What is the competitive advantage?

Scott Locke, chair of the intellectual property department at Dorf and Nelson LLP, advises thoroughly researching copyright infringement issues when determining your competitive advantage. 

“I always look for what will give the business a competitive advantage relative to businesses that want to offer the same or similar goods and services and an analysis of the competitive landscape,” Locke explained. “I pay particular attention as to whether there is valuable intellectual property, be it patents, trademarks, copyrights or trade secrets, that will serve as barriers to entry for competitors. Similarly, I like to see a discussion of the intellectual property of the most direct competitors and how the new business will avoid infringing on it.”

2. Is the business in a growth market?

Walter Recher, principal consultant at SmallBall Marketing, says your business plan should emphasize how you plan to grow your business . 

“The key to any successful business is to be a growing company in a growth market. A business plan should articulate how the entrepreneurs will enter the market, apply their investment to prepare them to grow quickly, and participate in the expansion of an industry that is thriving, with a better-than-average growth trajectory,” Recher said. “As I have spent my career working for hyper-growth companies in rapidly expanding markets, a founder of several small businesses and adjunct professor of a course on entrepreneurship, this has been the common denominator.”

3. Will customers pay for it?

Andi Gray, founder and president of Strategy Leaders, advises examining the risks of entrepreneurship and determining what and how customers will pay for their products and services. 

“When looking at business plans, I always want to know how the owners plan to get paying customers to engage at a fee and quantity that allows them, as owners, to be in business and sustain themselves,” Gray advised. “My frequently asked question is, ‘How do you plan to feed and clothe yourself, and where do you plan to sleep while you’re getting this venture off the ground?’ My hope is that it will cause the students to consider why they are planning to take the risks of entrepreneurship.” 

4. How will the business be staffed?

Larry Holfelder, senior consultant at DJL Insurance Services Inc., emphasizes the importance of staffing considerations. 

“In every business plan, I like to see the recognition of the need to cover and staff the production, sales and finance parts of the business. Roles should be established for the entity as if it were mature and successful,” Holfelder advised. “Multiple roles should be assigned at first, if necessary, and filled with the right people as the entity grows and the timing is right.” 

Holfelder says thoughtful staffing coverage shows that the business owners are realistic. “I like to see that type of thought process because it shows me they recognize that they won’t be able to do it all themselves and that business success revolves around collaboration and management,” Holfelder said. “It also shows that they recognize their own limitations, their ability to focus on their strengths, and the need to bring in others who know what they don’t in order to reach the goals they envision.”

5. Is the product innovative?

Irwin Glenn, chief identity scientist at Hunova, stresses the importance of innovation and inventiveness as well as the team’s level of inspiration. 

“Is the idea for the product or service innovative, a unique invention, or is the dream truly inspired? Glenn asked. “By innovative, I want to understand if the business plan is centered around a new twist on already-existing technology or services delivered in a new and compelling way. If inventive, can the idea be protected against new or existing competition? Finally, is the team assembled an excellent group that can’t be stopped from succeeding? Are they inspiring to me, each other, and their marketplace?”

6. Are the plans and goals realistic?

Charles North, former president and CEO of the Dutchess County Regional Chamber of Commerce, prioritizes a realistic business plan with reasonable expectations. 

“I look for it to be a realistic business plan, not something that is pie-in-the-sky. I want to see reasonable expectations,” North explained. “I tend to look more on the conservative side, since I feel that is the safest way to go. The idea doesn’t have to be reasonable; the plan does. The idea can be anything.”

North also emphasizes the importance of sales forecasts . “I always look for projections on what the business will do in the first year, second year, third year and fourth year showing sales, expenses [and the] bottom line as the business progresses. Those assumptions have to be reasonable.”

How planning for success pays off

A great business idea is no guarantee of success, but a solid business plan is a way to start a new business off the right foot and prepare your venture for a lucrative future. 

Business plans are a vital resource for businesses of all sizes. While business plans should, at minimum, lay out a series of goals and a road map for achieving them, a business plan should also help answer questions ranging from analyzing a business’ competitive advantages to considering if its goals are realistic. 

If you think through these questions while creating your business plan, your business will be in a better position to achieve its goals and weather any challenges it may face. 

David Mielach contributed to the reporting and writing in this article.

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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.

Original text

Copyright © 2024 SCORE Association, SCORE.org

Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.

How To Write a Business Plan in 9 Steps

Write your business plan with this step by step guide and take your idea into reality.

Salesforce Staff

Share article.

You have this amazing idea for a business. It’s been brewing for a couple of years now, and you’re finally ready to act on it. So, what’s your plan?

Like you, many people are preparing to start a business — and even some who have already started one — and fail to research and write a business plan that tests the feasibility of their idea. Some may think it’s a “waste of time.” They would rather wing it, stick with a pitch deck, or hope for the best.

But hope, unfortunately, isn’t a strategy for success. Writing a business plan and executing it kick-starts your road to success.

Here’s what you’ll learn:

Three reasons why you need to write a business plan Writing a business plan doesn’t have to be difficult How to write a business plan in 9 steps What’s left to do?

Three reasons why you need to write a business plan

If you haven’t considered writing a business plan until now, here are three key reasons why it’s a crucial tool when starting your business .

1. A business plan provides clarity

One of the easiest ways to gain clarity on your goals and brand message is to practice how you communicate them. Clearly describe what problem or need your business addresses and why it’s necessary for your target market. This strengthens your case when marketing and selling to your target audience.

It’s also useful when you need to apply for or raise funding for your small business. A clear picture of what your goals are will help you chart a course to deliver it as promised.

2. A business plan confirms the math

A lot of ideas sound great on paper or in casual conversations. But when you dive into the financials, such as how you plan to make money and how much it will cost, those ideas can fall apart.

Writing a business plan provides you with the space to create a financial model. It outlines the best- and worst-case scenarios that validate your idea’s worth.

3. A business plan establishes goals

Writing a business plan helps establish benchmark goals — those that are on your path to the main goal — and determine what you need for your success. Setting mini benchmark goals with deadlines for each month, quarter, and year provides you with short-term targets to focus on.

Nearly every plan for your business changes as the company grows. These benchmark targets ensure that your company is always moving forward.

( Back to top .)

Writing a business plan doesn’t have to be difficult

Creating a plan for your business can seem like an overwhelming project. Especially, if it’s your first business or you lack a background in finance or operations. Luckily, there are a number of resources available online, including Trailhead’s “ Salesforce Essentials for Small Business ” lesson, which helps you write a detailed plan. Your options vary based on your specific industry or product offering. However, all plans share a similar outline that you can follow when writing your own.

Below, we’ve put together a resource template for creating a thorough business action plan . Following a template allows you the opportunity to organize your thoughts and clearly present the plan to prospective partners, investors, or vendors. It can be a lot of trouble to start from scratch. Instead, try using this outline to draft a plan for your business and turn your napkin scribbles into a solid, well-researched plan that’s ready for financial investment.

How to write a business plan in 9 steps

Almost every detailed plan for a business follows the same framework. You can expand this however you’d like, but make sure these essential pieces are in place:

• Executive summary
• Company overview

Industry overview

• Market analysis
• Sales and marketing plan
• Business team

Operating plan

1. Executive Summary

Every thorough plan for a business opens with an executive summary that provides a brief description of the business, a mission statement, the products and services offered, and a summary of plans to succeed in the marketplace. If someone were to ask for a more involved version of your business elevator pitch, you’d recite your executive summary.

2. Company Overview

This is your napkin drawing on steroids. The company overview section is a snapshot of your business:

• Your business’s history
• A detailed list of products and services
• The physical location (if there is one)
• The problem/need your product or service addresses

Briefly touch on your target audience and how you plan to attract them (you’ll go into more detail later). This is only a snapshot summary for someone to grasp your idea and see the opportunity behind it. You also want to clearly define your company’s strategy for starting or growing in the marketplace.

3. Industry Overview

Your plan needs to address the industry as a whole, including relevant statistics, current trends, consumer demographics , and any external influences affecting the industry. Use this section to address how your business will fit into a specific industry and what (if any) subsections of the industry you will target.

4. Market analysis

Who will you battle for customers? The market analysis section requires you to validate that there is enough demand in the market for your business to both enter and grow. Research competitors in the industry, their market share, and how you plan to compete against them.

This is also a great opportunity to describe any industry barriers upon entry. You can explain how your company will establish itself — including your unique selling proposition — and share how the barriers will help protect your business from other startups or companies that want to go after your market share.

5. Sales and marketing plan

How will you execute your strategies and reach your goals? Your sales and marketing plan should clearly describe how you will grab the attention of busy consumers and persuade them to buy from your company. Use this opportunity to showcase your strengths, account for how your brand will stand out in the marketplace, and detail how you plan to build long-term customer loyalty for repeat business.

Don’t forget to describe your pricing strategy and how it compares to the rest of your market, as well as the advertising strategies you will use during your launch and first year.

6. Business team

Your business team section should focus on your business’s legal structure. Are you a sole proprietorship, partnership, corporation, or other type of business? Introduce your key team members such as managers, board members, and additional owners. Detail who owns what percentage of the company and each team member’s involvement in the business’s day-to-day operations.

7. Operating plan

Your operating plan gives insight into how your business will function on an ongoing basis and what daily operations will look like. The questions you’ll address in your operating plan may include:

• Will you have a physical location?
• What responsibilities will the management team shoulder?
• Do you have a customer invoice prepared?
• What expenses are related to running the business?

8. Financials

This is the money-making section, which can be an exciting part to investigate and budget. The financials portion of your plan may be the most important because it shows how your business will make money and grow over time. This section is even more crucial if you’re seeking outside financing or investors to help fund your startup.

Your financials should outline how your business will generate revenue and profit, and if necessary, how it will repay its loan or investors. Create monthly, annual, and three-to-five-year profit and loss projections and outline anticipated expenses.

9. Appendix

Close your business plan with an appendix that provides supporting documentation such as bank statements, employee bios, licenses, agreements, and business credit history. Think of it as your supporting research and reference documents.

What’s left to do?

Once you’ve outlined a plan for your business and gathered all the necessary research and documentation, it’s time to write it. By following this template, you should have no problem taking your great idea from a general concept to real life.

Your plan doesn’t have to be as long as War and Peace — it simply has to address each key point referenced above and show that your business addresses a need in the market. Then, after you finish writing your business plan, you can follow its guidance and get started on building your business.

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Top 15 Startup Questions Before Starting a Business

15 min. read

Updated November 3, 2023

• 1. What kind of person makes a successful entrepreneur?

Research of successful entrepreneurs has documented that successful small business people have certain common characteristics. This checklist cannot predict success, but it can give you an idea of whether you will have a head start or a handicap with which to work.

How do you measure up? Ask yourself these questions:

• Can I persevere through tough times?
• Do I have a strong desire to be my own boss?
• Do the judgments I make in life regularly turn out well?
• Do I have an ability to conceptualize the whole of a business?
• Do I possess the high level of energy that is sustainable over long hours?
• Do I have significant specialized business experience?

While not every successful business owner starts with a “yes” answer to all these questions, three or four “no” responses and undecided answers should make you think twice about going at it alone right now. But, don’t be discouraged. Seek extra training and support, and enlist the help from a skilled team of business advisors such as accountants, bankers, attorneys and SCORE counselors.

• 2. How do I determine whether I am capable of starting a business?

Small business owners have many things in common. Below are some of the qualities you will need to be successful.

• Willingness to sacrifice— If you enjoy working the nine to five, do not go into business for yourself. Entrepreneurship often requires many more hours beyond the forty-hour work week.
• Interpersonal skills— You will be required to interact with a host of people other than customers, such as lawyers, employees, and salespeople. If you do not like talking to people you do not know, it might be better to keep your day job.
• Leadership ability— You will be the one everyone turns to for the answers. Are you ready to call the shots?
• Optimism— Being able to hang in there when business gets tough is an important quality in small business owners.

Compare your skills and expertise with others who are successful in similar businesses. Can you duplicate and surpass the capability of other successful businesses? What unique skills or “edge” can you provide to obtain a sufficient share of total market?

Review business journals, trade magazines and other comparative studies that identify the requirements to operate the business. From that information, derive a formula for the skills and traits you plan to incorporate into the business operation.

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• 3. Why is a business plan important and who should write it?

A business plan is important because it summarizes both your vision for the company and your blueprint for the company’s operating success. The business plan is a written guide that details the startup and the future direction of your company.Who should write the plan? You, the entrepreneur. No one else knows your business idea and goals better. Yes, there are services that can do the work for you, however, you are the one who must present this business idea to bankers or other investors. Therefore, it is best if you are very familiar and comfortable with the plan.

Although there’s no set format, a good business plan typically includes:

• Cover page— Identifies your business
• Table of contents— Organizes information for the reader
• Executive summary— Provides a “big picture” view of the plan, highlighting the factors that will lead to success
• Business background— If it is a brand-new business, include your background and skills
• Marketing plan— Relates the business’s marketing strategy
• Action plan— Summarizes how you will create and deliver your product or service
• Financial statements and projections— Illustrates how the business will perform financially based on the plan’s assumptions
• Appendix— Includes statistical analyses, marketing materials, and résumés.
• 4. If I am not planning to apply for a bank loan, why do I need a business plan?

The fact that a bank or lending institution requires a well-executed business plan is a secondary consideration. The primary purpose of the business plan is to guide the owner or manager in successfully operating the business. Preparing the plan forces the writer to consider all aspects of the business and to confront any problems the plan highlights. For example, a monthly compilation of all known costs, over time, will indicate the revenue necessary to support these costs, plus a profit. This leads to the question of whether or not this revenue number is reasonable. If not, it may cast doubt on the viability of the venture itself. The business plan is a vital management tool that enables the manager to anticipate situations before they become problems — or worse yet, emergencies.

• 5. How do I determine my startup costs and other expenses?

It is wise to find out what startup costs you will incur before starting the business. Many a budding entrepreneur takes his or her life savings, or will borrow on the equity on their home before figuring these financial factors, only to find that they don’t have enough money. There are many web sites and other resources (including SCORE offices and Business Information Centers) that provide guidelines and worksheets to help determine costs for your business. Each item on your proposed budget sheet should be researched. Closely estimated costs can be obtained from utility companies, trade associations, and networking with other business people who may have already gone through this experience. Do not start buying until the investigation shows this venture is viable and you have all the information needed.

• 6. What do I need to know about financial statements?

First, you need to know which financial statements are important. They are:

• Balance Sheet—shows the financial conditions of your business at a point in time
• Statement of Operations (Profit and Loss Statement)—shows whether you made a profit during a specific period of time
• Cash Flow Statement—shows what happened to your cash position during a specific period of time

You should have a basic understanding of each of these statements. When compared with statements from prior periods, you can determine whether something is happening in your business that needs your special attention.

Your accountant can prepare these statements for you from the business data that you supply. There are also a number of computer software programs that will help you generate these statements from your input of regular transactions—such as sales, collections, purchases, payments and payroll.

A SCORE counselor can help you understand these statements and may be able to direct you to a workshop on this subject. In addition, most community and business colleges teach courses in financial statement analysis.

• 7. Why is it important to do a monthly cash flow analysis?

Your businesses cash-flow cycle may differ substantially from the income statement projections. Even if the projected income statement shows a profit, it is possible that the cash flow for the same period is actually negative.The analysis of monthly cash flow can indicate whether your business will collect sufficient cash to pay operating expenses. It will point out specific months during the year when the business may experience operating cash shortfalls and, therefore, either require additional capital or excess cash reserves for payment of expenses. It will also show when you may be able to make debt reductions and when there is excess cash to make major purchases or expand operations. By developing a monthly cash flow projection, you can time cash needs and quantify the amount needed. The cash flow projection is an important management tool and must be developed with very realistic expectations. Sufficient cash is critical for a business to pay its expenses and to enable it to expand. If your monthly cash flow projections indicate frequent cash shortfalls, you should review the type of products and services that you offer, the mix of sales, the pricing and terms of the sale, and your short-term borrowing needs.

• 8. How can I obtain cash to maintain and grow my business?

Develop a positive business relationship with your bank. Seek your banker’s advice even at times where you are not seeking funds. You may find that every time you go to your bank you speak to a different loan officer, so you should know them all.When the loan officer gets a promotion, you must start all over again with another person. If you want the bank to take an interest in your business, then you have to take an interest in theirs. How?

• Know your banker— Take an interest in your banker as a person. Ask your banker to hold on to your account if he or she is promoted. When you go to see your banker, have your business plan and financial papers ready. Make it easy for your banker to see what you want and why. The bank wants to minimize its risk with regard to you and your business. This is where you have to sell yourself.
• Know your bank— Know and understand your bank’s annual report. Know your bank’s business direction and plan. Know the bank’s lines of authority. Get on the bank’s mailing list. It’s an easy way to keep up with bank news.
• Go to a bank-sponsored seminar— Go to your bank’s seminars on commercial lending. This will teach you how your bank operates in terms of lending policies. By doing this, you also prove that you have an interest in what the bank is doing. Finally, it affords you the opportunity to meet and make an impression on the loan committee.
• 9. Why is location the most important aspect of my business?

A good location can make the difference between a profitable and a bankrupt business. There are many questions to consider when choosing a business site. Use the questions below as a checklist for potential locations and then compare several sites.

• Are there parking facilities?
• Is transportation available and convenient?
• Is the quality of police and fire service adequate?
• Will it be a quality site for the future—not just five years from now, but in 10, or 25 years?
• Is nearby housing readily available for management and employees?
• Is there nearby competition? Are those sites better or worse than yours?
• What is the general business climate in the area? Is this a prosperous market?
• Are merchandise and raw materials available? Are your suppliers easily accessible?
• How is the traffic flow—can your customers reach you quickly and inexpensively?
• Is your building suitable to your kind of business—will it need any major renovations?
• Is there an adequate community infrastructure for utilities (sewer, water, power, gas, etc.)?
• What is the tax burden—town, city, county, state? Will this impede your business and growth?
• What are the costs of operation in this location—will it be too high to offer you an adequate profit?
• 10. Why is competition important?

No business operates without direct competition. There also may be indirect competition, which has a significant impact on customer’s buying decisions in your market. Direct and non-direct competitors try to convince customers to buy their products or services instead of yours. It is in your best interest to learn more about the companies that are trying to reduce your take-home pay. List the strengths and weaknesses of each competitor. Talk with friends, visit your competition, call for information about their products and analyze how they advertise. Next, take a sheet of paper and list the major competitors. Give each a rating, on a scale of one to 10, for product quality, process, advertising, price and customer satisfaction. You can add other ratings that you feel are important.Your business can become more profitable by adopting practices you admire in competitor operations and by avoiding their mistakes. Some of your competitors have been in business successfully for many years. Certainly, as a new or relatively new business, you can learn a lot from them.

• 11. How can I better market my business?

To market your business, you must define your customer. To maintain consistent sales growth, you must become knowledgeable about your market. Develop an outline of your “typical” consumer:

• What exactly is your market?
• Where do the consumers come from (i.e. city centers, suburbs, tourists, international)?
• What are customers buying patterns?
• Why should they buy from you? Factors could include convenience, price, quality, service, etc.
• Should you try to appeal to a niche market segment or the entire market?
• Have you missed a new customer segment or special market?
• How large is the potential target market (in units or dollars)? Is it growing, stable or decreasing? What percentage of the market do you have?

Research will provide answers that are not available from your business records and a financial analysis. Conduct research through trade associations, your local chamber of commerce, libraries or even ask for the help of a SCORE counselor. Pay attention to how competitors market to their customers. Perhaps, some of their marketing strategies can be adopted for your business, or you may find examples of what not to do.

• 12. What makes a successful marketing strategy?

When creating a marketing strategy, keep in mind the four P’s of marketing:

• Product— What good or service will your business offer? How is that product better than those offered by competitors? Why will people buy/want it?
• Price— How much can you charge? How do you find the balance between sales volume and price to maximize income?
• Promotion— How will your product or service be positioned in the marketplace? Will your product carry a premium image with a price to match? Will it be an inexpensive, no-frills alternative to similar offerings from other businesses? What kinds of advertising and packaging will you use?
• Place— Which sales channels will you use? Will you sell by telephone, or will your product be carried in retail outlets? Which channel will economically reach your market?

The marketing strategy should summarize your findings about the key target buyer description, market segments the company will compete in, the unique positioning of the company and its products compared to the competition, the reasons why it is unique or compelling to buyers, etc.

• 13. What do I need to know before creating a marketing brochure?

A marketing brochure can be long-lasting or short-term. It can represent your business to potential customers and it can be a referral piece for existing customers. Decide the purpose of and goals for the marketing brochure before you begin to design and write. Remember, this brochure represents you and your business, so be sure its look and feel complements your business.

Here are few tips for when you are ready to begin:

• State your message up front—T he selling message should appear on the cover of the brochure. For instance, “The XYZ Company—Consultants on Doing Business Overseas.”
• Include artwork— If you have space limitations, one large photograph or graphic is better than several small images that might not clearly portray your services or products.
• Photo captions— Photo captions are read twice as often as the main copy.
• Create a keeper— Make your brochure worth keeping. Include a calendar of events in your specific industry or some data that will be useful to potential clients in the future.
• Quality is key— Your publications reflect you and your business. Using one to four colors in the brochure will make it stand out over one that is black and white. A good quality paper stock is also important (and comes in many colors and shades if you choose to use black ink). Remember to consider the weight of the paper stock in relationship to mailing costs.

It is wise to have your brochure professionally designed. Even if you have computer graphic skills, design is best left to professionals.

• 14. How can I improve customer service in my business?

Develop a strategy that puts the customer first. Customers will receive the best possible service when employees are empowered to make this happen. This is not to say that you should be lenient with your policies, but have a degree of flexibility. Just remember, a lost customer could spread the word of their discontent, resulting in more lost customers.Review the most common reasons for poor customer service. Use these insights as a way to improve your customer service:

• Too many rules— Employees lack creativity in problem solving. Rules are followed and good solutions are not developed because employees do not want to jeopardize their jobs.
• Lip service, not customer service— Customer service is really only a name for customer complaints. Time is spent trying to fix problems rather than preventing them from occurring in the first place.
• Unempowered employees— Approval is needed by a manager for small problems that can easily be solved by a good employee. This problem leads to long lines and time-consuming waits by the customer, who then refuses to come back-business operations turns a small problem into a large one.
• Unmotivated employees— Personnel are not encouraged to please the customer because there is no merit in it for them.
• Bad communication— Coordination of functions does not exist-one person may write an order while another picks it off a warehouse shelf and someone else delivers it to the customer. This can result in miscommunication, incorrect goods or services, and time delays.
• Arbitrary policies— Policies that are followed blindly without room for situational allowances may result in angry customers. For example, a store’s return policy of 30 days prevents a customer who, with good reason, could not get back to the store in time from receiving a refund. That customer will refuse to do business there anymore.
• 15. Is there anyone who can answer questions specific to my business?

SCORE “Counselors to America’s Small Business” provides free and confidential business advice and mentoring services to entrepreneurs nationwide. SCORE is a nonprofit association consisting of 10,500 business counselors who donate their time and business expertise to guide small businesses via face-to-face mentoring or online counseling.SCORE, a resource partner with the U.S. Small Business Administration (SBA), has assisted millions of start-up and growing businesses since 1964.

Clarify your ideas and understand how to start your business with LivePlan

SCORE "Counselors to America's Small Business" is America's premier source of free and confidential small business advice for entrepreneurs. Formed in 1964, SCORE provides a public service to America by offering small business advice and training.

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50 Questions to Ask Before Starting a New Business

Starting a business is an inherently risky venture. Getting your business off the ground requires a plan, capital, and a whole lot of hard work. From coming up with a great business idea to creating the proper business structure to execute this idea; from raising the money to fund startup costs to conducting the market research to justify your company’s raison d’etre, there are tons of steps before you can even think about opening the doors (physical or virtual) to your customers.

If you’re looking for a quick pathway from idea to implementation, we strongly recommend jumping from here to our article highlighting the 10 Steps to Starting a Business.

On the other hand, if you’re still in the early planning stages, you’ve come to the right place. The best way to really get the ball rolling is to start by asking yourself all the tough questions first. While you may not have an exact answer for each of these questions, this collection of inquiries is a great way to get you thinking about everything–big and small–that goes into launching your own business.

50 Questions To Help You Start a Successful Business

There’s obviously a lot that goes into getting a business off the ground. So how can you be sure you’ve thought of everything first? Well, you can’t. Rule number one–be prepared for the unexpected as a business owner. That said, you can take every possible step to reduce the risk of the unexpected. We’ve devised 50 critical questions to help you do exactly that. Because there’s a lot here, we’ve divided these questions into specific areas. Read on to find out which questions you should be asking about your Business Idea and Structure, the Competition and Customers shaping the marketplace, the Financial and Organizational components you’ll need to address to build your business, and finally, the Brand that you’ll be working to establish.

The Business Idea

1. What problem are you solving?

This is the very first question you need to ask yourself, because it will ultimately tell you whether or not there’s an actual need for the product or service you plan to market. Where did your business idea come from? Have you observed an unsatisfied demand for a certain product or service, or the need for innovation or improvement in the way a product or service is delivered? Perhaps you’ve found a way to offer quality with greater affordability, or a faster delivery system, or simply with a more customer friendly approach than the industry standard. Whatever it is that roots your business idea, be sure it’s something that addresses an actual problem with a viable solution. Moreover, be sure that the solution you’re offering is also profitable. Indeed, your goal here is to identify the need for your idea as well as the ability of this idea to generate profit.

2. Do you have a business plan?

Of course, it’s one thing to say that you have a great idea that can render a profit. It’s another thing to show it. That’s what your business plan is for. This is your chance to explain your idea in its entirety–to conduct a SWOT (Strengths; Weaknesses; Opportunities; Threats) analysis; to elaborate on the key features of the broader marketplace including the competition and the customers; to present financial forecasts that demonstrate the idea’s profitability; and more. That said, there aren’t necessarily any formal rules on what must be in a business plan. As an article from the Small Business Administration (SBA) notes, “A business plan is a written tool about your business that projects 3-5 years ahead and outlines the path your business intends to take to make money and grow revenue. Think of it as a living project for your business, and not as a one-time document. Break it down into mini-plans – one for sales and marketing, one for pricing, one for operations, and so on.” Ultimately, this will be a valuable document for securing bank loans, investor funding, or just for giving yourself a set of meaningful benchmarks to pursue. Developed properly, your business plan should give you the chance to think objectively about the various moving pieces that must ultimately come together to transform your idea into a reality.

3. What is your Unique Selling Proposition (USP)?

What is the value that you will offer your customers? Is there really a demand for this value, and can you actually deliver it? And can you deliver that value in a way that betters the current offerings in the marketplace? The key behind a great idea is that it will likely resonate with prospective customers either because it provides something heretofore unseen in the marketplace, because it significantly improves upon something in the marketplace, because it improves the accessibility of something in the marketplace for which there is great demand, or because it otherwise represents a distinct value to the customer that cannot be obtained elsewhere. Make sure you fully understand what makes your product or service offering unique, and just as importantly, why these unique properties represent a chance for profitability.

4. Is there a proof of concept for your idea?

So you’ve established the unique value proposition implied by your idea. But how can you be sure that it’s something people will actually pay for? That’s where proof of concept comes in. According to the definition provided by the Gartner Glossary of business terms, a proof of concept “is a demonstration of a product, service or solution in a sales context. A POC should demonstrate that the product or concept will fulfill customer requirements while also providing a compelling business case for adoption.” In other words, is there some precedent to prove that people will pay for what you’re offering? While your offering may be a unique proposition, is there a track record of success for similar product or service offerings? Have you yourself experienced even anecdotal success selling others on your product or service? And is that anecdotal success compelling enough to justify the launching of an entire business? In short, you’re looking to find the perfect balance between something that is at once novel and proven–a unique value spin on a product or service with a proven track record.

5. Have you thought of a good business name?

Believe it or not, this is one of the toughest parts of the process. Coming up with the perfect name can be genuinely challenging. And that makes sense. After all, a lot rests on a business name. The right name effectively describes what your business does, conveys the identity of your business, and gives your target customers something memorable to latch onto. While an imperfect name may not doom your business idea to failure, the perfect name could be a real game changer in your pursuit of success. Don’t rush this stage. Take the time to brainstorm ideas, run them by people you know and trust, and don’t settle for something that doesn’t feel right. Once you come up with the right business name, you can move on to the clerical steps like registration, licensing, and tax filing.

6. Can you explain your business idea in just a few words?

There’s an old adage that says, “if you can’t explain it simply, you don’t understand it well enough.” The quote is sometimes attributed to Albert Einstein, though historians have generally disputed this, especially in light of the actual complexity of his scientific theories. To wit, it may well have been coined by an unknown business magnate, because it applies brilliantly to the notion of a business startup. You need to be able to explain your business idea in as little as 30 seconds–the length of the so-called elevator pitch. This is important, because that’s about how long the attention span is of the average person. The attention span may be even shorter for the average venture capitalist. If you’re looking to excite others about your idea, perhaps even enough to net a few worthy investors, you need to be able to convey your business idea in a way that is at once compelling, clear and concise.

The Business Structure

7. What will be the legal structure of your business?

Now is the time to determine the best legal structure for your business based on the scale of your operation, the legal liabilities specific to your sector, and the nature of your product or service. Will your business be a sole proprietorship, a limited liability company, a partnership, or a corporation? Is your business intended as a non-profit entity, a religious organization seeking tax exempt status, or a traditional brick and mortar business in the retail space? Each of these entity types will come with its own specific rules for registration, licensing, tax status, operational regulations, and more. It’s up to you to determine which of these models makes the most sense for your product or service. If you’re not sure, this is a great time to consult a business attorney. You’ll want to be sure you get this step right as so many subsequent steps will hinge on making the right call here.

8. Do you need to register your business? 

The answer to this question may be different for every aspiring business owner and will depend on factors like your locality, the nature of your business, and the intended scale of your operation. In most cases, registration will be pretty straightforward, but it may not always be necessary. As an article from the Small Business Administration (SBA) notes, “For most small businesses, registering your business is as simple as registering your business name with state and local governments. In some cases, you don’t need to register at all. If you conduct business as yourself using your legal name, you won’t need to register anywhere. But remember, if you don’t register your business, you could miss out on personal liability protection, legal benefits, and tax benefits.” As long as you’re speaking with a lawyer about the structure of your business, you’ll probably want to inquire about these protections and benefits. Determine whether or not it makes sense to register your business. But bear in mind that you’ll probably need to register your business in order to respond in the affirmative to the next question.

9. Do you have an Employer Identification Number (EIN)?

This is important because you’ll need this number for just about everything else that comes with starting a business. Your EIN is kind of like a social security number, but for your business. This is what the U.S. government uses to identify your business as an official taxpaying entity. As an article from the Small Business Administration notes, “Your Employer Identification Number (EIN) is your federal tax ID. You need it to pay federal taxes, hire employees, open a bank account, and apply for business licenses and permits. It’s free to apply for an EIN, and you should do it right after you register your business.” The SBA explains that you’ll need an EIN to do everything from operating as a corporation to establishing a partnership; from paying employees to filing tax returns for employment; from withholding income tax from employees to overseeing certain tax-deferred pension plans. In other words, getting an EIN should be among your first steps. The good news is that it’s pretty easy to get an EIN directly through the IRS EIN assistance portal .

10. Do you have a general business license? No matter what kind of business you plan to operate, you are required to have a business license. In the vast majority of cases, a General Business License will suffice, and this will usually be issued by your locality. According to an article from Investopedia, “ Any business, including home-based businesses, must obtain a local city or county business license. This is a basic license that allows the holder to engage in business activities within the local jurisdiction. If your city or county doesn’t have a specific business licensing department, you can obtain information on obtaining a basic business license at your local tax office.”

11. Does your business model require a special sales tax license?

Depending on where you plan to operate, this license may already be included as part of the general business license. But this is not always the case. And where it isn’t the case, you are legally liable for ensuring that you do carry this additional licensing. According to the article from Investopedia “A sales tax license may be part of the general business license in some areas. But a separate sales tax license is required in other areas in addition to a local business license. Not sure if you need a separate tax license? The local department from which you obtain a business license can tell you if you must obtain a separate sales tax license and where to get it at either the state or local level. Make sure that you have this covered before you open your business.” Indeed, failure to do so could actually make you criminally liable.

12. Do you require special permits to conduct your business?

However you slice it, you will need to get this license. However, there is also specialized permitting that you may need to get. This will largely depend on the nature of your business. Permits, as per their name, give you permission to engage in specific business activities within your locality, and will usually be granted by a professional association specific to your sector. For instance, say the article from Investopedia, “ Environmental licenses or health department permits are less common for home-based businesses. These documents are most generally required for businesses that engage in the wholesale or retail sale of food and beverage products. In any event, it’s easy enough to check with state environmental protection agencies or local health departments to find out if your business requires any type of environmental inspection or permit.”

13. Do you need specialized insurance?

The answer to this question will depend on the nature of your business, as well as the organization, resources, and personnel involved in this business. If you are a sole proprietorship selling a creative service like web design or digital marketing, you won’t likely require any special insurance coverage to operate out of your home office space. On the other hand, if you plan to rent or purchase property for the operation of your business, you plan to hire employees, you expect to operate vehicles or machinery in the production or delivery of your products or services, or you are manufacturing a retail item that will find its way into the homes of consumers, you may need to carry certain specialized insurance policies. This may include commercial property insurance, professional liability insurance, or general liability insurance. Some small business owners will choose to carry a generalized business insurance simply in order to mitigate unforeseen risks and legal entanglements. If you’re not sure which types of insurance are recommended or required in your sector, consult a business attorney.

14. Are there zoning requirements you need to be aware of?

Before you start a business in your locality, make sure you’re aware of any practical legal limitations on what you can and can’t do. If you’re planning to rent or purchase a property, be sure you understand all the zoning rules in your municipality and county. Will your business objectives be in compliance with these rules? Are there additional steps you’ll need to take, and expenses you’ll need to sustain, in order to achieve compliance? You may need to ask these same questions if you plan to run your business out of your own home. Be sure that you are aware of any rules or regulations imposed by your township or country regarding the operation of certain business types from spaces that are zoned as residential properties.

15. Does your Home Owners Association (HOA) have any rules about operating a home business?`

Speaking of operating a business out of your own home, many communities and developments are overseen by organizations called Home Owners Associations (HOA). HOAs often have pretty far reaching rules about how you can and can’t use your residential space. Some may even have restrictions on operating a business out of your home. This is something you’ll want to be aware of before you attempt to launch a business from your home office or backyard workshop. If your HOA forbids this type of commercial activity, you may be required to rent or purchase an alternative space for the operation of your business. Naturally, this means you’ll need to factor this cost into your operating expenses.

The Competition

16. Who are the leading competitors in the space you’re entering?

Find out everything you can about the businesses that are leading in your space. Which companies are dominating in sales and market share? Which companies have succeeded in establishing a sturdy reputation in the space, and which entrants have made the biggest splash as innovators? In addition to finding out who these competitors are, you should know how each one has built a successful business in the space you plan to enter. An article from Business News Daily advises exploring all aspects of your competitors’ business to achieve a comprehensive understanding of what has allowed them to succeed. According to Business News Daily, “these aspects could be pricing, distribution and delivery strategies, market share, new products or services coming to market, who their long-standing, highest-spending customers are, the quality of after-sales support, and which sales and marketing channels they use.”

17. Is there room for a new entrant?

Now that you understand a bit more about the competition, you should be in a better position to honestly assess this question. How much space is there in the market for a new entrant? Are you facing down a field in which the competition is endowed with billions of dollars in operating capital? Is the field saturated with other startup businesses looking to build their own reputations as trailblazers? (Cryptocurrency industry–I’m looking in your direction.) As you prepare to make your own splash in a selected marketplace, do some honest soul searching about how much space there really is for your idea in this sector. If you find a marketplace that is deeply tilted toward just a few monopolistic entities, or one that is absolutely teeming with would-be innovators, you may want to turn your attention elsewhere.

18. Are you looking to innovate in your field?

Speaking of innovators, are you among them? This ties directly into the question of your Unique Sales Proposition (USP). Are you preparing to offer a product that significantly enhances what has previously been available in the marketplace? Is your service offering a meaningful step forward from previous service offerings in the same space? If you are offering customers something that is truly a distinctive, first-of-its-kind purchasing opportunity, you may be in a position to transform the marketplace, and place yourself at the forefront of this transformation. Before you enter the field, determine whether you plan to work within the parameters already established by those who came before you or whether you plan to disrupt the industry with exciting new innovations.

19. How will you differentiate your business offering from the competition?

Of course, innovation isn’t the only way to differentiate your offering from others in the marketplace. You can find ways to make your products and services more affordable, more accessible, more efficient, or more functional. Even incremental improvements in what’s available could set your company apart. An article from Business News Daily asks, “Could you improve the quality of your products or services by adding or amending a feature, lowering the price to be more affordable or improving after-sales support? Could you achieve a better ROI on your marketing budget by investing in a more capable CRM for better lead management?” Determine how you will set yourself apart, both from those who have established themselves as leaders in the space, and from those who are going head to head with you at the startup tier.

20. Is there anybody else who can do what you plan to do?

Do you have an ace in the hole–something that your business will do or offer that nobody else can replicate? Have you invented an exciting proprietary technology, or created an unparalleled synergy with another business partner, or is your team simply loaded with the type of intellect and talent that other companies can’t match? Identify the greatest strengths that your business has to offer, whether these are features embodied in your personnel, your products, your structure, or all of the above. Once you know what these strengths are, do everything you can to magnify them. These strengths will be your greatest selling point when it comes to beating the competition.

21. How has this industry or space changed in the last several years? Where is it going in the future?

Beyond just studying the current players in your business, you should have a strong sense of the history of your space. What are the trends and innovations that have helped to shape your area of the market? Are there technological or conceptual developments that have been inflection points in this field? And how has the field evolved since these inflection points? Try to gain a full understanding of the leading trends in the marketplace, as well as the path that led to this point. The better you understand what came before, the more readily you will be able to anticipate future developments in your field. Naturally, this anticipation could be the key to tremendous success.

22. What do the success stories in your industry look like?

Speaking of success, it’s not a bad idea to get a firsthand glimpse at exactly what this looks like. You’ve already identified the leading competitors in the field. Now find out what got them to where they are today? What was the unique value proposition that each of these successful businesses offered? What innovations did these businesses bring to the market? In short, what were the keys to their success? Whether you hope to replicate, build on, or surpass that success, the first step is to fully understand how your competitors achieved it. Every company has a story. Explore these stories and think about how they can inform your success.

23. What do the failures in your industry look like?

Not to be negative, but you can also learn a lot from the failures in your midst. Just as the sector you plan to enter is populated with winners, the world of business must also have losers. Find out more about the also-rans, the companies that tried, failed, and folded. These are cautionary tales with tremendous value to you, as a new entrant into the field. What were the causes of their failure–a failure to differentiate themselves, a lack of capital, poor organization, or just bad luck? All are possibilities, and more. Before you launch your business, use these stories of disappointment and poor fortune to identify, anticipate and sidestep your own pitfalls.

The Customers

24. Who are your customers?

Now that you know the competition, it’s absolutely critical that you also identity your customer base. Which demographics do you expect to serve, and more importantly, how well do you know the real people who make up these demographics. You need to understand your target if you are to effectively market to these populations. One helpful exercise here is to actually create target customer personas as hypothetical use cases for your products or services. To clarify, we mean that you should literally write out 300 word descriptions of imaginary customers–who they are, what their needs are, and why they are likely to find your product or service offering to be the ideal solution to that need. Beyond identifying customers by what you perceive to be key demographics, this exercise should allow you to hone in on individual customer types. Create characters around these customers and do your best to put yourself in their shoes. The better you understand exactly who your customers are, the easier it will be for you to identify their needs and provide products and services that effectively meet these needs.

25. Is there a large enough market for your product or service to fuel a profitable business?

Identifying your target customers should naturally lend an answer to this subsequent question. Does the customer base that you’ve identified constitute a large enough population to support your product or service? In the section below, we’ll discuss some of the financial components of starting a business. These will make it a bit easier to address a question like this. But on its own, the purpose of this question is to determine whether there is realistically a large enough market for your offering to fuel a profitable business. Without enough prospective buyers, it won’t matter how innovative your idea is. It will still be unlikely to generate a profit.

26. How will you market yourself to your target customers?

Now that you know who your customers are, and how many of them are out there, you have to figure out how you’ll reach them. This means determining where your prospective customers hang out. Are they online, browsing store aisles, or doing a bit of both? Are they reading print ads, clicking onto products from various social media accounts, or making their purchasing decisions based on word of mouth? This offers further motivation for getting to know your intended target market on a deeper and more personal level. As an article from The Score explains, “Knowing your target audience will also help you know how to market your business. For example, younger audiences may be attracted to social media channels, such as Snapchat or Instagram, while B2B audiences may respond better to webinars and white papers. Do you want to focus on SEO and content marketing or do you want to spend time gaining reviews and word-of-mouth referrals? Before you start a business, it’s important to understand where and how you are going to market that company. The best brands in the world have figured out how to communicate their value proposition effectively.” You need to be able to draw the triangulating lines that connect your marketing strategy, your value proposition, and your customer.

27. What is your marketing budget?

On the one hand, there’s the strategy you plan to implement in order to reach your prospective customer base. On the other hand, there’s the actual amount of money that you have with which to do so. Again, we’ll address some of the financial components of your startup business in the section below. But the purpose of the question in this section is to incline you to think realistically about what it costs to reach your targets through the various channels where you are most likely to find them. Will you be budgeted for a robust marketing campaign right out of the gate, or will you opt for a soft launch while you raise additional funding? The latter option may even be preferable if you are still in the process of working out the kinks in your product or process. In other words, you’ll want to develop an initial marketing budget based both on your available resources and your readiness for an influx of new customers.

28. Are your customers local, online or both?

Speaking of new customers, where are you expecting to find them, and where are you most likely to complete transactions with these customers? Is your business a strictly online business with a national or even global customer demographic? Is your business a strictly local operation like a landscaping business, a wedding cake baker, or a dentist? If it’s the latter, your strategy for reaching customers will likely be quite different from the strategy of those in the former category. Geography matters when marketing to your customer base for a variety of reasons, including its impact on the channels you will use to reach them, the language and tone you will use to engage them, and the nature of the products and services you will make available to them. Make sure your product or service offerings, and your marketing strategy, match the practical geographical expectations of your target.

29. Are there underserved groups in this space, or gaps in the marketplace?

Have you identified a unique subset of your chosen marketplace that is not currently being reached by your anticipated competitors? This could represent the opportunity to fill a need in your space. Remember those target personas that you developed? Now let’s think of some personas that are not having their needs met in the current marketplace. Are there prospective customers who are being priced out by the cost of products and services in your industry? Are there customers who require a more specialized type of service that simply isn’t available? Is there a geographic or cultural enclave that isn’t being reached by the messaging and marketing of current competitors? Try to find gaps in the way the marketplace is being served. These gaps could represent a substantial opportunity both to address unmet customer needs and to facilitate the growth of your business. Depending on the nature of your business, carving out a specialized niche could be just as profitable as taking a lead position in the industry, writ large.

The Financial Components

30. What are the startup costs for your business idea?

Once you’re certain that there is both space for your ideas in the industry and customers to help make your idea marketable, it’s time to get down to dollars and cents. How much money do you need to get your ideas off the ground? Startup costs will usually include a variety of administrative fees for licensing, registration, permitting, zoning, etc. These costs will also include property rental or purchase, any necessary insurance coverage, contract labor, employment costs, production costs, marketing costs and more. Clearly, there’s a lot of expense that comes with the start of a new business. Make sure you have a full sense of what those costs are. Refer back to your business plan for specifics. Hopefully, those specifics will also help you pin down sources for funding, whether these startup costs come from angel investors, venture capitalists, bank lenders, or from your own pocket.

31. What does it cost to make your products or deliver your services?

In addition to start up costs, you’ll need to know the operational costs of your business before you start paying the bills. If you’re manufacturing a product, you’ll need to calculate the costs of materials, labor, and delivery on the supply chain. If you’re delivering a service, you’ll need to calculate the costs of personnel, transportation, and actual labor. Do some research on your competitors to find out what they’re spending on these line items. Before you can determine what to charge for your goods and services, you need to know what it will cost you to deliver them.

32. Are there commodities that you’ll require that come with fluctuating costs?

Of course, that is easier said than done. That’s because many of the key commodities that businesses rely upon for production or for the delivery of services can fluctuate dramatically in price. The most obvious example is gas. Countless factors can impact the price of gas from inflation and supply chain disruption to natural disasters and political unrest. Of course, these occurrences can be highly difficult to predict, which means the price of this essential commodity can be difficult to anticipate. This directly impacts businesses that rely upon gas-powered vehicles for delivery or gas powered machinery for manufacturing. And of course, this is just one example. Shifts in the cost of lumber can have rippling effects on costs for builders and contractors. Changes in the availability of corn, rice, wheat, or soy can impact prices across the food distribution and service industries. These pricing fluctuations can impact profit margins and ultimately shape the price that you pass along to consumers. These fluctuations can be quite unpredictable. As you initiate your business, take into consideration your reliance on commodities that tend to fluctuate in value. To the extent that is possible, you’ll want to prepare for these possibilities in both your budgeting and pricing structure.

33. How will you price your products or services?

Speaking of pricing structure, it’s important to establish a price point for your products and services that makes sense within the scope of your industry and the broader economy. An article from Forbes notes that pricing is a delicate balance. Forbes points out that “You don’t want to over priced, but you don’t want to price your products too low. This is where research comes in handy as you want to look at what your competitors’ price their products at. Are your items the same, more luxurious or more simple? You also want to take into consideration the packaging and postage costing as well as maintaining the business overall. Where do you fit in the market for your target consumers?” Make sure you establish a price that consumers are likely to accept, but one that also ensures the profitability of your business regardless of your operational costs and potential fluctuations in the cost of commodities.

34. What is the product life-cycle for the goods or services you plan to deliver?

Obviously, you want to provide high quality products and services. This is a great way to ensure customer loyalty. On the other hand, nothing lasts forever. Do your products have a relative expiration date? Does the impact of your services have a diminishing benefit over time? In other words, will your customers ultimately need to update or upgrade the products they’ve purchased from you? Will they need regular service visits to ensure the continued effectiveness of the services rendered? This is important to know, because the timeline from initial purchase to subsequent purchase or service visit may tell you a great deal about your company’s profitability. If the goods and services you offer do indeed have a finite lifespan, be sure you have positioned your company to provide the appropriate replacements or repairs when the time is right.

35. How will you define financial success?

We recognize that this is a fairly broad question, but it is worthwhile to identify some financial benchmarks by which to log your own successes. Before you launch your business, you should have a clear sense of the milestones that you will use to mark your progress. Will you be targeting a specific amount of annual revenue; a break even point based on your initial investment; or a certain degree of profitability? What financial achievements will you use to track your company’s progress? Identify these measures in advance so that you have some concrete financial goals to shoot for.

36. Will you be opening a separate business bank account?

This is a good idea even if you operate as a sole proprietorship. A designated business account can make it a great deal easier to conduct effective accounting, to keep your personal finances separate, and to process customer payments. Indeed, you can set your business account to feed inputs into your accounting software, to accept credit card payments, to make payments on your business credit card, and more. In the simplest terms, you really should have a separate business bank account even for the smallest and most independent of operations. It helps to keep things clear and organized while reducing your personal financial risk.

The Organization

37. What skills do you bring to the table? What skills will you need to source from others?

You’ve decided to launch your own business, so obviously you are enterprising and ambitious. But what other virtues do you bring to the table? Are you good at delegating responsibilities and communicating ideas to others? Or are you better at wheeling and dealing with other business leaders? Do you have a gift for understanding and connecting with clients or are your skill sets more technical? It’s important to identify the talents you bring to the table for a few reasons. First and foremost, you’ll want to channel your greatest strengths into helping get this company off the ground. But secondly, and just as importantly, you’ll want to identify the areas where you may not be as strong. These are areas where you might want to enlist engagement from others. If you excel at business planning but are less skilled at engaging personnel, you may wish to partner with somebody who has managerial skills. If you bring a ton of technical expertise to the table but you don’t really know how to crunch the numbers in order to turn a profit, bring in somebody with financial management experience. In short, identify the areas where you excel, and partner with those who excel in areas where you don’t.

38. Are you still planning to work your day job?

This is worth asking if only because it underscores just how much time you’ll be able to invest in launching your own company. It’s understandable that you wish (or need) to retain your paying income even as you work to get a new company off the ground. But if this is the case, you simply need to be realistic about how much time you have to invest in your new venture. Divided attention may delay or even stand in the way of establishing a successful business. Taking the leap from full time work into full startup mode can be scary, but it may also be the only way to make it really work. If you have a day job with flexibility, you may be able to do both. But if your daily work responsibilities are standing in the way of your ability to launch a new company, you may want to think very seriously about taking the full leap into your new venture, and if possible, paying yourself a salary from the startup funding or revenue generated by this business.

39. How many employees will be needed to make this business work?

Speaking of taking a salary, you may not be the only one that your new company must pay. If you are a sole proprietorship, this probably isn’t a concern for you. But most business enterprises require other people to succeed. How many people you need to succeed will depend entirely on the initial scale of your organization. To the point, an article from Forbes notes the importance of anticipating the startup scale of your organization. Realistically speaking, what are the labor requirements for making your idea into a reality? Forbes notes that you may be “starting this business solo or with a business partner, but you also want to consider how many employees you will need as the time goes on. This is important to consider if you are beginning a business with the idea that it will scale up in the future, and require a team for growth.”

40. Is your business idea scalable? Can your company grow, and if so, what will that mean?

Speaking of growth, what do you envision for the future of your company? Are you providing a product that can be manufactured and distributed en masse? Are you offering a service that can be made widely accessible? How realistic is it that your company could expand regionally, nationally, or even globally? And if it did, what would that mean for your overhead costs, the size of your labor pool, and the potential for profitability? While all of these ambitions may be well in the future, you’ll want to anticipate these possibilities even now, at the outset of your business venture. Are these ambitions possible? Does your business model allow for this level of growth? And if not, what must you do to make this type of growth possible? Take steps now to analyze and recognize the potential scalability of your business model. This consideration may prevent you from suddenly realizing at some future date that you’ve reached the limits of your company’s ability to grow.

41. What logistical challenges will you have to address?

While there is a lot that you can control as a business entrepreneur, you must also rely on the competence of others to carry out your work. This may include mail sorters, parcel delivery services, truck driving fleets, port workers and countless others in the supply chain who will contribute to the timeliness of your shipments. Whether you’re waiting for incoming supplies or banking on the expedient shipment of outgoing products, there are logistical factors that will contribute directly to your costs of operation and your organizational efficiency. Make sure you have a full understanding of these logistical factors, and that you’re prepared to manage the challenges that these factors can sometimes impose on your ability to serve customers effectively.

42. Are there political externalities to consider?

In addition to logistical concerns, there are some businesses that are directly at the mercy of external political factors. Are you entering into the type of business that relies on government funding, that requires the efforts of lobbyists, or that touches upon an area that is considered divisive in American politics? Some products and services may even fluctuate in popularity based on their political and cultural appeal. Does your business idea depend on the political dominance of one party or another? Is your business model vulnerable to fluctuations in prevailing political ideals? If this is the case, you should be aware of the potential ebbs and flows this could create in your company’s popularity and relevance. These factors could consequently cause ongoing volatility in your company’s bottom line.

43. Will it be possible to delegate leadership responsibilities to others?

What role do you see for yourself in this company? Will you be a hands-on, day-to-day business manager? Or are you more likely to delegate responsibilities and take a hands off approach? The answer to this question should depend on your skill sets. Some business managers prefer to oversee every detail of their company’s operations. But speaking with candor, the most successful business owners are those that can effectively hand business leadership responsibilities over to trusted employees. In an ideal world, you would be able to delegate most daily management tasks to trusted personnel in your organization.

44. Do you plan to exit your business at any time?

This may seem like kind of a funny question to ask when you’re literally at the very start of running your own business. But it may be valuable to consider this question before you get your business off the ground. Do you envision this as a family company, one that you will ultimately pass on to the next generation? Or is it merely a profitable idea that you would ultimately sell to the highest bidder? In short, do you see yourself running this company for the rest of your working life, or would you be just as happy (if not happier) to create a valuable enterprise that ultimately sells to a bigger company for a big price tag? If you chose the latter, we can’t say we blame you.

45. What is your company’s identity, and how does this connect to your target market?

Your brand refers to the way you present yourself. So how do you intend to present your company? This should be a function of your target market. If you’re pursuing a younger demographic, you’ll want to establish an identity that is at once informal and authentic. If you’re pursuing a demographic of business professionals, you’ll want to establish an identity that is polished and articulate. Such is to say that your intended audience will play a big role in defining your brand. Make sure you establish an identity–in your imagery, marketing material, and personnel–that reflects the desires of your target demographic.

46. What are your company values?

Your brand is more than just an abstract vibe. It’s also the foundation underlying your company’s values–the things that your organization stands for. Identify those values from the start and it can help you to better understand your own brand. Is your company focused on affordability, accessibility and inclusion? Do your values emphasize activism in the face of global climate change? Or are your company’s values simply focused on creating profits for your shareholders? Whatever demographics and priorities you serve, take time to articulate your company values now. This may help to create a brand that truly resonates with your target audience over the long haul.

47. Does your company have a mission and vision?

Your values are an indication of what your company stands for. By contrast, your mission and vision speak to what your company actually intends to do. What do you hope to accomplish as an organization? Is it innovation, equality, environmental justice, social progress, or technological advancement, just to name a few of the infinite possible answers to that question? Part of establishing your brand is articulating the mission that your company will actively pursue and the vision that your company will hold as its grandest ambition.

48. How will you convey this brand?

Now that you’ve pinned down your brand, how can you be sure that others will perceive the image that you’re putting out there? Do you have plans to build a website that captures your company’s identity, tone and vibe? Do you have a way to source a logo, color palette, and iconography that match your organization’s culture, energy, and intent? In most cases, these are tasks that you will want to outsource to qualified third-party providers. But you’ll need to establish your own clear sense of these things first. Take time to think about the aesthetic that you believe will best convey your company’s identity and find artists, copywriters and web designers who will work closely with you to capture this aesthetic

49. Do you need any special patents or trademark copyrights?

In addition to working with artists and web designers to create your company’s iconography, you’ll want to work with lawyers to ensure that this ephemera is protected from intellectual property theft. That’s why, according to our own Ultimate Guide to Starting a Business, “Many companies apply for trademarks to protect the unique components of their company. Trademarks can cover a specific brand, a logo, a catchphrase, or product design. Or anything else that sets your business apart from your competitors.” Make sure you apply for these protections in the early going. When your company achieves massive success, you’ll be glad that you secured your images and icons against misuse.

50. Does your company have a story to tell?

Part of your brand identity is your personal history, the history of your idea, and the history of the organization you’ve built to deliver that idea to your customers. Find a compelling way to tell this story in your company’s literature, on your website, and through your marketing materials. Your company’s story can help to personalize the purchasing experience for your customers, to make your brand more relatable, and to ultimately help you establish an identity with lasting commercial impact.

Looking for even more detail on how to succeed at business? Our Ultimate Guide to Starting a Business includes step by step details on how to create a business plan, a rundown of special business permits and licenses, and tons of other actionable tips on getting your business venture off the ground. 

20 Questions for Your Q1 Business Plan Review

The end of Q1 is the ideal time for a business plan review.

So how do you even review a business plan?

You’ve heard me say before that having a business plan is an absolutely essential part of getting to where you want to be in life. But no matter how good of a plan you make, at the end of the day, it’s still only a plan – which means it’s meant to be followed, not written and set aside. That’s what this business plan review is for.

It’s the role of a good coach to check in on your progress and keep you on pace, so that’s exactly what I’m hoping to accomplish here in this blog.

According to your business plan , the strategies you’ve put in place so far can either:

• Launch you to where you want to be (if you refine them) or
• Send you spiraling into a crash (if they’re left unchecked)

It’s probably fair to say you’d prefer the first one, right? In that case, I’m giving you one of my favorite simple business plan review techniques. All you have to do is get all your numbers ready, pull up your business plan, and answer 20 questions.

Got everything ready? Then let’s get started…

How often should a business plan be reviewed?

Your business plan should be reviewed at least once per year. In today’s fast-paced business world, it’s easy to get caught up in the day-to-day operations and lose sight of the bigger picture. That’s why it’s crucial to schedule regular business plan reviews. Updating your business plan annually helps ensure that your company stays competitive and on track to meet its long-term goals. With so much at stake, you can’t afford to wait until the last minute to sift through all the numbers and make necessary changes. By reviewing your business plan regularly, you’ll be able to identify areas of improvement and make strategic adjustments. Don’t let your business plan become a static document. Keep it alive and thriving by scheduling regular reviews.

Business Plan Review Questions to Ask Yourself

Question No. 1: What’s your WHY? This is something you should already have written in your business plan , but it’s a question worth repeatedly asking not just at the end of every quarter but every day. So look at what you wrote down in December and then ask the question again. Has your answer changed? It’s okay if it has but make the adjustment.

Question No. 2: What’s your role?

Define your job, because your job title defines how you approach both your work and your business plan review. Are you operating as a real estate agent or like the CEO of your company?

Question No. 3: Did you make enough money to achieve your WHY?

Before we dive into any of your actual numbers, let’s establish a monetary value for your WHY. Not everything in life has a price tag: love, peace, honesty… But most things do, or at least money plays a role in them. Maybe you want to pay for your kid’s college. Maybe you want to start investing in properties. So ask yourself if over the last three months you’re on the right track for these goals and what being on the right track would actually look like.

Goals vs. Reality

Question No. 4: Units Closed vs. Goal Units Closed?

Question No. 5: Volume vs. Goal Volume?

Question No. 6: GCI vs. Goal GCI?

Question No. 7: What’s your average price per listing?

Add up the sum total of what all your listings have sold for and divide by the number of listings taken.

Are You Following Your Plan?

Question No. 8: Are you using all the lead sources you said you would on your business plan?

Question No. 9: Which lead sources are you underutilizing?

Question No. 10: Have you put in place the systems you wanted to have by Q2?

Question No. 11: In what ways do you need to adjust your plan to catch up to where you want to be by Q3?

Question No. 12: Expenses vs. Income. Are you staying in the right range?

If not, how far off are you and where is that money going?

Finding Your Personal Metrics

Question No. 13: How many conversations did you have?

Then break this down to how many you had each day, week, and month. Create a daily average.

Question No. 14: How many appointments did you take?

Question No. 15: How many conversations does it take you to get an appointment?

It’s simple division that creates massive predictability for your business. You should know this number and “live it” every day. Remember: Appointments are the only currency that matters today.

Question No. 16: How many appointments does it take for you to convert a listing?

Important Questions to Have Framed in Your Office

Question No. 17: How much money do you make from each conversation you have?

Divide your GCI by the total number of conversations you had. Then take this number and put it somewhere that you and every person on your team can see every day. When you don’t feel like making your calls, just remind yourself that this is how much every call is worth to you.

Question No. 18: What went well for you in Q1 and how can you do more of it?

It’s important to not only focus on where you’ve fallen short, because you’re strengths are what you need to rely on here – which means it’s important to know what they are!

Question No. 19: What do you need to stop doing and leave behind in Q2?

It’s time to strip away all the baggage that’s slowing you down, whether that means it’s time to hire someone or maybe it’s a lifestyle habit that’s getting in the way of your success.

Question No. 20: Are you getting to support you need?

In my 35+ years in this business, I’ve never seen anyone figure everything out by themselves. Even for people who are thriving right now, imagine what you could do if you had professional support to guide you on your journey…

My guess is, you’d learn that you’re not setting your goals high enough. Because we don’t know what we’re capable of until we have a valued mentor bring it out of us, push us to new limits, and show us the blind spots we can’t see for ourselves. So, if you’re ready to take this next step and fully commit to becoming the best version of yourself in Q2 and beyond, self-schedule a free coaching consultation right here . It only takes about an hour and might just change your life.

And if you’re already a coaching member or Sphere subscriber , be sure to watch Kay Fairchild’s webinar on conducting a more detailed quarterly business plan review inside of illūm, where she takes you step-by-step through her own extremely valuable quarterly review process.

Need to create a business plan first?

With access to this on-demand business plan webinar , you’ll gain immediate access to our acclaimed seven-point business plan template, essential tips on fostering the right mindset to conquer today’s volatile market, engaging Q&A sessions, and more insights from Tom Ferry. Don’t miss this chance to arm yourself with the knowledge and tools to thrive. Unlock your access to the full video, business plan template, and more!

Would You Like to Generate and Convert More Leads in Less Time?

Business Plan | 60 questions to ask yourself

Today, I will present to you the 60 good questions to ask yourself when creating your business plan . Here we go !

60 questions to ask yourself to create a Business Plan

Find in this video the questions to ask yourself to make a business plan  :

Below is the support I used for my presentation on the business plan :

So initially, to be completely honest with you, I didn’t necessarily want to write an article on business plans. The reason is quite simple. I’m not a big fan of business plans and I’ll tell you why.

In fact, 99% of business plans always have the same form, if we take a graph with revenue on the abscissa and time on the ordinate, we always go through the following phases: we are very poor at the start and afterwards as if by “magic”, we become very rich!

The question that arises is therefore that of the credibility of a business plan when creating a business.

Why does this simplistic approach bother me?

When you start a business, if there’s one thing that’s difficult to predict, it’s revenue levels. Simply because it is impossible to know in advance whether you will succeed in obtaining many customers or not, after how long, etc.

In other words, the only thing that we can predict more or less correctly are the costs, because with that, we can have a vision that is a little finer and a little more realistic.

On the other hand, for income, objectively, even if you base yourself on statistics, even if you base yourself on market phenomena or trends, these will always be big approximations.

This is why often when people talk to me about a business plan, I tend to take a step back and say to myself “Okay, what are they going to tell me now? “.

So why did I finally decide to write an article about it?

I decided to write today about business plans for a simple reason. I had the opportunity to read an article from Express Entreprise called “ Business plan, the 60 questions to ask yourself to develop it  ». 

And actually, I thought this article was really well done. For what ? Quite simply because this article allows you to ask yourself some really good questions.

Indeed, beyond a simplified curve as I was able to show you before, a good business plan or rather a good way of making a business plan, is above all the fact of asking the right questions, and therefore, to defend your project more effectively to a banker, a business angel or an investor.

These different questions will allow your investors, partners or financiers to see that you have understood all of the different parameters necessary to set up your business.

So, I decided to play the game as well.

The 60 questions I am going to ask myself and make sure to answer them for my business concern SEO advice .

On commence !

These 60 questions to ask yourself for your business plan will be organized into 6 main parts:

• Your profile
• The team you will form
• The commercial marketing strategies you are going to undertake
• Protect your know-how and your product

Find funding

I would like to make two comments before we begin the round of questions.

Obviously, certain questions will be more or less conducive to my activity. Indeed, to the extent that I am going to launch an activity in SEO consulting, do not be surprised if I quickly go over certain questions which will be more linked to industrial companies.

Second point that I would like to mention, the opinion or rather the perspective that I am going to give you will be perfectly “personal” and “subjective”. For example, in my current situation, I will not immediately need financing to start my business.

Indeed, I have personal resources and I am not going to spend thousands and cents in any case, so I am not going to call on a banker or an investor. Therefore, my perspective is going to be a little biased.

The objective of your business plan is to try to seduce, to show a “white paw” to an investor to try to convince them that you know what you are talking about, and you know in which direction your business is going.

Come on, let’s start!

First of all, we will talk about market-related issues.

A) The market

Having a good understanding of your market, the players and what your customer wants is essential. This is the first part, one of the most important from my point of view. So first question,

1) How big is your market? Is it local, national or global?

The size of the market is indeed important. Quite simply, because there are markets that are really small and where we can’t do much. Then, there are markets that are huge and sometimes that can be scary.

To the question, “Is it local, national, global?” “.

Objectively, if you start your company, don’t say to yourself from the start “I am a company that is global”. If you can become a “global” company, good for you. That’s really what I wish for you. The thing is, in the beginning, it never happens like that. We are in a local, national business, why not. But global, no.

We will try to take it step by step. For the size of your market, you can see this from the different types of statistical studies that exist in your sector or from your market research. Knowing that, this type of information, we must try to take it with a step back.

For what ? It’s good to have a view of an industry’s overall revenues. The problem is that it doesn’t really give you any indication of how and how many customers you will be able to convert. You just know that there is a market and you see that the trends are positive.

Now I will answer you in a concrete way for the SEO sector.

In SEO, the only numbers I have been able to find are industry-wide from a global perspective. In France in particular, I searched and I didn’t find anything in particular.

In any case, what I know will be more along the lines of trends . Unsurprisingly, there are more and more websites, on the one hand. On the other hand, companies are investing more and more money in SEO campaigns to improve their organic traffic.

Am I going to approach this from a local, national or global perspective?

So first of all, my business will be located in a very specific location, namely Paris. Therefore, I will make sure to find clients in Paris and its surroundings. Afterwards, the advantage I have with SEO is that it is an online business. So, I will have the possibility of doing some of my activities remotely. For example audit or even consulting activities.

As long as I have information like Google Analytics or Google Search Console, I can work from just about anywhere. So initially, it will be from my point of view, local and national.

The world, why not? You have to have ambition, that’s for sure, but it’s clearly not the priority. If at any given time growth is strong from a local and national perspective, why not consider something else. But right now, no.

Afterwards, you also need to know if the content and services that I offer are likely to be of interest abroad. I think so. But in all cases, we start “small”, we start local, potentially national. The world in a second phase, but not immediately.

2) How many customers can you expect?

When you are going to start your business, it is important at the outset to gauge how many clients you can hope to get.

Obviously, when you start your business, the number of customers most of the time is zero, and that is completely normal. Little by little, you will succeed in having customers, succeed in convincing them, etc.

Knowing that my activity will be SEO consulting, the objective will be to give the maximum added value to my clients to try to have a true qualitative approach .

What does it mean ?

This means in concrete terms that I initially aim for between 1 to 5 clients per month.

Why am I sure of this ratio?

Because I could have said 20 customers. The problem is that in fact if you have 20 clients from the start, and only one person takes care of them, the quality will inevitably plummet.

With my agence SEO , I do not want to tend towards a low-end service, but rather towards a service that is mid-range initially, to have low prices and customers who are interested. And little by little move upmarket. So between 1 to 5 SEO clients, that seems good to me to have a qualitative approach.

3) In this market, is there a shortage or excess of supply?

Indeed, there are very competitive markets where there will be a lot of people, and others, much less competitive, where there will be very few people. Therefore, if you have a particular skill that is in high demand, good for you.

This means that you will succeed in obtaining significant growth for your activity and your business. Knowing that competition, or having for example an excess of supply is not always a problem in itself.

I will have the opportunity to say this again in other questions that follow. But in essence, if there are people in a market, that most of the time means that there is income in that market. Therefore, you have the opportunity to create a business in this market.

Always be careful of markets where there are no people. If there is no one, it is either that everyone has missed out, so it is a golden opportunity, or it means that there is not necessarily any money to be made in this sector.

In SEO, there is neither shortage nor excess of offers. I would say it’s really somewhere in between actually. There are very good freelancers, but also very good agencies. So I don’t think we are in a sort of excess offer in terms of SEO advice. There is, but I think there is enough space!

4) Can new players appear in the short term?

Sometimes, it happens to find markets in which players are there historically. So, if you want to enter this market, it will be possible, but it will be more complicated. So it will depend on your sector, your products, your service, etc.

Regarding SEO, my answer is clearly yes. I think new players may appear. Currently, there are no dominant players to speak of. There are some very good actors, but none who are particularly above the rest. Regarding the barrier to entry, we will say that it is relatively low. So yes, there is the possibility of new actors appearing.

5) Is your activity BtoB (business to business) or BtoC (business to consumer)?

Depending on your business, your activity will tend towards BtoB or BtoC, and of course between the two, the approach will be radically different. In BtoB, you will contact professionals.

In BtoC, it will be for consumers. We do not approach consumers and professionals in exactly the same way. So, be aware of the nature of your audience. In this way, you will be able to adjust your communication, your marketing, commercial aspects, etc.

In SEO, we are clearly in BtoB. Knowing that in the communications that I am going to make, there will be a large part BtoB and a very little bit of BtoC (for example on YouTube). But basically, the actual SEO consulting service that I am going to offer will be for professionals above all.

6) Is your offer in line with market expectations?

It seems logical, but sometimes we can miss the obvious. So take some time to look at what the competition is doing.

For what ? Quite simply because if you come up with a product or service that is not at all aligned with what your customer wants, you are not going to sell absolutely anything, and your revenue will be 0. Therefore, really try to know market expectations, so you will be able to offer an offer that will be adapted.

For my SEO business, I will ensure that the different offers that I propose are in line with customer expectations. There will be an SEO audit, “On Page SEO”, backlinks, etc.

7) What are your customers’ expectations? Are they loyal or captive?

Understanding and knowing customer expectations is absolutely crucial. For what ? Quite simply because when you start your business, you may have things in mind.

The problem is that between what you have in mind and reality, sometimes there is a sort of abysmal gap. Therefore, when starting a business, first of all, it is important to go see customers or potential customers, and ask them:

• “Concretely what do you want? »
• “How can I help you? »
• “How and what are the elements of added value that I will be able to give you? »

For SEO, the expectations are simple. Clients have one or more websites and want to get more organic traffic, that is, traffic coming directly from Google. This is what SEO allows. The other element that interests them will be the income linked to organic traffic. In other words, we increase organic traffic, as well as revenue.

SEO also allows you to do this. And that will be part of customer expectations. Others SEO KPIs can also be interesting, such as the return on investment of an SEO campaign.

This is indeed a question that investors can askFor example, if I invest 1 euro, how much will come into my pocket after this SEO campaign? 2, 3, 4, 5…, 10 euros?

Then, the other element: are the customers loyal or captive?

Indeed, it will be important, because some clients will be difficult to obtain because they are very loyal, for example to the SEO firm with which they work. And others much less. For example if they use freelancers.

Knowing that this is an example. I could very well have said the opposite. There are freelancers who are exceptionally good at what they do. So we shouldn’t be caricatured at all about that. In all cases, be aware of the loyalty of your customers.

8) What are the customer benefits of your product or service?

When you are going to offer a product or service, customers must buy it because they feel that there is some kind of added value or additional benefit compared to other products and services on the market. Depending on your sector and industry, these benefits may be different.

In SEO, the benefit for the client lies in having more organic traffic, and earning more money thanks to that.

9) Are you in direct or partial competition with an existing offer?

When you have more or less significant competition in your market, logically, it will be more or less easy to find your place. But to come back to what I said before, competition should not scare you at any time.

I know that when you are a new entrepreneur, you often say to yourself “Oh my! There’s competition, I can’t go there! “. Don’t take it like that.

Really consider the fact that there are people there as a real lever for growth. Consider that there is potentially money to be made in this market. Therefore, do not be afraid.

Is it going to be more complicated than a sector where there is no competition at all? The answer is yes “. But the thing is that sometimes, sectors where there is no competition at all can be explained simply by the fact that there are no profits to be made. So, don’t be afraid of the competition!

In terms of offers from an SEO point of view, services related to audit SEO , At “ On Page SEO » or to backlinks , are often the types of activity that are offered by companies in this sector.

10) Can you easily differentiate yourself and find a niche position?

When you start a business, try to start, if you have the possibility, in a niche, that is to say on a relatively small fragment of the market. For what  ? Quite simply because it will allow you to become an “expert” on a very specific part of your market, and to satisfy your customers.

This is a good gateway to obtaining new customers. Then, when you have gained the trust of your customers, you can increase the services offered and grow your business little by little.

In any case, I advise you not to start in a huge market. Start small, with a service or something that will allow you to differentiate yourself.

At the level of the business that I am going to launch in SEO consulting, the differentiation will be at the service level. I will really try to highlight my service in order to be perceived as an “expert” company in “On page SEO”.

This is one of the things I really want to be defined on, an axis on which I really want to focus on to succeed in convincing my clients.

So this is one of the differentiating aspects, and this is my niche part. Afterwards, there will perhaps be developments. We will see how things will evolve.

In terms of differentiation, there is also another element on which I think I can distinguish myself. This is about creating my content. There is already a lot of SEO content out there. And content is crucial.

Obviously, people who work in SEO know how important it is. So I’m going to try things a little different way.

This will notably involve the type of content, for example videos YouTube . I am also going to make a particular effort in terms of my blog, my articles, and the visuals. I really want to make a significant effort to show future customers what my company is capable of.

11) How many years of experience do you need to be credible with your customers?

There are sectors where experience is a determining criterion. So, if you don’t have 10, 15, or 20 years of experience, it’s going to be very problematic for you. In SEO, experience is important, but you don’t have to have been in this industry for many years.

For what  ?

What you need to understand about SEO is that it is a sector that evolves quickly and regularly. In other words, from the moment Google makes algorithm changes, each time it involves a new way of doing things, because the way of doing SEO evolves radically.

So years of experience, why not. But the real criterion from my point of view, to choose the right SEO company, will be above all to know which company is the most up to date on the latest developments which impact the algorithms.

Ultimately, it will be about its ability to evolve over time, which from my point of view is the most important element. For example, if a person who has 15 years of experience in SEO, does SEO as on the first day 15 years ago, I can assure you of one thing, it is that at present , it clearly doesn’t work anymore.

12) Who are your competitors?

Take a little moment to try and see who the different players are in the market. It could be something important. Afterwards, you have to know them, but you shouldn’t be obsessed with what they do either.

Otherwise the only mistake you risk making will be to reproduce a pale copy of the original, which would be a shame. So you have to keep an eye on the competition, but not be obsessed with it.

SEO is a market where on the one hand there are, let’s say, SEO agencies which are structured. From my point of view, there is no actor that particularly stands out from the others, even if there are very good agencies that already exist.

This is the first part of the market. And on the other side, there are the freelancers. Just like with agencies, there are freelancers who are extremely good, others who are not necessarily exceptional. So we can say that there is a sort of duality, with freelancers on one side and agencies on the other.

13) Does your know-how give you a real advantage?

Indeed, there are skills that are extremely rare and which will allow you to have a real advantage. For example, if you are an exceptional craftsman or if you have special know-how. Therefore, you will get a definite advantage to complete a mission that is difficult to do by others.

Speaking of SEO, I think there are several things that I think I have an edge on. These include “On Page SEO”, where I have the opportunity to bring a lot of things to the market. There are others, but at the moment, it is mainly this aspect that I wish to highlight.

14) Where is added value created in the sector?

Knowing where the generation of added value takes place in your industry is an important element to know, because it will be a criterion which will intervene on several elements, including the definition of price levels. For example, if you have an activity that does not create a lot of value, that means that in terms of price, it will be difficult to offer high prices.

The added value in SEO really comes down to the ability to grow a website in terms of organic traffic and increased revenue.

15) How do prices change?

In some markets, price fluctuations can be considerable. Therefore, it is important to know the specifics of your market in relation to this.

Take for example the milk market. Without surprises, you will experience world prices with incredible price changes. So depending on your sector, you may be enormously impacted by price changes.

In SEO, there are global trends in the market, with average prices for services. Afterwards it is negotiated, depending on the customers and the type of service that you are going to offer.

In the same way, I will set prices on the business that I am going to start. To the extent that I am in “start-up” mode, I cannot afford to arrive with what are called eccentric prices, that is to say very high or the highest on the market.

When you arrive in a market, you must first have your first customers, satisfy them and ask for a recommendation. So, subsequently, I could gradually increase my prices if I wish.

So these will be prices, let’s say at the market average, or even a little lower even, just to try to be as attractive as possible initially.

16) Will regulatory changes make it more expensive to start a business?

As I had the opportunity to tell you in the introduction, there are questions that will not necessarily be conducive to my activity. Maybe this will be the case for yours.

Indeed, legal changes can sometimes impact the launch of a business. Therefore, if you are in an industry prone to regulatory changes, I advise you to monitor developments regularly so as not to be caught off guard.

To my knowledge, regulatory changes have no impact on SEO consulting.

17) Who are your suppliers? Are there many of them? Concentrated?

In SEO, there are no direct suppliers per se. But if you are in the ready-to-wear sector, for example, having suppliers who are concentrated or not will play a huge role.

Because if you have problems with prices that are too high and there aren’t many people, that simply means that you will be able to compete. In the opposite case, if there is none, i.e. if the suppliers are concentrated, this situation will have a direct impact on your business. So knowing your suppliers well, understanding the very structure of the supplier market will really be relevant for your business.

18) Is it easy to change supplier?

This question has a lot of overlap with what I just said. Namely, if you have a problem with price or quality. You do not have to stay with the same supplier if you are not satisfied with them. This way, you can change it very quickly.

19) Will they have the power to influence the quality and cost of your offer?

Indeed, if there are not many suppliers and they offer you something that is not of good quality and at prices that are too high, you will have practically no room to negotiate.

This situation does not apply to SEO.[fusion_menu_anchor name=”B” class=””][/fusion_menu_anchor]

Now that we have completed this part on the market, we can now move on to the next one, relating to the profile of the entrepreneur.

B) The profile

Now, I will present to you the different questions relating to the profile.

Indeed, when you present your business plan, know that it is above all about you, just like business in general. Therefore, it is not surprising that investors are interested in what you have done in the past in order to understand your journey.

Sometimes, some questions can even go as far as personal life, as this is a relevant element for investors. They know that certain personal concerns can have a lasting impact on your business.

20) Have you ever run a business?

people who want to create their own company. Depending on your answer, investors or bankers will be able to assess the risk according to them.

In fact, investors have more confidence in people who have already managed companies. If you’ve never set up a company and this is your first, don’t stress out forever about it. There are a large number of examples where people who had never managed a company succeeded by becoming excellent leaders.

The best known cases, Bill Gates and Zuckerberg. But many others too. So for me, it’s not obligatory. It’s just a little extra. Some investors sometimes like to say that if the entrepreneur already has experience, it is more reassuring.

So, my answer is yes, I have already assembled boxes in the past. Some were completely wrong. So the objective is to try to capitalize on what did not work to ensure that the future succeeds.

21) Are you trained in management?

Same as the previous question. For me, being trained in management is both important, but not essential, if that is not your case.

If you have never studied management, business school or that sort of thing, and you want to set up your company, don’t hold yourself back for that reason. The fact of not being trained in management is a personal point of view after all, it is not the most problematic element.

Afterwards, on this subject, I have a slightly biased point of view. For me, management is not obligatory to learn in training or to attend business schools. In my opinion, most of the time, “management” is above all a matter of common sense.

Namely, are you able to put yourself in the shoes of others to understand what their interests are? What are its objectives ? What does he want to aim for? And many others. It turns out that there are people who are naturally good at management and who have never gone to school. Conversely, there are people who have gone to school or studied management, who find themselves at a given moment in a managerial position and are absolutely catastrophic.

For me, management is above all a relationship with people. Personally, I believe that there are many more management lessons in literature than in any other book that claims to teach you management. Again, this is my point of view, you don’t have to agree with me. So to the question, have I been trained in management? The answer is yes, I went to business school.

22) Can your family environment facilitate the realization of your project? Do you have the support of your spouse?

This question close to the intimate sphere can sometimes be disturbing. And yet, this is an extremely important and decisive point. For what ?

Simply to the extent that when you are going to set up your company, you will find yourself in the same situation as if you were creating a sort of boat to go to sea. Obviously, when you set up your company and especially for the first time, there is a tendency to really sway. There are doubts, uncertainties, you will have moments of loneliness and you will be afraid. In short, moments where you will feel alive. However, it is so difficult to start a business if you don’t have a family who supports you. It’s a kind of weight that we add to the boat and which can literally sink you.

Same thing with your spouse. It’s even stronger with the spouse. If you want to set up your company and your partner is not aligned with it, or is even formally opposed to it, it’s a really bad start! Because not only will you have to fight to exist as a business, but you will also have to fight in your home to show that your decision is the right one. So it’s very difficult.

On a personal level, does my family make it easier to carry out my project from a financial point of view? Let me be perfectly clear, the answer is no. I don’t come from some sort of upper middle class background. I’m going to start my business with my own finances, not asking anyone for money.

Is my family putting obstacles in my way when it comes to setting up my business? The answer is no. But there may be times when some members of my family are afraid.

Entrepreneurship ultimately also means knowing how to manage your own fears, managing the fears of others, and that can be a little more complicated. But over time, experience and confidence allow me to ensure that it is not a hindrance.

So my family doesn’t put obstacles in my way regarding that, but financially they don’t help me either. Especially since for the activity that I want to create, namely SEO consulting, there is no one in my family who has already set up companies in this field.

Then, in terms of support, I have Mariana’s support at 200%. At certain times, she will even help me with this business that I am going to start, particularly with all the design aspects linked to the brand identity. Mariana is therefore a support, and it’s a real pleasure to have someone who supports you on a daily basis because being an entrepreneur is difficult!

23) Do you know someone with whom you can regularly do update on the project?

Indeed, it is always a good idea to regularly take stock. It could be with a person in your industry, a person who has already set up a company in the same sector…

In short, different types of profiles, of people who will suit you, knowing that it is still better to make points with people who know your activity or people who have already set up companies.

If this is not the case, it’s a little more complicated in fact, because they will not necessarily, from my point of view, have the ability to really give you relevant advice for your specific situation. talk.

So, am I going to do it? In fact, the real people with whom I’m going to do the accounts, quote, is you. So you will watch my videos, you will see the evolution of my business, and regularly I will take stock. And why are points important?

Quite simply because it allows us to see what we have managed to do, and above all, what we will aim for next. So it’s a really good game to play. Afterwards, don’t spend 15 years there either. Spending time preparing for meetings to take stock when you are a start-up, when you are a large structure, is a little different. But when you’re a small start-up, you have to make points, but also not spend too much time on it.

24) Have you ever met an association of creators and support?

Indeed, if it’s your first time, it could really be interesting to join an association that will support you in creating your business. Knowing that in fact, it will also depend on another element, namely whether you are a solo entrepreneur or if you already have members in your team.

Depending on this, you will have to adapt your strategy. Because sometimes, when you start in entrepreneurship while you were in another sector, often in the end, you are not really competent as a business creator.

So this requires knowledge, sometimes basic knowledge, knowledge which can be of a human nature. In short, there are quite a few things to develop. And concerning myself, rather than very theoretical things, I prefer knowledge that is more pragmatic. After all, that’s my point of view.

So yes, I had the opportunity to go to certain support or creator associations in Paris, notably some which are quite large and well-known. I stayed there, but not very long.

To be honest, I only went three, four times to some of them. In any case, it was never really long term. Quite simply because in fact, I had the feeling that at certain moments, it didn’t help me move forward very much.

Once again, this is not a global vision that I wish to give. It’s mine. Simply sometimes, for example when I ask myself a question, I go on the Internet to find out, I watch videos, and in fact, that solves the point where I potentially have a problem or I wish to improve.

And the problem I find with associations is that they have so many things to deal with that sometimes, from my point of view at least, it’s a bit long, a bit theoretical. This means that in the end, it is added value that we lose, especially time. When you are an entrepreneur, don’t waste time!

25) Are you ready to make financial sacrifices?

Indeed, when you set up your business, and it is ultimately quite linked with the story of the spouses from earlier, the financial side will be something that you absolutely must discuss with your wife, or your man , never mind.

To set up your company, especially if you are in a position that is relatively comfortable, stable, if you have been in a company for a while and you have prospects, you do not necessarily pose any problems, the financial sacrifices you make, but not too much.

Also note that when you start a business, in general the income at the start is 0 and therefore, it can be complicated at the start to start your business. So what I advise you in relation to this is to really imagine what things or what activities you consider to be a sacrifice. The idea when you start a company is not to be frustrated.

Let’s say you love doing sports, gym, whatever, and that’s your passion. If ever when you set up your business, you say to yourself, ok to set up my business, I have to eliminate my sport or the activity that I particularly enjoy, you will end up being frustrated. So it’s not at all a good plan to do this kind of thing.

Try to think about things that don’t seem essential to you. And when there are some that really make you happy and you know that deleting them will frustrate you, don’t do it. Really, never delete things that will frustrate you because a frustrated entrepreneur is the worst thing!

26) What will your financial needs be in the coming years? (children / apartment)

We really get into the personal with these aspects. Indeed, depending on your business, you will have to give more of yourself. Let’s take the example of a Tech type business. The thing is, it requires R&D (Research and Development) for several years, before it starts generating revenue.

I actually mean that sometimes the personal calendar and the professional calendar can be a bit in conflict. When you have life goals, sometimes entrepreneurship involves shifting them a little. So you have to be aware of it to do things well. Then the third point is to form a team.

C) Form a team

This goes back to what I was saying earlier. You don’t build a business or an empire alone. We can start on our own, that will be the case for me. But the objective, of course, is to get people to join you to succeed in making your business explode.

27) Can you rely on a close-knit, complementary, experienced team?

Indeed, when you start entrepreneurship, at least a start-up, having a team that is united is extremely important from my point of view. Besides, the experience will come. Even if you’re not the most experienced at the start, it doesn’t matter. From the moment you are united, it will fix a lot of things.

Obviously, if you complement each other that’s also very good. For a very simple reason. Sometimes we can be very good at certain things and very bad at others. Therefore, if you can bring together people who have different skills, this allows you to accelerate your business much faster.

For now, I am starting as a solo entrepreneur on this project, therefore SEO consulting. Knowing that obviously the objective for me will subsequently be to grow the company and to succeed in creating a complementary, united and experienced team, of course!

28) Are the key skills for the success of your project represented?

It’s a good question. Because if, for example, you want to get into technology and you don’t have any engineers on your team, it’s complicated. So, still have a minimum of key skills in the activity you want to get into.

Again, you don’t have to know how to do everything. But at least have good foundations or key skills in certain aspects. This is really important for your business. Personally, I have good SEO skills. On the other hand, one of the elements where I think I will have to find someone fairly quickly to help me is, for example, at the commercial level.

I can do things myself, but there are people who are clearly much better than me on this subject. So that will be part of my priorities.

Furthermore, you should not create positions just for the sake of it when it comes to training your team. Indeed, it is not uncommon to see in many young companies positions such as deputy director which increase costs, without being of much use.

29) Failing that, can you count on external skills?

In fact, the idea is simple. It’s just a matter of understanding what your state of mind is regarding the subject. And understand that if you don’t know how to do everything when you set up your company, that’s normal!

Nobody knows how to do everything. A business is not created like that. You’re going to have to have several types of people, several types of skills, and that’s how you’re going to grow your team and then succeed in the end.

So the fact of relying on someone outside or external resources, really take it into consideration. Don’t tell yourself, to launch my company, I have to know how to do everything. Otherwise it will never happen.

30) Are your objectives understood and shared by everyone?

Indeed, when you start a company and you are a team from the start, it is really important to share your objectives with the other members. For what ? Quite simply because if you don’t share your objectives, you will gradually realize that ultimately, you are not going in the same direction at all.

The problem in fact is that a start-up at the beginning, if it ever starts to have a little growth and two types of teams are formed, there will be one which will want to go in this direction- there, and the second in the other direction. And I tell you, it’s going to breathe fire!

So what you will obviously have to do is communicate as much as possible, see if everyone agrees with you. And if this is not the case, which may be normal, really try to separate yourself as quickly as possible from people who do not potentially share your goals or your vision. Because otherwise, it’s not going to do it. A concrete example.

If in your business, you are with a partner who wants to obtain money, let’s say extremely quickly, why not, it’s laudable, and your objective is to create a long-term business, which pays you money and will allow you to be satisfied over a long period of time, you clearly see that you are in opposition.

So gauge carefully, see everyone’s objectives and based on that, make decisions.

For example, I am a solo entrepreneur, I agree with myself, let’s say, in terms of my objectives. But really, the goal with my business, the business that I am going to create in SEO, is to try to set up an agency that will have a lot of authority in the coming months/years. Because the objective for me is to have a long-term activity.

I’m not looking for a first try where I earn money for a little while then, after that, I do something else and go off I don’t know where. So it’s really long term that I want to create. And that’s why my overall approach will always be long-term.

31) Have you planned to retain your key people?

Indeed, when you find people who will have the same objectives as you, people who will have important skills, what you will have to do is to succeed in keeping them.

It may seem trivial, but managing to retain key skills and people is essential for me. Maybe I have a vision that is a bit particular, but for me, a business is really, above all, about people. Above all, it is values ​​that you will share.

Therefore, if you ever find people who are aligned with your objectives, your values, and who are effective, do everything to keep them.

So there may be several levers, but try to do your best to keep them. It can sometimes be through remuneration, through financial aspects, but it’s not just that either. There are many other aspects that will come into play.

In any case, it is above all a team story, a company that is being set up. And for now, I’m not going to paraphrase Bill Gates, but at one point, he told a story where he said that ultimately, what he did with Microsoft was not so much him, but the 20 first people who joined Microsoft at the very beginning.

And I think he’s absolutely right. Quite simply because a business at the beginning, if there aren’t the right people or if you can’t keep your key people, it can quickly get out of hand.

Then the fourth part, marketing and sales strategy.

D) Marketing and sales strategy

Marketing and sales strategy. I tell you, the articles that I will write will clearly be mostly about SEO, but there will also be some on online marketing. Quite simply because it is absolutely crucial.

So if you have ideas like “yes, marketing is good on paper, but hey here…”, you will have to delete them, because marketing is going to be really crucial. It’s literally the fuel for your business model.

32) Do you know what types of customers you are going to target?

Indeed, when you start your business or when you wonder how to make a business plan, it will be important to know what type of customers you want to reach out to.

In the context of SEO, to the extent that I am going to start, I will not be able to address point blank let’s say, to large companies, for example from the CAC 40. Large structures, clearly, it will be inaccessible.

Because what’s more, getting into the selection process is a whole lot of things and in any case, it’s going to take time. Therefore, the big boxes later perhaps, but not immediately.

Initially, what I will really focus on will be start-ups, especially those that have raised funds. Because they will have funding.

Also generally speaking, start-ups that are doing well and already have money that they want to invest in SEO to increase their organic traffic. Because I love start-ups and I think that even beyond SEO, I could give them a lot of advice.

The other element that I’m really going to try to focus on is going to be VSEs. Because they already have a successful business, but do not necessarily have Internet skills, particularly in terms of SEO. And there clearly, I can give them my expertise, I could help them increase their organic traffic. Basically, these are the two types of customers that I will prioritize.

Besides, why do you need to prioritize clients? Quite simply because at first, you started with very few resources. So the objective will be to try to allocate your resources, your time, as best as possible, to obtain clients who will potentially last in the long term. And this as quickly as possible.

That’s why it’s actually interesting to know from the start which types of clients seem to you to be the most affordable and, above all, those who will also allow you to have a significant margin. If we consider two customers, one with an average margin and the other with a slightly larger margin, prioritizing the one with the larger margin will be interesting, because it will allow you to have more silver. As a result, you will be able to grow your business even faster!

33) Is your market segmented?

I’ll take the example of SEO, it will be simpler. The SEO market is clearly segmented, I would even say almost fragmented, in fact. On the one hand, there are the SEO agencies themselves, for which this is the core business. There are several on the market, at least in France. And on the other side, there are, let’s say, freelancers. So there you have it, on one side there are the agencies and on the other the freelancers.

34) Have you defined priority targets?

This goes back a bit to what I said before. When you are going to get clients, really try to initially focus on those who are the least difficult to obtain, with the best remuneration, therefore the best margins for you from the start. It’s important to prioritize because it will allow you to accelerate faster.

35) Will you face a network of priority prescribers?

Right now, I don’t know anything about it, I don’t even know what a network of priority prescribers is. So sorry. If this ever concerns you, look, but right now I don’t know.

36) What are the commercial means to implement to achieve your turnover objective?

Indeed, I am going to mix commercial means with marketing. Of course, when you’re in a company that’s just started, you do absolutely everything. So all domains in quotes are mixed.

We are not in a big company, where there are people who do the commercial aspects, some the marketing and others the finance. There, as a start-up, you will do a little bit of everything. So the commercial aspects, I will mix them with marketing.

Basically for me, the right way to obtain new customers is with inbound marketing on one side and outbound marketing on the other. I’ll explain to you what it is.

Inbound marketing in a very simple way is when customers will come to you to see your business and use your service. Outbound marketing is when you are the one who contacts customers. So you understand that in terms of approach, they are two different things.

I am someone who believes enormously in inbound marketing . And SEO is inbound marketing. Content creation is also inbound marketing.

The advantage with inbound marketing, it’s a huge advantage, is that when you start it and you do it well, it allows you to have customers on a regular basis, customers who will come non-stop. knock on your door asking you to work with them.

Outbound marketing is different. Because it is you who will take the time to pick up the phone or send an email. In short, prospecting to get a new client. So you should do inbound marketing from the start. And that’s exactly what I’m going to do. Because for me, that’s really the most crucial element.

In summary, inbound marketing from the start, in terms of content creation, and in parallel a little outbound marketing, the first three months.

Outbound marketing can be useful, effective, but the thing is that inbound marketing, from my point of view, is much more powerful. And that’s why I recommend putting it in place from the start.

So here are the different commercial means.

37) Is your marketing process defined?

The answer is no, I don’t have a process per se. Maybe it’s already clear in your head.

Yes, I know roughly how I am going to approach a client. Most of the time when doing SEO, one of the good entry points is the customer audit. Because it will allow you to see what technical problems there may be on the client’s website and therefore help them quickly resolve them. Afterwards, why not sell another service, annexed to SEO.

So there you have it, my marketing process is at that level. But objectively, it would be worth exploring on my part.

38) How will you organize your sales force?

So there, it’s the same. I think it’s good to ask yourself this kind of question. In a structure, with a team of 2 or 3 people, everyone will do a little of everything at the beginning. Except if you decide from the start to split the tasks with a person who will only do sales. Since I am a solo entrepreneur at the moment, the sales force will be me.

39) Have you planned a forecasting and reporting system?

Indeed, when you start a business, when you start an activity, the idea will be to follow your information, financial or otherwise. So having a reporting system is important. I think I have good Google Sheet and Excel skills in general. So this will be the kind of reporting that I will do when it requires a, say, manual aspect.

But above all from an automatic point of view, to the extent that I am going to work on my site, I am going to use a system called Google Analytics, which can also be coupled with Google Search Console. It doesn’t really matter.

But basically, on Google Analytics, you will see the sources of your traffic, your income and all that. So it’s going to be extremely effective to have a reporting system.

40) Do you need a marketing function?

So for now, my point of view on the subject will be partisan. But I almost want to say that no matter what you do, no matter whether you are a plumber, a pastry chef, whether you are a consultant or whether you are setting up your own business, marketing is very important. And to show you, I’m just going to give you one item.

For example, imagine two people with the same skills, and wanting to enter the same sector. They have the same money at the start. It can be said that at this point they are identical.

Now one of them is going to have much more developed marketing skills than the other. I can assure you of one thing, it is that with equivalent skills, the person who is good at marketing will explode their business much more quickly than the other.

So really take that into account. Marketing is not something to be taken lightly, especially not today. After saying that, I’m also going to put things into perspective. Let’s take the same example. There are two people who want to create a business on the same activity. One of them is very good at his core business. The other no. The person who is not good at their core business is, on the other hand, very good at marketing.

What’s terrible right now is that the person who is not good at their core business, but good at marketing, will do better in the short term. In the medium to long term, it is the other who will do best, quite simply because word of mouth will work. And since its customers will be satisfied, it will increase its business.

What I mean by that is don’t see marketing as some sort of superfluous element. It clearly shouldn’t be. Right now, to create a successful business, marketing from my point of view is more important today than ever.

And tomorrow it will be even more so. You will perhaps say to me “From what you say, the form is more important than the substance”. The thing is that when you put together a box, the shape and the content must be prioritized. There is no form more important than the substance, or substance more important than the form. Both have to be good.

41) Have you calculated your communications budget?

Bankers may ask you this question. With the company that I am going to set up in SEO, I am not going to bring an amount of money strictly speaking. On the other hand, I’m going to spend some time there. Because communication is really important, it’s really crucial at the start.

So yes, I will spend time there. Budgetarily no, but it is possible at certain times that I use certain tools. Some of these tools will be free, others will be paid.

Don’t worry, I will have the opportunity to show you concretely how I do it.

42) What communication tools do you have?

I have already answered a little but indeed, there are tools which will be more or less important. Afterwards, I don’t know exactly which ones. Because depending on the business, there may be things that we prioritize more or less.

Depending on your sector, you can prioritize social networks like Instagram, for example, others prefer Pinterest, or platforms like Linkedin.

In short, depending on your sector, whether you are BtoB or BtoC, and what the customer expects, the tool will vary. So for me, this question is not very relevant.[fusion_menu_anchor name=”D” class=””][/fusion_menu_anchor]

D) Protect your know-how and your product

Sometimes depending on your sector of activity, especially if you do R&D, you will spend time doing research, which can be extremely expensive. And so that just means that in the end, you’re going to have to protect what you’ve done. Because otherwise, there will always be smart people who will be there to steal your technology. Or your know-how.

43) Can your technological knowledge be subject to legal protection?

Don’t take this lightly. If this is your case, take the time. It’s true that it’s not the most glamorous time when you’re doing entrepreneurship, but it’s really important to protect, legally in any case, your business, to avoid the slightest glitch afterwards. Because sometimes things can go very wrong.

44) Can your solution establish itself as a standard in the sector?

Yes. Indeed, the more innovative a solution is, let’s say, the more important it is to protect it. Simply because when you arrive on the market, you potentially explode what is being done, and that can create tensions among other players. So keep that in mind. And that’s all I wish you.

If you have a solution like that, I say congratulations. This is exactly what we should try to do.

45) Are you going to have to convince other technological players?

Yes. Of course, there are certain technologies that are ultimately combined with others. And the problem is that if these actors do not agree to implement your solution, well it will simply not be viable.

It’s not that it won’t be viable, but it’s that it will never exist on the market. So sometimes, there are certain sectors where it can be extremely decisive to check this type of thing.

46) Is your innovation at risk of being quickly outdated?

Again, this is not a question that applies to SEO at all. But overall, if you do research and development (R&D) for two, three, four years, and you finally realize that when you put the product on the market, 6 months later there is no longer anyone buying your product, it’s a shame.

So it’s true that technology is moving at such a speed today that sometimes it’s a little difficult to predict what the next move will be. But simply put, it’s better to say “stop” rather than launching into something that ultimately won’t lead to anything. Or something obsolete.

47) Have you quantified your R&D needs?

If you are in technology, R&D, you will have to quantify it. Your banker or your business angel will be interested in it.

48) Will your production tool initially be sufficiently calibrated?

I don’t really know how to understand this question. In any case, the interpretation that I make of it is that if you have a business, for example in ready-to-wear, and you have machines that create your items, your new products, well from at a certain level, your machines will reach a sort of limit.

So that means that potentially, you will have to invest again if you want to increase your volume. Knowing that in certain sectors, if you don’t reach some kind of critical mass, it’s not actually worth it. So okay, I don’t know if that’s the way I should interpret it, but that’s how I understood it.

49) Do you know how to arbitrate between internal production and subcontracting?

What I recommend to you, in quotes, is that depending on what you do, if you have a core business, a core activity, it must remain internal. On the other hand, anything that is potentially supportive, or anything that is not essential and does not directly intervene in your core business, yes, you can subcontract it. But obviously, the fact of internalizing things, the fact of subcontracting, generally, it’s a bit on a case by case basis. Business by business. You really have to ask yourself questions. And there is no obvious answer to these kinds of questions.

Finally, the last part will be finding the funding.[fusion_menu_anchor name=”E” class=””][/fusion_menu_anchor]

This is the moment where we will talk about finances and where your banker or your business angel could potentially challenge you.

50) What is your overall financial need?

In addition to your business strategy, you also need to think about the financing plan. In many cases, to start your business, you will need resources. So resources can be linked to debt.

But there may also be resources which will be linked to your equity, therefore for example to your money or your savings. You can also use what some call “love money”. Love money is simply asking for money from loved ones.

That’s basically it. So, understanding your financial needs is important because it simply prevents you from asking for too much when ultimately, you are not going to need as much. So there you have it, this can really be an important thing for bankers.

51) What distribution between equity and debt?

That’s important at the moment. Your banker will challenge you on the subject. If, for example, you were planning to take out a bank loan, putting 0 of your personal contribution, I tell you, there is very little chance that it will work.

I’d be really curious to know the name of the banker with whom it would have worked, since most of the time it doesn’t happen.

Investors always expect you, as a business creator, to put your hand in your pocket too. It’s a question of credibility. And they too, the investors, will say to themselves that if they lose money, you lose money too.

52) Is your business a consumer or generator of income?

There are ultimately businesses where, in terms of earnings, it will be complicated. If that doesn’t speak to you, I’ll give you examples.

Take for example the case of supermarkets. Supermarkets are types of business that have a positive WCR (Working Capital Requirement). This simply means that supermarkets will receive money from customers.

For example, when you go to the supermarket, you pay the structure directly for the different products you buy. So the supermarket receives the money immediately from its customer. On the other hand, the supermarket will pay its suppliers a long time later. It could be in 30, 60 days.

And what does that mean from a cash flow point of view? This means that we will always have a cash flow which will be positive. So the supermarket will generate income. This is going to be extremely interesting. And the bankers absolutely want to know it. For what ?

Simply because if it is the opposite and you are a consumer of income or in other words, you have a negative WCR, that will mean that it is your bankers who will finance your lack of cash flow. And overall, they don’t really like it.

The thing with this is that it will really depend on your type of business. Ultimately, there are very few businesses that will be extremely revenue-generating, like the supermarket. So, be aware of this, because cash flow is essential. This must be taken into account.

53) What will your cash flow needs be in the first year of activity?

As I told you earlier, cash flow is really important. Indeed, money in general is the sinews of war. I don’t plan to give you finance lessons. But understand, the issues around cash flow are important.

There will be many challenges. Good investors will really challenge at this level. Because if you don’t have cash flow, if you can’t generate cash flow, it’s going to be extremely complicated to make your business last over time.

Afterwards, there may be activities where the WCR is negative, say structurally. But in this case, you have to have financing arrangements and others.

54-55) What will be the collection time for customers? Could you provide payment deadlines from suppliers?

It goes back a bit to what I just said, with the supermarket stories. In fact, I took for supermarkets, the cases where the cash flow was positive. Let’s take a reverse case. Let’s say you want to set up a company, in ready-to-wear fashion for example. With ready-to-wear, you are going to need working capital from a structural point of view.

For what ? Quite simply because in fact, for a collection, between the start and the moment when your client will pay you, the time will be very long. The problem with that is that when you create your collection, you will request products from suppliers.

And these will have to be paid for. You can set deadlines with suppliers, but you will have to pay them at one point or another. Here, your suppliers will ask for their money before your end customers have paid you. So that will mean that you will be in the negative.

So. When you are a start-up or an entrepreneur in general, the ability to negotiate the payment deadline of customers or that of suppliers can be a kind of lever on which you can pull, to try to improve your situation by Treasury.

56) After how many months will your cash flow be positive on a recurring basis? ?

When I told you that cash flow is a bit of a cakewalk, we weren’t there yet. What does it mean ?

Basically, this means that there will be what we call in finance, cash flow tables, which will allow you to see when you are going to spend and when you are going to receive money. You will be able to make forecasts thanks to this. And above all, it will allow you to know how many months you think everything will be positive.

57) What is the forecast amount of your cumulative financing requirement before reaching the cash flow break-even point?

It’s the same principle. You are asked how long it will take you to be positive. Basically that’s it. And once again, where it is problematic, and I am not at all enthusiastic about it, is in terms of sources of income and forecasted income, when we are an already established company.

When you are, for example, a sort of large liner, it is possible to have forecasts on income. In any case, in a much more serene way. But when you are a start-up, it is absolutely impossible.

So, the problem is that we are always making big assumptions. Sometimes there are things that work well, other times not. And the only good way to do it is to test. That’s why I’m not a big fan of all this.

58) When do you expect to break even?

It’s the same principle. Break-even point, break-even point… This is the cream of business plans.

59) Is the profitability generated over a three to five year horizon sufficient?

Here we are on things that I don’t necessarily like with the business plan, but that you must do if you ever ask for money from a banker, the BPI (bpifrance creation) or whoever you want. Because once again, the profitability generated will depend on the income that you are going to set. And when you start a company, you never know how much income will come. Just because you look at the numbers from a statistical point of view and a global point of view doesn’t mean that’s going to be the case. So we are on something very nebulous from my point of view.

There you have it, we’ve gone around with these many questions that others will call checklist. It took longer than expected. I am sorry. The idea for me was to dig deeper into the topics to try to show you exactly what questions it might be interesting to ask when making a business plan. The questions I presented to you are much more relevant than a curve that always rises. This is what will allow you to finally ask yourself the really good questions that can be useful for your business.

So there you have it, thank you for reading until the end. From the next articles, we will get into the pragmatic and thatwill be, of my point of view, much more interesting for you and for me to show you all that.

1 thought on “Business Plan | 60 questions to ask yourself”

This was very helpful,and informative, especially for those that are new to writing business plans it makes it more understandable and practical

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The Hard Questions to Ask When Planning Your Strategy

• Eddie Yoon,
• Christopher Lochhead,
• Katrina Kirsch

You need to be brutally honest about what really makes your business special — even if it’s uncomfortable.

Many managers view strategy as a complex subject, but at its essence it boils down to three questions: Where are we now? Where do we want to go? What is a credible path to get there? To successfully use these questions to chart a course, people must be brutally honest with themselves about where they are now. Once a company understands its present situation, it can chart a path to creating a truly differentiated offering that can create economic value.

‘Tis the season for annual strategic planning. For most companies, the process is a spectacle — a ritualistic game of jump ball for budget where emotions run high and departments defend their turf. Marketers cringe as non-marketers dish out “expert” wisdom. Salespeople shake their heads at the mention of “stretch goals.” And every business unit believes it is the chosen one.

• EY Eddie Yoon  is the founder of  Eddie Would Grow , a partner in Greyspace, and leads strategy for Geneo in the United States. His book, Superconsumers , was published by HBR Press. He is also the co-author of The 22 Laws of Category Design. Follow him on Twitter  @eddiewouldgrow . His is a co-creator of the  Category Pirates Newsletter.
• CL Christopher Lochhead  is co-author of The 22 Laws of Category Design  and  Play Bigger , and host of the  Follow Your Different and Lochhead on Marketing podcasts. He has been an adviser to over 50 venture-backed tech companies and a former chief marketing officer at three public tech firms. Follow him on Twitter @lochhead . He is a co-creator of the  Category Pirates Newsletter.
• KK Katrina Kirsch  is co-author of The 22 Laws of Category Design  , founder of Editpreneur, LLC and former managing editor & co-founder of Scribez. Follow her on Twitter @thekatkirsch . She is the head of operations at the Category Pirates Newsletter.

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30 Questions to Ask Entrepreneurs (So You Can Become One)

By Hannah Donor • Mar 9, 2023

The beginning stages of entrepreneurship can feel overwhelming. It’s hard to know exactly what you don’t know about starting a business. Although internet research can be immensely helpful, it cannot speak to personal experience. By connecting with a successful entrepreneur, you can benefit from their wisdom and gain knowledge that may not be commonly available online, preparing you to start your own business in a completely different way.

Why You Should Interview an Entrepreneur

When starting a small business, it’s important to remember that you’re not alone. Running a business as a solo act is isolating by nature, so forming a network of support from the start can bolster your confidence and help you strategize for more effective growth and sustainable success.

Whether you’ve been in business for a while and are looking for advice on scaling (growing), or are brand new to entrepreneurship and need to know what things to do before starting a business, interviewing someone with real entrepreneurial experience will go a long way in preparing you to enter the field.

Best Interview Questions to Ask an Entrepreneur

1. why did you decide to start your own business.

Every business owner has a “why” – the reason they chose the unconventional route of entrepreneurship as opposed to a corporate career. Understanding their reason for choosing the business owner path can help you to understand what motivated their success and discover your own reason (or reasons).

2. What advice would you give to someone just starting their own business?

This is the most obvious question you should ask, but also one of the most important! Every business owner has gone through the trying and risky experience of being a new business owner, and every one of them will have direct experience with what worked and what didn’t. You’re meeting with this entrepreneur to get their advice, so don’t be afraid to ask for it!

3. How do you deal with fear and doubt?

Even someone as prolific as Maya Angelou experienced the phenomenon known as imposter’s syndrome , once confessing, “I have written 11 books, but each time I think, ‘Uh-oh, they’re going to find out now.’ I’ve run a game on everybody, and they’re going to find me out.” By asking your interviewee how they deal with self-doubt as an entrepreneur, you’ll gain strategies for conquering fears that will inevitably come up throughout your own venture into business ownership.

4. What routines do you follow each day?

Success is in the details, and most accomplished people follow strict routines and daily habits to keep their busy days running smoothly. This can be as simple as setting an alarm and always getting up when it goes off, eating the same breakfast each morning, or even having multiples of the same outfit so they don’t have to think about what to wear each day.

5. Where do you see your business in five years? Ten?

No entrepreneur is ever done growing their business – it’s an ongoing journey with ever-changing goals and aspirations. Asking the entrepreneur you’re interviewing what their vision for the future is will inspire you to dream big and never stop pursuing success. It will also give you an idea of future milestones you can pursue in your own business.

Recent Articles That Might Interest You:

• Navigating Tomorrow: Lili’s Accountant AI Empowers Business Growth April 18, 2024
• Introducing the New Lili: Reflecting Our Growth and Your Ambitions April 1, 2024

6. How does your business look different now vs. when you first started?

Similar to asking for advice on just starting out, ask your interviewee to reflect on how their business has grown and shifted over the years. Are they where they expected to be? Did they pivot a completely different direction than originally planned? How does where they are now compare to where they expected to be at this time in their business?

7. How do you set your business apart from others in your industry?

Small businesses require a special twist that makes them different. This may be a unique spin on their product or service, or it may come down to well-crafted branding . Find out how your fellow entrepreneur has distinguished themself from the competition and brainstorm how you can do the same.

8. How did you market your business when it was brand new?

Without the reputation or booming revenue of a larger business, you’ll need to develop strategies for marketing your business and building a loyal audience from scratch. Every business owner has to tackle this at the start, so you’ll definitely want to find out how the person you’re interviewing did this. How did they leverage networking or advertising or social media to start connecting with potential investors or customers?

9. What is the hardest part of being an entrepreneur?

Running your own business won’t always be easy. Like any job, no one loves it all the time. Starting your own business is going to be difficult. It’s going to take a lot of time and determination to make it a success, but knowing what hurdles you may encounter will make it easier to overcome them.

10. What is your favorite part of being an entrepreneur?

Follow up preparing for the worst by hoping for the best! Find out what your interviewee truly loves about the entrepreneurial path. Why are they glad they chose to start their own business? What makes it fun or exciting? These joys are what you will cling to when times get tough.

11. What qualities do you think every entrepreneur should possess?

Ask them what makes a good entrepreneur, but don’t be downhearted if you don’t possess those qualities! Everyone is different and thus approaches entrepreneurship differently, so you may just not fit the mold they would expect. Nevertheless, this is an important question to ask. It can affirm the qualities you do possess and give you ideas of how you can form new habits and cultivate the qualities of a successful entrepreneur.

12. How have you grown personally from becoming an entrepreneur?

Entrepreneurship is extremely personal. Your business is completely your own, so it’s impossible to separate it from yourself as you might be able to with a standard employment situation. As such, starting a business will inevitably result in growth and change in you personally. By asking for stories of personal growth from a successful entrepreneur, you can get the inside scoop on how you should seek to grow personally.

13. What have been some of your biggest learning experiences in running a business?

Failures are opportunities to learn and do better next time, and no business is without their fair share of mistakes and failures. Although you will likely find your own mistakes to make, you can avoid some of them by asking an entrepreneur what failures they’ve learned from over the years.

14. What do you look for when outsourcing or hiring?

When your business outgrows what you can accomplish as a solopreneur, you’ll need to consider hiring employees or outsourcing work to contractors and freelancers . Ask an entrepreneur who has done this before what qualities they look for in potential hires to prepare you for when it’s time to find the right person to further your business’s success.

15. What will you never compromise on with your business?

Whether it be your personal values or your business ethics, you will face situations as a business owner that may require compromise. Decide what your non-negotiables are so you will not compromise yourself or your business from the get-go. Learning what other entrepreneurs won’t compromise on can help you figure out what matters most to you.

Fun Questions to Ask an Entrepreneur:

• Who is your biggest role model?
• How do you define success ?
• What makes a good leader?
• At what point did you look at your business and consider it a success?
• What would you change about your business journey if you could go back?

Financial Questions to Ask an Entrepreneur

• How did you raise funding or financially prepare for your business?
• Any advice about setting up a business in terms of legal/accounting?
• Should I get an LLC before starting a business?
• How do you plan financially for your business’s future?
• Have you ever taken out a business loan ? Would you recommend it?

Bad Questions to Ask an Entrepreneur

• What do you think of my business?
• Do you think my business will fail?
• May I pick your brain on something?
• Mind if I copy your idea?
• How can I make money as fast as possible with my business?

How to Find an Entrepreneur to Interview

Finding a local business owner to interview is the ideal scenario so you can connect in person and form an ongoing relationship. Talk to your local small business development center to inquire about any business owners they would recommend in your area. They’ll also have a lot of resources for helping you get started and to make sure your business is legally above board.

Once you connect with an entrepreneur who has enough experience under their belt to mentor and support your business journey, set up a time to meet, and print a copy of these entrepreneur interview questions to take with you.

Hannah Donor is a freelance copywriter and social media strategist with 5+ years of experience helping small businesses authentically curate the written word to reach and inspire their target market.

By Hannah Donor • Apr 4, 2023

By Hannah Donor • Feb 26, 2023

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Want to Sell More Products, Get More Customers and Make More Money? Ask Yourself These 4 Questions.

The following is an excerpt from Grow Your Business: Scaling Your Business for Long-Term Success by the staff of Entrepreneur Media and Eric Butow, on sale now.

You've probably heard this saying since you were very young: Don't put all your eggs in one basket . It's trite, but it persists because diversifying often leads to success, especially for products, customers, and marketing. If you make only one product, have only one huge customer, or use only one method of marketing, you're putting yourself in danger.

This can be confusing because you've probably also heard that you have to focus squarely on one niche. How do you reconcile these two seemingly opposing approaches? As with many things in life, the answer lies somewhere in the middle. You need to start somewhere, so start with one product or service and one market.

You have to make sure that the first product or service is excellent and sells well before you add more. For example, Apple helped establish the home computing market with the Apple II in 1977, but it made iterations of that product with the Apple II Plus and the Apple IIe before introducing the Macintosh in 1984. It's just as important not to use the "throw everything at the wall and see what sticks" approach because then your focus becomes scattered and you can't develop or support your products. Apple fell into that trap in the 1990s, when it had so many Macintosh models that it was hard to keep track of them all. At the same time the company was developing other products, such as the Newton handheld computer. When Steve Jobs returned to Apple in 1997, he cut down the hardware line to just four devices: the iMac and PowerMac desktops and the iBook and PowerBook laptops. Once those were selling reasonably well, Jobs turned to developing new products, such as the iPod.

Grow Your Business: Scaling Your Business for Long-Term Success is available now at Entrepreneur Bookstore | Amazon | Barnes and Noble

Diversify Your Products, Services, or Both

Depending on how your product or service is selling, it might be time to look at adding to your company's repertoire. With a product, you may feel compelled to create a new one for several reasons. Suppose that tracking your sales (you are doing that, aren't you?) shows that sales of the product are slumping. Customers may want a new product that is more useful or exciting. The same is true for services. You might want to offer a new one, either to complement an existing product or service, to replace one that's not selling as well, or to enter a new market segment. Before you decide to add a new product or service or replace the one that you're currently selling, take these four steps:

• Determine the specific needs of customers in each of the markets you sell to.
• Identify the products or services that will be attractive to your customers.
• Create a unique value proposition and determine how you'll position the product
• Determine the sales and distribution channels you'll use for your market segments.

Also talk with current and prospective customers, your marketing team (or partners), and any distributors to find out how they think your company can help people with new products or services.

Diversify Your Customers

Speaking of customers, one thing to determine during your exploration is whether your current customer base is the best one for you. For example, you may find that your current market segment serves a customer base that looks very much like the one you've been trying to reach all along. Or you may look at what your competitors are doing and notice that they aren't serving a particular market niche very well, if at all—but you think you can. No matter if you're a small or large company, you can fall into the same trap: having one large customer either as your only customer or as one that provides a disproportionately large amount of your revenue. If you have a customer like that, no doubt you have nightmares about them leaving you. You're convinced that you need to expand with more products, services, and/or markets to find more customers and stabilize your company. You've probably guessed the next step: Identify genuine problems that your company can solve, not just to keep current customers in the fold, but also to serve potential customers.

Here are four questions to ask yourself when you want to expand:

1. Is the timing right?

As with comedy, timing is everything. Find out if your product or service is something your clients need right now. If they don't, find out what problems they are having and see if your company can provide solutions.

2. Is your company well-positioned to make a new product or service work for your clients?

In the summer of 2022, the watchmaker Omega worked with Swatch to offer the MoonSwatch, which was a far less expensive version of its Moonwatch (so named because it was worn by U.S. astronauts on the moon). The MoonSwatch was offered exclusively in Swatch stores and were so popular that the original supply of watches ran out in hours, store employees around the U.S. were overwhelmed, and Swatch had to tell people who waited at stores for hours that the watch wasn't available. The company had to deal with a lot of negative online reviews from frustrated people who had waited for hours in line at Swatch stores hoping to buy a watch. The moral of this story is to make sure you have the product, the people, and the tools you need to serve your customers.

3. Do you have the skills to succeed?

You not only need to know your customers' needs very well, but you also need to have the skills to produce your product or service and deliver it.

4. Will moving fast help you win?

You need to know what your competition is doing throughout the development process. If your competitors aren't moving much, if at all, it may make sense to take your time and produce a richer solution. If they are moving fast, you need to release the product or service only with the features your clients absolutely need. You can add all the extra features you planned in future updates

Related: How to Create a Growth Plan for Your Business in 6 Simple Steps

Beware of Feature Creep

This is where you constantly want to make changes and additions to a product in development, can be fatal when you're dealing with one or more competitors, so make sure it doesn't happen. You can prevent it by being strict about which features you need to ship because there will be times when developers, sales, or marketing want you to add something they feel is vital. As long as you show customers that you're giving them what they need and you're working constantly to improve it, they'll be patient with your solution as you grow.

For more growth strategies, pickup Grow Your Business: Scaling Your Business available now at Entrepreneur Bookstore | Amazon | Barnes and Noble

Assuring the sustainability of the Canada Pension Plan: A new consensus is required

Keith Ambachtsheer is director emeritus of the International Centre for Pension Management, senior fellow at the National Institute on Ageing, and executive in residence at the Rotman School of Management.

Malcolm Hamilton is a retired pension actuary and a senior fellow at the C.D. Howe Institute.

Ed Waitzer is a lawyer and a senior fellow at the C.D. Howe Institute.

The creation of the Canada and Quebec pension plans in the 1960s and subsequent amendments to them in the 1990s is a compelling story of how governments worked together to create and sustain one of Canada’s greatest public-policy achievements. Today we are faced with the thorny issue of how to determine a fair basis on which Alberta might choose to exit the CPP.

When the CPP was created, Ontario requested a provision to allow a province to leave the CPP by setting up an equivalent provincial plan. While open to different interpretations, Section 113 of the CPP Act describes the calculation of the amount to be paid to a withdrawing province. Its essence is to transfer to the pension fund of the withdrawing province an amount that would have accumulated in that pension fund had it always been separate.

Alberta’s share of the CPP’s contributions has long exceeded its share of the benefits. Between 1981 and 2018, Albertans were responsible for 14 per cent of the CPP’s contributions while collecting 10 per cent of the benefits. The difference, accumulated with actual CPP investment returns over time, is significant. Last September’s LifeWorks study found that Section 113 could be interpreted to allow Alberta to claim about half of the CPP’s accumulated assets.

If Alberta were to set up its own pension plan with half of the CPP’s assets, employees in Alberta would contribute significantly less than they now contribute, and significantly less than employees in the other provinces. If other “low-cost” provinces withdraw, the contribution rate for employees in the “high-cost” provinces would increase further. The result would be a collection of identical provincial pension plans, each with its own contribution rate and larger administrative costs. Is such an arrangement fairer than what we have today? Is it more likely to unite, or divide?

Opinion: Fear the politicization of pensions, no matter the politician

Before answering these questions, we must address several concerns.

The first is whether the data required to perform the calculations set out in Section 113 are available or can be made available. If not, the process by which a province withdraws from the CPP will need to be reimagined.

More importantly, we need to agree on what constitutes “fair” contribution rates. Today all CPP members contribute the same percentage of contributory earnings and accrue the same pension as a percentage of their pensionable earnings. There are no differences by age, gender, or province of employment.

However, by design, those who entered the CPP at the outset received a much better deal. For example, those who retired at the age of 65 in 1976 received full pensions after contributing at a rate of 3.6 per cent for only 10 years. Those entering the CPP after 2002 will be expected to contribute at a 9.9-per-cent rate for 40 years to earn the same pension. The current contribution rate would be about 6 per cent without this intergenerational transfer. Arguably there were mitigating circumstances. The first generation had to contend with the Depression, the Second World War and runaway inflation. They paid for the upbringing of the baby-boom generation. The CPP helped them retire in comfort and allowed their children to concentrate more on saving for their own retirements and less on supporting aging parents.

Opinion: Don’t meddle with Canada’s pension-plan model

As the fastest-growing province, Alberta had relatively fewer first-generation participants and more second- and third-generation participants than the other provinces. This is one of several factors that helps explain why Alberta’s contributions were relatively high and its benefits were relatively low. The intergenerational transfer cannot be reversed, but some of the burden could be shifted between provinces.

Without some new source of CPP funding, such a shifting of burdens and/or the withdrawal of one or more provinces is a zero-sum game, with winners and losers. Ultimately the question is whether Canadians are best served by a CPP with one national contribution rate, or by a CPP with regional or provincial contribution rates. Setting up separate provincial pension administrators simply increases costs.

Reaching an acceptable compromise will be challenging, but we cannot proceed without one. As was the case when the CPP was cobbled together, we’ve come to a point where all involved must look beyond narrow self-interest and be cognizant of the risks and uncertainties of political posturing, inaction, or of referring the matter to the courts. The 22 million Canadians who are CPP members expect a sensible solution. Future generations deserve no less.

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