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How To Write the Operations Plan Section of the Business Plan

Susan Ward wrote about small businesses for The Balance for 18 years. She has run an IT consulting firm and designed and presented courses on how to promote small businesses.

Stage of Development Section

Production process section, the bottom line, frequently asked questions (faqs).

The operations plan is the section of your business plan that gives an overview of your workflow, supply chains, and similar aspects of your business. Any key details of how your business physically produces goods or services will be included in this section.

You need an operations plan to help others understand how you'll deliver on your promise to turn a profit. Keep reading to learn what to include in your operations plan.

Key Takeaways

• The operations plan section should include general operational details that help investors understand the physical details of your vision.
• Details in the operations plan include information about any physical plants, equipment, assets, and more.
• The operations plan can also serve as a checklist for startups; it includes a list of everything that must be done to start turning a profit.

In your business plan , the operations plan section describes the physical necessities of your business's operation, such as your physical location, facilities, and equipment. Depending on what kind of business you'll be operating, it may also include information about inventory requirements, suppliers, and a description of the manufacturing process.

Keeping focused on the bottom line will help you organize this part of the business plan.

Think of the operating plan as an outline of the capital and expense requirements your business will need to operate from day to day.

You need to do two things for the reader of your business plan in the operations section: show what you've done so far to get your business off the ground and demonstrate that you understand the manufacturing or delivery process of producing your product or service.

When you're writing this section of the operations plan, start by explaining what you've done to date to get the business operational, then follow up with an explanation of what still needs to be done. The following should be included:

Production Workflow

A high-level, step-by-step description of how your product or service will be made, identifying the problems that may occur in the production process. Follow this with a subsection titled "Risks," which outlines the potential problems that may interfere with the production process and what you're going to do to negate these risks. If any part of the production process can expose employees to hazards, describe how employees will be trained in dealing with safety issues. If hazardous materials will be used, describe how these will be safely stored, handled, and disposed.

Industry Association Memberships

Show your awareness of your industry's local, regional, or national standards and regulations by telling which industry organizations you are already a member of and which ones you plan to join. This is also an opportunity to outline what steps you've taken to comply with the laws and regulations that apply to your industry. 

Supply Chains

An explanation of who your suppliers are and their prices, terms, and conditions. Describe what alternative arrangements you have made or will make if these suppliers let you down.

Quality Control

An explanation of the quality control measures that you've set up or are going to establish. For example, if you intend to pursue some form of quality control certification such as ISO 9000, describe how you will accomplish this.

While you can think of the stage of the development part of the operations plan as an overview, the production process section lays out the details of your business's day-to-day operations. Remember, your goal for writing this business plan section is to demonstrate your understanding of your product or service's manufacturing or delivery process.

When writing this section, you can use the headings below as subheadings and then provide the details in paragraph format. Leave out any topic that does not apply to your particular business.

Do an outline of your business's day-to-day operations, including your hours of operation and the days the business will be open. If the business is seasonal, be sure to say so.

The Physical Plant

Describe the type, site, and location of premises for your business. If applicable, include drawings of the building, copies of lease agreements, and recent real estate appraisals. You need to show how much the land or buildings required for your business operations are worth and tell why they're important to your proposed business.

The same goes for equipment. Besides describing the equipment necessary and how much of it you need, you also need to include its worth and cost and explain any financing arrangements.

Make a list of your assets , such as land, buildings, inventory, furniture, equipment, and vehicles. Include legal descriptions and the worth of each asset.

Special Requirements

If your business has any special requirements, such as water or power needs, ventilation, drainage, etc., provide the details in your operating plan, as well as what you've done to secure the necessary permissions.

State where you're going to get the materials you need to produce your product or service and explain what terms you've negotiated with suppliers.

Explain how long it takes to produce a unit and when you'll be able to start producing your product or service. Include factors that may affect the time frame of production and describe how you'll deal with potential challenges such as rush orders.

Explain how you'll keep  track of inventory .

Feasibility

Describe any product testing, price testing, or prototype testing that you've done on your product or service.

Give details of product cost estimates.

Once you've worked through this business plan section, you'll not only have a detailed operations plan to show your readers, but you'll also have a convenient list of what needs to be done next to make your business a reality. Writing this document gives you a chance to crystalize your business ideas into a clear checklist that you can reference. As you check items off the list, use it to explain your vision to investors, partners, and others within your organization.

What is an operations plan?

An operations plan is one section of a company's business plan. This section conveys the physical requirements for your business's operations, including supply chains, workflow , and quality control processes.

What is the main difference between the operations plan and the financial plan?

The operations plan and financial plan tackle similar issues, in that they seek to explain how the business will turn a profit. The operations plan approaches this issue from a physical perspective, such as property, routes, and locations. The financial plan explains how revenue and expenses will ultimately lead to the business's success.

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How to Write an Operations Plan Section of your Business Plan

Free Operations Plan Template

Ayush Jalan

• December 14, 2023

Your business plan is an elaborate set of instructions stating how to run your business to achieve objectives and goals. Each section describes a part of the process of reaching your desired goal. Similarly, the operations plan section of your business plan explains the production and supply of your product.

An operations plan is formed to turn plans into actions. It uses the information you gathered from the analysis of the market , customers, and competitors mentioned in the previous parts of your business plan and allows for the execution of relevant strategies to achieve desired results.

What Is an Operations Plan?

An operations plan is an in-depth description of your daily business activities centered on achieving the goals and objectives described in the previous sections of your business plan. It outlines the processes, activities, responsibilities of various departments and the timeframe of the execution.

The operations section of your business plan explains in detail the role of a team or department in the collective accomplishment of your goals. In other words, it’s a strategic allocation of physical, financial, and human resources toward reaching milestones within a specific timeframe.

A well-defined operational plan section of your business plan should be able to answer the following questions:

• Who is responsible for a specific task or department?
• What are the tasks that need to be completed?
• Where will these operations take place?
• When should the tasks be completed? What are the deadlines?
• How will the tasks be performed? Is there a standard procedure?
• How much is it going to cost to complete these tasks?

How to Write an Operations Plan Section?

Creating an operational plan has two major stages, both addressing different aspects of your company. The first stage includes the work that has been done so far, whereas the second stage describes it in detail.

1. Development Phase

In this stage, you mention what you’ve done to get your business operations up and running. Explain what you aim to change and improvise in the processes. These are the elements your development section will contain:

Production workflow

: Explain all the steps involved in creating your product. This should be a highly informative, elaborate description of the steps. Here, you also mention any inefficiencies that exist and talk about the actions that need to be taken to tackle them.

Supply chains

Quality control, 2. manufacturing phase.

The development stage acquaints the reader with the functioning of your business, while the manufacturing stage describes the day-to-day operation.

This includes the following elements:

Outline of daily activities:

Tools and equipment:, special requirements:, raw materials:, productions:, feasibility:, why do you need an operations plan.

An operations plan is essentially an instruction manual about the workings of your business. It offers insight into your business operations. It helps investors assess your credibility and understand the structure of your operations and predict your financial requirements.

An operations plan reflects the real-time application of a business plan.

Internally, an operations plan works as a guide, which helps your employees and managers to know their responsibilities. It also helps them understand how to execute their tasks in the desired manner—all whilst keeping account of deadlines.

The operations plan helps identify and cut the variances between planned and actual performance and makes necessary changes. It helps you visualize how your operations affect revenue and gives you an idea of how and when you need to implement new strategies to maximize profits.

Advantages of Preparing an Operations Plan:

• Offers Clarity: Operational planning, among other things, makes sure that everyone in the audience and team are aware of the daily, weekly, and monthly work. It improves concentration and productivity.
• Contains A Roadmap: Operational planning makes it much easier to reach long-term objectives. When members have a clear strategy to follow: productivity rises, and accountability is maintained.
• Sets A Benchmark: It sets a clear goal for everyone about what is the destination of the company and how to reach there.

Operations Plan Essentials

Now that you have understood the contents of an operations plan and how it should be written, you can continue drafting one for your business plan. But before doing so, take a look at these key components you need to remember while creating your operational plan.

• Your operations plan is fundamentally a medium for implementing your strategic plan. Hence, it’s crucial to have a solid strategic plan to write an effective operations plan.
• Focus on setting SMART goals and prioritizing the most important ones. This helps you create a clear and crisp operations plan. Focusing on multiple goals will make your plan complicated and hard to implement.
• To measure your goals, use leading indicators instead of lagging indicators. Leading indicators is a metric that helps you track your progress and predict when you will reach a goal. On the other hand, lagging indicators can only confirm a trend by taking the past as input but cannot predict the accomplishment of a goal.
• It is essential to choose the right Key Performance Indicators (KPIs) . It is a good practice to involve all your teams while you decide your KPIs.
• An operations plan should effectively communicate your goals, metrics, deadlines, and all the processes.

Now you’re all set to write an operations plan section for your business plan . To give you a headstart, we have created an operations plan example.

Operations Plan Example

Operations plan by a book publishing house

Track and Accomplish Goals With an Operations Plan

Drafting the operations plan section of your business plan can be tricky due to the uncertainties of the business environment and the risks associated with it. Depending on variables like your market analysis, product development, supply chain, etc., the complexity of writing an operations plan will vary.

The core purpose here is to put all the pieces together to create a synergy effect and get the engine of your business running. Create an effective operations plan to convey competence to investors and clarity to employees.

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Frequently Asked Questions

What role does the operations plan play in securing funding for a business.

The operations plan defines the clear goals of your business and what actions will be taken on a daily basis to reach them. So, investors need to know where your business stands, and it will prove the viability of the goals helping you in getting funded.

What are the factors affecting the operations plan?

• The mission of the company
• Goals to be achieved
• Finance and resources your company will need

Can an operations plan be created for both start-up and established businesses?

Yes, both a startup and a small business needs an operations plan to get a better idea of the roadmap they want for their business.

About the Author

Ayush is a writer with an academic background in business and marketing. Being a tech-enthusiast, he likes to keep a sharp eye on the latest tech gadgets and innovations. When he's not working, you can find him writing poetry, gaming, playing the ukulele, catching up with friends, and indulging in creative philosophies.

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Expertly Writing the Operations Plan Section of Your Business Plan

Written by Dave Lavinsky

Operational plans are important for any effective business plan . They provide a roadmap for how the company will operate on a day-to-day basis. The operational strategic plan should outline the company’s goals and objectives, as well as the strategies and actions that will be taken to achieve them.

Business Operations Section of a Business Plan

The operational plan or operations section of a business plan is where you describe how your business will function on a day-to-day basis. This includes everything from the resources you’ll need to run your business, to the people who will be responsible for carrying out various tasks, to the processes and procedures you’ll use to get work done.

Purpose of the Operational Plan Section of a Business Plan

An operational plan is essential for any business because it provides a roadmap for how it will function. It ensures that everyone involved in the business is on the same page and knows what their roles and responsibilities are. Having an operational plan also makes it easier to track and accomplish goals, while driving cost reduction and improving overall results. Finally, your operations plan section helps show readers that you can turn your vision and goals into reality.

Benefits of an Operations Plan Include:

• Identifying the key processes your company must perform to achieve its goals
• Mapping out short-term and long-term milestones so you have specific goals and a roadmap for achieving them
• Understanding the human and other resources required to execute your vision

Writing an Operations Section of a Business Plan

When writing the operations section of a business plan, there are a few things you’ll want to keep in mind. First, be sure to describe the resources that will be required to run your business. This includes everything from office space and equipment to human resources. Next, detail the processes and procedures that will be used to get work done. Be as specific as possible so that there is no confusion about how things should be done. Finally, identify the people who will be responsible for carrying out various tasks. This includes both employees and contractors.

Tracking Key Performance Indicators with Operational Planning

As a business owner, it’s important to track your progress against your company goals. This is where KPIs come in. KPIs are performance indicators and an important part of creating a strategic plan that can help you track your progress and identify areas of improvement. You should document your KPIs in the operation plan of your business plan

There are a few things to keep in mind when choosing KPIs for your business:

• Make sure that the KPIs you choose are relevant to your company’s goals.
• Choose KPIs that can be easily measured.
• Avoid choosing too many KPIs, as this can be overwhelming. Stick to a few key ones that will give you the most insights into your business’s progress.
• Set realistic targets for each KPI. This will help you track your progress and identify areas of improvement.
• Review your KPIs on a regular basis to ensure that they are still relevant and accurate, while also being in line with strategic plans.

Some Examples of KPIs that You Could Track with an Operational Plan

When creating an operations plan, it’s important to track key performance indicators (KPIs) to measure your progress against your company goals. Some examples of KPIs that you could track are:

• Sales growth
• Delivery times
• Customer satisfaction ratings
• Product Quality
• Production Process
• Employee retention
• Operational costs

Creating an operational plan with KPIs will help you track your progress, identify areas of improvement, improve strategic planning and make necessary changes to reach your company’s strategic objective.

Example of an Operations Section of a Business Plan

Here is what an operations plan example might look like:

The XYZ Company will require the following resources to operate:

• 1,000 square feet of office space
• $10,000 for office furniture and equipment
• 3 full-time employees
• 2 part-time employees
• 1 contractor

The XYZ Company will use the following processes and procedures to get work done:

• All new clients will be contacted within 24 hours of the initial inquiry
• Initial consultations will be scheduled within 48 hours of contact
• Proposals will be presented within 10 days of the initial consultation
• Work will begin within 2 weeks of proposal acceptance

The following people will be responsible for carrying out these tasks:

• John Smith, full-time employee, will contact new clients
• Jane Doe, full-time employee, will schedule initial consultations
• John Smith and Jane Doe will conduct initial consultations
• John Smith and Jane Doe will prepare proposals
• John Smith and Jane Doe will manage projects
• Joe Johnson, contractor, will provide support as needed

An operations plan is a critical part of any business planning work. It provides a roadmap for how the business will function on a day-to-day basis. This includes everything from the resources you’ll need to run your business, to the people who will be responsible for carrying out various tasks, to the processes and procedures you’ll use to get work done. Having operational plans in place will ensure that everyone involved in the business is on the same page and knows what their roles and responsibilities are. It will also make it easier to track and accomplish goals.

Key Takeaways

A few key things to remember when writing your operations plan:

• Describe the resources that will be required to run your business
• Detail the processes and procedures that will be used to get work done
• Identify the people who will be responsible for carrying out various tasks

Following these tips will help you create a comprehensive and effective operations plan for your business.

A strategic plan is one of the critical components of any successful company. The operations plan outlines the roadmap for your business, outlining the steps you need to take to achieve your goals. If you’re not sure where to start, we can help. Our team of experts has created a comprehensive business plan template that will guide you through the process of creating an operational plan tailored to your specific business needs. Ready to get started? Download our template today and get access to all the tools and information you need to create a thriving business.

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How to Write the Operations Section of the Business Plan

Back to Business Plans

Written by: Carolyn Young

Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.

Edited by: David Lepeska

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

Published on February 20, 2023 Updated on December 12, 2023

Among the countless tasks involved in starting a business is writing a business plan . Many entrepreneurs who don’t need funding view this as a step they can skip, but that’s never a good idea. 

A sharp and detailed business plan is essentially a business owner’s commitment to and preparation for the road ahead, detailing the operations, strategies, and potential growth.

The operations section is the real heart of a business plan, detailing how your venture will operate on a day-to-day basis. Researching and writing this section will prepare you to run your business, structure your operations, and deal with any hurdles.  

This guide delivers all the insight you need to whip up a fantastic operations section of your plan.

• What Are Operations?

Operations are the assets, processes, and people necessary to keep the business running and making money on a day-to-day basis. They include how the product or service is developed or sourced, what needs to be done for that to occur, and the resources required. 

You’ll also detail the activities that need to occur to attract customers, make sales, and deliver the product or service. 

Keep in mind that operations are different for every company. If you’re running an online shoe store , for instance, you won’t learn much by examining the operations of a cement manufacturer. 

• Elements of the Operations Section

The operations section of the business plan has several key elements. 

1. Assets Required

Your business’s required assets may include a physical space, such as a shop or office, as well as equipment, vehicles, computers, and other physical assets needed to develop your product and operate the business. List all these assets, the expected cost, and how you’ll acquire them. 

2. Product Development or Sourcing

Detail all the steps necessary to produce or acquire your product or service. Include details of your suppliers, how you will acquire products and raw materials, and the estimated cost. If you’re manufacturing products, detail the processes and production oversight plan, as well as costs. 

If your product involves technology, detail the stages of development and how you’ll maintain and advance the product on an ongoing basis.

Your goal should be to paint a picture of exactly what will happen on a day-to-day basis to produce a product or service that’s ready to sell, who will be involved, and how much it will cost. 

3. Technical Processes

If you expect to use any technical processes, explain them and who will be involved. These could be anything from business process automation and workflow management systems to project management or AI analytics for marketing. 

Detail the initial and ongoing costs for any software and hardware used.

4. Marketing and Sales Activities

To clarify, this section will not explain your business’s marketing and sales strategies. Rather, here you detail how marketing and sales will be conducted, who’ll be responsible, and the expected cost. For example, you might have your own internal team or outsource to a marketing agency.  

If you plan to hire marketing staff, detail what roles you’ll fill, what they’ll do, and how they’ll be paid. For example, your salespeople may receive a base salary and commissions.

5. Product or Service Delivery Activities

Detail how you will get the product or service to the customer. If you’re selling a product online, describe how products will be shipped and who is involved in packaging products and getting them to the delivery provider. 

If you’re delivering a service, detail how this is done and who is responsible for performing the service. 

6. Operational Objectives

Finally, you’ll include your operational objectives. These could include:

• Acquiring equipment by a certain date
• Hiring employees
• Short-term production goals
• Engaging with a supplier

It’s important to illustrate that you have specific operational plans and goals that will enable you to meet your overall business objectives.

Every business is different, so you may need to include all of the elements described above, or just a few of them. What’s important is that the reader is able to grasp how your company will function on a day-to-day basis. 

By writing the operations section, you’ll learn exactly what it will take to keep your business chugging along and bringing in revenue – and that knowledge will likely be invaluable down the road.  

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How to Write the Operations Section of Your Business Plan

2 min. read

Updated January 3, 2024

The operations plan covers what makes your business run. It explains the day-to-day workflows for your business and how you will deliver the product or service that you offer. As part of your plan, it’s your chance to describe what you’ve set up so far and that you understand what is still left to make your business fully operational.

• How to write about business operations

Like some of the other sections in your plan, the information you include fully depends on your type of business. If you run a subscription box service you’ll need to cover how you source and fulfill each order. If it’s a service-oriented business (like a mechanic or coffee shop) you’ll need to go into more detail about your location as well as the tools and technology you use.

The important thing is that the information here fully addresses how your business runs.

What to include in your operations plan

The components of your operations plan fully depend on what’s necessary to produce your product or service. For most, you’ll be adding details about your location and facilities, the technology being used, and any equipment or tools.

Location and facilities

The information you include about your business location fully depends on the state, city, and neighborhood you’ve chosen. This will determine the specific taxes, registration, licenses, permits, zoning laws, and other regulations you’ll be subjected to.

Once you’ve legally established your business be sure to reference the relevant paperwork and legal documentation in this section. You may also want to point to mockups of the building, copies of legal agreements, and any other supporting documentation for how valuable the property is and how it helps your business function.

Sourcing and fulfillment

How will you create your product/service and what will it cost? You’ll include detailed breakdowns in your financial plan, but here you’ll talk about what it will take, who you will work with, and any alternatives.

How and when to write about technology

Is your product or service driven by a specific technology or process? Let investors, banks, or other necessary parties know why it’s a valuable part of your business.

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• Why you need an operational plan

Understanding your business operations makes your processes real. It ensures that you have organized steps in place to produce a product or service.

For investors, this helps prove that you know what you’re doing and can back up the rest of your plan with actual work that makes it happen. For you as a business owner, it’s a starting point for optimization. You have a blueprint for how things work. And as you run your business, can begin to identify opportunities for improvement.

If you don’t cover operations as part of your business plan, then you’re flying blindly. There’s no documented process for how things should work and no connection to the other strategic elements of your business.

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Operations Plan

• Lesson Materials Operations Plan Worksheet
• Completion time About 40 minutes

The operations section of your business plan is where you explain – in detail – you company's objectives, goals, procedures, and timeline. An operations plan is helpful for investors, but it's also helpful for you and employees because it pushes you to think about tactics and deadlines.

In the previous course, you outlined your company's strategic plan, which answers questions about your business mission. An operational plan outlines the steps you'll take to complete your business mission.

Your operations plan should be able to answer the following:

• Who – The personnel or departments who are in charge of completing specific tasks.
• What – A description of what each department is responsible for.
• Where – The information on where daily operations will be taking place.
• When –The deadlines for when the tasks and goals are to be completed.
• How much – The cost amount each department needs to complete their tasks.

In this session, we explain each item to include in your operations plan.

Goals and Objectives

The key to an operations plan is having a clear objective and goal everyone is focused on completing. In this section of your plan, you'll clearly state what your company's operational objective is.

Your operational objective is different than your company's overall objective. In Course One , you fleshed out what your strategic objective was. Your operational objective explains how you intend to complete your strategic objective.

In order to create an efficient operational objective, think SMART:

• Specific – Be clear on what you want employees to achieve.
• Measurable – Be able to quantify the goal in order to track progress.
• Attainable & Realistic – It's great to be ambitious but make sure you aren't setting your team up for failure. Create a goal that everyone is motivated to complete with the resources available.
• Timely – Provide a deadline so everyone has a date they are working towards.

Different departments will have different operational objectives. However, each department objective should help the company reach the main objective. In addition, operational objectives change; the objectives aren't intended to be permanents or long term. The timeline should be scheduled with your company's long-term goals in mind.

Let's look at the following example for a local pizza business objective:

• Strategic objective : To deliver pizza all over Eastern Massachusetts.
• Technology department operational objective : To create a mobile app by January 2017 to offer a better user experience.
• Marketing department operational objective : To increase website visitors by 50% by January 2017 by advertising on radio, top local food websites, and print ads.
• Sales department operational objective : To increase delivery sales by 30%, by targeting 3 of Massachusetts's largest counties.

Sales department operational objective: To increase delivery sales by 30%, by targeting 3 of Massachusetts's largest counties.

Production Process

After you create your objectives, you have to think strategically on how you're going to meet them. In order to do this, each department (or team) needs to have all the necessary resources for the production process.

Resources you should think about include the following:

• Suppliers – do you have a supplier (or more) to help you produce your product?
• Technology team: app developing software
• Marketing team: software licenses for website analytical tools
• Sales team: headsets, phone systems or virtual phone system technology
• Cost – what is the budget for each department?

In addition to the production process, you'll also need to describe in detail your operating process. This will demonstrate to investors that you know exactly how you want your business to run on a day-to-day basis.

Items to address include:

• Location – where are employees working? Will you need additional facilities?
• Work hours – will employees have a set schedule or flexible work schedule?
• Personnel – who is in charge of making sure department tasks are completed?

Creating a timeline with milestones is important for your new business. It keeps everyone focused and is a good tracking method for efficiency. For instance, if milestones aren’t being met, you'll know that it's time to re-evaluate your production process or consider new hires.

Below are common milestones new businesses should plan for.

When you completed your Management Plan Worksheet in the previous course, you jotted down which key hires you needed right away and which could wait. Make sure you have a good idea on when you would like those key hires to happen; whether it’s after your company hits a certain revenue amount or once a certain project takes off.

Production Milestones

Production milestones keep business on track. These milestones act as "checkpoints" for your overall department objectives. For instance, if you want to create a new app by the end of the year, product milestones you outline might include a beta roll out, testing, and various version releases.

Other product milestones to keep in mind:

• Design phase
• Product prototype phase
• Product launch
• Version release

Market Milestones

Market milestones are important for tracking efficiency and understanding whether your operations plan is working. For instance, a possible market milestone could be reaching a certain amount of clients or customers after a new product or service is released.

A few other market milestones to consider:

• Gain a certain amount of users/clients by a certain time
• Signing partnerships
• Running a competitive analysis
• Performing a price change evaluation

Financial Milestones

Financial milestones are important for tracking business performance. It's likely that a board of directors or investors will work with you on creating financial milestones. In addition, in startups, it's common that financial milestones are calculated for 12 months.

Typical financial milestones include:

• Funding events
• Revenue and profit goals
• Transaction goals

In summary, your operations plan gives you the chance to show investors you know how you want your business to run. You know who you want to hire, where you want to work, and when you expect projects to be completed.

Download the attached worksheet and start putting your timelines and milestones together on paper.

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Operational Planning: How to Make an Operations Plan

The operations of your business can be defined as the sum of all the daily activities that you and your team execute to create products or services and engage with your customers, among other critical business functions. While organizing these moving parts might sound difficult, it can be easily done by writing a business operational plan. But before we learn how to make one, let’s first understand what’s the relationship between strategic and operational planning.

Operational Planning vs. Strategic Planning

Operational planning and strategic planning are complementary to each other. This is because strategic plans define the business strategy and the long-term goals for your organization, while operational plans define the steps required to achieve them.

What Is a Strategic Plan?

A strategic plan is a business document that describes the business goals of a company as well as the high-level actions that will be taken to achieve them over a time period of 1-3 years.

What Is an Operational Plan?

Operational plans map the daily, weekly or monthly business operations that’ll be executed by the department to complete the goals you’ve previously defined in your strategic plan. Operational plans go deeper into explaining your business operations as they explain roles and responsibilities, timelines and the scope of work.

Operational plans work best when an entire department buys in, assigning due dates for tasks, measuring goals for success, reporting on issues and collaborating effectively. They work even better when there’s a platform like ProjectManager , which facilitates communication across departments to ensure that the machine is running smoothly as each team reaches its benchmark. Get started with ProjectManager for free today.

What Is Operational Planning?

Operational planning is the process of turning strategic plans into action plans, which simply means breaking down high-level strategic goals and activities into smaller, actionable steps. The main goal of operational planning is to coordinate different departments and layers of management to ensure the whole organization works towards the same objective, which is achieving the goals set forth in the strategic plan .

How to Make an Operational Plan

There’s no single approach to follow when making an operation plan for your business. However, there’s one golden rule in operations management : your strategic and operational plans must be aligned. Based on that principle, here are seven steps to make an operational plan.

• Map business processes and workflows: What steps need to be taken at the operations level to accomplish long-term strategic goals?
• Set operational-level goals: Describe what operational-level goals contribute to the achievement of larger strategic goals.
• Determine the operational timeline: Is there any time frame for the achievement of the operational plan?
• Define your resource requirements: Estimate what resources are needed for the execution of the operational plan.
• Estimate the operational budget: Based on your resource requirements, estimate costs and define an operational budget.
• Set a hiring plan: Are there any skills gaps that need to be filled in your organization?
• Set key performance indicators: Define metrics and performance tracking procedures to measure your team’s performance.

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Operational Plan Template

Use this free Operational Plan Template for Word to manage your projects better.

What Should be Included in an Operational Plan?

Your operational plan should describe your business operations as accurately as possible so that internal teams know how the company works and how they can help achieve the larger strategic objectives. Here’s a list of some of the key elements that you’ll need to consider when writing an operational plan.

Executive Summary

An executive summary is a brief document that summarizes the content of larger documents like business plans, strategic plans or operation plans. Their main purpose is to provide a quick overview for busy stakeholders.

Operational Budget

An operational budget is an estimation of the expected operating costs and revenues for a given time period. As with other types of budget, the operational budget defines the amount of money that’s available to acquire raw materials, equipment or anything else that’s needed for business operations.

It’s important to limit your spending to stay below your operational budget, otherwise, your company could run out of resources to execute its normal activities. You can use our free operating budget template for Excel to track your operating costs.

Operational Objectives

It’s essential to align your operational objectives with your strategic objectives. For example, if one of your strategic objectives is to increase sales by 25 percent over the next three years, one possible operational objective would be to hire new sales employees. You should always grab your strategic plan objectives and turn them into one or multiple action items .

Processes & Workflows

Explain the various business processes, workflows and tasks that need to be executed to achieve your operational objectives. Make sure to explain what resources are needed, such as raw materials, equipment or human resources.

Operational Timeline

It’s important to establish a timeline for your operational plan. In most cases, your operational plan will have the same length as your strategic plan, but in some scenarios, you might create multiple operational plans for specific purposes. Not all operational plans are equal, so the length of your operational timeline will depend on the duration of your projects , workflows and processes.

Hiring Plan

Find any skills gap there might be in your team. You might need to hire a couple of individuals or even create new departments in order to execute your business processes .

Quality Assurance and Control

Most companies implement quality assurance and control procedures for a variety of reasons such as customer safety and regulatory compliance. In addition, quality assurance issues can cost your business millions, so establishing quality management protocols is a key step in operational planning.

Key Performance Indicators

It’s important to establish key performance indicators (KPIs) to measure the productivity of your business operations. You can define as many KPIs as needed for all your business processes. For example, you can define KPIs for marketing, sales, product development and other key departments in your company. This can include product launch deadlines, number of manufactured goods, number of customer service cases closed, number of 5-star reviews received, number of customers acquired, revenue increased by a certain percentage and so on.

Risks, Assumptions and Constraints

Note any potential risks, assumptions and time or resource constraints that might affect your business operations.

Free Operational Plan Template

Leverage everything you’ve learned today with our template. This free operational plan template for Word will help you define your budget, timeline, KPIs and more. It’s the perfect first step in organizing and improving your operations. Download it today.

What Are the Benefits of Operational Planning?

Every plan has a massive effect on all team members involved, and those can be to your company’s benefit or to their detriment. If it’s to their detriment, it’s best to find out as soon as possible so you can modify your operational plan and pivot with ease.

But that’s the whole point of operational planning: you get to see the effect of your operations on the business’s bottom line in real time, or at every benchmark, so you know exactly when to pivot. And with a plan that’s as custom to each department as an operational plan, you know exactly where things go wrong and why.

How ProjectManager Can Help with Operational Planning

Creating and implementing a high-quality operational plan is the best way to ensure that your organization starts out a project on the right foot. ProjectManager has award-winning project management tools to help you craft and execute such a plan.

Gantt charts are essential to create and monitor operational plans effectively. ProjectManager helps you access your Gantt chart online so you can add benchmarks for operational performance reviews. You can also create tasks along with dependencies to make the operation a surefire success.

Whether you’re a team of IT system administrators, marketing experts, or engineers, ProjectManager includes robust planning and reporting tools. Plan in sprints, assign due dates, collaborate with team members and track everything with just the click of a button. Plus, we have numerous ready-made project reports that can be generated instantly, including status reports, variance reports, timesheet reports and more.

Related Operations Management Content

• Operational Strategy: A Quick Guide
• Operations Management: Key Functions, Roles and Skills
• Operational Efficiency: A Quick Guide
• Using Operational Excellence to Be More Productive

Operational planning isn’t done in a silo, and it doesn’t work without the full weight of the team backing it up. Ensure that your department is successful at each benchmark. ProjectManager is an award-winning pm software dedicated to helping businesses smooth out their operational plans for a better year ahead. Sign up for our free 30-day trial today.

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How to structure the operations section of your business plan

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Introduction

Writing a comprehensive business plan is an essential part of preparing your business for success. The business plan is a roadmap that outlines your vision, helps prioritize goals, and defines objectives to ensure the success of your business. In order to ensure you have included all the information necessary for success, it is important to include certain key components, such as an operations section.

The operations section outlines the day-to-day operations of the business and sets forth the details about each of the functional areas within the company. When it comes to structuring the operations section of the business plan, there are a few key goals to keep in mind.

Outline Typical Content of an Operations Section

Operations are one of the most important elements in any business plan. An effective business plan should include a thorough assessment of operational requirements and strategies. The operations section should cover a range of topics such as key personnel roles and responsibilities, resources, costs and policies.

Responsibilities of Holders of Key Positions in the Business

A key component of the business plan operations section is to outline the responsibilities of each key position holder. This should describe both their individual and collective responsibilities. Holders of key positions should also consider how they can work together to oversee the performance and growth of the organization.

Identifying Resources Such as Capital, Personnel, and Technology

The operations section should also include a thorough assessment of the resources available to the organization. This should include an evaluation of the following elements:

• Capital - this should consider sources of capital such as investments, loans, and personal capital.
• Personnel - the number of staff, their roles, and the hiring process.
• Technology – the technological requirements for running the business and the services it provides.

Projected Costs of Operations

A crucial component of writing a business plan is to project the costs associated with operations. This should consider factors such as the cost of personnel, supplies, and any other materials related to running the business. Additionally, projected costs should also account for any external costs, such as taxes or insurance.

Outlining General Work Policies

The operations section of a business plan should include a detailed list of the organization’s general work policies. This should include policies on working hours, holiday entitlements, sick leave, and any other relevant policies. This should be tailored to each business and its operational needs and requirements.

Assessing Quality of Operational Procedures

Crafting a successful operations procedure is key to running a successful business. Establishing this procedure, and assessing its quality, can be a challenging task, and essential for generating meaningful results. There are a few key considerations to bear in mind when assessing the quality of operational procedures.

What Sets Aside a Successful Operational Strategy from an Unsuccessful One

When developing an operations procedure, the aim should be to create an efficient and effective system that covers all aspects of the business. A successful procedure should have a logical sequence, enabling the company to effectively manage all of its operations. It should also be able to track progress and record performance data, as well as generating reports that provide insight into key performance metrics.

Other important criteria include developing streamlined processes that are cost-effective and that can maintain quality across all processes. Assessing the quality of your operation's procedures should involve the following steps:

• Assessing the complexity and scalability of the operational procedures. Does the operational procedure handle complexity efficiently? Is it scalable to accommodate changes within the business?
• Reviewing the operational efficiency. How efficient are the current processes? Are there any opportunities to streamline or automate them?
• Assessing the effectiveness of the operations procedures. Are they able to meet the goals of the business? Are there any areas of improvement?
• Analyzing the cost of implementing the operations procedures. Are there any additional costs that need to be considered?

Developing Metrics to Monitor Operational Performance and Quality

To ensure that your operational procedures are effective and consistent, it is important to develop and implement metrics to track performance. These metrics should be based on the goals and objectives of the business and should be able to measure success accurately. A few key metrics that you should consider include:

• An assessment of the speed of operations. Are tasks being completed in a timely manner? Are there any opportunities to improve speed?
• The accuracy of data. Is data being accurately reported and tracked? Are key performance indicators (KPIs) being monitored?
• An analysis of customer satisfaction. Are customers satisfied with the services they receive? Are there any areas of improvement?
• A review of cost savings. Are operations costs being kept in line with expectations? Are there any areas where additional expense could be reduced?

By regularly monitoring these metrics, businesses will be able to ensure that their operational procedures are effective and efficient, and can adjust where necessary to ensure desired results.

Defining the Management Structure

Having a well-structured management system is critical for any business, regardless of size or industry. From clearing defining decision-making processes to developing team building and communication strategies, the operations section of a business plan should clearly outline the management structure of the business in scrupulous detail.

Decision-making processes

Whether it's a small start-up or an established organization, company decisions should be made in accordance with a abide to a set of rules laid by the founders. Establishing these protocols is essential, as it ensures that all decisions are considered carefully. Different types of decisions tend to fall into a base-level hierarchy, and each decision must fit within this structure.

Roles & responsibilities of all key roles

Naturally, a business must have key personnel that are responsible for managing the business. Taking into account the size of the company, the business plan should clearly outline the roles and responsibilities of all key roles. This includes the chief executive officers, the board of directors, the financial officers, and any other important personnel, as well as the strict lines of demarcation for each role.

Team building and communication interworking between all roles

Successful businesses are built upon strong team building, and clear communication is a pillar of that. When writing the operations section of a business plan, it is important to consider the strategies that will be employed by the business to ensure that all roles and personnel are able to interact with one another effectively. These could include the incorporation of company meetings or online collaboration tools, as well as specifying the lines of communication that should be maintained between team members.

Training & development opportunities for employees and management

Finally, businesses should strive to provide employees and management with quality training and development opportunities. Outlining the potential initiatives that the company could undertake will ensure that employees have the opportunity to learn new skills and stay up-to-date with the changing industry. These can include the provision of internal and external training opportunities, as well as strategies for monitoring the performance of each employee.

Formulating Legal Forms and Other Requirements

Before finalizing your business plan, it is essential to ensure that your business adheres to all of the relevant laws, regulations, and requirements as stated by your local, state, and/or national government. To ensure these are properly addressed, the operations section of your business plan should include chapters for the following:

Ensuring adherence to local, state and national laws

Once you have identified the laws, rules, and regulations you must follow, you must figure out the ways in which your business must comply. This may include obtaining licenses and permits from relevant government bodies, as well as, setting up any additional paperwork required to keep your business compliant. It is important to take the time to research and understand all the legal and regulatory requirements applicable to your line of business.

Compiling &developing terms & conditions of operation

Terms and conditions are legal documents that outline the expectations and set out the responsibilities between both parties – your business and the other party. By carefully outlining these terms and conditions of operation, you protect your business in case of dispute or breach of contract. Make sure to include details such as payment terms, cancellation policies and warranties.

Required licenses & permits

Depending on the nature of your business, you may need to obtain various licenses and/or permits applicable in your area. For example, if you are offering a service, you will require a business license. If you are serving liquor or food, you may need to obtain a separate permit. It is essential to familiarize yourself with the laws and regulations necessary to start and operate a business in your jurisdiction and should be included in your business plan.

Analyzing & Mitigating Risk Factors

The Operations section of the business plan should include an in-depth look at risk factors and the steps necessary to mitigate them. Risk can be mitigated in a number of ways and include:

Establishing safeguards against risks and scenarios

The first step in mitigating risk is to properly identify what the risks are and establish safeguards. This includes developing policies and procedures for safe operation and for “what-if” situations. It is also important to develop systems to monitor and evaluate performance and output. This is important for not only diagnosis of issues, but identification of areas of risk.

Developing Contingency Plans to Prepare for and Respond to Risks

In addition to establishing safeguards, it is wise to develop contingency plans. This will ensure your business is prepared should a risk materialize. Contingency plans should include proactive plans such as training and retreats to ensure the team is prepared to handle situations. It should also include reactive plans to quickly respond – such as emergency response teams, data backup procedures, and communication protocols.

Reviewing Insurance Policy Needs

Finally, it is important to review the insurance policy needs of your business. This should include general liability, worker’s compensation, property and product liability, professional and errors & omissions, and cyber liability coverage. It is important to understand the scope of your risk and to secure the appropriate insurance policies to not only protect your business, but also your customers.

The operations section of your business plan is one of the most important components, as it forms the basis of your future growth strategies. In this blog post, we have briefly discussed the different elements that you should include in your operations plan, along with tips on how to structure your document effectively and efficiently.

Summary of key points of a business plan operations section

Below are some of the key points that should be considered when creating an operations section for your business plan:

• Identify your operational processes, including raw material procurement and inventory management.
• Analyze and document your operational processes, from order processing to delivery.
• Set operational goals, such as cost savings or improved efficiency.
• Outline personnel resources, such as staffing and training.
• Consider legal issues, such as protection of intellectual property and insurance requirements.
• Create an operational budget and plan.

Benefits of taking the time to accurately plan your operations section

By considering all aspects of your operations plan and analyzing each element in detail, you can ensure that everything from the management of resources to the cost of labor is covered. This carefully planned approach can help you to develop realistic strategies for future growth and success.

Encouragement to further research topics particular to business industry and region

It is important to remember that every business is unique and has different requirements, so it is essential to research the relevant laws and regulations, customs and standards that apply to your particular industry and region. Additionally, you may need to consider the type of workforce you will need, the job market, and the costs involved in hiring, training, and retaining personnel.

As with any business plan, exploring the operations section in detail will help to ensure the success of your venture. By taking the time to plan and analyze your operational processes effectively, you can take the first step towards a successful and prosperous future for your company.

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How to write the operational section of your business plan

Posted: Tue 2nd Aug 2022

Whether you’re looking to start a business or you already run one, planning is vital to its early stage development, future growth and longevity.

Your business plan is crucial, as not only does it describe your business but it will help you to explain your idea, set your objectives and evaluate your success.

The body of your business plan should focus on three key building blocks - operational, marketing and people. In this month’s blog we take a deep dive into the operational section, giving you the lowdown on what you need to cover to help your business plan, and ultimately your business, succeed.

What is the operational section of your business plan?

So let’s kick off by answering the most obvious question: what is the operational section of your business plan?

In a nutshell, the operational part outlines the detail of your day-to-day operations. It describes what you need to run your business from the processes to the resources and the finance.

If you want to secure a bank loan or attract investors this section is especially important. It shows clearly where any finance could be needed and where you might have already used capital to purchase the physical assets necessary for the running of your business.

Explaining the operational section of a business plan

In our previous blog ‘ How to build a business plan ’ we looked at top line detail for the operational part of the business plan. Here we break it down in more detail showing what you need to think about and include for each topic.

Your tools/plant/machinery/equipment

This is the part where you note all the equipment you need to run your business - the physical necessities.

This could include plant, machinery, tools, office furniture, vehicles and anything else vital to your business operations.

If any equipment is crucial for your business, you must include it here.

Your products/services/manufacturing delivery process

In this section, chart how your products and services are created and how they are delivered to the customer.

For a product, detail the entire production cycle without giving away any trade secrets - the concept, how it’s made, its journey to the production line and on to the customer.

Outline the manufacturing process in succinct steps. Don’t forget to include mentions of testing and how you oversee quality control.

Give the reader of your business plan an idea of how long the manufacturing process takes, how you manage customer lead times and how you meet delivery requirements.

Repeat the process for any services focusing on the delivery to the customer.

A detailed breakdown of your business financials

Your financials should include but not be limited to set-up costs, break-even and stress (or burn) calculations, projected cashflows, profit and loss, and balance sheet calculations.

Stress calculations involve quantifying risks in the context of wider scenarios including calculating the impact of both isolated events and ongoing risks.

Your products and services descriptions

This is where you describe your products and services. In essence, what they are, who will use them - the nuts and bolts of what you offer.

Include product and service descriptions from brochures and websites in the appendix of your business plan to support the information you give here.

Explain your unique selling point and why people should buy from you. In particular, try to show the problems you solve for customers and the benefits.

If your product or service fills a gap or improves on what has been done before, then explain how. This will be of interest to investors looking for something new.

You can expand on the detail you give here in the marketing section of your business plan. Look out for future blogs when we will be covering this topic!

Your pricing against the costs of the products/services

Setting the price of your products and services can be challenging and is something that small business owners often struggle with. It’s essential that you compare the pricing against the costs of creating and delivering your products and services.

Your profit is your entire income minus your costs. If you don’t understand your costs, you won’t know your profit. If you don’t show that you understand your pricing against the costs an investor will not be able to see the potential of investing with you.

Your business could be a great opportunity for an investor!

Dealing with your debtors and creditors

This is where you outline your strategy for dealing with debtors and creditors.

Having a process in place will make life much easier for you and also show any investors that you mean business!

It’s a case of finding the right balance for your cash flow. Your terms and conditions for customer payments will dictate how quickly you can pay your suppliers and avoid getting into the red.

Your business legal structure

Choosing your business structure is one of the first things you do when you start a business.

The main options are: limited company, sole trader, and limited liability partnership (LLP).

Explain your chosen legal structure. If you are a limited company, list any directors and the company secretary if applicable. Name your partner in any LLP arrangement.

Where you are trading from, is it a physical premises or online?

It’s essential that you have somewhere to trade from. Are you a brick-and-mortar or an online business?

Give details of where you trade from, whether it’s a shop, a factory, a restaurant, an office or another venue. Give the location and size of your business premises. If you trade online give your website address.

Business owner's personal financial statements or survival budgets

If your business is in the start-up stage, providing details of the business owner’s financial situation or survival budgets can really help potential investors and/or lenders to have confidence in a business and the business owner’s resilience during the early stages of the business.

The founder of any business is crucial to its success - a small business even more so. Any investors or banks will want to know who the founder is as this can often play a deciding factor in whether they want to invest. Providing evidence that a business owner is financially sound is crucial to building trust.

Earlier in the business plan, in the executive summary , there is the opportunity to tell your story and what makes you tick to attract interest. This is the place to tell your financial story and show that you have what it takes to effectively manage money in a business, particularly any investment.

Your suppliers and materials

This is where you detail how you source materials and what you need for your business to operate.

Outline how you purchase what you need to manufacture your products and list any key suppliers.

If you run a services business, you may not need raw materials but you will need to source your tools of the trade from a mobile phone to office stationery and computers.

List any service providers you depend on to run your business, such as website developers, merchant accounts, vehicle leasers, and then outline their terms.

Suppliers are often the cornerstone of any business which cannot function without the provision of its products and services.

Licences and business regulations

When setting up a business, it’s vital that you ask: "Do I need a business licence?"

Some specialist activities and business types need a licence before it’s legal to trade.

You may require one-off licences for individual business activities.

Use the Licence Finder tool on gov.uk to find out which licences apply to your business.

You also need to check the specific regulations for your industry, for example, if you provide financial services, check with the Financial Conduct Authority (FCA).

List any licences and specific regulations you need to adhere to in the operational section.

Your technology

What technology do you need to operate as a business?

Make a note of everything here including computers, software, databases, CRM systems, communications hardware, your website and any devices such as mobile phones.

It might help to get out a piece of paper and list all your technology to make sure nothing is missed. Ask your staff as they may use a software package that you’ve forgotten to include.

Your business and the environment

The environment is a serious issue for everyone. Investors will want to know about your green credentials and how your business approaches environmental issues.

What does your business do to reduce its carbon footprint and be more sustainable? Do you recycle, use solar power, have a paperless office etc? Do you have sustainability targets, such as being carbon neutral by 2025?

Include your environmental and carbon reduction plans and pledges.

If you have an environmental policy, mention it here and include the full policy in your appendix.

Please note that we have covered many of the things you need to focus on in the operational section of your business plan, but this is not comprehensive. You may need to add further detail depending on the nature of your business.

Key takeaway

The operational section of a business plan is vital. It describes the essentials you need to run your business.

If you need help with business planning or another business issue, contact Maria at Be Rescued and connect with her on Enterprise Nation.

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How to Create an Operating Plan for Your Business Plan

What is an operating plan.

An operating plan outlines how a business will manage its day-to-day operations. It includes information on the physical facilities and equipment needed for production, the manufacturing and business process, inventory management, personnel, regulatory compliance, risk management, and financial projections.

The operating plan is essential to the business plan .  It will provide a comprehensive overview of how the business will function to achieve its goals. It serves as a roadmap for the business owner, investors, and stakeholders to understand the company’s operations and to guide informed decisions.

Beyond defining an operating plan, this post will detail what to include in each section. For example, you’ll find a functional operating plan template, operating plan examples, and details about how to write an operational plan for your business plan.

Using the information provided, you’ll be well-positioned to create an operational plan that helps you meet your business goals.

How is an Operating Plan Different from a Strategic Plan?

An operating plan outlines how a business will manage its day-to-day operations. It is a tactical plan that covers a short-term period of one year or less and focuses on implementing the company’s strategies to achieve its goals. The operating plan deals with the practical aspects of the business, such as production, sales, marketing, and finances with details for each specific department.

On the other hand, a strategic plan is a comprehensive document that outlines long-term company goals and objectives, along with the strategies and tactics required to achieve them. It is a high-level plan that covers a more extended timeframe of three to five years or more. The strategic plan deals with the big-picture aspects of the business, such as market analysis , competitive positioning, growth opportunities, and risk management.

Simple Outline of an Operating Plan

An operating plan will cover the following categories of information. We’ll expand on each category in more detail in the operating plan template below. Plus, we’ll elaborate on how to customize the operating plan for your business and industry.

• Physical facilities and equipment
• Manufacturing process
• Inventory management
• Regulatory compliance
• Risk management
• Financial projections

Eight Essential Sections for Your Operating Plan Template

The operating plan template below covers the eight essential elements that should be included in your business plan. The aim is to provide an overview so that you capture all the essential information in your business plan operating plan.

You’ll see things that do not apply to your business or industry. The section that follows, provides industry-specific ideas for fine-tuning your plan.

1. Overview of Operations

• Briefly introduce the company’s operations, including its products/services, location, and any unique aspects of the operations.

2. Facilities and Equipment

• Describe the business’s physical location, including any facilities or equipment necessary for operation.
• Discuss any costs associated with the facilities or equipment, and how they will be acquired.

3. Production and Manufacturing

• Outline the process for creating the company’s products or delivering its services.
• Discuss any suppliers or vendors necessary for production and any agreements or contracts.

4. Inventory Management

• Describe how inventory will be tracked and managed, including any software or systems used.
• Discuss any potential issues with inventory, such as spoilage or obsolescence.

5. Personnel

• Detail the roles and responsibilities of employees, including management positions and any necessary training.
• Discuss any employment contracts, benefits, or compensation plans.

6. Regulatory Compliance

• Explain any regulations or legal requirements the business must comply with, such as licensing or permitting.
• Discuss any potential legal or regulatory issues that could affect the business.

7. Risk Management

• Identify potential business risks, such as natural disasters or supply chain disruptions.
• Discuss any contingency plans in place to address these risks.

8. Financial Projections

• Include financial projections related to the operating section of the business plan, such as expected revenue and expenses and how they will be managed.
• Summarize your break-even analysis, and discuss any capital requirements for the business.

Overall, the operating section of a business plan should provide a comprehensive review of how the business will operate and manage its day-to-day operations.

Fine Tuning the Operating Plan for Specific Types of Businesses

Effective operational plans will differ depending on the type of business due to variations in their operations, facilities, equipment, personnel, and regulatory requirements.

The examples below help to illustrate the latitude you can take when drafting your plan:

• Restaurant: An operating plan for a restaurant would focus on issues such as food preparation, kitchen management, menu design, customer service, and staff training. An operating plan for a restaurant will cover food safety regulations, health inspections, and inventory management.
• Software company: An operating plan for a software company would focus on issues such as product development, project management, quality control, and customer support. The plan should address rapid technological change, intellectual property protection, and software testing and debugging.
• Candle manufacturer: An operating plan for a manufacturing business would focus on issues such as raw material sourcing, production processes, quality control, and marketing and sales. The plan would need to address the unique challenges of the manufacturing industry, such as supply chain management, environmental regulations, and product packaging and labeling.
• Used car dealership: An operating plan for a used car dealership would focus on vehicle acquisition, pricing, sales and marketing, and customer service. It should also address vehicle maintenance and repair, financing and insurance, and compliance with state and federal regulations.

To determine what to include in an operating plan for their industry, business owners can research best practices and industry standards, consult with experts in their field, and seek guidance from industry associations.

They can also analyze their business’s specific needs and challenges and tailor their operating plan accordingly. By developing a comprehensive and realistic operating plan, business owners can ensure their business is well-positioned for success.

Restating Other Parts of Your Business Plan – Stay in Sync

It’s common for an operating plan to briefly mention certain aspects of a business that are covered in more detail elsewhere in the business plan. For example, the revenue forecast may be mentioned in the operating plan, but the financial or sales sections will provide more detailed information on how that revenue will be generated. However, it’s crucial to ensure that everything is consistent across all sections of the plan. The numbers and information presented must be accurate and match up in order to avoid confusion and maintain credibility.

Business plans and operating plans are dynamic documents that should be updated regularly as a company grows and evolves. It’s important to remember that any updates or changes made to one section of the plan should be considered with what has already been written in other areas. This will ensure that the plan remains consistent and cohesive and that any changes made are in line with the overall goals and objectives of the company.

Regularly reviewing and updating the plan will also ensure that it remains relevant and valuable as a guiding document for the business.

Operating Plan Example for a Retail Business

The operating plan below follows the business plan outline we provided. You’ll see that the operational plan for a business plan primarily demonstrates that you have thought through the most critical aspects of operating the business.

However, it does not have to be an operating manual explaining all the details as long as your operating plan conveys that you understand the business operations.

Overview of Operations

Our company, Sporting Goods Resale, is a retail business selling high-quality, gently used sporting goods. We will be located in a busy shopping center in downtown Anytown, USA, and will offer a wide variety of products for athletes of all ages and skill levels.

Facilities and Equipment

Our store will occupy a 2,000 square foot space in the shopping center, which we have leased for five years. The space has will be fully renovated to suit our needs, including shelving and display cases. Other resource requirements include purchasing the necessary equipment, including cash registers and point-of-sale software.

Production and Manufacturing

We will not manufacture any products but purchase gently used sporting goods from individuals and sell them in-store. Our purchasing process will be streamlined, and we will offer fair prices to customers looking to sell their used equipment.

Inventory Management

We will use a computerized inventory management system to track our products. We will have an efficient process for accepting and sorting items we purchase and will dispose of any items that do not meet our quality standards. In addition, we will regularly review our inventory and adjust prices as necessary to ensure profitability.

Our store will be staffed by a team of six employees, including a store manager, an assistant manager, and four sales associates. All employees will be trained on how to appraise used sporting goods, customer service, and store operations. We will offer competitive wages and benefits to attract and retain top talent by working with an outside human resources advisory firm.

Regulatory Compliance

We will ensure compliance with all local, state, and federal regulations related to retail operations. This will include obtaining all necessary licenses and permits and ensuring we are up-to-date on sales and other tax requirements.

Risk Management

We will have a contingency plan in place in case of emergencies, such as power outages or natural disasters. We will also have security measures in place to prevent theft and damage to our inventory.

Financial Projections

Based on market research, we project $750,000 in revenue for our first year of operations, with expenses of $600,000. Our break-even point is $500,000 in revenue. We will have adequate working capital to cover our startup costs and will regularly review our financials to ensure we are meeting our goals.

Overall, we believe that Sporting Goods Resale will be a successful retail business that fills a gap in the market for high-quality, affordable used sporting goods. Our efficient operations and knowledgeable staff will set us apart from our competitors and ensure our long-term success.

Operating Plan Example for a Manufacturing Business

To demonstrate the differences between businesses from different industries, we recommend you read through this manufacturing business operating plan, even if you’re in another sector. Take note of how a sense of experience and confidence in how the company will be operated is conveyed.

FurnitureCraft will specialize in creating high-quality and customizable furniture for residential and commercial use. Our facility will be located in a suburban area, and we will pride ourselves on our attention to detail and personalized customer service.

Our manufacturing facility will include a 20,000-square-foot warehouse that will house all of our equipment and materials. We will acquire six CNC machines, three table saws, and a variety of other equipment necessary for our operations. We will also purchase a fleet of delivery trucks for transporting finished products to customers. The costs associated with our facility and equipment have been accounted for in our startup budget.

Our furniture will be made using a combination of handcrafted techniques and modern technology. We will source our materials from trusted suppliers, and our manufacturing process will include cutting, shaping, sanding, and finishing. We will have agreements in place with our suppliers to ensure that we have a steady supply of materials.

We will use a software system to track our inventory, which will allow us to manage our materials and finished products efficiently. Our system will also alert us to any potential issues with inventory, such as items that are at risk of spoilage or obsolescence. We aim to keep a lean inventory to reduce waste and minimize costs.

Our team will include skilled craftsmen and craftswomen, as well as management staff, to oversee operations. We will provide training to all employees to ensure that they are able to perform their roles effectively. Our employment contracts will include competitive salaries, health benefits, and paid time off.

We will be required to comply with regulations related to health and safety, as well as environmental regulations. We will obtain all necessary permits and licenses to operate our business, and we will regularly monitor our operations to ensure compliance.

We have identified potential risks to our business, such as supply chain disruptions and natural disasters. We will have contingency plans in place to address these risks, such as working with multiple suppliers and having emergency response plans.

Our financial projections indicate that we will break even within the first year of operations, with expected revenue of $2 million and expenses of $1.8 million. We plan to reinvest profits into our business to expand our product offerings and increase our market share. We will secure funding for our startup costs through a combination of investors and loans.

For More Help

There are several authorities and resources that individuals can turn to for credible advice on developing an operating plan. Here are a few for you to consider.

• Small Business Administration (SBA): The SBA provides free resources and advice for small businesses, including guidance on creating an operating plan.
• SCORE: SCORE is a non-profit organization that provides free business advice and mentoring services. They offer guidance on developing an operating plan, as well as other aspects of starting and running a business.
• Business consultants and coaches: Hiring a business consultant or coach can provide valuable guidance on developing an operating plan tailored to your specific business needs.
• Industry associations and trade groups: Industry associations and trade groups often provide resources and guidance specific to their industry. These resources can be useful in developing an operating plan that takes into account industry-specific factors.

It’s important to ensure that any sources of advice or guidance are credible and reputable. It’s also important to consider the specific needs and goals of your business when seeking guidance on developing an operating plan.

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How to write an operational plan for your business

Table of Contents

What is an operational plan? 

What should your business’s operational plan include , objectives , production , finances , simplify your operational finances and more with countingup.

If you plan to start a small business, you’ll need to prepare for success. A business plan will help you organise your services and structure to set up and earn funding. But an operational plan is essential to managing your day-to-day. 

This guide will cover how to write an operational plan for your business, including: 

• What is an operational plan?
• How can an operational plan help your business? 
• What should your operations plan include?

An operational plan outlines the physical requirements of running your business and how you’ll function daily. It can be its own document or a section of your business plan. Either way, the operational plan answers essential questions about how you’ll make your business earn a profit. 

This plan covers your business’s who, what, where, when, and how much, similar to a company description . But your operational plan dives into the nitty-gritty details and outlines exactly how you’ll achieve them. 

Writing an operational plan for your business will help you determine the essential materials to set up. The more detailed it is, the easier it will be to organise your business and increase productivity. As your operations grow, you can update the plan to fit your needs, so check in with it regularly. 

If you wonder how to write an operational plan for your business, you’ll need to know some key components. We’ll outline the essentials. 

The first step to outlining your operations is considering your objectives . Objectives are the specific things you want to achieve for your business in a particular time frame. For example, you may want to achieve profitability within the first six months. Or you might aim to use paid advertising to double your client base in a year. 

Create different objectives based on the departments or sectors of your business. For example, you can form financial, marketing, sales, and development objectives. To develop effective plans, use the SMART method, short for specific, measurable, achievable, relevant, and time-based. 

Next, you’ll have to consider the logistics of where you’ll run your business. Are your operations home-based or will you need an office or shop? If you need to find a space, outline where it will be and how you plan to do it. You may need to use a real estate or letting agency to purchase or let a space. 

So, discuss that process, when you plan to have a location, and how much you’ll spend. Costs will include things like rent, electricity, water, and any other elements you’ll need to include. For example, you might need to fit a cafe with kitchen equipment or decorate the space. 

If you already have an office or shop, provide the address. For a customer-facing shop or office, outline the working hours. 

Once you decide where you’ll run your business, you’ll need to consider the how. In this part, outline daily operating procedures. Which products or services will you provide? How will you offer them? Outline your structure and how you’ll achieve your objectives day-to-day.  

But your business procedures won’t be effective without a reliable production plan. If you need to develop a supply chain or keep an inventory , you’ll discuss that here. First, list which supplies, equipment, and technology you’ll need to run your business. Then, include which suppliers you’ll use to keep a stock of your products. 

Finally, detail what your production will cost by breaking it into sections. How much will you spend on your inventory each month as you start your business? What other regular expenses will you have?  

For example, if you run a coffee shop, you would outline which coffee supplier you’ll use and how much you’ll order at what cost. Then, you might include the cost of ordering baked goods for your shop and other things necessary for your business. Additional production costs might consist of shop rent, disposable cups, stirrers, milk etc. 

As you outline each aspect of your operations, consider the cost of running that aspect. Then, in the finances sections, bring each cost together. This section will help you get a broader picture of how much you’ll need to spend to run your business. 

This section also outlines where you’ll get the money to keep up these operations. Similarly, list prices for your products or services, plus the profit margin and sales goals. Then, touch on how you’ll accept payments and organise your finances. 

You might discuss what business current account you’ll use and how you’ll maintain your financial accounting . For example, you could explain how you’ll use Countingup , the business current account with built-in accounting software. 

The Countingup app offers valuable features that simplify your finances, automate processes, and help track your performance. Using a unique tool like this will make your operations more efficient and allow you to maintain accurate records. 

When writing your operational plan, it’s also important to consider your timeline. Consider outlining a daily working schedule and attaching times to different functional tasks. For example, how often will you reorder inventory? When do you plan to achieve your short-term, medium-term, and long-term objectives?

By organising your calendar, you can stay on top of what you need to do and when you need to do it. Plus, consider how you’ll manage your time well , which will help you run your business smoothly.  

Once you know how to write an operational plan for your business, you can earn money. But, financial management can be stressful and time-consuming when you run a business. That’s why thousands of business owners use the Countingup app to make their financial admin easier. 

Countingup offers features that help you stay on top of your operations. With automatic expense categorisation and receipt capture, you can stay on top of your business spending and maintain accurate records. Plus, the app lets you create and send invoices on the go, helping you receive the money you earn. The app will even notify you when the invoices are received and match them to payments. 

Start your three-month free trial today. 

Find out more here .

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Contents of a Business Plan: Everything You Need to Know

The contents of a business plan consist of a detailed description of what, when, why, where, and how the business's operations will be accomplished. 3 min read updated on January 01, 2024

Overview of a Business Plan

A business plan includes the cost of organizing the business, the anticipated sources of revenue, how the products and services are customer oriented, and anticipated profit margins. Business plans serve two main purposes. First, they are a guide business owners use to streamline management and planning/organization of the business. Second, they show potential venture capitalists, bankers, and other lenders a comprehensive plan to encourage them to invest in the business.

Sublevels of a business plan include:

• Marketing plan
• Financial plan
• Human resource plan
• Production plan

Elements of a Business Plan

A well-written business plan will include the following:

• Cover letter

Table of Contents

Executive Summary

• Mission statement
• Company background
• Products and services
• Competitive analysis

Marketing/Realization

• Location/Production/Administrative
• Management and international organization
• Risk analysis
• Financial planning

Summary/Conclusion

Cover Letter

The business plan's cover letter has the same purpose as a cover letter for a resume. The point is to engage prospective investors using the cover letter so they'll look at the entire plan. The cover letter should include the recipient's address, the date, and your address. Begin the cover letter with "Dear" followed by the person's name.

In the body of the cover letter, let the recipient know you're submitting a business plan with a short one-sentence description of the business and what the recipient can expect when reading the plan. In the next paragraph, indicate that you look forward to hearing from them and provide a phone number they can call at their convenience.

Thank them for their time. Sign off. Include your name in typewritten form along with your signature.

Keep this page short and to the point. Include your business logo, business name, if there is a founder, and the name. Add "Business Plan," an image (optional), and the date.

The table of contents is a roadmap to help the recipient peruse the list and easily find each section. Some people may choose to read sections one after the other while others may choose to skip around. Include every section and subsection that may be of interest to a potential investor.

This is an important section. Because you're targeting executives, the overview of your business should be top-quality information to entice them to read the complete plan. The focus should be a summary of the main facets of your business plan.

Mission Statement

This section is a short statement about your business's goal and what you plan to create through the enterprise.

Company Background

This is a short statement including the date the business was developed, its founders, stages of development, the date it was incorporated, and, for existing businesses, the level of success.

Also, include the key figures in the business and the ownership and legal structure.

Products and Services

Under this section, provide a detailed description of your customer needs, benefits to customers, marketing services, and advantages and disadvantages of any competitor services or products.

Marketing Plan

This will include an overview of the market in general with an emphasis on purchase incentives, market analysis, and customer structure. It will also include the position your business holds in the market using information from target customer groups, canvassed market segments, and sale channels.

Competitive Analysis

Provide information about your main competitors' names, locations, market positions, weaknesses, strengths, and target markets.

This section covers details about product range, services, and pricing strategies. Sales targets for the next five years should also be included.

Location/Production/Administration

Include the location of the business and the advantages and disadvantages of its location. The production should discuss in-house and/or outsourced production and material costs. The administration portion will discuss the office infrastructure, such as accounting and technical support.

Management and International Organization

This section could work written as an organizational chart outlining member functions and responsibilities, special skills, and salaries.

Risk Analysis

Provide information on anticipated internal risks such as marketing, production, management, and financing. External risks would include information on ecological, economic, social, and legal areas.

Financial Planning

Lay out your plan for short- and long-term financial planning.

This is a final wrap up of the business plan that binds the everything together.

If you need help with outlining the contents of a business plan, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

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How to Make an Operational Plan in a Business Plan

Priyanka Bhadani

An operational plan clarifies how each department within an organization will streamline its business processes to achieve a set of goals for the next year. Successful organizations write operational plans to clarify their required short-term tasks and workflows to maximize workplace accountability. While an operational plan is often written separately from other proposals, startups often include it within a larger business plan. An operating plan is given to investors so they can assess a company's organizational structure, assets, and long term financial needs. Read ahead for the best practices on including an operational plan within a business plan, along with the benefits of doing so.

What to Include in the Operational Plan Section of Your Business Plan

A business plan is written by a startup to outline key objectives and the strategies used to achieve them. Within business plans, there is typically an operational plan section. It describes the physical requirements to maintain operations, including the office building, additional facilities, tools, and other apparatus. Depending on the type of small business, the operational plan portion may also refer to required stock, vendors, and the production process. An operational plan section seeks to explain the assets, costs, and resources needed to maintain day-to-day business activities. These requirements are outlined to investors and involved stakeholders to reaffirm what is needed to start operating. It also demonstrates that the company recognizes the different production and delivery activities needed to produce quality goods and services. Including the following subsections will make sure the operational plan is detailed and organized when it comes time to present it to investors-

1. Development Stage

• Manufacturing System - A detailed, piecemeal guide of how goods and services are manufactured in the organization. Any inefficiencies or risk factors should also be included, along with how the company plans to mitigate them.
• Memberships - Demonstrates the company's awareness of federal and state regulations by telling which industry-related organizations the startup is a part of or wants to join. Also defines how the organization is currently complying with regulations.
• Supply Chains - Explains who the vendors are and outline details of each contractual relationship. Also lists any backup suppliers if the current ones fail to live up to the company's standards.
• Quality Control Measures - The various quality control initiatives put in place, along with any that will be enacted. Also describes how the organization plans to achieve those measures.

2. Manufacturing Process

• Outline of Day-to-Day Activities - Includes the operating hours, working days, and whether there are seasonal hours.
• Location - Describes the physical location, any facilities, and where they are located. It may include lease agreements, real estate information, titles, or other applicable data. Demonstrates how much these properties cost and their worth, along with why they are so essential to maintain operations.
• Tools and Machinery - Describes any equipment or tools and how much they cost, along with their worth to the business.
• Assets - Includes all land, facilities, stock, tools, cars, or any other assets. Defines exactly how much each piece of property is worth in legal language.
• Unique Needs - Lists any unique needs and what has been done to ensure compliance or gain permission.
• Raw Materials - Explains plans to acquire any raw materials needed to manufacture a product/service. Also lists the contracts with suppliers in regards to these materials.
• Manufacturing - Describes the length of time required to manufacture an item and provides a time frame for when this process will begin. Lists any circumstances that may impact the manufacturing timeline and how these will be mitigated.
• Stock - Describes exactly how the startup plans to optimize inventory management to streamline the reordering process and maintain customer satisfaction.
• Testing - Outlines any testing or studies that have been performed on any of the company's products or services to ensure feasibility.
• Expenses - Details how much each product or service costs.

Key Takeaways

• An operational plan should include a development stage to let investors know what has been done in real-time to get the business up and running. It should also include a manufacturing section describing how the business will function and achieve goals in more detail.
• The development section should include a subsection on manufacturing systems, memberships, the supply chain, and quality control measures.
• The manufacturing section should include an outline of day-to-day activities and project management measures, the location of the company, required tools and machinery, any assets, any unique needs, required raw materials and vendors, inventory needs, details of previous testing or studies, and expenses.
• By writing an operation plan, the startup will focus on what is needed to meet key objectives. It will also build trust with investors by outlining all of the details and requirements to achieve long term goals.

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How to Write an Operations Plan for Retail and Sales Businesses Tips for detailing what has to be done and who does what in service and retail companies.

By Eric Butow • Oct 27, 2023

Opinions expressed by Entrepreneur contributors are their own.

This is part 6 / 11 of Write Your Business Plan: Section 5: Organizing Operations and Finances series.

Investors and other plan readers pay careful attention to the part of your plan describing your operations. Most entrepreneurs are highly expert, interested in operations, and love to talk about it. In fact, one risk is that you'll go into too much detail and wind up with what amounts to a technical treatise in which the essential marketing element seems lost.

David Wheeler recognized that risk when seeking investors for his software startup, InfoGlide Inc. One of his first hires was someone to take on the job of CEO, to interface directly with investors and high-profile prospects so Wheeler could get back to the operations he loved. "That's what I like," he says, "working with database code, not doing product demos."

Related: Use This Worksheet to Write a Product Description That Sells

The basic rule for your operations section is to cover just the major areas—labor, materials, facilities, equipment, and processes—and provide the details that are critical to operations or give you a competitive advantage. If you do that, you'll answer investors' questions about operations without overwhelming them.

How to Break Down Operations

The simplest way to treat operations is to think of it as a linear process that can be broken down into a sequence of tasks. Break down each task into smaller elements.

Related: The Top 4 Types of Business Plans

A task listing chart might include the task and what has to be done daily, weekly, or monthly.

Once the initial task listing is complete, turn your attention to who is needed to do which tasks. Keep this very simple. You don't have to look at minor tasks (who opens the door? who fetches the mail?), but you do have to concentrate on major tasks such as producing a product or delivering a service. Use your judgment.

Related: How to Craft a Business Plan That Will Turn Investors' Heads

Retail and Service Firms

Service and retail firms have different operations requirements from manufacturers. Companies that maintain or repair things, sell consulting, or provide health care or other services generally have higher labor content and lower investments in plants and equipment.

Related: How to Write an Operations Plan for Manufacturers

Another important difference is that service and retail firms have much simpler operational plans than manufacturers. When turning raw materials into finished goods, manufacturers may employ sophisticated techniques in a complex series of operations. By comparison, it's pretty simple for a retailer to buy something, ship it to his store, and sell it to a customer who walks in.

That's not to say operations are any less important for retailers and service firms. But most people already understand the basics of processes such as buying and reselling merchandise or giving haircuts, or preparing tax returns. So you don't have to do as much explaining as, say, someone who's manufacturing microprocessors.

People Matter

For service and retail firms, people are the main engines of production. The cost of providing a service is primarily driven by the cost of the labor it entails. Retail employees' skills and service attitudes drive their employers' productivity and market acceptance to a great degree.

Related: What Technology to Include In Your Business Plan

A service firm plan has to devote considerable attention to staffing. Regional educational attainment data will help readers understand why you can hire sufficient semi- and high-skilled workers for a service or repair operation. You'll want to include background information and, if possible, describe employment contracts for key employees such as designers, marketing experts, buyers, and the like.

You'll want to walk the reader through the important tasks of these employees at all levels so they can best understand how your business works and the customer experience.

Service operations checklist:

• Staffing completed (or staffing plan completed)
• Organization chart completed
• Marketing implemented
• Sales policies
• Customer relations policies
• Service delivery policies
• Administering monitoring and control policies
• Follow-up procedures

Buying Basics

The ability to obtain reliable, timely, and reasonably priced supplies of easily salable merchandise is perhaps the prime skill of any retailer. Buying is both art and science. Knowing the ideal ordering quantities for a given product is mechanical, but knowing which items to stock requires knowing customer desires and demands. Buying is based on your marketing plan. You cannot make wise purchasing decisions without clear knowledge of the marketing environment.

Related: 6 Best Practices to Grow Your Small Business

If you have what consumers want when few competitors do, you're almost guaranteed to have strong sales. If you run out of a hot item, on the other hand, disappointed consumers may leave your store, never to return.

Operations plans for retailers, therefore, devote considerable attention to sourcing desirable products. They may describe the background and accomplishments of key buyers. They may detail long-term supply agreements with manufacturers of in-demand branded merchandise. They may even discuss techniques for obtaining desirable products from manufacturers on the gray market who try to restrict the flow of goods to their stores.

Retail operations checklist

• Marketing (include sales projections, location, promotional efforts, advertising, and online marketing efforts)
• Training sales staff
• Buying procedures (include delivery times, freight-in, reorder points)
• Inventory control
• In-store sales tools
• Customer service policies and procedures
• Backroom operations staffed

Note the importance of training sales staff and customer service representatives. Many retailers omit this due to their economic loss. But consumers often cite a discourteous or unhelpful sales staff as the reason they don't return. Point out that you will train your sales staff so that they will act as a powerful resource for your company.

Related: Business Plan Lingo and Resources All Entrepreneurs Should Know

More in Write Your Business Plan

Section 1: the foundation of a business plan, section 2: putting your business plan to work, section 3: selling your product and team, section 4: marketing your business plan, section 5: organizing operations and finances, section 6: getting your business plan to investors.

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Ini Patrick Notes

Writing the Operations Plan of your Business Plan

Operations are concerned with how you will run your business and deliver value to your customers.

Operations are defined as the processes used to produce your products/services and deliver them to the marketplace.

This can include manufacturing, sourcing raw materials, transportation, logistics, hiring labor, travel, printing, consulting, after-sales service, and so on.

It’s different depending on whether you’re a manufacturer, a retailer or a service firm.

In all likelihood, about 80% of your expenses will be for operations, 80% of your employees will be working in operations, and 80% of your time will be spent worrying about operating problems and opportunities.

Be sure that you carefully link the design of your operations to your marketing plan.

For example, if high quality will be one of your comparative advantages in the marketplace, then design your operations to deliver high quality, not low costs.

Remember that you will probably have to make trade-offs with your operations.

It is impossible to have the lowest costs, highest quality, and best on-time performance in your industry all at the same time.

Often, high quality means higher costs, low costs means less variety and less flexibility.

Be careful how you make these trade-offs so that you can deliver products to the market in accordance with your marketing plan .

It is advisable just to cover only the major areas when writing your operations section of your business plan .

This includes; labor, materials, facilities, equipment, and processes and provides the major details of pertinent things that are critical to operations or that give you the competitive advantage.

Completing this will give answers to your operations questions without making it overwhelming.

Operations checklist include:

How will you produce and deliver your product/service?

What will you do in-house, and what will you purchase (make vs. buy), how will you use your operations to compete cost quality timeliness flexibility, what comparative advantages do you have with your operational design, what will be your relationship with vendors, suppliers, partners, and associates.

The simplest way to treat operations is to think of it as a linear process that can be broken down into a sequence of tasks.

Once the initial task listing is complete, turn your attention to who’s needed to do which tasks. Keep this very simple and concentrate on major tasks such as producing a product or delivering a service.

Major sections to look at for when writing your operation section include;

Table of Contents

Operations Strategy

In this subsection, describe how you will fulfill your marketing strategy using operations:

How will you use operations to add value for customers in your target market?

How will you win in the marketplace on the dimensions of cost, quality, timeliness, customer service, and flexibility, which dimensions will you stress and which ones will be less significant, scope of operations.

Describe the scope of your operations. Include details in an appendix, as necessary.

What will you do in-house and what will we buy (make vs. buy)? Why does this make sense for your business?

What kind of people will you need to hire.

The right mix of staff will be the most valuable asset any business has. Employees and staff will play an important role in the overall operation of your business.

It is very important to know what skills you have and the ones you lack since you will have to hire staff to supply the skills you lack.

Furthermore, it is essential that you know how to manage and treat your employees.

Make them feel as part of the team. Keep them informed of changes and be sure to get their opinion.

Employees can often be a great source of excellent ideas, of innovations to existing products/services, and inspiration for new product lines and markets to enter.

So be sure to take the time to listen to your employees as they may offer you the new competitive edge you have looked for.

Production Plan (Manufacturing Businesses)

The production plan demonstrates your ability to produce products. this section may not apply to service businesses., production flow chart (manufacturing businesses), provide a flow chart/process diagram showing the entire production process from start to finish., list and budget production equipment required for the business. procurement (businesses that manufacture or sell products), sources of supply and order lead time., terms and conditions of sale., alternate sources of supply (this addresses procurement risk)., inventory control systems., physical space requirements (unless covered in location sections)., sub-contractors (both goods and services), provide a list of sub-contractors., show exactly what these sub-contractors do and where they fit into the production of the business., show alternative sub-contractors (this addresses sub-contract risk)..

Other things include to consider in writing your operations section include;

Operations Expenses

Legal environment, credit policies, managing your accounts receivable, managing your accounts payable, now, your turn.

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About the author.

Ini Patrick

Hello, I'm Ini Patrick, a Serial Entrepreneur, Business Analyst, and Web Business Strategist. Am committed to helping entrepreneurs grow their business by sharing hybrid information and ideas that teaches strategies and systems to start and grow any business.

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