Business Plan Basics

In the fourth quarter of each year, many companies craft a business plan in preparation for the coming year. In our view, this plan should be a working, living document that gets used often as a guide and tool to manage the business over the course of the year.

Business plan components.

A comprehensive business plan should have multiple components.

First, start with an executive summary that captures the highlights of your business, especially as it relates to your market, products and services, strategies, goals, and financials.

Second, describe your products and services in greater detail. Detail the problems or pain points that your products solve for your customers. If you have done some market or customer research in the past year, those insights can be included here. And be sure to list any intellectual property, like patents or trademarks.

Third, talk about your market. How big is it, how fast is it growing, exactly what is your addressable market? What are the key trends and your specific market position? Are there identifiable market segments that are the most attractive, and why? Also include commentary on your customer base, retention of your largest clients, new account wins, upsell and cross-sell potential, consolidation risk, and customer concentration.

Fourth, talk about your top competitors. What are their relative strengths and weaknesses? What trends or shifts are noteworthy, including ownership changes? What are the implications for your business? What opportunities can you leverage to grow your market share?

Fifth, outline your sales and marketing plans to serve your customers and grow your business. How will you reach your customer base and what sales approach will you be using, especially if you are implementing any changes to the go-to-market model? For example, your growth in the past two years may have been predominantly in big box retail stores. Describe any adjustments that can potentially unlock faster growth. Some thoughts about proposed marketing activities (particularly if you plan to launch any new products) or pricing strategies are relevant here.

Sixth, provide an overview of your operations and then speak to major investments in equipment or capacity to meet demand. How did your investments in operations benefit the business in 2023—either in lower costs, greater productivity, or in the ability to satisfy customer requirements during peak periods? Did you figure out any improvements in your supply chain to better service demand with on time and complete deliveries?

Seventh, describe your milestones and key metrics for the coming year, with year-over-year trends. Meeting and exceeding those key numbers and then hitting your deadlines will keep the momentum going and your team fully engaged in your success.

Eighth, include an overview of your organizational structure with a description of your leadership team. Did you make any key new hires in the past year and what characteristics or skills do they bring that will help advance the business? Did you experience any turnover of key execs? Or did you consolidate or shift responsibilities to get more done with the same or less headcount?

Lastly, finish with a summary of the financials for the business, highlighting key performance indicators like revenues, profit margin, net income, debt, free cash flow, planned capital expenditures, and balance sheet. Outline the assumptions underlying your financial model, including any new source of funds or the reduction or elimination of debt.

A rigorous and thoughtful business plan provides a blueprint for managing the company. While it’s especially relevant for your leadership team, you should also share a summary recap of your plans with your entire team. This can build a sense of inclusion and ownership of the initiatives to come. In our experience, it is well worth the several weeks of work to complete.

At Forge, we thrive on helping clients get to the next level. We have been privileged to have a seat at the table with many clients putting together ambitious but doable business plans for growth.

We are here to be your partner, a member of your extended team, your devil’s advocate. And we will always bring the conversation back to strategy. Who is your primary target audience going forward? How does your product meet and exceed their needs? How do we maximize the market opportunity and optimize return on investment?

Importantly, we are pragmatic, focused, and energetic. We get assignments done well, and quickly.

Take the first step to a more successful business today.

1.    Hit “LET’S TALK” to schedule a free 30-minute discussion. No pressure – we promise.
2.    We’ll provide real-world case studies showing the process in action.
3.    If we’re a fit, we finalize the details and get started!

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