Which type of Business Plan is best for me?

What type of plan is best for me?

When they first consider writing a Business Plan, a lot of people are uncertain about the length. Likewise, when they download a template, they’re unsure whether to slavishly fill-in all the sections or just some of them. The good news is there are lots of ways to save time and still produce an excellent Business Plan. In this blog, we will run you through which types of Plans will work for you, and how to make sure you don’t overdo or under-do it. 

Different lengths of Business Plan at a glance. 

Obviously, there are short, medium and long Plans. The length depends on the amount of research that needs to be done into the market and how many financial statements (like the Profit and Loss, for example) are needed. 

A simple business for a small café that you’re starting up for the first time may not need a huge amount of market research, and it may need no more than the standard three financial reports. So therefore, if you are starting up a small café, then you could get away with a short Business Plan…to help you run the business and decide how much of your money to put in.

However, if you were starting a very large café chain and intended to franchise it to other entrepreneurs, then you would have to do national market research and have lots more financials to cover off the needs of people wanting to buy into your business. 

This would end up being a long Business Plan.  

Types of Business Plans. 

So, if that’s the length of the Plan question resolved, what are the different types of Plan? 

A Plan to raise finance. This will need more key financial statements. Most importantly it will have documented assumptions so that the lender will be able to see how you’ve arrived at some of the revenue forecasts and the costs. 

They’ll also be able to understand how you intend to scale by looking at your three to five-year projections of revenue and costs. 

A one-page Plan. This is a bit of a misnomer – as it’s not really possible to go through all the steps to write a Business Plan and then demonstrate that you have taken them on one page. This type of Plan is commonly used to create or get interest from investors. It’s very important that you do the full Business Plan first and use snippets of that to populate the one-page summary. No investor will ever lend you money from a one-page Plan.

A Plan to get a lease. This needs more detailed financials and, therefore, a slightly longer Plan, as you will want to prove at least three to five years of projections. These show you can pay the rent.

The Accreditation Plan. These have an increased focus, not on revenue or marketing as such, but on operations. They want to know that you will do a good job servicing their clients in the role for which they’re accrediting you. For example, if it’s State Government, they may want to know that you will be able to run a childcare centre. However, the finances and the marketing are still important, and need to be in the Plan, too.

The Visa Plan. Most people applying for an immigration Business Visa will need to demonstrate all the foregoing points: good understanding of the local market (especially true if they don’t already live here necessarily),identify a gap that needs to be filled in the market, financial security, and sensible projections. 

An Emergency Plan. This is just our name for something we get asked for quite a lot – someone has run out of money, their number one customer has dumped them, or they must grow to survive. The emphasis here is on marketing, marketing, marketing. As always, this starts with good quality market research to identify the gap in the market, make sure that it’s a big enough gap, identify the client’s strengths, make sure they can be communicated in the marketing plan, and the weaknesses dialled down. 

Wrapping up. So, in summary, when choosing a Business Plan, remember to ask yourself:

  • Does it need to be longer because the market is more complex and needs more researching?
  • Does it need to be longer because the person I’m writing it for has exposure and risk, and wants to understand all the financial ins and outs? or
  • Does it need to be longer because I’m providing it to a third party organisation who wants to look at my Plan for operational effectiveness and efficiency?