What is a business plan? What does it consist of? And why do business owners need to understand it?
Business Plan: What entrepreneurs should learn, from the methods and steps for writing a business plan, writing examples, and what a business plan is, in order to plan a business effectively.
A business plan is a crucial document that every business must have for smooth and effective operations. The structure of a business plan is like a blueprint that gathers all important details that must be carefully considered and thought out. Today, we will introduce what you need to do and the steps involved if you want to create a development plan for your personal business, starting from how to write a business plan, introducing its types, to learning about its components.
Table of Contents
- What is a Business Plan? Why Do Business Owners Need to Understand It?
- How Many Types of Business Plans Are There?
- What Does a Business Plan Include?
- Example of Writing a Lean Business Plan
- What Are the Benefits of Writing a Business Plan?
- The Business Plan: A Crucial Concept for Entrepreneurs
What is a Business Plan? Why Do Business Owners Need to Understand It?
A business plan is a conceptual framework document that summarizes the entire overview of a business, from its Mission and Vision, strategic goals, to operational guidelines and detailed market analysis. Writing a business plan involves analyzing the business environment, including competition, target audience needs, and market trends, to identify opportunities and prevent risks. Additionally, a business plan specifies clear operational plans related to products or services, procurement processes, inventory management, marketing and sales, as well as the organizational structure and team responsibilities.
Financial planning is another part of creating a business plan, as it requires estimating revenue, costs, profits, and cash flow. In other words, writing a business financial plan allows you to visualize the financial viability of the business. Overall, creating a business plan not only helps entrepreneurs and their teams have a clear and unified direction but also serves as a crucial tool for communicating with partners or investors that the business's (Business Model) is well-structured. This enhances credibility and demonstrates that the business can achieve its goals and is ready for sustainable growth.
How Many Types of Business Plans Are There?
Business plans can be divided into 3 main types, each with different formats and purposes depending on the business type, to suit the context and needs of the entrepreneur, as follows:
Traditional Business Plan
A Traditional Business Plan is a comprehensive document covering all dimensions, from the executive summary, company overview, market analysis, products or services, strategy, operational plan, organizational structure, risk management, to financial projections including revenue, costs, profit, and cash flow. This document is used to present to investors or financial institutions to request funding or loans, as it clearly demonstrates thorough planning and business viability.
Lean Canvas / One-Page Business Plan
A Lean Canvas or One-Page Business Plan is short, concise, and focuses on about 9 to 10 key sections, such as customer problems, sales channels, cost structure, and revenue streams. The advantage of this business plan format is the ability to quickly adjust and test business hypotheses, making it suitable for startups or new projects that require agility in developing and implementing their plans.
Non-Profit Business Plan
A Non-Profit Business Plan is designed for organizations or projects whose main goal is to create benefits for society, the community, or the environment. The topics in this type of business plan include information about the mission, social impact, target beneficiaries, fundraising strategies, resource allocation plans, and outcome evaluation, to build trust with donors or supporters that resources are used to achieve maximum social benefit.
What Does a Business Plan Include?
The components of a business plan consist of 9 key parts that provide a clear and robust framework for driving the business. The details must be clearly defined in the business plan as follows:
1. Executive Summary
2. Company Description
3. Market Research & Business Potential
4. Competitive Analysis
5. Products or Services
6. Marketing & Sales Strategy
7. Business Financials
8. Management & Organization
9. Appendix
Example of Writing a Lean Business Plan
For those who want to learn how to write a business plan correctly, it is necessary to learn about the lean business plan format and understand the following example:
1. Draft a Simple Executive Summary
The executive summary condenses the key points of the entire Business Plan into a single page to attract attention and provide a quick initial understanding.
Example:
“ABC Tech is a startup with an intelligent AI-powered online task management platform that reduces task tracking time by 50%. Sign up today and we guarantee to boost your team's efficiency within 14 days.”
2. Write a Comprehensive Company Description
This section provides an overview of the company's history, background, unique selling points, and goals, so that readers understand what your business is and why it's different.
Example:
“Founded in 2025 by a team of software engineers from Chulalongkorn University, ABC Tech is committed to developing project management tools that are easy to use and customizable to each organization's needs, aiming to create a smooth and efficient work experience.”
3. Analyze the Market and Related Details Comprehensively
A business plan needs to incorporate online marketing. Market analysis helps assess the size, opportunities, and risks in the industry, while defining strategies that align with customer needs.
Example:
- What is the size of the potential market?
“The SaaS market for medium-sized enterprises in Thailand is valued at over 2 billion baht annually and is expected to grow by 20% per year.”
- SWOT Analysis
1. Strength: Advanced, easily customizable AI technology
2. Weakness: Limited marketing budget
3. Opportunity: More SME customers are transitioning to online systems
4. Threat: Major competitors from both overseas and local developers
- Competitive Analysis
“Our main competitors, WorkFlowPro and TaskMaster, focus on large enterprise clients, whereas ABC Tech targets the SME segment that requires more flexibility and affordable pricing.”
4. Draft the Management and Organizational Structure
Show the management team structure and responsibilities in the business plan to confirm that the organization has sufficient personnel and expertise to drive the business.
Example:
“The founding team consists of a CEO who is an AI expert, a CTO with experience in developing enterprise-level platforms, and a CMO who has managed digital campaigns for leading companies, along with a team of 5 engineers and 3 marketers.”
5. Specify the Company's Products and Services
Describe the key features, benefits, and important components of the products or services to clarify what the business sells.
Example:
“The main product is ProjectBuddy, an online task management platform with standout features such as Task Automation, Timeline Visualization, and real-time summary reports.”
6. Segment Your Customers
Segmenting customer groups and levels helps focus resources and sales strategies on the right targets, turning assumptions into tangible markets.
Example:
- Primary Group: SME companies with 10 - 200 employees
- Secondary Group: Startup teams and freelancers who need a professional project management system.
7. Define a Marketing Plan and Appropriate Strategies
Develop strategies within the business plan by selecting channels, promotions, and sales activities to build awareness and stimulate purchases for the business.
Example:
“Utilize a Content Marketing strategy by optimizing product content on Marketplace or E-Commerce websites, running Google Ads and Facebook Ads campaigns with a focus on a 14-day free trial promotion, and hosting monthly user training webinars.”
8. Create a Logistics and Operations Plan
Specify the workflow, from product development and infrastructure management to after-sales service, to ensure the smoothest possible process.
Example:
“The ProjectBuddy system is developed as a web app on AWS with automatic scaling to reduce hosting costs. The development team releases system updates monthly, and a support team provides 24/7 live chat customer service.”
9. Develop a Financial Plan
Compile and forecast basic financial statements (P&L, Balance Sheet, and Cash Flow) to assess the business's liquidity, stability, and financial sustainability. You can also use an automatic direct debit service to reduce the risk of late payments and increase confidence in cash flow.
Example:
- Profit and Loss Statement
“We expect to start generating a net profit of 200,000 THB in the 6th month, based on the Standard plan priced at 1,000 THB/user/month with 300 customers.”
- Balance Sheet
“Total assets of 1.5 million THB (800,000 THB in cash and 700,000 THB in server equipment) with short-term liabilities of 300,000 THB.”
- Cash Flow Statement
“Cash receipts of 1.2 million THB from subscription sales, cash payments of 500,000 THB for development and marketing expenses, leaving an unencumbered cash balance of 700,000 THB.”
What Are the Benefits of Writing a Business Plan?
Writing a business plan provides entrepreneurs with a tool to frame their operations and define clear strategies, which can also be adapted to future interesting business trends. The main benefits are as follows:
- Provides a holistic view of the business: It helps in understanding various components like products/services, customer needs, operational processes, and revenue-cost structure, which serves as a foundation for more accurate strategy planning.
- Helps define operational strategies: A business plan helps prioritize goals, allocate resources, and choose growth paths effectively.
- Aids in performance measurement and plan improvement: It provides metrics to assess progress, compare actual results with the initial plan, and adjust strategies promptly when new problems or opportunities arise.
- Serves as a tool for securing funding: A well-structured and clear business plan boosts the confidence of investors, financial institutions, or other supporters in their decision to provide funds or loans.
The Business Plan: A Crucial Concept for Entrepreneurs
From all the information mentioned, it is clear that all components—from the definition and elements of a business, to the writing method, the lean business plan example, and the correct way to write a business plan—are crucial elements that will undoubtedly help entrepreneurs write a business plan and create a Business Plan that is relevant and effective.
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