The Business Plan: Seven Questions You Need to Ask When Starting a Business

Any company, from one plotting world domination to one selling jam at the local farmers’ market, can benefit from writing a business plan. But even if you don’t anticipate needing to seek financing, permits, or legal counsel, the process of writing a business plan will help you focus and will be a valuable reference as your business grows.

The level of detail will vary accordingly, but all business plans address at least the following questions:

• What is the product or service?
• Who are your customers? Describe the demographics. Research their purchasing habits. Know how your product or service meets their needs or wants.
• What is your marketing strategy? How will you make your customers aware of your product?
• Who are your competitors? How is your product different and better than that of the competition?
• What will it take to operate your business—in a physical sense—on a day-to-day basis?
• Who is the management team? Include short bios of who’s running the show and their qualifications.
• What is your financial situation? How much do you need to get started? How much do you expect to earn, and when?

Be sure to include an “executive summary.” It should appear at the beginning of the document, but you may want to write it last, since it’s exactly what it’s called—a summary. It should boil down all the information in your business plan to no more than two pages.