BUSINESS PLAN
TEMPLATE AND
GUIDANCE NOTES
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Page 1
FRONT PAGE
Name of Business:
Client(s) Name(s):
Date:
Signature of client(s):
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GENERAL GUIDANCE FOR CLIENT(S)
Business plans paint a picture of your business idea. You should try to make the
picture as colourful as possible but they must always tell the truth. One word
answers are not enough as you should attempt to answer every question as fully as
possible.
Do not think of a business plan as just a fund-raising tool. In fact, a business plan is
much more than that: It's a tool for understanding how your business will work. They
are necessary for anyone who may have an interest in the business.
1) To test the feasibility of your business idea.
Writing a business plan is the best way to test whether or not an idea for starting a
business is feasible, other than going out and doing it.
2) To give your new business the best possible chance of success.
Writing a business plan will ensure that you pay attention to both the broad
operational and financial objectives of your new business as well as details, such as
budgeting and market planning. It can help flag up any risk areas and future growth
areas.
3) To secure funding, such as bank loans.
If your business requires funding then you need a business plan to help funders
assess your business proposition before they make a lending decision. Established
businesses often need money, too, to do things such as buy new equipment or
property. Having a business plan gives you a much better chance of getting the
money you need to keep operating or to expand.
Make sure to provide back up evidence for anything you have said in the business
plan such as direct research, written proof of the cost for any tools etc. you may be
seeking funding for, qualifications, insurance costs etc. etc.
On reading the plan, there should be no questions anyone needs to ask you, either
about yourself or the business, as everything they need to know should be contained
in the business plan.
Lastly when you are happy that the business plan is complete sign it off!
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1.0 BUSINESS DETAILS
Proprietor(s): -
(Proposed) Legal Company Name:-
Business Address:-
Business Web Address:-
Business Social Media Address(es):-
Email Address:-
Telephone number:-
Business Advisor:-
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2.0 EXECUTIVE SUMMARY
Although the summary appears at the front of the plan it is usually written last.
This should provide an overview of the business outlining the key points throughout
the business plan. It should highlight important information from each section of the
plan from the idea and structure of the business through to the key elements of the
financial forecast.
Use this section to summarise the business idea and business objectives.
Describe the products you make or sell and/or services you provide.
This section should mention if your venture will be set up as a sole trader,
partnership, co-operative, limited company or community business and what your
percentage ownership in the business is.
Details of the premises for the Business should also be noted.
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3.0 BACKGROUND INFORMATION
3.1 Personal Background
This section should cover information about you and why you want to run your own
business. Together with what skills you can offer the business and how these skills
will be best utilised. If there is an area you identify as a weakness in your skillset,
you need to outline if this skills gap will require addressing in the future and how will
you fund this.
3.2 Entrepreneur Training, Skills and Experience
This section should include a description of how any previous professional
experience or training, or business knowledge gained can contribute to the success
of the business.
Also provide details of any training you have identified and intend to undertake to
help assist the development of the business.
3.3 Regulatory Qualifications
This section should mention if there are any specific licences required to operate the
business e.g. OFSTED approval for childcare, Health & Safety Executive for food
outlets, correct and valid driver’s licence for specific vehicles, licences for IT
software…
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4.0 BUSINESS DESCRIPTION
4.1 The Proposition
This section should detail the product(s) & service(s) the business will offer and how
the product/service(s) will be delivered. The target market must be clearly defined
and identified and the customer and end user should be clearly distinguished.
Detail what is your Unique Selling Point?
Outline if it is your intention to have a shop or other premises, work from home
and/or will you have an online presence.
What are your business aims? What are your ambitions for the business? I.e. to
provide quality service, fill a niche in the market, to run a professional business, be
your own boss.
Be as descriptive as possible and remember one sentence answers are not good
enough. Describe all aspects of your business in as much detail as possible in
structured paragraphs. Remember potential funders will read this business plan and
they know nothing about you or your business so be as descriptive as possible.
Assume nothing but rather presume that they will know nothing whatsoever.
Existing businesses need to describe how long the business has been trading and
what the current turnover is.
4.2 Key People
Describe all the people who will be involved in the running of the business including
proprietor, business partners, directors and staff required.
If you plan on employing members of staff, state when you intend to take them on
i.e. at the start, after 6 months etc... How many staff will you need, what their job role
will be and possible job description. Identify how they will benefit your business and
the relevant qualifications they possess to assist you and your business.
4.3 Premises
Give details of the premises your business will operate from. Outline if you will work
from home, a shop, a warehouse, or be mobile.
Write down the business address if you have one and other relevant information of
exactly what the premises compromise including the size, lease costs, rent costs,
legal costs and rateable value. If you have business premises, taking out a suitable
insurance policy will ensure you are covered for damage from a variety of causes.
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Describe if you need to modernise the premises i.e. internal renovation, decor,
security, etc...
Outline if it is a private landlord and if possible obtain a letter from the landlord
confirming you will be renting the premises, at what rate and for what period of time.
If you are a tenant, ask your landlord who is responsible for insuring the premises.
Normally this is the landlord. The tenant, however, is usually responsible for shop
fronts.
You should check the terms and conditions of your mortgage or rent agreement, as
lenders/landlords often require to be informed if you use your (rented) home to
operate a business.
4.4 Hours of Trade
Describe what your hours of trade will be.
4.5 Legal Trading Status
Describe your business structure / legal trading status i.e. Sole Trader, Partnership,
Limited Company, Social Enterprise…
4.6 Accountancy
Describe if you will you record your own records for the business or if you will employ
a bookkeeper or accountant.
4.7 Health and Safety
What law and legislation will affect you when providing the services such as Health
and Safety at Work Act, COSHH, Licences, CRB Checks, etc...?
Will you incur any legal and professional costs such as solicitor’s fees, accountancy
fees etc...
4.8 Insurance
Describe what insurance cover you will need to put in place in order to run your
business.
If you operate as a sole trader you are liable for any accidents that occur. If someone
is injured or their property is damaged, the person or business responsible may be
sued and held legally liable for the injury or property damage. Public Liability
insurance is designed to protect your business against these costs. You should
contact several insurance companies to obtain quotes tailored to your business
needs.
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Product Insurance can be purchased to protect against liability if a product goes
wrong, causes injury etc... or causes harm. For example if you manufacture food or
produce buffets and the food causes a public health hazard or if you make a toy and
the parts come off causing a choking hazard.
If your business has employees, it is likely that employers' liability insurance is
compulsory by law.
If you work from home, you may need a specialist insurance policy. Household
insurance will not cover any loss of office equipment, nor will it provide public liability
cover. Your standard household insurance may even be invalid if you work from
home, although most household policies can be extended to cover this.
If you have premises you will need contents insurance for equipment, fixtures and
fittings and if you own the building you will need buildings insurance to cover against
fire, flood and other damage or destruction.
If you are in the business of selling your knowledge or skills, you may want to
consider taking out professional indemnity (PI) insurance. This insurance protects
your business against claims for loss or damage by a client or a third party if you
have made mistakes or are found to have been negligent in some or all of the
services that you provide for them.
Include in your business plan a list of insurance policies that are relevant to your
business needs. State which insurance company you will take the policy out with and
include a written quotation where possible.
4.9 Supplier Analysis
This section should describe who have you enlisted to supply any of the product(s)
you will be using and why was this supplier chosen (Quality/Cost?).
Outline if you have got a suppliers contract.
Describe if there is a back-up plan in place if this supplier falls through at late notice.
Describe the terms obtained from suppliers i.e. 30 days.
4.10 Vehicle/Travel
Decide if a vehicle is essential to your business needs, do you already own a
suitable vehicle or do you intend to purchase a vehicle? Note important details such
as where you will purchase the vehicle from, the age of the vehicle, the price, if it is
taxed and when the MOT is due for renewal. Also indicate if a change of personal
vehicle insurance cover is required for the use of an existing vehicle or not.
If no vehicle is required how will you buy stock i.e. suppliers deliver, etc..
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5.0 MARKET RESEARCH
The reader will want robust evidence of market research carried out around your
business idea to show it is a viable proposal. Depending on the business you can
use direct or indirect research to prove that there is a need for your service.
5.1 Direct Research
(Direct market research means that you approach your potential customers direct to
ask their opinion)
Outline what form of direct market research you carried out e.g. questionnaires,
letters of intent etc. Funders will want to know who you have talked to and what
response did you receive.
By letters of intent you will require a letter with a name, address and signature
thereon indicating that the customer would consider using your services/products as
and when you start your business, although it should be explained to the customers
that this letter in no way constitutes a legally binding contract of obligation to buy
from you, it is merely to prove that there is a potential or otherwise interest in your
product or service.
Should a questionnaire be issued a copy of the questionnaire and results should be
included.
5.2 Indirect Market Research
(Indirect market research means you use information from other sources such as
surveys, national statistics, etc...)
You can establish information about your market, industry and the consumer through
statistics, market research papers, directories and field research, technical data and
predicted market trends or influences.
You can use the internet, newspapers and magazines, industry publications,
government papers, population census, etc... However you must reference the
quotations with the source, author and date of publication.
5.3 Customers
From the market research results indentify:
Who are your potential customers/target market?
Are your customers from the domestic or commercial market?
How and where will you find them?
How many potential customers are there in the area you intend to cover?
Why will they buy from you and not from your competitors?
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What is your unique selling point that makes you stand out from the rest?
Try to create a picture of your potential customers considering important factors such
as age, gender, shopping habits, hobbies and interests, disposable income, do they
work, what times will they be available etc...
5.4 Competitor Analysis
This section needs to outline your business’s key competitors. Include what they do
better, breadth of products, location, and target market. Describe how the
competition will react to a new entrant in the market and how this reaction will be
mitigated.
This section should include details of:
Who are they?
How many are there in your target area?
Where are they?
What are they good at and what are they bad at?
How much are they charging?
Where do they advertise?
How do you intend to compete with? (Consider factors other than price)
Identify at least 3 of your competitors and where they are based. You can identify
your competition by ‘checking them out’, pay a visit to your competitors or enquire
with a phone call so you have a good knowledge of what they offer and how they
operate. Complete the following table.
Competitor Analysis Table
Competitor
Location
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Products /
Services
offered
What is your
unique selling
point to rival
this
competitor?
How much are
they charging?
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6.0 MARKETING STRATEGY
Given the market research completed, outline what the marketing and promotional
strategy is for the business.
What is the marketing budget? How often will this be conducted? i.e. initial marketing
campaign with follow up marketing. Is this going to be outsourced? i.e. Website
creation. Will you be advertising? Do you have events planned, brochures, website
and leaflets?
Describe what your budget is and verify this is realistic for a business of this size.
Describe/outline how you will sell your product/ service and what initial and ongoing
costs are involved. Try to provide written costs where possible.
Your marketing objectives should look at how you will:
 Establish a customer base
 Build on customer loyalty
 Establish a good reputation within the locality and beyond
Establish a Customer Base
How will you make potential customers aware you are now entering the market?
Using your customer analysis you need to choose what promotional methods will
appeal to your target market. How much will your advertising cost? Do you need to
create a brand / logo? What image do you want to portray to your customers? What
free advertising can you get?
Identify your sales methods e.g. direct marketing, advertising in magazines,
publications or newspapers, PR, Email, e sales, flyers through doors.
Build On Customer Loyalty
You will need to plan for marketing your business once the initial buzz of a new
business slows down. Do you need to find new customers or are you relying on
customers returning to you time and time again? How will you retain your customers
and establish a loyal customer base? Do you need to keep records of existing
customers? Will you offer loyalty schemes?
Establish a Good Reputation within the Locality & Beyond
Reputation is how your business is perceived through the eyes of your customers,
suppliers, employees and other interested parties, such as your bank manager or a
potential investor.
Everything your business does – from launching a new product or promotion to
responding to customer queries and complaints – helps define your reputation.
By building a strong business reputation you will be able to:
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Attract and retain customers
Increase perceptions of quality
Charge premium prices for goods and services
It’s important to remember that gaining a good business reputation doesn’t happen
overnight. It is a gradual process - that can take months and even years to cultivate.
Networking
Networking is another effective way of building your presence and reputation among
your client and supplier base, as well as other businesspeople. The key to
networking is building genuine relationships with people with the intention of
providing referrals or information that they might need. By being known as someone
who is always willing to help, your personal reputation will improve, and this will have
a knock-on effect for your business.
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7.0 PRICING
Establishing a pricing strategy for your product or service is an important part of the
business planning process. The following factors should be taken into account:

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
The benefits - or value - to the customer of your product or service compared
with what the competition has to offer?
Will the price be one that customers are prepared to pay?
How and where you will sell the product, which will affect your promotional
spend and distribution costs?
Are you covering your costs?
You will need to decide exactly how you are going to price your work, for example:
- By the hour
- Per project
- Separately for different packages
- For each individual task or item
- By results.
-By item(s) sold
You need to work out two prices for your products, the wholesale price and the retail
price.
Full details of your pricing strategy must be included and details of exactly how you
decided upon these figures. Don’t forget to include all overheads such as materials,
stock, heat, light, rent, labour, admin costs and any unproductive time.
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8.0 Key risks and how you can minimise the risk
From your SWOT analysis, this section should outline what the critical success
factors are for your business.
Outline how you are going to manage the weaknesses and reduce the risks these
weaknesses pose.
Address the risks in the following table (note – add more cells where required – there
should be at least 5 or more risks that you identify from thorough SWOT analysis. If
not, you need to write a commentary.
Key Risk Table (examples in italics)
Key risk
Level of risk
high/medium/low
How might this
affect the
business?
How will you
minimise the risks
to the business?
Supplier fails to
deliver
High
Without supplies you
cannot deliver your
product/services to
customers.
Have a backup
supplier in place and
maintain good
communication with
customer.
Cash flow may be
affected if you have
already paid for the
supplies.
Allow a contingency
budget in place to
cover cash flow
issues and Pay on
delivery for supplies.
The business
reputation could be
adversely affected.
Good customer
service and
communication will
minimise the risk of
gaining a bad
reputation.
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9.0 Financial Analysis
9.1 Sales Forecast
New businesses have to make assumptions based on their market research
and realistic judgement. Once market research has been carried out you will be in a
position to prepare a sales forecast to cover the first 2 years of trading. The first few
months sales should be based on your market research evidence for example, value
of work lined up, etc... The following months will be based on assumptions, seasonal
trends etc...
You could begin by listing the number of customers you think is realistic to attain in
your first year. Then try to apportion a realistic sales figure against each of them.
There will inevitably be some guesswork here, but at least you should reach a
forecast that is broadly in the right area. Do you have any evidence supporting
Revenue and Cost Assumptions? Supplier cost contracts, marketing quotes, tenancy
agreements and product costs?
Make sure to project a conservative sales forecast within the first 3-6 months.
Evidence needs to be provided as to how you reach these sales projections.
Depending on your type of business, you may want to specify the volume of sales
in the forecast - for example, how many jars of coffee can you sell - as well as the
value of sales. By knowing the volume, you can plan what resources you're likely to
need in terms of production, storage, transport and staffing.
You may be able to find some industry research to show the average turnover of a
business similar to you own, however this will have some regional variation i.e.
Business in London may have higher turnover and costs than a business in the
North. You can use a graph to show seasonal variation such as bad wear during
winter months or higher sales at Christmas time. See Diagraph
Can you anticipate the sales peaks and troughs over a typical year?
High *
*
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Med
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*
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Low
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Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
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Using the information from your market research, you should complete the following
table:
To the nearest £
How
Many?
X Average
= Value of
Selling Price
Monthly Sales
In a “High” month, how many
“average” sales will you make
In a “Medium” month, how many
“average” sales will you make
In a “Low” month, how many
“average” sales will you make
9.2 Start up costs
Outline all plant, machinery, equipment and vehicles required in order for you to
commence trading.




List everything you already own that is relevant to your business and attach a
cost to it. This will show what you are personally contributing to the business.
List all the equipment you need in order to commence trading, who will supply
the goods, how much they cost and any reference code/number you have for
the items. Get a couple of quotes for each item and include a written estimate
from the supplier where possible.
List any other requirements needed to be purchased in order for you to start
the business, i.e. initial marketing budget, insurances, lease costs, etc...
You must provide a competent estimation of the capital costs to be funded.
Complete the following table:
Description
Cost £
9.3 Financial Assistance
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Give details of any finance you have to have to introduce into your business
personally and then list any other applications for funding you have applied for and
the amount, include these figures in your cash flow.
These could include Loans, Family finance, investments and grants from a bank or
agency.
9.4 Cash Flow Forecast
A cash flow forecast is a predication of your income and expenditure for the coming
twenty four months your business will be trading and show in terms of figures the
profits (or loss) your business should make.
It should be based on hard facts and figures from your research and
assumptions that you have made in the business plan.
An explanation will also need to be devised on how you arrived with the
figures outlined in your plan and how you determined your sales.
Included in this forecast will be how much you need to withdraw from the business
on a monthly basis in order to pay yourself a wage every month.
Is the Cash Flow still positive after the initial set up costs? If not, you need to
reconsider either cutting the costs or changing the amount of funding that you
require. It is advised you do not over inflate your expected revenue in order to
make this cash flow work – this will only make your cash flow difficult to
maintain over the coming year.
Do you identify a Break Even point within the first year of operation? If not, provide
commentary around this.
Have you included the loan repayment in the cash flow? Make sure to account for
any interest only periods.
Make sure the cash flow forecast is reflective of the full loan term.
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9.5 Cash Flow Explanation
To help outline how all income and expenditure lines were arrived at in the cash flow,
complete the following information:
Business Funding – Grants
Note what funding you will get from Grants and the source
Business Funding - Loans
Note what funding you will get from loans, the source and the repayment terms
Sales Predictions
Identify monthly sales from your income predictions. Consider when the cash will
come into the business i.e. your invoice terms. If you are not paid at the point of sale
you will need to consider when the cash will be received.
VAT
Will you need to register for VAT and have you considered this in your income
predictions?
Stock and Materials
How much will you spend buying initial stock and materials and replacing those
which have been sold?
Consumables
Any supplies that are not directly charged back to the customer.
Rent and Rates
How much is the rent on your business premises? This does not include your
personal home rent or mortgage.
How much is your business rates on your premises? You can find this information
from the landlord or council office.
Heat, Light and Water Rates
How much have you allowed for your heating and lighting for business use?
How much are your water rates on the business premises?
Stationery
How much have you allowed for office stationery such as paper, printing costs, etc...
Postage
How much have you allowed covering incurred postage charges?
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Telephone
£ will cover incurred phone charges/line rental.
Marketing Budget
What is your initial and monthly marketing and advertising budget?
Legal and Professional Fees
Consider legal fees involved in premises, contracts, solicitors, architects and
accountants, book keeping.
Insurance
How much will be paid in one instalment to cover public liability
How much will it cost? Will you pay it all at once or in instalments?
Vehicle / Travel Costs
Estimate how much fuel you will use or use a mileage estimate.
Vehicle Repairs and Renewals
Do you need a budget to cover any repairs needed on the vehicle?
Tax will be purchased in x for one year and is charged at £
Website and SEO
How much will it cost to develop a website and what is your monthly budget for
Search Engine Optimisation (SEO)
Cleaning & Sundries
Do you need money for cleaning your work clothing, office, equipment or vehicle on
a regular basis?
Drawings
I will withdraw £
Wages / Payroll
How much will you pay your staff on a weekly, monthly or yearly basis? How much
have you allowed for payroll services and employer contributions?
Loan Repayments
Do you have any business loans to repay? If so how much is the repayment? How
much of that figure is interest on the loan?
Capital Expenditure / Assets
How much money will be utilised on purchasing essential items of equipment at the
start of the business? This will include vehicles and equipment. Will you need to
allow a budget for replacement and upgrading the equipment?
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Unforeseen Expenditure
It is advisable to allow a contingency budget within your cash flow.
10. Future Plans
In this section you should outline what your plans are regarding the business in 12
months’ time, and by year two. For example, do you see the possibility of taking on
staff? What about updating or replacing existing equipment?
Put your ideas down together with details of any research you have done.
Work out carefully, step by step, how your business is going to grow.
Also describe if you have an exit strategy (sell the business, pass on to family or
friends)
Outline how you will pay this loan back if the business is unsuccessful.
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11. Appendices
You must attach the following documents;
 Your fully completed application
 Your CV
 Any relevant work or personal references
 Your personal survival budget
 Cash flow Forecast for a minimum of 24 months
 P&L and Balance Sheet for a minimum of 24 months
 3 months current account bank statements (most recent 3 months)
 Proof of ID and address (dated within the last 3 months)
 Include all supporting documents you mention in the Business Plan examples
of these are as follows:
-
Lease Agreements
-
Sales Contracts
-
Supplier Contracts
-
Pre Orders
-
Letters of Intent
-
Quotes for shop layouts and work
-
Advertisements for cars to show correct purchase price is included in the
Cash Flow
-
Relevant certifications
-
Regulatory Requirements – Certificates must be attached
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Insurances
-
Results of research on Market – observation and survey results
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