Benefits of a business plan

Your business plan outlines:

  • your vision for the business
  • the actions that will help you achieve it.

When you are starting out, your business plan can help you secure financing and investment. But your business plan does more than tell others what your plans are. A good business plan can help you test the feasibility of your new business idea, set operational and financial objectives, and make sure your business is manageable and effective.

You will need to revisit your business plan regularly as your business evolves and the business environment changes. These changes could include increased competition, advances in technology or the expectations of your customers.

What to include in your business plan

A clearly written business plan should include:

  • the vision and direction of your business; where are you now and where do you want to be?
  • *a SWOT (strengths, weaknesses, opportunities, threats) analysis – a good business plan won't only identify ways to make your business idea work, it can also help you identify reasons why your idea might not work so you can address them before you invest time and money
  • a force field analysis – for each issue identified in your SWOT analysis, identify the positives and negatives of each issue and the actions you will take to address the issue.

Write your business plan

Our Guide to writing a business plan will help you to create or update your business plan.

Video: How to write a business plan in 8 steps

Whether you're planning to start a business or have been running it for years, business planning is the key to your success. A business plan helps you get finance, gives you control and direction and helps you set priorities.

Step 1: Define your vision

When you start a business, you have a clear goal to achieve this vision. After some time, the clarity of your vision may become blurry. Writing down your vision will help you define it for your staff to identify with your mission. Where are you now? Where do you want your business to be in the future?

Step 2: Set your goals

Make your goals and objectives realistic. Plan your short-term, mid-term, and long-term goals, including choosing your location; the number of customers you plan to reach and your customer demographics; your sales targets - revenue and profit margins; what you will outsource; your required staff numbers; and your growth strategy. Planning this strategy will help realise your dream and make your business thrive.

Step 3: Define your unique selling proposition

What makes you different from your competitors? Highlight the characteristics that make your business stand out from your competitors. Is there demand for your range of products or services? What can your business offer to increase demand?

Step 4: Research your market

Who are your competitors? What product range or services do they offer? Where are the gaps? Where is demand greater than supply and for which products or services? What are the current and future industry trends? How do you leverage these opportunities?

Conduct a SWOT analysis to explore the Strengths, Weaknesses, Opportunities and Threats faced by your business; Think of all possible scenarios. List the issues and conduct a Force Field Analysis for each. This will help you determine clear actions to implement in order to address them.

Step 5: Know your customer

Do your research and define your target audience. Customers are spoilt by choice, so find out their buying habits. What does your ideal customer want? Get their feedback. Who are you targeting by age, gender, behavioural patterns or location? Find your niche.

Step 6: Set your marketing goals

Consider the product range and stock quantities to output or warehouse. Create a product development strategy. What is the price you should set to achieve your desired revenue? How will you handle distribution and delivery? What tools will you use for promotion?

Step 7: Define your marketing strategy

Include your chosen social media channels and engagement. How and where will you advertise - search engine marketing, print, radio or other media? Will you attend industry, trade or networking events?

Step 8: Talk to your accountant

Do your sums - are your financial goals and propositions realistic? How can you improve cash flow? How can you achieve your goals? Good business planning is a three-stage process:

  • You PLAN for the future.
  • You TRACK your progress.
  • And you LEARN from your experience.

One of the most important things to remember is that a business plan is a living document. Just as your business evolves over time, so too should your plans. Set reminders in your calendar to revisit your plan every 3, 6 or 12 months. It's important to revise your goals according to your current status as changes occur over time. Make planning part of your business. It doesn't have to be onerous and it doesn't have to be done in solitude. Make it fun, get creative, and include others in your process.

For more information on business planning, visit business.vic.gov.au where you can access tools, workshops and resources to help you plan for your success.

Create your one-page action plan

A one-page action plan is an overview of the current situation, where you want to be and what you need to do to get there. It's also a practical way to record the outcomes of the planning process.

A one-page action plan has the following elements:

  • 'Now' analysis – Summarise your current situation and issues in 4 or 5 points.
  • 'Where' analysis – What is your vision? What is your competitive advantage? What are your key objectives?
  • Strategies – What are the 3 or 4 key strategies you need to work on over the next 12 months? You can draw these from the SWOT analysis in your business plan.
  • Action plans – List about 3 or 4 of the most important actions to complete to help achieve your strategies. You can draw these from the analysis of your key issues and strategies in your business plan.
  • Timing – State when you aim to achieve the result and who is responsible for each task. These should be in priority order and are critical for accountability.

Get help in person

If you’re a first time business owner then you might need help working out how to action some of the steps you want to take. This might mean talking to an accountant, other business owners, a mentor, business coach or joining an industry group or your local chamber of commerce.

There's plenty of support available in Victoria to help you upskill and put you on the right track. Try one of our mentoring services or workshops.