A traditional business plan is the collegiate approach to planning your business. It’s like a business constitution — an extremely well thought-out and lengthy document detailing your financials, marketing plan, projections, and overall objectives.
Creating a document like this is a super effective way to plan a business, but these days the average startup veers toward a more streamlined approach. If you choose to go this route, we highly recommend leveraging business planning software like LivePlan to make the process significantly easier. These programs are designed to help you organize your thoughts and prevent any important details from slipping through the cracks.
The business model canvas is a mapping-style approach to planning a business. Many folks prefer the informality of this method — it’s essentially like writing on a digital whiteboard with post-it notes. The canvas serves as a customizable outline to help you break down the key components of your business model.
The main difference here is that using this method won’t leave you with a business plan, but instead a business model. If you choose to go this route, you’ll probably want to supplement it with at least a one-page business plan (see option #3) to get clear on your specific objectives and milestones.
If you’re interested in constructing a business model canvas, use the links below to learn more. We highly recommend looking into Strategyzer, the company founded by the creator of the original business model canvas.
The leanest version of a conventional business plan is the one-pager. The focus here is on a small amount of data sets that are essential to effectively pitching your business. These days, most people won’t want to read your 40-page business plan unless they get a chance to read a summary of it first (and like what they see).
The process of creating a one-page business plan is fairly simple, but don’t let its brevity fool you. This is still an incredibly important document, so it may be worth investing in a business planning software for a month to make sure you don’t miss anything. This’ll also help make your one-page business plan 100% presentation-ready.
We encourage you to read our free guide to constructing a one-page business plan, or check out what LivePlan has to offer.
What problem are you solving for customers?
Being able to effectively communicate the problem you’re solving for customers, and the specific way you’re going about it, is absolutely essential to crafting a quality business plan. Before moving forward with anything else, make sure you nail this.
Who is your ideal customer or user?
Again, this is all about specifics. You need to be able to describe exactly who you’re targeting, considering age, gender, income level, geographical location, and any other relevant factors. This will allow you to create a powerful brand voice, better focus your marketing efforts and narrow the playing field.
What sets your business apart?
What is your product or service bringing to the table that no one else has? What about you and your team (if you have one) — what truly distinguishes you from the competition?
How will you handle promotion/marketing?
This gets complicated fast, so keep it as simple as you can in the early stages. The most important thing for you to do right now is find out the most effective marketing channels for your industry, as well as what your ideal customers are most responsive to.