7 Essential Questions Your Business Plan Should Answer
You need a business plan as a solopreneur, but what should you include in that plan? Here are 7 essential questions your business plan should answer.
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Every business—from a large corporate entity to a home-based blog business—needs to have a business plan. I realize that might sound scary to a lot of bloggers or content creators, but it's absolutely necessary if you want to actually grow and make money.
Just because what you're doing isn't what we traditionally think of as a business doesn't mean that it isn't. If you can regularly earn money from it, it's a business.
Even though I've been running a business for a long time, it never really felt "real" to me.
I work from home. I'm in an isolated space that prides itself as being an escape from "the real world" (chat/gaming). I've even had employees.
But even though it pays my bills, I felt like I wasn't running a real business. So I didn't need all that stuff I learned in my business classes right?
Now that I'm trying to work in a new space, I'm realizing all my mistakes. If I had created a plan—even if it wasn't right when I started—I'd definitely have a more structured business. Structure is great for making sure you do all the right things to keep your business profitable.
So I'm trying to do things right this time. The first thing for me is creating a plan. And not just any plan—a full-fledged business plan.
So Why is a Business Plan so Important Anyway?
Before I can explain why a business plan is important, it's useful to understand exactly what a business plan is. A business plan is simply a document that outlines what your business is, the goals for your business, and your plan for achieving those goals.
A business plan will help you:
- Define your business and set goals
- Create a plan of action
- Develop your brand
- Organize your marketing efforts
- Stay focused on your business
When you get excited about a new business venture, it is easy to get overwhelmed with ideas. Writing out your business plan will help you sort out your ideas and make it easier to identify which ones make the most sense.
Within your plan, you'll include:
- An overview of your business – Your mission, how you see the future of your business, what you want to achieve
- Basic information about your business – A name, addresses, and goals and objectives
- Your target market – Who you want to be your customers
- Your competition – Who else runs a similar business and ways you can compete with them
- A marketing plan – What you're going to do to build awareness for your business and make sales
7 Answers to Include in Your Business Plan
Even as an entrepreneur, you need a business plan to act as a guide. Without one, it's easy to lose track of what you should be doing to grow your business.
Whether this is your first business or just the first time you actually create a business plan, you may not know exactly what to include in your plan.
Luckily for you, you landed in the perfect plan to learn a simple method for creating your business plan.
Make sure your business plan has the information to answer the following 7 questions.
Who is your business for?
Your business can’t be a one-stop-shop to every human being on the planet, especially when it's new. Even Amazon started out as a bookstore before branching out after they gained popularity.
It's much easier to build your business by becoming the go-to spot for one specific thing or type of person—your niche.
A business plan can help you narrow down which products and services you are going to offer, as well as help you decide which target market to offer them to.
For example, if you're a professional organizer, you can choose to market your business to other local businesses and offer to help them clean out their paper clutter. Or you can market to local residential clients and help them clean out their attics and spare bedrooms.
You can also market your business online and create webinars or information products so people can learn from you long distance.
Once you've determined who your target market is and how your business is going to help them, you will need to write out your goals and determine your plan of action in achieving them.
What image does your business portray?
Having a business plan can also help you develop your brand. Your brand is more than just what fonts and colors you use; it's your ideology and your methodology—how your business thinks and acts.
Your brand will help you achieve recognition among your target market and set you apart from the competition. This is often the difference between people choosing one product over the other, even if the result they receive is the same.
Someone may absolutely love your personality or like that their own ideals match with yours. Maybe they feel a connection to the struggles you had which makes them feel that you can really help them.
Some people can really struggle with determining their brand, and unfortunately, never create one. Having a business plan will help you create a “big picture” idea of your business. When you see the big picture, you can determine how you want your customers to see you.
How will you deal with startup costs?
While online businesses have lower startup costs than traditional, brick-and-mortar businesses, there are still some costs. You could start making money will as little as a website, email marketing service, and payment processor/shopping cart system, but each of these has specific costs if you want to be taken seriously as a business owner.
People are less likely to trust a website hosted on WordPress.com (and without their own domain name) with a PayPal button asking for money. It just looks and feels like what a scammer would do.
Too many entrepreneurs try to bootstrap their business to such extremes that they don't even consider their website as essential enough to pay for. But if you want people to buy, you have to build trust. That trust starts subconsciously in people's minds with your website.
Including a plan to cover the cost of essentials in your business plan is one way to combat this. If you're already expecting to pay for certain things, it makes it easier to actually put forth the money.
Depending on what you business is, you may need certain things like:
- Email hosting (for your own email inbox)
- Shopping cart host
- Email marketing service
- Payment processor
- Social media management/scheduling
- Video hosting
- Online course platform
You also might need certain tools to do your job, like how if you're a graphic designer, you may use Illustrator or InDesign to work on projects for clients. Don't forget to include costs for things like this, too!
How will your business make money?
Here it is, the meat of any business! Your plan should obviously include what you're going to sell in order to make money.
Whether you're a blogger building traffic to earn through ads or you're a live streamer on Twitch or YouTube, every business is selling something. Just some things are more obvious than others:
- The blogger looking for ad revenue is selling clicks to an advertisers website
- The Twitch streamer is tipped for providing entertainment to viewers
- The Instagram influencer sells access to their audience to build brand/product awareness and "the cool factor"
- The digital product seller can provide an unlimited supply of information products, templates, printables, or entertainment value
- The service provider sells their time and expertise to help clients, either by training/coaching them or doing the work for them
- The affiliate marketer introduces products and services to an audience who needs them
If you want to make money, you have to have something of value to trade for dollars. Your business plan will make you think about all the ways you can do this and decide on one way that works best for you.
As your business grows, you can edit your business plan to include other forms of monetization to create multiple income streams.
What will your business sell?
Once you know how you want your business to make its money, you need to decide on what exactly you're going to sell. Sure, you might want to be a coach, but coaching what and for who? Digital products sound like your jam, but what exact products will you offer?
Again, this isn't always as straight forward as "I want to sell this product." In the digital world we live in, pretty much anything could become a product.
Some popular choices are:
- Physical products
- Coaching services (1:1 and group coaching)
- Freelance/contracted work
- Online courses
- Mastermind groups
- Printable posters, cards, worksheets, banners, etc.
- Stock media and templates (written content, graphics, audio, video, etc.)
- Software and apps
- Membership programs
There's probably a lot more but that's what I can think of off-hand. Pretty much anything that someone wants, you can put a price on.
Remember that you can—and should—get creative! The more creative you are, the more unique your product. This gives you an advantage in your industry.
Just don't get so caught up in trying to be creative that you never release a product. You can also suddenly have your most awesome, creative idea after you've already started your business. And who knows, maybe it'll be your customers who light the spark that births your idea.
How will you market your products?
I'm sure you already know that there are many different ways to market your business. The trouble is picking one or a few to focus on that will lead to the best outcome.
Another benefit of having a business plan and being able to see the “big picture” is being able to organize your marketing efforts. Your business plan will help you decide how you want to promote your business.
- Will you be marketing to local customers or taking your business global and marketing online?
- Should you invest time in building a blog to build an email list, or should you just focus on a signature webinar or landing page to build one?
- Does Instagram truly help you sell products, or does it serve better as a way to connect with customers/clients on a personal level?
- Should you have a Facebook group or just a Facebook page so you can advertise?
All of these questions can be answered in the marketing section of your business plan. If you have no idea how to market your business, then your plan is going to be to first figure out how and then come up with a marketing plan.
Who else has a business like yours?
Knowing who your competition is is just as important as knowing what your own business is. Even though they may be selling a competing product or service, they can also be a source of inspiration.
What can you do differently or better than they are? What do their clients or customers have to say about their product or service? Can you improve on the weak areas your competition has?
Some people who may seem like competitors at first may actually teach others how to do what they do. This makes them a valuable learning asset with experience you can benefit from.
Consuming content from someone who has built a similar business or created one using methods you want to use can save you time and frustration trying to figure everything out yourself.
Even if your competition doesn't have any learning materials available, you can learn a lot by paying attention to the actions they take in their business. You never want to copy someone, but you can take inspiration from how they're running their business to make yours more successful.
What are your business' goals?
Finally, your business plan can keep you focused on setting and achieving the right goals for your business. You don't want to end up working on things in the wrong order or setting goals that are completely wrong for your business.
For example, you might get so caught up in the plans for the future that you completely forget about what's most important for right now.
You don't want to get stuck thinking about how you're going to scale your sales funnel when you need to work on making people aware that the first parts of your funnel even exist.
It can also help you sort out affiliate opportunities. If someone approaches you about a joint venture project or if you have an idea for a solo project, you can take a quick look at your business plan and see if that is something that would enhance your business.
Will their audience benefit you? Will your audience benefit them? You can easily tell what will help advance your business goals, besides just making money, if you have a solid plan.
Write a Business Plan of Your Own
I hope both my story and the advice in this post has inspired you to actually take the time to write your own business plan.
Even if you're "just a blogger" or "just making videos on YouTube," having a plan will lead you towards growth. That's probably something you want even if making money isn't your number one objective.
Having a business mindset is essential for success and one way to do that is to start by creating a plan. Without one, things can get overwhelming pretty quick
Check out my tips for creating a simple one-page business plan if all of this is overwhelming you. Even though it may not be the most thorough plan, it's better to have something rather than nothing. You can also update and revise it as you learn more about running your business.