how to describe a product in a business plan

Expert business plan and financial models

Products & Services Section in a Business Plan (+ Examples)

• September 4, 2024
• Business Plan , How to Write

In this blog post, we’ll guide you through writing the products and services section of your business plan. We’ll cover how to describe what you’re selling and why it’s important in your business plan.

Whether you’re launching a new startup or creating a business plan for an existing business, this section is crucial for showing the value you bring to customers. Let’s get started!

Why do we include them in a business plan?

The products and services section of a business plan is more than just a list of what a company sells; it’s a vital narrative that tells the story of the business’s core offerings and their significance to the market.

This section is paramount for readers (especially potential investors) to grasp the essence of what the business is about, the unique problems it solves, or the specific needs it addresses.

A meticulously crafted products and services segment does much more than describe offerings. Indeed, it lays the groundwork for comprehensive marketing strategies , informs operational planning, and financial projections.

Moreover, understanding the business’s offerings in depth enables stakeholders to envision the company’s value proposition and competitive edge.

Where should you include them?

In a business plan, the Products and Services section is typically included within the business overview section.

This allows you to first introduce the business model and what it offers to customers. Only after this you can provide more details of the products and services.

The Products and Services section should clearly detail what you are selling, highlight the unique value proposition . It should also ideally explain how it meets the needs of your target market if it isn’t obvious. T

What to include: 2 Examples

Begin with a clear, engaging description of each product or service you offer. For services, describe the process, customer experience, and outcome. For products, discuss the materials, technology, and any unique features.

Services example: a Cryotherapy business plan

Products example: a Brewery business plan

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How to describe your product and service in a business plan like a pro

It’s deceiving.

You’d think that this part of a business plan does exactly what it says on the tin–describe your product & service offering– right ?

And yes, you are partially right. 

But there’s a very specific way in which this description should be written to make sure that your business has the best chance of succeeding – in real life and under the eagle eye of a potential backer (if you’re preparing a business plan for external financing purposes).

Keep reading to find out the secret sauce to writing a winning product and service description:

WHAT is the Product and Service Description in a Business Plan?

This business plan section is also known as:

• Product and/or Service Overview

HOW Do You Write a Product and Service Description in a Business Plan?

So, what should a good product/service overview contain?

Here are some items to consider including into this section:

1.     Portfolio:

The range of products and/or services that a business offers to potential and current customers.

2.     Features and benefits (value proposition):

Explain what the product/service does and how it works.

3.     Problem and solution (value proposition cont.):

The problem(s) the product or service solves. Every business needs to solve a problem that its customers face. Explain what the problem is and how the product or service solves it.

4.     Innovation:

If the company is doing something new and different, explain why the world needs the innovation.

5.     Proprietary advantages:

Any proprietary features that contribute to a competitive advantage. This could include: intellectual property (e.g., copyright, trademark, patent filings, trade secret), exclusive agreements with suppliers or vendors, exclusive licenses (e.g., for a product, service or technology), company’s own research and development activities.

6.     Development stage:

Current stage of development of the product / service (e.g., idea, development, testing, prototype, already on the market).

7.     Product life-cycle:

Estimate the life span of the product or service.

Specify whether the product or service under consideration is a short-lived fad or has a long-term potential.

8.     Future:

Mention plans for changes and new additions to the current portfolio of products / services.

Describe any plans to move into new markets in the future (e.g., serving different types or sizes of customers, industries, geographic areas).

Make your best guess at when the business will be ready to address these markets and what it needs to do first to be ready.

9.     Limitations:

If applicable, explain any risks or limitations associated with the product (e.g., liability issues like guarantees or returns), along with any legal advice received regarding these issues.

10.  Visual aids:

Use photos, images, diagrams and other graphics to help the reader visualize and learn about the products / services.

If the business is tackling several distinct problems through different products / services, describe the solutions individually .

However, for a large line of products / services, there is no need to list each one, just identifying the general categories will suffice.

How LONG Is the Product and Service Chapter of a Business Plan?

This part of a business plan can be very short, just a couple of paragraphs, or it can spread over multiple pages, depending on how many products/services you offer and how much explanation they require.

If your products or services are particularly complex , technical , innovative , or proprietary , you will want to provide more information and spend considerable time describing them.

This is especially true if you are seeking funding for a new product or service, particularly one that is not immediately understandable to the business plan readers, and if potential funders are likely to be motivated by the specifics.

In any case, when describing a product or service, provide just enough information to paint a clear picture of what it is and does . A brief explanation of what you will be making, selling or doing is appropriate here.

Excessive detail makes this section cumbersome for a reader to wade through. Reserve detailed descriptions (e.g., production processes) for the Appendix.

In any case, it is a good idea to first summarize the value proposition of each product or service into a one short sentence, and only then continue with a more detailed description of the product or service.

If any images or graphics are available that would contribute to the understanding of the product or service, the writers of a business plan should use them.

Otherwise, include any product or service details , such as technical specifications, drawings, photos, patent documents and other support information, in the Appendix section of the business plan document.

TOP 4 TIPS for Writing a Product and Service Overview

Tip #1: features v. benefits.

Don’t just list the features of the product / service.

Instead, describe the specific benefits it will offer to customers – from their perspective.

Make it clear what your customers will gain through buying your product or service. Include information about the specific benefits of your product or service – from your customers’ perspective.

Features are not the same thing as benefits. And you need to understand both.

Confused? Let’s clarify:

What Is the Difference Between Features and Benefits?

Tip #2: Problem v. Solution

If at all possible, present the information in the Problem >> Solution format.

Start by describing the key problem that your customers have, immediately followed by the solution with which you will address this need for your target market.

Tip #3: Competitive Advantage

You should also comment on your ability to meet consumers’ key problems or unmet needs in a way that brings your product or service advantages over the competition.

For example:

• If you have a common business, such as a restaurant:

Explain why your customers need your particular restaurant. Do you offer lower prices? More convenient hours? A better location? A different concept, such as a vegan ice-cream pop up store? A specialty that is not otherwise available in your area, such as a Peruvian ceviche or Hungarian goulash?

• If your company is doing something new and innovative :

What is it about the existing solutions that is subpar? Maybe you are improving on a mediocre product category, such as creating better medical uniforms for healthcare workers (e.g., more flattering cut, trendy designs, sustainable materials). Or perhaps your new blockchain solution has the potential to entirely eliminate the middle-men in an entire industry.

Although the subject of competitive advantage regarding the business as a whole will be fully explored in the Market and Competitor Analysis part of a business plan, it is advisable to touch on it here also – in the context of the company’s products and service.

Tip #4: Validating the Problem and Solution

Speaking of which, when you are doing market research and analysis for your business plan, remember to validate the problem and solution your product or service is addressing.

There is a plethora of minor issues out there that people are perfectly fine with just tolerating. To build a solid business, though, you need a problem that a sufficient number of people are motivated to solve. That is, that they recognize it as a problem that’s worth paying you to solve. Even if they didn’t realize it was solvable until they were presented with your solution.

So, how do you get evidence that prospects are willing to pay for your solution?

Validation of Problem

Describe what you’ve done so far to confirm that the problem you are focused on is a real problem for your customers.

• Existing Business:

For an established business, this is probably just a matter of recapping your success in the marketplace. Your customers have already voted with their wallets.

• New Business:

For a startup, it is important to survey and have conversations with as many potential customers as possible about where they are having problems, how they solve them today, and validate that they are interested enough in addressing those problems to pay for a good solution.

Validation of Solution

Describe how you have tested your ideas with existing or potential customers to confirm that there is a good market for the products or services you plan to offer. Summarize the positive customer feedback or market traction that you have achieved with your solution so far.

For an established business, the answers probably lie in your paying customer base – their existence itself, combined with their repeat business, word-of-mouth referrals, follow-up customer surveys, and other indicators of customer satisfaction.

For a new business, you can start validating your solution immediately by trying it out with potential customers, even informally or at no charge, to get their opinion. If your product or service does not exist yet, talk to prospects about what you plan to offer and measure their feedback.

In summary, this section should answer the million dollar question:

What makes you think that people will buy, be satisfied with, and recommend your products or services?

Related Questions

What are products and services.

Products and services are items that businesses offer for sale to a market. While services are intangible, meaning that they do not exist in a physical form, products are of tangible nature, in other words – you can touch them.

What is a Product Line?

Product line is a group of related products that are all produced or sold by one entity and typically marketed under one brand name.

What is a Service Line?

Service line is a group of related services that are all produced or sold by one entity and typically marketed under one brand name.

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Home » Business Plans

How to Describe your Product in a Business Plan

The product or products your business intends to produce or offer will have to be described in the product description section of your business plan. This section of your business plan is meant to explain how your product will stand out from comparable items in the market.

You have to clearly explain its concept, coupled with all aspects of purchasing, manufacturing, packaging, and distribution. You should also identify your suppliers, costs, and how the product you are offering fits into the current market.

Note that the product description in your business plan is more than a simple listing of product features. In this section, you will need to highlight your product’s most unique characteristics that will ensure it stands out in the marketplace and attract buyers who won’t mind paying your price.

Note that a properly written product description in your business plan can entice investors and help your business grow. Make sure you describe what you are offering in layman’s terms, to guarantee that someone who isn’t conversant with your business will grasp and be excited about it.

It may also be necessary to provide some basic background if this is an area or industry that people are not so familiar with. While you write up the Products and Services description section of your business plan, always keep your reader in mind.

What to Include in the Products and Services Description Section of Your Business Plan

Just as was noted above, the products and services section of your business plan will have to explain in detail your product or service, its demand in your market, and how it intends to compete with other businesses selling the same or similar products or services. Nonetheless, the product and services description section of your business plan is expected to include:

The Product or Service Description

It is important the product description section of your business plan clearly explains the concept of your product, coupled with all aspects of purchasing, manufacturing, packaging, and distribution. What are your product and service, and how does it work? How will this product benefit your customers? How do you plan to make it or how do you intend to get it made?

Product Comparison

This section of your business plan will also have to explain how your product compares with similar products in the market. What makes this product or service unique or better than what’s already obtainable in the market? Why would anyone prefer your product or do business with you?

You will need to describe how and why you are competitive. How do you stand out, and why do your business and everything it offers have such a viable chance at succeeding? In talking about your product or service, always try to answer why a client would want it and how it can make their lives better or more profitable?

Accreditations/Intellectual Property

For businesses that have had their product tested by industry experts, you must include this information when describing your product. Don’t forget to highlight any certifications, trademarks, copyrights, or patents.

Have it in mind that these added advantages or achievements can give you and your product an upper hand. Verified patents and trademarks can also heighten the value of your product especially since it shows that only your company can manufacture the product for the life of the patent.

Have it in mind that a product’s life cycle includes the idea, prototype, and expansion stages. If you are still in the idea stage, you must buttress in your description how you intend to get the product made and why your product matters.

If you maybe already have a prototype, outline your plans for evaluating the prototype and manufacturing your product. If your business has been making the product but is looking to expand to keep up with demand, ensure you explain this when describing your product in your business plan.

You will also want to include the cost of your product and how that cost aligns with other comparable products on the market. In very concise detail, explain how you came to this price, including the cost to manufacture, selling price, and profit margin.

Sales and Distribution Strategy

Also, take your time to explain how and where you will sell your product. Have in mind that your options may include online stores, brick-and-mortar locations, and vendors. If you already have vendors selling your product, ensure to note who they are and their locations in this section of your business plan.

Fulfillment

When describing your product in your business plan, it is also important you describe your plan to ensure your product gets to the intended customers. This should include manufacturing details and delivery specifics. If you plan to outsource the production of your goods, don’t forget to note manufacturer specifics such as location and production time. Also, remember to include the approximate delivery times and methods.

Requirements

Will you require any special equipment or technology to provide your product or service? Also explain if any specialized technology, materials, or equipment will be required to manufacture your product.

You will also have to explain your plans for product development and introduction especially as your business grows.

Photos or Brochures

Also, make sure that your potential investors can get a good insight into your product through photos and brochures. Don’t forget that your business plan is expected to have an appendix for photos and brochures. Also, don’t forget to refer to them in the product description section.

Tips for Writing a Product Description

To ensure you describe your product thoroughly, here are some vital tips to guide you;

• Always remember the reader. The product description section of your business plan must note your product’s most vital information. Always remember to make this section very easy to read and understand. Consider making it better by leveraging numbered lists and bullets.
• Focus on benefits. When describing your product, you must explain how its features can provide value to consumers. Translate your features into benefits, and remember that the aim is to describe how your product or service will be a solution to a problem or improve a client or customer’s life.
• Highlight the features of your product or service. To attain substantial success in any business, your business will need the ability to set itself apart from other businesses that offer or sell the same products and services. Take your time to analyze key features, such as price point or level of service, or anything that makes your product unique in the market.
• Show off a little. Don’t forget that you are selling a product and also selling yourself as the most viable provider of that product. Ensure to include all vital educational or industry-specific experiences and awards in this section. If you have endorsements or testimonials specific to your product, include them as well.
• Show the need for your product. Also make sure you explain how your product will cater to a need or improve life, showing why your product is very necessary to the consumer. This is very pertinent if your product has no current market.

The product and services description section of your business plan is meant to provide the reader with an explicit understanding of why you are in business, what you sell, how you will compete with what’s already available, or how you intend to fill a niche that no one else is currently meeting. Noted above are things you need to consider when creating the product description section of your business plan to ensure that it will indeed grab your readers’ attention.

More on Business Plans

How to Describe the Product in a Business Plan

by Charles Crawford

Published on 1 Jan 2021

The reader of a business plan should come away with an understanding of what the company's product line is, what it does and how it functions. The same is true if the company offers a service. If pictures and other images contribute to this understanding of the product, the writers of the plan should use them. The business plan should tell about problems the product solves, the needs it meets and the benefits it gives to consumers. The plan should also address any liability issues associated with the product.

Explain what the product does, how it works, and how it can be put to commercial or consumer use.

Write a description of the product's physical characteristics, including colors, finishes, sizes, specifications and ingredients. Use photographs, diagrams and other graphics to help the reader learn about the product.

Compare the product to those of competitors. Tell how the company's product is better than competing products. Discuss its potential in the marketplace. Include the results of any market trials, surveys or focus groups.

Describe the product's benefits to the customer. For example, if the product reduces wrinkles on the face, saves money or increases efficiency, explain in detail how it does each of these things. If there is a family of products, discuss the customer benefits of each one.

Explain any liability issues associated with the product, if applicable. If you have consulted with a lawyer about these issues, provide a summary of those discussions in the business plan.

Remember that the business plan often becomes a sales document for the company. When writing about the company's product, keep sales in mind.

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How To Write a Product Description (Examples + Template)

Struggling to write compelling product descriptions for your store? Try these expert copywriting tips to inform, persuade, and boost your sales.

Ever dismissed product descriptions as unimportant? Assumed that as long as the information on your product page is accurate, you’re good to go? It’s time to think again.

Product descriptions are more than a summary of what you’re selling. Written correctly, they can boost your store’s conversion rate and make your products seem more valuable. The right words can even make customers happy to pay more.

Here’s how to make product descriptions work harder for your ecommerce business .

Let Shopify Magic write product descriptions for you

Ever wished a product description would write itself? With Shopify Magic—Shopify’s artificial intelligence tools designed for commerce—it will. Create product descriptions in seconds and get your products in front of shoppers faster than ever.

What is a product description?

A product description is a piece of marketing copywriting that tells people what a product is and why it’s worth buying. Beyond a list of product details or features, descriptions tell a story about what makes a product special and persuade customers to make a purchase.

Product descriptions can vary in length, style, and format, and may be written in a brand’s unique voice.

What makes a good product description?

A well-crafted product description can significantly impact sales, customer satisfaction, and brand reputation by performing a dual purpose:

• It informs customers about product details, such as its features, uses, and benefits. This helps customers understand what the product is and how it works.
• It convinces customers of the product’s value. This is where the persuasive power of a product description comes into play. It answers questions like, “What problem does a product solve?” and “What makes it better than the competition?”

By addressing these points, a good product description paints a clear picture of a product’s value proposition . It highlights the unique benefits and advantages that set a product apart from its competitors.

Good product descriptions move buyers through a sales funnel , turning them from interested browsers to motivated buyers, making them more likely to hit the Buy button.

How to write compelling product descriptions that sell

Many online stores list the features of their products and call it a day. While clear information about your items is important, you also need to tell people how a product can help them. 

Let’s look at how you can create descriptions that capture your product’s value:

• Speak to your ideal customer
• Highlight benefits, not features
• Avoid generic phrases
• Support superlatives with facts
• Feed customers’ imagination
• Tell your product’s story
• Use sensory language
• Add social proof
• Make descriptions scannable
• Set and measure KPIs

1. Speak to your ideal customer

When product descriptions are written with a broad audience in mind, they can become vague and fail to resonate.

To make your descriptions engaging, speak directly and personally to your target audience. Anticipate and answer product-related questions as if you were having a one-on-one conversation, using language and terminology that resonates with your ideal customer. That includes using the word "you."

Take a look at how The Oodie , an apparel retailer, harnesses this approach in the product description for its I Love Plants Oodie.

I Love Plants Oodie product description:

“Can’t stop buying plants? Unbeleafable. Don’t worry—us too! Cover yourself in your favourite obsession in our NEW I Love Plants Oodie! For every I Love Plants Oodie sold, one tree is planted across the world.”

When writing product descriptions for your ecommerce business, start by visualizing your ideal customer. What kind of tone do they appreciate? What vocabulary are they familiar with? Are there certain words they dislike? What questions might they have?

Think about how you would communicate with your ideal customer if you were selling your product face-to-face in a physical store. Then, try to incorporate that language into your ecommerce site. This approach can help create an online conversation that resonates more deeply with your customers, making them feel understood.

2. Highlight benefits, not features

While it’s natural to be excited about the unique features of your products, potential buyers are more interested in how these features will benefit them. They want to understand how your product will solve their problems or enhance their lives.

Writing an effective product description, therefore, requires highlighting the benefits of each feature—addressing any uncertainty or cognitive bias around the helpfulness of your product. A good example of this approach comes from Dr. Squatch , a company that sells natural soaps for men.

Pine Tar soap product description:

“Made with real pine extract, this all-star bar is as tough as a freshly cut bat. A true MVP of the shower, this heavy-hitter knocks out grime with its gritty composition and ultra-manly, woodsy scent. Toss in the exfoliating oatmeal and the super-soothing shea butter, and you’ve got a bullpen of natural ingredients that will strike out any stink.”

Dr. Squatch’s product page places the ingredients list of its Pine Tar soap on a hidden tab, choosing instead to lead with a description, which paints a vivid picture of the experience of using the product.

The description suggests that the soap performs its function (to clean) in a way that’s specifically suited to its target customer (men looking for a natural yet heavy-duty bathroom product). 

When writing product descriptions, consider the benefits of each product feature. How can your product make your customers’ lives better, easier, or more enjoyable? What problems does your product solve? Remember, you’re not selling a product; you’re selling an experience.

Dr. Squatch’s description also uses a brand-relevant extended metaphor (baseball) and overtly masculine adjectives (“tough,” “woodsy,” and “gritty”) to appeal to its target audience. Fine-tuning your copywriting in this way can help your product resonate.

3. Avoid generic phrases

When you’re unsure what to say about a product, writing descriptions can get challenging. It’s tempting to resort to general, overused phrases such as “effective” or “high quality.” However, clichés fail to impress potential buyers. They’ve heard these claims before, and they don’t provide unique or persuasive information about your product.

To avoid banalities, be as specific as possible in your copywriting.

Take Beardbrand , for example. Instead of making broad claims about the effectiveness of its products, it provides detailed reasons why its Best Sellers Bundle is so popular.

Beardbrand Best Sellers Bundle product description:

“ A do-it-all beard wash, hair shampoo, face wash, and body wash in a massive 14 oz. bottle. Formulated with hydrating, coconut-derived surfactants, this wash is gentle enough for your beard, hair, and face yet strong enough to wash everywhere else.

“Life is hard; soften up with this do-it-all beard and hair conditioner featuring an ultra-moisturizing punch of coconut oil and shea butter. Utility Softener doubles down as a hydrating shave lotion that helps reduce razor burn and irritation.

“An award-winning blend of jojoba, abyssinian, castor, and babassu oils makes Utility Oil the only oil you’ll ever need. Use this lightweight, moisturizing blend as a beard oil, hair oil, skin moisturizer, face serum, and pre/post-shave oil.

“Finish off your grooming routine with Styling Paste — a medium hold, satin finish styling aide for hair and beard. It locks in your look while leaving hair soft, flexible, and touchable for a natural, flowing, and reshapable style.”

Detailed descriptions like these serve multiple purposes. First, they add credibility to your products. By explaining the specific benefits of each product, you show potential customers that you know your products well and believe in their value.

Second, detailed descriptions help customers visualize how they’ll use the products. By painting a clear picture of the product experience, you help customers understand exactly what they’re buying and why it’s worth their investment.

Lastly, detailed product descriptions build trust. When you can speak with authority about the granular details of your products, customers are more likely to trust your brand.

💡 Once a product description has enticed a customer, Beardbrand uses a subscription model to generate recurring revenue from them.

4. Support superlatives with facts

Superlatives can sound insincere in product descriptions—unless they are substantiated with clear evidence. If you claim your product is the best, the easiest, or the most advanced, you need to provide specific reasons why.

An example of this product-writing technique can be seen in the product description for Casper’s Wave Hybrid Snow mattress .

Casper Wave Hybrid Snow mattress product description:

“Our most supportive mattress paired with Snow Technology for continuous cooling all night long. Here’s how The Wave Hybrid Snow unlocks your deepest and coolest night’s sleep—for even better tomorrows:

“Foam is divided into continuous ergonomic zones to provide maximum support and spinal alignment. Our most advanced solution to nighttime overheating keeps you 6° cooler all night.”

While Casper makes the bold claim that its product can unlock your deepest night’s sleep, it backs up the rhetoric with factual evidence. The product description explains how “Casper Labs testing” has verified mattress performance. Additionally, Casper offers a 100-day free trial period to show confidence in its product and allow customers to verify the claim for themselves.

If your product really is the best in its category, provide specific proof. Otherwise, tone down your product copy —or quote a customer who can provide a positive subjective opinion.

5. Feed customers’ imagination

Research proves that physically touching a product in a store can create feelings of ownership and increase the likelihood of a purchase.

So, how can you recreate that effect online, when your customers can’t physically interact with your products? High-quality product photography and videos can help—but there’s also a powerful ecommerce copywriting technique to increase desire: let your reader imagine what it would be like to own your product.

Notice how Todd Snyder applies aspirational content, in the form of a tagline and hero image, to promote its Spring clothing collection.

Clothing collection tagline:

“Dreaming of the Amalfi.”

Todd Snyder transports website visitors to the Amalfi Coast in Italy, a place associated with luxury, chill vibes, and classic style. The image helps link Todd Snyder’s clothing collection to the dreamy lifestyle you’d find in this famous Italian spot.

To practice this copywriting technique, start a paragraph with the word “Imagine” and finish it by explaining how your readers will feel when they own your product. Then, use what you’ve generated to write an aspirational tagline in your brand’s voice.

Let’s say you’re selling an espresso machine called the Barista Pro. First, you might create this imagined scenario:

Imagine stepping into your kitchen, the sun peeking through the windows. You pull a perfect cup of coffee from your Barista Pro and experience the rich aroma of a freshly brewed latte. You feel satisfied and energized.

From that scenario, you can craft a product tagline:

Start each day with an extra shot of joy.

6. Tell your product’s story

One effective way to create engaging product descriptions is to tell the story of your product. A well-crafted narrative can make your product more relatable and memorable, helping it stand out in a crowded marketplace.

A product’s story can include the inspiration behind its creation, the challenges faced during its development, or the impact it has had on customers since launch.

When crafting a product story, consider the following:

• What inspired the creation of the product?
• What challenges were faced during development?
• How does the product reflect your brand’s values or mission?
• What impact has the product had on customers’ lives?

7. Use sensory language

Sensory language refers to words that describe how we experience the world: how things taste, smell, look, feel, and sound. By using sensory words in your product descriptions, you can help customers imagine what it’s like to own your product.

When you use sensory language in your product descriptions, you’re not just making your products sound more appealing—you’re also engaging more of your customers’ brains. A recent study has shown that social media influencer posts can generate higher engagement when they contain sensory words like “crumble” and “juicy.”

Another study revealed that exposure to tactile verbs (e.g., “touch”) can prime your brain to react as if you’re actually touching an object.

When writing your own product descriptions, think about how your product engages the senses. Whether it’s the “crisp” sound of a new keyboard, the “smooth” feel of a luxury fabric, or the “bright” flavor of a fresh fruit, sensory language can make your product descriptions more engaging.

8. Add social proof

When potential customers are unsure about buying a product, they often look for advice from trusted sources. While you can provide reassurance through high-quality product descriptions and other on-page tactics, you can’t be a neutral third-party.

This is where customer reviews and industry testimonials come in. Social proof is the idea that people are influenced by others’ actions or opinions. Examples of social proof include a comments section, customer reviews, quotes from professional critics and review sites, or mentions from mainstream newspapers and industry magazines.

Athletic wear brand Gymshark includes detailed customer reviews on each product page. They go beyond a traditional star rating system by including six relevant and easily understandable review criteria, such as “comfort” and “squat proof.”

Asking customers to review specific product features is a simple, effective way to show that you understand what your customers care about.

If you don’t have enough customers to host an active review section, consider allocating some of your marketing budget to sponsored content about your product in a relevant, well-known publication.

At the very least, you can include images of people using your products to create the impression that your product is popular and trusted. Seeing others use and enjoy a product can reassure potential customers that they’re making a good choice.

9. Make descriptions scannable

Does your website design encourage visitors to read your product descriptions?

Consider how Kettle & Fire presents its product information. The brand uses eye-catching icons, simple dropdown tabs, and bullet points to make the content easy to scan.

Visitors can quickly scroll through the page and understand pricing, key benefits, ingredients, usage recommendations, customer reviews, and the brand’s values, all within a few seconds.

Kettle & Fire also organizes information based on what customers care about most. Different categories of information are separated by contrasting background colors, providing an instant visual guide.

Keeping your product descriptions clear and easy to scan makes them more reader-friendly and appealing to potential customers.

Here are some visual ideas to make your descriptions more scannable:

• Use headlines: Grab your visitor’s attention with compelling headlines.
• Use bullet points: Break up information into easy-to-read bullet points.
• Use white space: Don’t be afraid of white space. It can make your content easier to digest.
• Use a readable font size: Using a bigger font size can improve readability.
• Use high-quality product images: Well-designed and placed images can convey a lot of information quickly.

10. Set and measure KPIs

The aim of a product description is to convince a shopper to buy. But how can you tell if your descriptions are doing their job?

Here are some common key performance indicators to monitor on your product pages. They can indicate whether your product descriptions are working:

• Conversion rate tells you how many page visitors you converted into leads or customers.
• Cart abandonment rate shows how many shoppers put an item in their cart but left without buying. All stores deal with cart abandonment, but if this KPI is poor, your product descriptions and checkout process may need some work.
• Return rate highlights how many products are being returned . If it’s high, it could mean that your product descriptions or images aren’t accurately representing your products.
• Support inquiries . If you’re getting lots of questions about a product through email or a live chat feature, it could mean that the product description isn’t clear.
• Organic search engine rankings directly correlate with the amount of traffic entering your website. Good product descriptions help with search engine optimization and make your products show up in search results, leading to more visitors and sales.

Once you’ve picked which KPIs you want to watch, consider running some tests to see if you can optimize your product descriptions. A popular type of test used to iterate descriptions is A/B testing . This involves making a new version of your product description and serving it to a subset of your audience, allowing you to compare the performance of each version in real time.

You can run multiple A/B tests to fine-tune your product descriptions, until they are fully optimized for your KPIs. Try an app like OptiMonk to run tests on your Shopify store.

Product description template

Even if you’re using AI to write great product descriptions , you need to consider the features and benefits of each product individually. Every product serves different needs, and every set of potential customers has distinct buying triggers. 

That said, it’s possible to take a similar approach to writing product descriptions across your store, by developing a product description template containing open-ended prompts. 

Try developing a template with two sections: a brainstorming section followed by a draft description section.

Product description brainstorm

Answer these questions for each of your products to develop unique, relevant information that you can craft in to a product description:

• Who’s the ideal customer for this product? Knowing who your product is for is foundational to writing a good description.
• What are the products’ basic features? Collect dimensions, materials, functions, care instructions, and other factual details about the item.
• When should the product be used? List the intended use cases for your product. Highlight the ideal scenarios for when a customer should use your product.
• What makes the product special? Think about the unique benefits of your product and why it’s better than similar offerings from competitors. 

Product description draft

Once you’ve collected your product information in a document, use the following template to draft your product description.

• Write an attention-grabbing product title: Keep your copy short and simple while communicating a product use or benefit. For example, if you’re selling a patterned yoga t-shirt, you could call it the Fleck Studio Shirt.
• Craft a short paragraph: Turn your product information into an entertaining description that tells a clear story. For example, you could describe a scene in which your product is being used.
• Create a bulleted list: Add a section that lays out product features and materials.
• Include social proof: Deploy a product review app to capture customer reviews on your product page and integrate any customer feedback that already exists on search engines or social media platforms. 

Get your free ecommerce copywriting template

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Product descriptions are always worth the effort

Writing product descriptions for your online store isn’t about listing features. It’s a chance to connect with your target customers and show them exactly how a product fits into their lives.

Taking time to share your enthusiasm about a product’s backstory, design process, and thoughtful details proves you’re excited about your store’s items—making it more likely your customers will get excited, too.

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Product description FAQ

How do you write a product description statement.

To write an effective product description, follow these steps:

• Know your audience: Understand who your ideal customer is and what they care about. Use language and terminology that resonates with them.
• Highlight benefits, not features: Explain how your product can solve a problem or enhance the customer’s life.
• Use sensory language: Describe how the product feels, smells, sounds, tastes, or looks to help customers imagine owning or using it.
• Tell a story: Share the inspiration behind the product or its impact on customers to make it more relatable and memorable.
• Avoid clichés: Be specific and avoid overused phrases.
• Include social proof: Add customer reviews or testimonials to build trust and credibility.
• Make it scannable: Use bullet points, subheadings, and white space to make the description easy to read.
• Include a call to action: Encourage customers to make a purchase or take the next step.

What is the purpose of a product description?

Product descriptions have two purposes: to inform and persuade potential customers. Product descriptions inform readers by detailing a product’s features, helping them understand use-cases and value. Simultaneously, they persuade readers by showcasing a product’s benefits and solutions, compelling them to purchase.

What needs to be in a product description?

A product description should clearly highlight the key features and benefits of your product to attract customers. You should make it engaging by using persuasive language that speaks directly to their needs and desires.

What is a good product description format?

A good product description starts with an attention-grabbing product title, followed by a brief paragraph telling a story about a product’s value. Next, include a bulleted list of product features and details for easy scanning. Add customer reviews for credibility, and finish with a compelling call to action .

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How To Write A Business Plan (2024 Guide)

Updated: Apr 17, 2024, 11:59am

Table of Contents

Brainstorm an executive summary, create a company description, brainstorm your business goals, describe your services or products, conduct market research, create financial plans, bottom line, frequently asked questions.

Every business starts with a vision, which is distilled and communicated through a business plan. In addition to your high-level hopes and dreams, a strong business plan outlines short-term and long-term goals, budget and whatever else you might need to get started. In this guide, we’ll walk you through how to write a business plan that you can stick to and help guide your operations as you get started.

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Drafting the Summary

An executive summary is an extremely important first step in your business. You have to be able to put the basic facts of your business in an elevator pitch-style sentence to grab investors’ attention and keep their interest. This should communicate your business’s name, what the products or services you’re selling are and what marketplace you’re entering.

Ask for Help

When drafting the executive summary, you should have a few different options. Enlist a few thought partners to review your executive summary possibilities to determine which one is best.

After you have the executive summary in place, you can work on the company description, which contains more specific information. In the description, you’ll need to include your business’s registered name , your business address and any key employees involved in the business. 

The business description should also include the structure of your business, such as sole proprietorship , limited liability company (LLC) , partnership or corporation. This is the time to specify how much of an ownership stake everyone has in the company. Finally, include a section that outlines the history of the company and how it has evolved over time.

Wherever you are on the business journey, you return to your goals and assess where you are in meeting your in-progress targets and setting new goals to work toward.

Numbers-based Goals

Goals can cover a variety of sections of your business. Financial and profit goals are a given for when you’re establishing your business, but there are other goals to take into account as well with regard to brand awareness and growth. For example, you might want to hit a certain number of followers across social channels or raise your engagement rates.

Another goal could be to attract new investors or find grants if you’re a nonprofit business. If you’re looking to grow, you’ll want to set revenue targets to make that happen as well.

Intangible Goals

Goals unrelated to traceable numbers are important as well. These can include seeing your business’s advertisement reach the general public or receiving a terrific client review. These goals are important for the direction you take your business and the direction you want it to go in the future.

The business plan should have a section that explains the services or products that you’re offering. This is the part where you can also describe how they fit in the current market or are providing something necessary or entirely new. If you have any patents or trademarks, this is where you can include those too.

If you have any visual aids, they should be included here as well. This would also be a good place to include pricing strategy and explain your materials.

This is the part of the business plan where you can explain your expertise and different approach in greater depth. Show how what you’re offering is vital to the market and fills an important gap.

You can also situate your business in your industry and compare it to other ones and how you have a competitive advantage in the marketplace.

Other than financial goals, you want to have a budget and set your planned weekly, monthly and annual spending. There are several different costs to consider, such as operational costs.

Business Operations Costs

Rent for your business is the first big cost to factor into your budget. If your business is remote, the cost that replaces rent will be the software that maintains your virtual operations.

Marketing and sales costs should be next on your list. Devoting money to making sure people know about your business is as important as making sure it functions.

Other Costs

Although you can’t anticipate disasters, there are likely to be unanticipated costs that come up at some point in your business’s existence. It’s important to factor these possible costs into your financial plans so you’re not caught totally unaware.

Business plans are important for businesses of all sizes so that you can define where your business is and where you want it to go. Growing your business requires a vision, and giving yourself a roadmap in the form of a business plan will set you up for success.

How do I write a simple business plan?

When you’re working on a business plan, make sure you have as much information as possible so that you can simplify it to the most relevant information. A simple business plan still needs all of the parts included in this article, but you can be very clear and direct.

What are some common mistakes in a business plan?

The most common mistakes in a business plan are common writing issues like grammar errors or misspellings. It’s important to be clear in your sentence structure and proofread your business plan before sending it to any investors or partners.

What basic items should be included in a business plan?

When writing out a business plan, you want to make sure that you cover everything related to your concept for the business,  an analysis of the industry―including potential customers and an overview of the market for your goods or services―how you plan to execute your vision for the business, how you plan to grow the business if it becomes successful and all financial data around the business, including current cash on hand, potential investors and budget plans for the next few years.

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How To Write Product Descriptions To Grow Online Sales

No matter the size of your online store , product descriptions play a key role in your ecommerce business.

Effective product descriptions can possibly lure potential customers . Good product descriptions can potentially influence a purchase decision. Great product descriptions can ultimately help improve conversion rates and increase sales , as well as boost your visibility and SEO on paid channels .

The technical details, including the use of power words and A/B tests, can be the difference between a potential buyer on your ecommerce website and those customers shopping at a competitor with similar products.

Business owners, marketers and copywriters all know the importance of writing product descriptions, but what’s the best way to help reach your target audience ?

What are Product Descriptions?

A product description is a form of marketing copy used to describe and explain the benefits of your product. In other words, it provides all the information and details of your product on your ecommerce site.

These product details can be one sentence, a short paragraph or bulleted. They can be serious, funny or quirky. They can be located right next to or underneath product titles and product images. They can be scannable selling points or have strong readability.

There are multiple styles and ways to make product descriptions work for your ecommerce store, but there’s much more to them than simple copywriting.

Creating the Best Product Descriptions

There’s no doubt product descriptions can help take your business to the next level, but what should they say? How long should they be? Which format is best? How do you make the products rank high for Search Engine Optimization (SEO)?

Here’s a product description template to follow:

1. Think about the who, what, when, where, why and how before writing.

This method is often used by journalists to provide facts in their stories and it is the first step in crafting a product description.

Who is this product for? The target audience can be gender (i.e. male or female), an age group (i.e. college students or retirees), a lifestyle demographic (i.e. new mothers or car enthusiasts) or some other defined group of people.

What are the product’s basic details? This includes attributes such as dimensions, materials, product features, cost and functions.

When should someone use the product? Is it meant to be used during a certain time of day, seasonally or for a specific type of occasion? Just as important is pointing out if a product can or should be used every day or year-round. These details will help speak to the product’s long-term value.

Where should someone use the product? Is it meant for indoor or outdoor use, for your car or your home?

Why is this product useful or better than the competition? This can be anything from quality to value to features. Think about the product benefits to your customers and consider how images can complement your product copy.

How does the product work? This may not be necessary for every product, but it’s a must-have feature if you are selling anything with moving parts or electronics.

Let’s now dive into ways to make your product pages and landing pages shine.

2. Determine the best format to describe your products.

When starting to craft your perfect product description, it’s important to determine the best format to use.

Since some online shoppers only scan text on websites, it might be helpful to use bullet points that cover the most important product details. Bullet points should generally be used for specs (like dimensions) or short phrases (like features) so they are quick and easy to read.

Unfortunately, bullet points aren’t always the best way to tell a product’s story and convince target customers that they are looking at a great deal. They can look cold and clinical on a page instead of engaging the shopper’s emotions or imagination.

To avoid those common mistakes and pain points, use prose instead.

By writing a paragraph (three or more sentences) or two about the product, retailers can set the scene and help the shopper realize why their life up to this point has been incomplete without it. It may seem daunting, but after some practice, it will become second nature and even (gasp!) fun.

This is your opportunity to be a little creative and establish a voice (personality and tone) for your brand. Just imagine you’re at a party, telling someone you’ve just met about the product. How would you describe it so that they would understand how great it truly is?

This brand voice permeates every aspect of your online marketing: social media, SEO, paid search — every customer touchpoint. Unique, compelling copy makes your products more relevant for search engines and other marketing mediums that value original content.

In fact, following this simple formula below is a great way to writing compelling product descriptions:

[Paragraph(s) of Prose] + [Bulleted List of Specs or Product Features] = [Engaging Product Description]

3. Choose goals and KPIs to measure success of your product descriptions.

You need goals to measure the success of product descriptions.

“But this is going to take a long time,” you might be thinking, especially if you rely on product descriptions from your distributors or manufacturers. And you’re right, this isn’t a quick process. However, if you can commit to writing product descriptions using the formula above, you can begin to see a variety of benefits:

An increase in conversion rate.

A decrease in cart abandonment.

A lower return rate.

Fewer calls from shoppers.

Improved organic search rankings.

There are countless product description examples, including on platforms such as Amazon, BigCommerce and Shopify.

4. Make your product descriptions short and sweet.

Don’t overthink it. Use conversational paragraph-long descriptions to engage fans and ideal customers as well as quick bullet points with need-to-know specs to concisely convey the most important information for online shoppers.

5. Use storytelling to your advantage.

Does your product have a backstory that’s particularly special to you? Chances are it will be particularly special and endearing to your audience, too. Use that story in your product description to add more character to your item, engage your audience and win hearts and minds.

6. Don’t be afraid to boast.

Here’s how you take the product description formula above one step further. Is your product differentiated through a founder’s expertise? Is your product better because of years of testing? Is it hand-crafted? Does it get strong social proof with testimonials and product reviews?

Call that out!

Tell a better story in your short product description paragraph by including tidbits of detail that prove why your product is better than the rest. Don’t be afraid to name drop, either.

7. Get technical to win trust when needed.

If you have a more technical product, don’t be afraid to get in the weeds with your product description. Prove to your customer your brand’s expertise in the industry by providing all possible details they’d need to know before they ever even have to ask.

8. Know when to show and not tell.

Text isn’t always the best way to describe your product. If you are getting too wordy, think about how you can simplify.

Images carry weight and are better remembered by customers. If possible, show off your product in a visual that explains exactly what the product does.

9. Know when to show, tell and describe.

Other than graphics, videos can be an effective way to showcase how to use a product or why it is better than others. Many brands use videos , graphics and text to drive the point home.

10. Don’t be afraid to be unique.

While a short paragraph description on a product page is a best practice, know when that isn’t what your audience wants. Every industry and online business is unique. Do you know your customer well enough to know they won’t read that product description? Are all of your customers scanners?

Pull out the content that is most important to them and find engaging, visual ways to get all the relevant information to them without any headache. Your buyer personas should inform the overall form and approach toward your product descriptions, including the website design and white space on the page.

Go Big or Go Home

In all, it’s important to first know your audience in order to determine what kind of content will best speak to them to increase conversions.

The ecommerce product description formula works for most brands, but it’s only a starting point.

Think visually. Add graphics and optimize your product images. A/B test copy and get personal on those pages. Look at Google Search Console to identify popular terms and power words so you can improve SEO traffic to the product page.

Whether you’re selling t-shirts or strollers, shoppers like to buy from people they trust and building trust is different based on what you are selling.

From the moment you use a website builder and construct your site’s design, think about how images and descriptions can work in harmony to tell your story to customers. There are countless examples of product descriptions, but find the best fit for your business.

Know your audience. Know your product. And then, show and tell with your online shop descriptions.

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• How to Write a Great Business Plan: Products and Services

The fourth in a comprehensive series to help you craft the perfect business plan for your startup.

This article is part of a series on  how to write a great business plan .

In the Products and Services section of your business plan, you will clearly describe--yep--the products and services your business will provide.

Keep in mind that highly detailed or technical descriptions are not necessary and definitely not recommended. Use simple terms and avoid industry buzzwords so your readers can easily understand.

On the other hand, describing how the company's products and services will differ from the competition is critical. So is describing why your products and services are needed if no market currently exists. (For example, before there was Federal Express, overnight delivery was a niche business served by small companies. FedEx had to define the opportunity for a new, large-scale service and justify why customers needed--and would actually use --that service.)

Patents, copyrights, and trademarks you own or have applied for should also be listed in this section.

Depending on the nature of your business, your Products and Services section could be very long or relatively short. If your business is product-focused, you will want to spend more time describing those products.

If you plan to sell a commodity item and the key to your success lies in, say, competitive pricing, you probably don't need to provide significant product detail. Or if you plan to sell a commodity readily available in a variety of outlets, the key to your business may not be the commodity itself but your ability to market in a more cost-effective way than your competition.

But if you're creating a new product (or service), make sure you thoroughly explain the nature of the product, its uses, and its value, etc.--otherwise your readers will not have enough information to evaluate your business.

Key questions to answer:

• Are products or services in development or existing (and on the market)?
• What is the timeline for bringing new products and services to market?
• What makes your products or services different? Are there competitive advantages compared with offerings from other competitors? Are there competitive disadvantages you will need to overcome? (And if so, how?)
• Is price an issue? Will your operating costs be low enough to allow a reasonable profit margin?
• How will you acquire your products? Are you the manufacturer? Do you assemble products using components provided by others? Do you purchase products from suppliers or wholesalers? If your business takes off, is a steady supply of products available?

In the cycling rental business example we've been using, products and services could be a relatively simple section to complete or it could be fairly involved. It depends on the nature of the products the company plans to rent to customers.

If Blue Mountain Cycling Rentals plans to market itself as a provider of high-end bikes, describing those bikes--and the sources for those bikes--is important, since "high-end cycling rentals" is intended to be a market differentiation. If the company plans to be the low-cost provider, then describing specific brands of equipment is probably not necessary.

Also, keep in mind that if a supplier runs out of capacity--or goes out of business altogether--you may not have a sufficient supply to meet your demand. Plan to set up multiple vendor or supplier relationships, and describe those relationships fully. 

Remember, the primary goal of your business plan is to convince you that the business is viable--and to create a road map for you to follow.

The Products and Services section for our cycling rental business could start something like this:

Product Description

Blue Mountain Cycle Rentals will provide a comprehensive line of bicycles and cycling equipment for all ages and levels of ability. Since the typical customer seeks medium-quality equipment and excellent services at competitive prices, we will focus on providing brands like Trek bikes, Shimano footwear, and Giro helmets. These manufacturers have a widespread reputation as mid- to high-level quality, unlike equipment typically found in the rental market.

The following is a breakdown of anticipated rental price points, per day and per week:

Bicycle $30 $120

Helmet $6 $30

• Customers can extend the rental term online without visiting the store.
• A grace period of two hours will be applied to all rentals; customers who return equipment within that two-hour period will not be charged an additional fee.

Competition

Blue Mountain Cycle Rentals will have clear advantages over its primary competitors, the bike shops located in Harrisonburg, Virginia:

• Newer equipment inventory with higher perceived quality
• Price points 15 percent below the competition
• Online renewals offering greater convenience
• A liberal return grace period that will reinforce our reputation as a customer-friendly rental experience

Future Products

Expansion will allow us to move product offerings into new equipment sales. We will also explore maintenance and fitting services, leveraging our existing maintenance staff to provide value-added services at a premium price.

(And so on...)

When you draft your Products and Services section, think of your reader as a person who knows little to nothing about your business. Be clear and to the point.

Think of it this way: The Products and Services section answers the "what" question for your business. Make sure you fully understand the "what" factor; you may run the business, but your products and services are its lifeblood.

Now let's take a look at the next major section of your business plan: the Market Opportunities .

More in this series:

• How to Write a Great Business Plan: Key Concepts
• How to Write a Great Business Plan: the Executive Summary
• How to Write a Great Business Plan: Overview and Objectives
• How to Write a Great Business Plan: Market Opportunities
• How to Write a Great Business Plan: Sales and Marketing
• How to Write a Great Business Plan: Competitive Analysis
• How to Write a Great Business Plan: Operations
• How to Write a Great Business Plan: Management Team
• How to Write a Great Business Plan: Financial Analysis

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How to Write the Products or Services Section

Learn about this essential part of a business plan

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Describe and Compare

Price points, order fulfillment, tips for writing the products or services section.

The products or services section of your business plan should clearly describe what you are selling with an emphasis on the value you're providing to your customers or clients. Include an in-depth look at all of the elements related to what you are selling.

The section needs to explain exactly what you are selling and how it fits in the marketplace. It's easier to describe the value provided if you are the only business in the area selling the product or service in question, but it is likely competitors are doing something similar.

Provide information about your competitors' offerings, how they are similar to yours, and how they are different. It's possible your business has a slightly different take on the product or service or is targeting a slightly different audience. It's also possible what you are offering is almost identical to what your competitors are offering, but demand in the marketplace is high enough to support multiple businesses doing the same thing. Explain your situation.

In addition to describing the actual products or services, break down how much they will cost. Products may come in different sizes, quantities, or varieties that will impact price, and services might be more or less extensive depending on the price being charged.

Address what competitors are doing in this regard as well. Perhaps you are offering higher or lower quality for a different demographic, but be clear about the cost and who can afford it.

Explain what happens once someone purchases what you are selling. If it is a product, they might buy it from a retail store, have it delivered from your online shop, or perhaps they submit a custom order in advance and pick it up at a later date.

If you are offering a service, it might be something that involves clients coming to you, or you might go to them. Whatever the details, make sure the process is clear.

If special technology is involved, outline what it entails. This could be specific technology you need in order to provide your services, or it might be technology clients or customers need in order to take advantage of what you're selling.

For example, if signing up clients for a training seminar, you might need specific hardware and software for a presentation. Perhaps you are selling software that requires the latest version of a particular operating system. Be sure these details are provided.

Make your description of available products or services an effective part of your business plan by following these tips:

• Focus on the customer:  The purpose of the products or services section is to clearly express the benefits you're providing to your customers or clients. Focus on that goal by addressing how what you are selling benefits your customers. Show how it makes their lives better, easier, or more profitable.
• Get to the point:  State the value upfront, then elaborate throughout the rest of the section while providing supporting materials. For example, if the primary benefit of what you are offering is that it saves time, state as much right away. Follow this statement with details about how it saves time and data to support the claim.
• Keep It simple:  Assume the reader has little to no understanding of your industry and product or service. You're the expert in the industry, but the basics may not be as clear to those reading your business plan.
• Show what makes you unique:  While describing similar products and services that are already in existence, take some time in your description to express how your product or service stands out as something different.
• Include the fine print:  While the bulk of your products or services section should focus on the end result, you also should include information about your pricing and how you arrived at that price point.

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How to Write a Business Plan, Step by Step

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What is a business plan?

1. write an executive summary, 2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. summarize how your company operates, 10. add any additional information to an appendix, business plan tips and resources.

A business plan outlines your business’s financial goals and explains how you’ll achieve them over the next three to five years. Here’s a step-by-step guide to writing a business plan that will offer a strong, detailed road map for your business.

LLC Formation

A business plan is a document that explains what your business does, how it makes money and who its customers are. Internally, writing a business plan should help you clarify your vision and organize your operations. Externally, you can share it with potential lenders and investors to show them you’re on the right track.

Business plans are living documents; it’s OK for them to change over time. Startups may update their business plans often as they figure out who their customers are and what products and services fit them best. Mature companies might only revisit their business plan every few years. Regardless of your business’s age, brush up this document before you apply for a business loan .

» Need help writing? Learn about the best business plan software .

This is your elevator pitch. It should include a mission statement, a brief description of the products or services your business offers and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description. This should contain basic information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, write a little about the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out what you’d like to accomplish, both in the near term and over the coming years.

If you’re looking for a business loan or outside investment, you can use this section to explain how the financing will help your business grow and how you plan to achieve those growth targets. The key is to provide a clear explanation of the opportunity your business presents to the lender.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch that new product and how much you think sales will increase over the next three years as a result.

» MORE: How to write a successful business plan for a loan

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

Include details about your sales and distribution strategies, including the costs involved in selling each product .

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

Accounting software may be able to generate these reports for you. It may also help you calculate metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

Before the end of your business plan, summarize how your business is structured and outline each team’s responsibilities. This will help your readers understand who performs each of the functions you’ve described above — making and selling your products or services — and how much each of those functions cost.

If any of your employees have exceptional skills, you may want to include their resumes to help explain the competitive advantage they give you.

Finally, attach any supporting information or additional materials that you couldn’t fit in elsewhere. That might include:

Licenses and permits.

Equipment leases.

Bank statements.

Details of your personal and business credit history, if you’re seeking financing.

If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are some tips to write a detailed, convincing business plan:

Avoid over-optimism: If you’re applying for a business bank loan or professional investment, someone will be reading your business plan closely. Providing unreasonable sales estimates can hurt your chances of approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

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How to Write a Business Plan for a Small Business

Noah Parsons

24 min. read

Updated September 2, 2024

Writing a business plan doesn’t have to be complicated. 

In this step-by-step guide, you’ll learn how to write a business plan that’s detailed enough to impress bankers and potential investors, while giving you the tools to start, run, and grow a successful business.

• The basics of writing a business plan

If you’re reading this guide, then you already know why you need a business plan . 

You understand that writing a business plan helps you: 

• Raise money
• Grow strategically
• Keep your business on the right track 

As you start to write your business plan, it’s useful to zoom out and remember what a business plan is .

At its core, a business plan is an overview of the products and services you sell, and the customers that you sell to. It explains your business strategy: how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

Most business plans also include financial forecasts for the future. These set sales goals, budget for expenses, and predict profits and cash flow. 

A good business plan is much more than just a document that you write once and forget about. It’s also a guide that helps you outline and achieve your goals. 

After writing your business plan, you can use it as a management tool to track your progress toward your goals. Updating and adjusting your forecasts and budgets as you go is one of the most important steps you can take to run a healthier, smarter business. 

We’ll dive into how to use your plan later in this article.

There are many different types of plans , but we’ll go over the most common type here, which includes everything you need for an investor-ready plan. However, if you’re just starting out and are looking for something simpler—I recommend starting with a one-page business plan . It’s faster and easier to create. 

It’s also the perfect place to start if you’re just figuring out your idea, or need a simple strategic plan to use inside your business.

Dig deeper : How to write a one-page business plan

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• What to include in your business plan

Executive summary

The executive summary is an overview of your business and your plans. It comes first in your plan and is ideally just one to two pages. Most people write it last because it’s a summary of the complete business plan.

Ideally, the executive summary can act as a stand-alone document that covers the highlights of your detailed plan. 

In fact, it’s common for investors to ask only for the executive summary when evaluating your business. If they like what they see in the executive summary, they’ll often follow up with a request for a complete plan, a pitch presentation , or more in-depth financial forecasts .

Your executive summary should include:

• A summary of the problem you are solving
• A description of your product or service
• An overview of your target market
• A brief description of your team
• A summary of your financials
• Your funding requirements (if you are raising money)

Dig Deeper: How to write an effective executive summary

Products and services description

When writing a business plan, the produces and services section is where you describe exactly what you’re selling, and how it solves a problem for your target market. The best way to organize this part of your plan is to start by describing the problem that exists for your customers. After that, you can describe how you plan to solve that problem with your product or service. 

This is usually called a problem and solution statement .

To truly showcase the value of your products and services, you need to craft a compelling narrative around your offerings. How will your product or service transform your customers’ lives or jobs? A strong narrative will draw in your readers.

This is also the part of the business plan to discuss any competitive advantages you may have, like specific intellectual property or patents that protect your product. If you have any initial sales, contracts, or other evidence that your product or service is likely to sell, include that information as well. It will show that your idea has traction , which can help convince readers that your plan has a high chance of success.

Market analysis

Your target market is a description of the type of people that you plan to sell to. You might even have multiple target markets, depending on your business. 

A market analysis is the part of your plan where you bring together all of the information you know about your target market. Basically, it’s a thorough description of who your customers are and why they need what you’re selling. You’ll also include information about the growth of your market and your industry .

Try to be as specific as possible when you describe your market. 

Include information such as age, income level, and location—these are what’s called “demographics.” If you can, also describe your market’s interests and habits as they relate to your business—these are “psychographics.” 

Related: Target market examples

Essentially, you want to include any knowledge you have about your customers that is relevant to how your product or service is right for them. With a solid target market, it will be easier to create a sales and marketing plan that will reach your customers. That’s because you know who they are, what they like to do, and the best ways to reach them.

Next, provide any additional information you have about your market. 

What is the size of your market ? Is the market growing or shrinking? Ideally, you’ll want to demonstrate that your market is growing over time, and also explain how your business is positioned to take advantage of any expected changes in your industry.

Dig Deeper: Learn how to write a market analysis

Competitive analysis

Part of defining your business opportunity is determining what your competitive advantage is. To do this effectively, you need to know as much about your competitors as your target customers. 

Every business has some form of competition. If you don’t think you have competitors, then explore what alternatives there are in the market for your product or service. 

For example: In the early years of cars, their main competition was horses. For social media, the early competition was reading books, watching TV, and talking on the phone.

A good competitive analysis fully lays out the competitive landscape and then explains how your business is different. Maybe your products are better made, or cheaper, or your customer service is superior. Maybe your competitive advantage is your location – a wide variety of factors can ultimately give you an advantage.

Dig Deeper: How to write a competitive analysis for your business plan

Marketing and sales plan

The marketing and sales plan covers how you will position your product or service in the market, the marketing channels and messaging you will use, and your sales tactics. 

The best place to start with a marketing plan is with a positioning statement . 

This explains how your business fits into the overall market, and how you will explain the advantages of your product or service to customers. You’ll use the information from your competitive analysis to help you with your positioning. 

For example: You might position your company as the premium, most expensive but the highest quality option in the market. Or your positioning might focus on being locally owned and that shoppers support the local economy by buying your products.

Once you understand your positioning, you’ll bring this together with the information about your target market to create your marketing strategy . 

This is how you plan to communicate your message to potential customers. Depending on who your customers are and how they purchase products like yours, you might use many different strategies, from social media advertising to creating a podcast. Your marketing plan is all about how your customers discover who you are and why they should consider your products and services. 

While your marketing plan is about reaching your customers—your sales plan will describe the actual sales process once a customer has decided that they’re interested in what you have to offer. 

If your business requires salespeople and a long sales process, describe that in this section. If your customers can “self-serve” and just make purchases quickly on your website, describe that process. 

A good sales plan picks up where your marketing plan leaves off. The marketing plan brings customers in the door and the sales plan is how you close the deal.

Together, these specific plans paint a picture of how you will connect with your target audience, and how you will turn them into paying customers.

Dig deeper: What to include in your sales and marketing plan

Business operations

When writing a business plan, the operations section describes the necessary requirements for your business to run smoothly. It’s where you talk about how your business works and what day-to-day operations look like. 

Depending on how your business is structured, your operations plan may include elements of the business like:

• Supply chain management
• Manufacturing processes
• Equipment and technology
• Distribution

Some businesses distribute their products and reach their customers through large retailers like Amazon.com, Walmart, Target, and grocery store chains. 

These businesses should review how this part of their business works. The plan should discuss the logistics and costs of getting products onto store shelves and any potential hurdles the business may have to overcome.

If your business is much simpler than this, that’s OK. This section of your business plan can be either extremely short or more detailed, depending on the type of business you are building.

For businesses selling services, such as physical therapy or online software, you can use this section to describe the technology you’ll leverage, what goes into your service, and who you will partner with to deliver your services.

Dig Deeper: Learn how to write the operations chapter of your plan

Key milestones and metrics

Although it’s not required to complete your business plan, mapping out key business milestones and the metrics can be incredibly useful for measuring your success.

Good milestones clearly lay out the parameters of the task and set expectations for their execution. You’ll want to include:

• A description of each task
• The proposed due date
• Who is responsible for each task

If you have a budget, you can include projected costs to hit each milestone. You don’t need extensive project planning in this section—just list key milestones you want to hit and when you plan to hit them. This is your overall business roadmap. 

Possible milestones might be:

• Website launch date
• Store or office opening date
• First significant sales
• Break even date
• Business licenses and approvals

You should also discuss the key numbers you will track to determine your success. Some common metrics worth tracking include:

• Conversion rates
• Customer acquisition costs
• Profit per customer
• Repeat purchases

It’s perfectly fine to start with just a few metrics and grow the number you are tracking over time. You also may find that some metrics simply aren’t relevant to your business and can narrow down what you’re tracking.

Dig Deeper: How to use milestones in your business plan

Organization and management team

Investors don’t just look for great ideas—they want to find great teams. Use this chapter to describe your current team and who you need to hire . You should also provide a quick overview of your location and history if you’re already up and running.

Briefly highlight the relevant experiences of each key team member in the company. It’s important to make the case for why yours is the right team to turn an idea into a reality. 

Do they have the right industry experience and background? Have members of the team had entrepreneurial successes before? 

If you still need to hire key team members, that’s OK. Just note those gaps in this section.

Your company overview should also include a summary of your company’s current business structure . The most common business structures include:

• Sole proprietor
• Partnership

Be sure to provide an overview of how the business is owned as well. Does each business partner own an equal portion of the business? How is ownership divided? 

Potential lenders and investors will want to know the structure of the business before they will consider a loan or investment.

Dig Deeper: How to write about your company structure and team

Financial plan

The last section of your business plan is your financial plan and forecasts. 

Entrepreneurs often find this section the most daunting. But, business financials for most startups are less complicated than you think, and a business degree is certainly not required to build a solid financial forecast. 

A typical financial forecast in a business plan includes the following:

• Sales forecast : An estimate of the sales expected over a given period. You’ll break down your forecast into the key revenue streams that you expect to have.
• Expense budget : Your planned spending such as personnel costs , marketing expenses, and taxes.
• Profit & Loss : Brings together your sales and expenses and helps you calculate planned profits.
• Cash Flow : Shows how cash moves into and out of your business. It can predict how much cash you’ll have on hand at any given point in the future.
• Balance Sheet : A list of the assets, liabilities, and equity in your company. In short, it provides an overview of the financial health of your business. 

A strong business plan will include a description of assumptions about the future, and potential risks that could impact the financial plan. Including those will be especially important if you’re writing a business plan to pursue a loan or other investment.

Dig Deeper: How to create financial forecasts and budgets

This is the place for additional data, charts, or other information that supports your plan.

Including an appendix can significantly enhance the credibility of your plan by showing readers that you’ve thoroughly considered the details of your business idea, and are backing your ideas up with solid data.

Just remember that the information in the appendix is meant to be supplementary. Your business plan should stand on its own, even if the reader skips this section.

Dig Deeper : What to include in your business plan appendix

Optional: Business plan cover page

Adding a business plan cover page can make your plan, and by extension your business, seem more professional in the eyes of potential investors, lenders, and partners. It serves as the introduction to your document and provides necessary contact information for stakeholders to reference.

Your cover page should be simple and include:

• Company logo
• Business name
• Value proposition (optional)
• Business plan title
• Completion and/or update date
• Address and contact information
• Confidentiality statement

Just remember, the cover page is optional. If you decide to include it, keep it very simple and only spend a short amount of time putting it together.

Dig Deeper: How to create a business plan cover page

How to use AI to help write your business plan

Generative AI tools such as ChatGPT can speed up the business plan writing process and help you think through concepts like market segmentation and competition. These tools are especially useful for taking ideas that you provide and converting them into polished text for your business plan.

The best way to use AI to write a business plan is to leverage it as a collaborator , not a replacement for human creative thinking and ingenuity. 

AI can come up with lots of ideas and act as a brainstorming partner. It’s up to you to filter through those ideas and figure out which ones are realistic enough to resonate with your customers. 

There are pros and cons of using AI to help with your business plan . So, spend some time understanding how it can be most helpful before just outsourcing the job to AI.

Learn more: 10 AI prompts you need to write a business plan

• Writing tips and strategies

To help streamline the business plan writing process, here are a few tips and key questions to answer to make sure you get the most out of your plan and avoid common mistakes .  

Determine why you are writing a business plan

Knowing why you are writing a business plan will determine your approach to your planning project. 

For example: If you are writing a business plan for yourself, or just to use inside your own business , you can probably skip the section about your team and organizational structure. 

If you’re raising money, you’ll want to spend more time explaining why you’re looking to raise the funds and exactly how you will use them.

Regardless of how you intend to use your business plan , think about why you are writing and what you’re trying to get out of the process before you begin.

Keep things concise

Probably the most important tip is to keep your business plan short and simple. There are no prizes for long business plans . The longer your plan is, the less likely people are to read it. 

So focus on trimming things down to the essentials your readers need to know. Skip the extended, wordy descriptions and instead focus on creating a plan that is easy to read —using bullets and short sentences whenever possible.

Have someone review your business plan

Writing a business plan in a vacuum is never a good idea. Sometimes it’s helpful to zoom out and check if your plan makes sense to someone else. You also want to make sure that it’s easy to read and understand.

Don’t wait until your plan is “done” to get a second look. Start sharing your plan early, and find out from readers what questions your plan leaves unanswered. This early review cycle will help you spot shortcomings in your plan and address them quickly, rather than finding out about them right before you present your plan to a lender or investor.

If you need a more detailed review, you may want to explore hiring a professional plan writer to thoroughly examine it.

Use a free business plan template and business plan examples to get started

Knowing what information to include in a business plan is sometimes not quite enough. If you’re struggling to get started or need additional guidance, it may be worth using a business plan template. 

There are plenty of great options available (we’ve rounded up our 8 favorites to streamline your search).

But, if you’re looking for a free downloadable business plan template , you can get one right now; download the template used by more than 1 million businesses. 

Or, if you just want to see what a completed business plan looks like, check out our library of over 550 free business plan examples . 

We even have a growing list of industry business planning guides with tips for what to focus on depending on your business type.

Common pitfalls and how to avoid them

It’s easy to make mistakes when you’re writing your business plan. Some entrepreneurs get sucked into the writing and research process, and don’t focus enough on actually getting their business started. 

Here are a few common mistakes and how to avoid them:

Not talking to your customers : This is one of the most common mistakes. It’s easy to assume that your product or service is something that people want. Before you invest too much in your business and too much in the planning process, make sure you talk to your prospective customers and have a good understanding of their needs.

• Overly optimistic sales and profit forecasts: By nature, entrepreneurs are optimistic about the future. But it’s good to temper that optimism a little when you’re planning, and make sure your forecasts are grounded in reality. 
• Spending too much time planning: Yes, planning is crucial. But you also need to get out and talk to customers, build prototypes of your product and figure out if there’s a market for your idea. Make sure to balance planning with building.
• Not revising the plan: Planning is useful, but nothing ever goes exactly as planned. As you learn more about what’s working and what’s not—revise your plan, your budgets, and your revenue forecast. Doing so will provide a more realistic picture of where your business is going, and what your financial needs will be moving forward.
• Not using the plan to manage your business: A good business plan is a management tool. Don’t just write it and put it on the shelf to collect dust – use it to track your progress and help you reach your goals.
• Presenting your business plan

The planning process forces you to think through every aspect of your business and answer questions that you may not have thought of. That’s the real benefit of writing a business plan – the knowledge you gain about your business that you may not have been able to discover otherwise.

With all of this knowledge, you’re well prepared to convert your business plan into a pitch presentation to present your ideas. 

A pitch presentation is a summary of your plan, just hitting the highlights and key points. It’s the best way to present your business plan to investors and team members.

Dig Deeper: Learn what key slides should be included in your pitch deck

Use your business plan to manage your business

One of the biggest benefits of planning is that it gives you a tool to manage your business better. With a revenue forecast, expense budget, and projected cash flow, you know your targets and where you are headed.

And yet, nothing ever goes exactly as planned – it’s the nature of business.

That’s where using your plan as a management tool comes in. The key to leveraging it for your business is to review it periodically and compare your forecasts and projections to your actual results.

Start by setting up a regular time to review the plan – a monthly review is a good starting point. During this review, answer questions like:

• Did you meet your sales goals?
• Is spending following your budget?
• Has anything gone differently than what you expected?

Now that you see whether you’re meeting your goals or are off track, you can make adjustments and set new targets. 

Maybe you’re exceeding your sales goals and should set new, more aggressive goals. In that case, maybe you should also explore more spending or hiring more employees. 

Or maybe expenses are rising faster than you projected. If that’s the case, you would need to look at where you can cut costs.

A plan, and a method for comparing your plan to your actual results , is the tool you need to steer your business toward success.

Learn More: How to run a regular plan review

How to write a business plan FAQ

What is a business plan?

A document that describes your business , the products and services you sell, and the customers that you sell to. It explains your business strategy, how you’re going to build and grow your business, what your marketing strategy is, and who your competitors are.

What are the benefits of writing a business plan?

A business plan helps you understand where you want to go with your business and what it will take to get there. It reduces your overall risk, helps you uncover your business’s potential, attracts investors, and identifies areas for growth.

Writing a business plan ultimately makes you more confident as a business owner and more likely to succeed for a longer period of time.

What are the 7 steps of writing a business plan?

The seven steps to writing a business plan include:

• Write a brief executive summary
• Describe your products and services.
• Conduct market research and compile data into a cohesive market analysis.
• Describe your marketing and sales strategy.
• Outline your organizational structure and management team.
• Develop financial projections for sales, revenue, and cash flow.
• Add any additional documents to your appendix.

What are the 5 most common business plan mistakes?

There are plenty of mistakes that can be made when writing a business plan. However, these are the 5 most common that you should do your best to avoid:

• 1. Not taking the planning process seriously.
• Having unrealistic financial projections or incomplete financial information.
• Inconsistent information or simple mistakes.
• Failing to establish a sound business model.
• Not having a defined purpose for your business plan.

What questions should be answered in a business plan?

Writing a business plan is all about asking yourself questions about your business and being able to answer them through the planning process. You’ll likely be asking dozens and dozens of questions for each section of your plan.

However, these are the key questions you should ask and answer with your business plan:

• How will your business make money?
• Is there a need for your product or service?
• Who are your customers?
• How are you different from the competition?
• How will you reach your customers?
• How will you measure success?

How long should a business plan be?

The length of your business plan fully depends on what you intend to do with it. From the SBA and traditional lender point of view, a business plan needs to be whatever length necessary to fully explain your business. This means that you prove the viability of your business, show that you understand the market, and have a detailed strategy in place.

If you intend to use your business plan for internal management purposes, you don’t necessarily need a full 25-50 page business plan. Instead, you can start with a one-page plan to get all of the necessary information in place.

What are the different types of business plans?

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. Here are a few common business plan types worth considering.

Traditional business plan: The tried-and-true traditional business plan is a formal document meant to be used when applying for funding or pitching to investors. This type of business plan follows the outline above and can be anywhere from 10-50 pages depending on the amount of detail included, the complexity of your business, and what you include in your appendix.

Business model canvas: The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea.

One-page business plan: This format is a simplified version of the traditional plan that focuses on the core aspects of your business. You’ll typically stick with bullet points and single sentences. It’s most useful for those exploring ideas, needing to validate their business model, or who need an internal plan to help them run and manage their business.

Lean Plan: The Lean Plan is less of a specific document type and more of a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, test, review, refine, and take action based on performance. It’s faster, keeps your plan concise, and ensures that your plan is always up-to-date.

What’s the difference between a business plan and a strategic plan?

A business plan covers the “who” and “what” of your business. It explains what your business is doing right now and how it functions. The strategic plan explores long-term goals and explains “how” the business will get there. It encourages you to look more intently toward the future and how you will achieve your vision.

However, when approached correctly, your business plan can actually function as a strategic plan as well. If kept lean, you can define your business, outline strategic steps, and track ongoing operations all with a single plan.

Noah is the COO at Palo Alto Software, makers of the online business plan app LivePlan. He started his career at Yahoo! and then helped start the user review site Epinions.com. From there he started a software distribution business in the UK before coming to Palo Alto Software to run the marketing and product teams.

Table of Contents

• Use AI to help write your plan
• Common planning mistakes
• Manage with your business plan

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How To Write a Business Plan

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Starting a business is a wild ride, and a solid business plan can be the key to keeping you on track. A business plan is essentially a roadmap for your business — outlining your goals, strategies, market analysis and financial projections. Not only will it guide your decision-making, a business plan can help you secure funding with a loan or from investors .

Writing a business plan can seem like a huge task, but taking it one step at a time can break the plan down into manageable milestones. Here is our step-by-step guide on how to write a business plan.

Table of contents

• Write your executive summary
• Do your market research homework
• Set your business goals and objectives
• Plan your business strategy
• Describe your product or service
• Crunch the numbers
• Finalize your business plan

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Step 1: Write your executive summary

Though this will be the first page of your business plan , we recommend you actually write the executive summary last. That’s because an executive summary highlights what’s to come in the business plan but in a more condensed fashion.

An executive summary gives stakeholders who are reading your business plan the key points quickly without having to comb through pages and pages. Be sure to cover each successive point in a concise manner, and include as much data as necessary to support your claims.

You’ll cover other things too, but answer these basic questions in your executive summary:

• Idea: What’s your business concept? What problem does your business solve? What are your business goals?
• Product: What’s your product/service and how is it different?
• Market: Who’s your audience? How will you reach customers?
• Finance: How much will your idea cost? And if you’re seeking funding, how much money do you need? How much do you expect to earn? If you’ve already started, where is your revenue at now?

Step 2: Do your market research homework

The next step in writing a business plan is to conduct market research . This involves gathering information about your target market (or customer persona), your competition, and the industry as a whole. You can use a variety of research methods such as surveys, focus groups, and online research to gather this information. Your method may be formal or more casual, just make sure that you’re getting good data back.

This research will help you to understand the needs of your target market and the potential demand for your product or service—essential aspects of starting and growing a successful business.

Step 3: Set your business goals and objectives

Once you’ve completed your market research, you can begin to define your business goals and objectives. What is the problem you want to solve? What’s your vision for the future? Where do you want to be in a year from now?

Use this step to decide what you want to achieve with your business, both in the short and long term. Try to set SMART goals—specific, measurable, achievable, relevant, and time-bound benchmarks—that will help you to stay focused and motivated as you build your business.

Step 4: Plan your business strategy

Your business strategy is how you plan to reach your goals and objectives. This includes details on positioning your product or service, marketing and sales strategies, operational plans, and the organizational structure of your small business.

Make sure to include key roles and responsibilities for each team member if you’re in a business entity with multiple people.

Step 5: Describe your product or service

In this section, get into the nitty-gritty of your product or service. Go into depth regarding the features, benefits, target market, and any patents or proprietary tech you have. Make sure to paint a clear picture of what sets your product apart from the competition—and don’t forget to highlight any customer benefits.

Step 6: Crunch the numbers

Financial analysis is an essential part of your business plan. If you’re already in business that includes your profit and loss statement , cash flow statement and balance sheet .

These financial projections will give investors and lenders an understanding of the financial health of your business and the potential return on investment.

You may want to work with a financial professional to ensure your financial projections are realistic and accurate.

Step 7: Finalize your business plan

Once you’ve completed everything, it's time to finalize your business plan. This involves reviewing and editing your plan to ensure that it is clear, concise, and easy to understand.

You should also have someone else review your plan to get a fresh perspective and identify any areas that may need improvement. You could even work with a free SCORE mentor on your business plan or use a SCORE business plan template for more detailed guidance.

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The takeaway

Writing a business plan is an essential process for any forward-thinking entrepreneur or business owner. A business plan requires a lot of up-front research, planning, and attention to detail, but it’s worthwhile. Creating a comprehensive business plan can help you achieve your business goals and secure the funding you need.

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How to Excite Readers With Your Business Plan's Product Section. (Yes, Seriously.) Product descriptions can be as dry as toast--or as exciting as a roller coaster ride. Here's how to craft one that keeps people reading.

By Teresa Ciulla Dec 18, 2014

Opinions expressed by Entrepreneur contributors are their own.

In their book Write Your Business Plan , the staff of Entrepreneur Media offer an in-depth understanding of what's essential to any business plan, what's appropriate for your venture, and what it takes to ensure success. In this edited excerpt, the authors offer a look at 15 factors you can use to make your product or service stand out from the pack.

In your plan, it's important to be able to build a convincing case for the product or service upon which your business will be built. The product description section is where you do that. In this section, you'll describe your product in terms of several characteristics, including cost, features, distribution, target market, competition and production concerns.

A product description is more than a mere listing of product features, however. You have to highlight your product's most compelling characteristics, such as low cost or uniquely high quality, that will make it stand out in the marketplace and attract buyers willing to pay your price. Even the simplest product has a number of unique potential selling strengths.

Many of the common unique selling strengths are seemingly contradictory. How can both mass popularity and exclusive distribution be strengths? The explanation is that it depends on your market and what its buyers want.

Here are the things you'll want to consider when creating the product section of your business plan that will help grab your readers' attention:

Features. If your product is faster, bigger or smaller, or comes in more colors, sizes and configurations than others on the market, you have a powerful selling strength. In fact, if you can't offer some combination of features that sets you apart, you'll have difficulty writing a convincing plan.

Price. Everybody wants to pay less for a product. If you can position yourself as the low-cost provider (and make money at these rock-bottom prices), you have a powerful selling advantage. Conversely, high-priced products may appeal to many markets for their better-quality, high-end value. People with discerning tastes want quality and don't buy based solely on price points, so saving money isn't always the issue. Price is also dependent on other issues such as service. People will pay more for good customer service.

Time savings. People buy products to help them expedite a process. If yours is faster and can help them get out of the office and on their way home more quickly, they want it. Today, everyone is looking to save time, so products and services that help people do that are valuable.

Ease of transport. The mobile world has taken over. People are using their mobile phones to go online as much if not more than their laptops. How mobile is your product? Today's consumers like to take things with them—they want apps and gadgets that are portable.

Availability. Typically, the more easily accessible your products are, the better it is for business. In most cases, you want to have products and services that people can get quickly. Today, thanks to the Internet, you no longer need brick-and-mortar locations in many communities. Scarcity, however, can also generate a higher demand, so you may have a marketing plan to release products at intervals and let the demand—and the desire—build. Scarcity doesn't mean that you'll be running out anytime soon. For service providers, availability means a good location or locations that are easy to get to.

Cutting edge/new . If you have something to offer that's not on the market, this is a major selling point or competitive edge. Get out there and patent it, market it and sell it before someone comes along and steals your thunder. You can also utilize technology to build upon products or services you already provide, such as an app.

Training and support . These are components of service that have become increasingly important, particularly for high-technology products. For many sophisticated software products and electronic devices, a seller who can't provide tech support to buyers will have no chance of success.

Financing . Whether you "tote the note" and guarantee credit to anyone, offer innovative leasing, do buybacks or have other financing alternatives, you'll find that giving people different, more convenient ways to pay can lend your product a convincing strength.

Customer service . Excellent service is perhaps the most important thing you can add to any product or service today. In a world where word travels fast through social media, you want to provide top-notch customer service. The shoe giant Zappos has built its reputation by providing excellent customer service. Make this a top priority.

Reputation . Why do people pay $10,000 for a Rolex? The Rolex reputation is the reason. At its most extreme, reputation can literally keep you in business, as is the case with many companies, such as IBM and WalMart, whose well-developed reputations have tided them over in hard times.

Knowledge . Your knowledge and the means you have of imparting that to customers is an important part of your total offering. Retailers of auto parts, home improvement supplies and all sorts of other goods have found that simply having knowledgeable salespeople who know how to replace the water pump in a '95 Chevy will lure customers in and encourage them to buy.

Experience. "We've been there. We've done thousands of installations like yours, and there's no doubt we can make this one work as well." Nothing could be more soothing to a skeptical sales prospect than to learn that the seller has vast experience at what he's doing. If you have ample experience, make it part of your selling proposition.

Fast delivery . Nobody wants to wait for anything anymore. If you can offer overnight shipping, on-site service or 24/7 availability, it can turn an otherwise unremarkable product or service into a very attractive one.

Endorsements . There's a reason Peyton Manning makes millions of dollars a year from endorsements. People want to relate to Peyton and share his aura, if only obliquely.

Other factors . There are many wild cards unique to particular products, or perhaps simply little used in particular industries, with which you can make your product stand out. For instance, consider a service agreement guarantee. When consumers know they can get a product repaired under a service guarantee or return a faulty product for a refund, they're often more likely to buy it over otherwise superior competitors offering less powerful warranties.

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How to Write a Business Plan in 9 Steps (+ Template and Examples)

Every successful business has one thing in common, a good and well-executed business plan. A business plan is more than a document, it is a complete guide that outlines the goals your business wants to achieve, including its financial goals . It helps you analyze results, make strategic decisions, show your business operations and growth.

If you want to start a business or already have one and need to pitch it to investors for funding, writing a good business plan improves your chances of attracting financiers. As a startup, if you want to secure loans from financial institutions, part of the requirements involve submitting your business plan.

Writing a business plan does not have to be a complicated or time-consuming process. In this article, you will learn the step-by-step process for writing a successful business plan.

You will also learn what you need a business plan for, tips and strategies for writing a convincing business plan, business plan examples and templates that will save you tons of time, and the alternatives to the traditional business plan.

Let’s get started.

What Do You Need A Business Plan For?

Businesses create business plans for different purposes such as to secure funds, monitor business growth, measure your marketing strategies, and measure your business success.

1. Secure Funds

One of the primary reasons for writing a business plan is to secure funds, either from financial institutions/agencies or investors.

For you to effectively acquire funds, your business plan must contain the key elements of your business plan . For example, your business plan should include your growth plans, goals you want to achieve, and milestones you have recorded.

A business plan can also attract new business partners that are willing to contribute financially and intellectually. If you are writing a business plan to a bank, your project must show your traction , that is, the proof that you can pay back any loan borrowed.

Also, if you are writing to an investor, your plan must contain evidence that you can effectively utilize the funds you want them to invest in your business. Here, you are using your business plan to persuade a group or an individual that your business is a source of a good investment.

2. Monitor Business Growth

A business plan can help you track cash flows in your business. It steers your business to greater heights. A business plan capable of tracking business growth should contain:

• The business goals
• Methods to achieve the goals
• Time-frame for attaining those goals

A good business plan should guide you through every step in achieving your goals. It can also track the allocation of assets to every aspect of the business. You can tell when you are spending more than you should on a project.

You can compare a business plan to a written GPS. It helps you manage your business and hints at the right time to expand your business.

3. Measure Business Success

A business plan can help you measure your business success rate. Some small-scale businesses are thriving better than more prominent companies because of their track record of success.

Right from the onset of your business operation, set goals and work towards them. Write a plan to guide you through your procedures. Use your plan to measure how much you have achieved and how much is left to attain.

You can also weigh your success by monitoring the position of your brand relative to competitors. On the other hand, a business plan can also show you why you have not achieved a goal. It can tell if you have elapsed the time frame you set to attain a goal.

4. Document Your Marketing Strategies

You can use a business plan to document your marketing plans. Every business should have an effective marketing plan.

Competition mandates every business owner to go the extraordinary mile to remain relevant in the market. Your business plan should contain your marketing strategies that work. You can measure the success rate of your marketing plans.

In your business plan, your marketing strategy must answer the questions:

• How do you want to reach your target audience?
• How do you plan to retain your customers?
• What is/are your pricing plans?
• What is your budget for marketing?

How to Write a Business Plan Step-by-Step

1. create your executive summary.

The executive summary is a snapshot of your business or a high-level overview of your business purposes and plans . Although the executive summary is the first section in your business plan, most people write it last. The length of the executive summary is not more than two pages.

Generally, there are nine sections in a business plan, the executive summary should condense essential ideas from the other eight sections.

A good executive summary should do the following:

• A Snapshot of Growth Potential. Briefly inform the reader about your company and why it will be successful)
• Contain your Mission Statement which explains what the main objective or focus of your business is.
• Product Description and Differentiation. Brief description of your products or services and why it is different from other solutions in the market.
• The Team. Basic information about your company’s leadership team and employees
• Business Concept. A solid description of what your business does.
• Target Market. The customers you plan to sell to.
• Marketing Strategy. Your plans on reaching and selling to your customers
• Current Financial State. Brief information about what revenue your business currently generates.
• Projected Financial State. Brief information about what you foresee your business revenue to be in the future.

The executive summary is the make-or-break section of your business plan. If your summary cannot in less than two pages cannot clearly describe how your business will solve a particular problem of your target audience and make a profit, your business plan is set on a faulty foundation.

Avoid using the executive summary to hype your business, instead, focus on helping the reader understand the what and how of your plan.

View the executive summary as an opportunity to introduce your vision for your company. You know your executive summary is powerful when it can answer these key questions:

• Who is your target audience?
• What sector or industry are you in?
• What are your products and services?
• What is the future of your industry?
• Is your company scaleable?
• Who are the owners and leaders of your company? What are their backgrounds and experience levels?
• What is the motivation for starting your company?
• What are the next steps?

Writing the executive summary last although it is the most important section of your business plan is an excellent idea. The reason why is because it is a high-level overview of your business plan. It is the section that determines whether potential investors and lenders will read further or not.

The executive summary can be a stand-alone document that covers everything in your business plan. It is not uncommon for investors to request only the executive summary when evaluating your business. If the information in the executive summary impresses them, they will ask for the complete business plan.

If you are writing your business plan for your planning purposes, you do not need to write the executive summary.

2. Add Your Company Overview

The company overview or description is the next section in your business plan after the executive summary. It describes what your business does.

Adding your company overview can be tricky especially when your business is still in the planning stages. Existing businesses can easily summarize their current operations but may encounter difficulties trying to explain what they plan to become.

Your company overview should contain the following:

• What products and services you will provide
• Geographical markets and locations your company have a presence
• What you need to run your business
• Who your target audience or customers are
• Who will service your customers
• Your company’s purpose, mission, and vision
• Information about your company’s founders
• Who the founders are
• Notable achievements of your company so far

When creating a company overview, you have to focus on three basics: identifying your industry, identifying your customer, and explaining the problem you solve.

If you are stuck when creating your company overview, try to answer some of these questions that pertain to you.

• Who are you targeting? (The answer is not everyone)
• What pain point does your product or service solve for your customers that they will be willing to spend money on resolving?
• How does your product or service overcome that pain point?
• Where is the location of your business?
• What products, equipment, and services do you need to run your business?
• How is your company’s product or service different from your competition in the eyes of your customers?
• How many employees do you need and what skills do you require them to have?

After answering some or all of these questions, you will get more than enough information you need to write your company overview or description section. When writing this section, describe what your company does for your customers.

The company description or overview section contains three elements: mission statement, history, and objectives.

• Mission Statement

The mission statement refers to the reason why your business or company is existing. It goes beyond what you do or sell, it is about the ‘why’. A good mission statement should be emotional and inspirational.

Your mission statement should follow the KISS rule (Keep It Simple, Stupid). For example, Shopify’s mission statement is “Make commerce better for everyone.”

When describing your company’s history, make it simple and avoid the temptation of tying it to a defensive narrative. Write it in the manner you would a profile. Your company’s history should include the following information:

• Founding Date
• Major Milestones
• Location(s)
• Flagship Products or Services
• Number of Employees
• Executive Leadership Roles

When you fill in this information, you use it to write one or two paragraphs about your company’s history.

Business Objectives

Your business objective must be SMART (specific, measurable, achievable, realistic, and time-bound.) Failure to clearly identify your business objectives does not inspire confidence and makes it hard for your team members to work towards a common purpose.

3. Perform Market and Competitive Analyses to Proof a Big Enough Business Opportunity

The third step in writing a business plan is the market and competitive analysis section. Every business, no matter the size, needs to perform comprehensive market and competitive analyses before it enters into a market.

Performing market and competitive analyses are critical for the success of your business. It helps you avoid entering the right market with the wrong product, or vice versa. Anyone reading your business plans, especially financiers and financial institutions will want to see proof that there is a big enough business opportunity you are targeting.

This section is where you describe the market and industry you want to operate in and show the big opportunities in the market that your business can leverage to make a profit. If you noticed any unique trends when doing your research, show them in this section.

Market analysis alone is not enough, you have to add competitive analysis to strengthen this section. There are already businesses in the industry or market, how do you plan to take a share of the market from them?

You have to clearly illustrate the competitive landscape in your business plan. Are there areas your competitors are doing well? Are there areas where they are not doing so well? Show it.

Make it clear in this section why you are moving into the industry and what weaknesses are present there that you plan to explain. How are your competitors going to react to your market entry? How do you plan to get customers? Do you plan on taking your competitors' competitors, tap into other sources for customers, or both?

Illustrate the competitive landscape as well. What are your competitors doing well and not so well?

Answering these questions and thoughts will aid your market and competitive analysis of the opportunities in your space. Depending on how sophisticated your industry is, or the expectations of your financiers, you may need to carry out a more comprehensive market and competitive analysis to prove that big business opportunity.

Instead of looking at the market and competitive analyses as one entity, separating them will make the research even more comprehensive.

Market Analysis

Market analysis, boarding speaking, refers to research a business carried out on its industry, market, and competitors. It helps businesses gain a good understanding of their target market and the outlook of their industry. Before starting a company, it is vital to carry out market research to find out if the market is viable.

The market analysis section is a key part of the business plan. It is the section where you identify who your best clients or customers are. You cannot omit this section, without it your business plan is incomplete.

A good market analysis will tell your readers how you fit into the existing market and what makes you stand out. This section requires in-depth research, it will probably be the most time-consuming part of the business plan to write.

• Market Research

To create a compelling market analysis that will win over investors and financial institutions, you have to carry out thorough market research . Your market research should be targeted at your primary target market for your products or services. Here is what you want to find out about your target market.

• Your target market’s needs or pain points
• The existing solutions for their pain points
• Geographic Location
• Demographics

The purpose of carrying out a marketing analysis is to get all the information you need to show that you have a solid and thorough understanding of your target audience.

Only after you have fully understood the people you plan to sell your products or services to, can you evaluate correctly if your target market will be interested in your products or services.

You can easily convince interested parties to invest in your business if you can show them you thoroughly understand the market and show them that there is a market for your products or services.

How to Quantify Your Target Market

One of the goals of your marketing research is to understand who your ideal customers are and their purchasing power. To quantify your target market, you have to determine the following:

• Your Potential Customers: They are the people you plan to target. For example, if you sell accounting software for small businesses , then anyone who runs an enterprise or large business is unlikely to be your customers. Also, individuals who do not have a business will most likely not be interested in your product.
• Total Households: If you are selling household products such as heating and air conditioning systems, determining the number of total households is more important than finding out the total population in the area you want to sell to. The logic is simple, people buy the product but it is the household that uses it.
• Median Income: You need to know the median income of your target market. If you target a market that cannot afford to buy your products and services, your business will not last long.
• Income by Demographics: If your potential customers belong to a certain age group or gender, determining income levels by demographics is necessary. For example, if you sell men's clothes, your target audience is men.

What Does a Good Market Analysis Entail?

Your business does not exist on its own, it can only flourish within an industry and alongside competitors. Market analysis takes into consideration your industry, target market, and competitors. Understanding these three entities will drastically improve your company’s chances of success.

You can view your market analysis as an examination of the market you want to break into and an education on the emerging trends and themes in that market. Good market analyses include the following:

• Industry Description. You find out about the history of your industry, the current and future market size, and who the largest players/companies are in your industry.
• Overview of Target Market. You research your target market and its characteristics. Who are you targeting? Note, it cannot be everyone, it has to be a specific group. You also have to find out all information possible about your customers that can help you understand how and why they make buying decisions.
• Size of Target Market: You need to know the size of your target market, how frequently they buy, and the expected quantity they buy so you do not risk overproducing and having lots of bad inventory. Researching the size of your target market will help you determine if it is big enough for sustained business or not.
• Growth Potential: Before picking a target market, you want to be sure there are lots of potential for future growth. You want to avoid going for an industry that is declining slowly or rapidly with almost zero growth potential.
• Market Share Potential: Does your business stand a good chance of taking a good share of the market?
• Market Pricing and Promotional Strategies: Your market analysis should give you an idea of the price point you can expect to charge for your products and services. Researching your target market will also give you ideas of pricing strategies you can implement to break into the market or to enjoy maximum profits.
• Potential Barriers to Entry: One of the biggest benefits of conducting market analysis is that it shows you every potential barrier to entry your business will likely encounter. It is a good idea to discuss potential barriers to entry such as changing technology. It informs readers of your business plan that you understand the market.
• Research on Competitors: You need to know the strengths and weaknesses of your competitors and how you can exploit them for the benefit of your business. Find patterns and trends among your competitors that make them successful, discover what works and what doesn’t, and see what you can do better.

The market analysis section is not just for talking about your target market, industry, and competitors. You also have to explain how your company can fill the hole you have identified in the market.

Here are some questions you can answer that can help you position your product or service in a positive light to your readers.

• Is your product or service of superior quality?
• What additional features do you offer that your competitors do not offer?
• Are you targeting a ‘new’ market?

Basically, your market analysis should include an analysis of what already exists in the market and an explanation of how your company fits into the market.

Competitive Analysis

In the competitive analysis section, y ou have to understand who your direct and indirect competitions are, and how successful they are in the marketplace. It is the section where you assess the strengths and weaknesses of your competitors, the advantage(s) they possess in the market and show the unique features or qualities that make you different from your competitors.

Many businesses do market analysis and competitive analysis together. However, to fully understand what the competitive analysis entails, it is essential to separate it from the market analysis.

Competitive analysis for your business can also include analysis on how to overcome barriers to entry in your target market.

The primary goal of conducting a competitive analysis is to distinguish your business from your competitors. A strong competitive analysis is essential if you want to convince potential funding sources to invest in your business. You have to show potential investors and lenders that your business has what it takes to compete in the marketplace successfully.

Competitive analysis will s how you what the strengths of your competition are and what they are doing to maintain that advantage.

When doing your competitive research, you first have to identify your competitor and then get all the information you can about them. The idea of spending time to identify your competitor and learn everything about them may seem daunting but it is well worth it.

Find answers to the following questions after you have identified who your competitors are.

• What are your successful competitors doing?
• Why is what they are doing working?
• Can your business do it better?
• What are the weaknesses of your successful competitors?
• What are they not doing well?
• Can your business turn its weaknesses into strengths?
• How good is your competitors’ customer service?
• Where do your competitors invest in advertising?
• What sales and pricing strategies are they using?
• What marketing strategies are they using?
• What kind of press coverage do they get?
• What are their customers saying about your competitors (both the positive and negative)?

If your competitors have a website, it is a good idea to visit their websites for more competitors’ research. Check their “About Us” page for more information.

If you are presenting your business plan to investors, you need to clearly distinguish yourself from your competitors. Investors can easily tell when you have not properly researched your competitors.

Take time to think about what unique qualities or features set you apart from your competitors. If you do not have any direct competition offering your product to the market, it does not mean you leave out the competitor analysis section blank. Instead research on other companies that are providing a similar product, or whose product is solving the problem your product solves.

The next step is to create a table listing the top competitors you want to include in your business plan. Ensure you list your business as the last and on the right. What you just created is known as the competitor analysis table.

Direct vs Indirect Competition

You cannot know if your product or service will be a fit for your target market if you have not understood your business and the competitive landscape.

There is no market you want to target where you will not encounter competition, even if your product is innovative. Including competitive analysis in your business plan is essential.

If you are entering an established market, you need to explain how you plan to differentiate your products from the available options in the market. Also, include a list of few companies that you view as your direct competitors The competition you face in an established market is your direct competition.

In situations where you are entering a market with no direct competition, it does not mean there is no competition there. Consider your indirect competition that offers substitutes for the products or services you offer.

For example, if you sell an innovative SaaS product, let us say a project management software , a company offering time management software is your indirect competition.

There is an easy way to find out who your indirect competitors are in the absence of no direct competitors. You simply have to research how your potential customers are solving the problems that your product or service seeks to solve. That is your direct competition.

Factors that Differentiate Your Business from the Competition

There are three main factors that any business can use to differentiate itself from its competition. They are cost leadership, product differentiation, and market segmentation.

1. Cost Leadership

A strategy you can impose to maximize your profits and gain an edge over your competitors. It involves offering lower prices than what the majority of your competitors are offering.

A common practice among businesses looking to enter into a market where there are dominant players is to use free trials or pricing to attract as many customers as possible to their offer.

2. Product Differentiation

Your product or service should have a unique selling proposition (USP) that your competitors do not have or do not stress in their marketing.

Part of the marketing strategy should involve making your products unique and different from your competitors. It does not have to be different from your competitors, it can be the addition to a feature or benefit that your competitors do not currently have.

3. Market Segmentation

As a new business seeking to break into an industry, you will gain more success from focusing on a specific niche or target market, and not the whole industry.

If your competitors are focused on a general need or target market, you can differentiate yourself from them by having a small and hyper-targeted audience. For example, if your competitors are selling men’s clothes in their online stores , you can sell hoodies for men.

4. Define Your Business and Management Structure

The next step in your business plan is your business and management structure. It is the section where you describe the legal structure of your business and the team running it.

Your business is only as good as the management team that runs it, while the management team can only strive when there is a proper business and management structure in place.

If your company is a sole proprietor or a limited liability company (LLC), a general or limited partnership, or a C or an S corporation, state it clearly in this section.

Use an organizational chart to show the management structure in your business. Clearly show who is in charge of what area in your company. It is where you show how each key manager or team leader’s unique experience can contribute immensely to the success of your company. You can also opt to add the resumes and CVs of the key players in your company.

The business and management structure section should show who the owner is, and other owners of the businesses (if the business has other owners). For businesses or companies with multiple owners, include the percent ownership of the various owners and clearly show the extent of each others’ involvement in the company.

Investors want to know who is behind the company and the team running it to determine if it has the right management to achieve its set goals.

Management Team

The management team section is where you show that you have the right team in place to successfully execute the business operations and ideas. Take time to create the management structure for your business. Think about all the important roles and responsibilities that you need managers for to grow your business.

Include brief bios of each key team member and ensure you highlight only the relevant information that is needed. If your team members have background industry experience or have held top positions for other companies and achieved success while filling that role, highlight it in this section.

A common mistake that many startups make is assigning C-level titles such as (CMO and CEO) to everyone on their team. It is unrealistic for a small business to have those titles. While it may look good on paper for the ego of your team members, it can prevent investors from investing in your business.

Instead of building an unrealistic management structure that does not fit your business reality, it is best to allow business titles to grow as the business grows. Starting everyone at the top leaves no room for future change or growth, which is bad for productivity.

Your management team does not have to be complete before you start writing your business plan. You can have a complete business plan even when there are managerial positions that are empty and need filling.

If you have management gaps in your team, simply show the gaps and indicate you are searching for the right candidates for the role(s). Investors do not expect you to have a full management team when you are just starting your business.

Key Questions to Answer When Structuring Your Management Team

• Who are the key leaders?
• What experiences, skills, and educational backgrounds do you expect your key leaders to have?
• Do your key leaders have industry experience?
• What positions will they fill and what duties will they perform in those positions?
• What level of authority do the key leaders have and what are their responsibilities?
• What is the salary for the various management positions that will attract the ideal candidates?

Additional Tips for Writing the Management Structure Section

1. Avoid Adding ‘Ghost’ Names to Your Management Team

There is always that temptation to include a ‘ghost’ name to your management team to attract and influence investors to invest in your business. Although the presence of these celebrity management team members may attract the attention of investors, it can cause your business to lose any credibility if you get found out.

Seasoned investors will investigate further the members of your management team before committing fully to your business If they find out that the celebrity name used does not play any actual role in your business, they will not invest and may write you off as dishonest.

2. Focus on Credentials But Pay Extra Attention to the Roles

Investors want to know the experience that your key team members have to determine if they can successfully reach the company’s growth and financial goals.

While it is an excellent boost for your key management team to have the right credentials, you also want to pay extra attention to the roles they will play in your company.

Organizational Chart

Adding an organizational chart in this section of your business plan is not necessary, you can do it in your business plan’s appendix.

If you are exploring funding options, it is not uncommon to get asked for your organizational chart. The function of an organizational chart goes beyond raising money, you can also use it as a useful planning tool for your business.

An organizational chart can help you identify how best to structure your management team for maximum productivity and point you towards key roles you need to fill in the future.

You can use the organizational chart to show your company’s internal management structure such as the roles and responsibilities of your management team, and relationships that exist between them.

5. Describe Your Product and Service Offering

In your business plan, you have to describe what you sell or the service you plan to offer. It is the next step after defining your business and management structure. The products and services section is where you sell the benefits of your business.

Here you have to explain how your product or service will benefit your customers and describe your product lifecycle. It is also the section where you write down your plans for intellectual property like patent filings and copyrighting.

The research and development that you are undertaking for your product or service need to be explained in detail in this section. However, do not get too technical, sell the general idea and its benefits.

If you have any diagrams or intricate designs of your product or service, do not include them in the products and services section. Instead, leave them for the addendum page. Also, if you are leaving out diagrams or designs for the addendum, ensure you add this phrase “For more detail, visit the addendum Page #.”

Your product and service section in your business plan should include the following:

• A detailed explanation that clearly shows how your product or service works.
• The pricing model for your product or service.
• Your business’ sales and distribution strategy.
• The ideal customers that want your product or service.
• The benefits of your products and services.
• Reason(s) why your product or service is a better alternative to what your competitors are currently offering in the market.
• Plans for filling the orders you receive
• If you have current or pending patents, copyrights, and trademarks for your product or service, you can also discuss them in this section.

What to Focus On When Describing the Benefits, Lifecycle, and Production Process of Your Products or Services

In the products and services section, you have to distill the benefits, lifecycle, and production process of your products and services.

When describing the benefits of your products or services, here are some key factors to focus on.

• Unique features
• Translating the unique features into benefits
• The emotional, psychological, and practical payoffs to attract customers
• Intellectual property rights or any patents

When describing the product life cycle of your products or services, here are some key factors to focus on.

• Upsells, cross-sells, and down-sells
• Time between purchases
• Plans for research and development.

When describing the production process for your products or services, you need to think about the following:

• The creation of new or existing products and services.
• The sources for the raw materials or components you need for production.
• Assembling the products
• Maintaining quality control
• Supply-chain logistics (receiving the raw materials and delivering the finished products)
• The day-to-day management of the production processes, bookkeeping, and inventory.

Tips for Writing the Products or Services Section of Your Business Plan

1. Avoid Technical Descriptions and Industry Buzzwords

The products and services section of your business plan should clearly describe the products and services that your company provides. However, it is not a section to include technical jargons that anyone outside your industry will not understand.

A good practice is to remove highly detailed or technical descriptions in favor of simple terms. Industry buzzwords are not necessary, if there are simpler terms you can use, then use them. If you plan to use your business plan to source funds, making the product or service section so technical will do you no favors.

2. Describe How Your Products or Services Differ from Your Competitors

When potential investors look at your business plan, they want to know how the products and services you are offering differ from that of your competition. Differentiating your products or services from your competition in a way that makes your solution more attractive is critical.

If you are going the innovative path and there is no market currently for your product or service, you need to describe in this section why the market needs your product or service.

For example, overnight delivery was a niche business that only a few companies were participating in. Federal Express (FedEx) had to show in its business plan that there was a large opportunity for that service and they justified why the market needed that service.

3. Long or Short Products or Services Section

Should your products or services section be short? Does the long products or services section attract more investors?

There are no straightforward answers to these questions. Whether your products or services section should be long or relatively short depends on the nature of your business.

If your business is product-focused, then automatically you need to use more space to describe the details of your products. However, if the product your business sells is a commodity item that relies on competitive pricing or other pricing strategies, you do not have to use up so much space to provide significant details about the product.

Likewise, if you are selling a commodity that is available in numerous outlets, then you do not have to spend time on writing a long products or services section.

The key to the success of your business is most likely the effectiveness of your marketing strategies compared to your competitors. Use more space to address that section.

If you are creating a new product or service that the market does not know about, your products or services section can be lengthy. The reason why is because you need to explain everything about the product or service such as the nature of the product, its use case, and values.

A short products or services section for an innovative product or service will not give the readers enough information to properly evaluate your business.

4. Describe Your Relationships with Vendors or Suppliers

Your business will rely on vendors or suppliers to supply raw materials or the components needed to make your products. In your products and services section, describe your relationships with your vendors and suppliers fully.

Avoid the mistake of relying on only one supplier or vendor. If that supplier or vendor fails to supply or goes out of business, you can easily face supply problems and struggle to meet your demands. Plan to set up multiple vendor or supplier relationships for better business stability.

5. Your Primary Goal Is to Convince Your Readers

The primary goal of your business plan is to convince your readers that your business is viable and to create a guide for your business to follow. It applies to the products and services section.

When drafting this section, think like the reader. See your reader as someone who has no idea about your products and services. You are using the products and services section to provide the needed information to help your reader understand your products and services. As a result, you have to be clear and to the point.

While you want to educate your readers about your products or services, you also do not want to bore them with lots of technical details. Show your products and services and not your fancy choice of words.

Your products and services section should provide the answer to the “what” question for your business. You and your management team may run the business, but it is your products and services that are the lifeblood of the business.

Key Questions to Answer When Writing your Products and Services Section

Answering these questions can help you write your products and services section quickly and in a way that will appeal to your readers.

• Are your products existing on the market or are they still in the development stage?
• What is your timeline for adding new products and services to the market?
• What are the positives that make your products and services different from your competitors?
• Do your products and services have any competitive advantage that your competitors’ products and services do not currently have?
• Do your products or services have any competitive disadvantages that you need to overcome to compete with your competitors? If your answer is yes, state how you plan to overcome them,
• How much does it cost to produce your products or services? How much do you plan to sell it for?
• What is the price for your products and services compared to your competitors? Is pricing an issue?
• What are your operating costs and will it be low enough for you to compete with your competitors and still take home a reasonable profit margin?
• What is your plan for acquiring your products? Are you involved in the production of your products or services?
• Are you the manufacturer and produce all the components you need to create your products? Do you assemble your products by using components supplied by other manufacturers? Do you purchase your products directly from suppliers or wholesalers?
• Do you have a steady supply of products that you need to start your business? (If your business is yet to kick-off)
• How do you plan to distribute your products or services to the market?

You can also hint at the marketing or promotion plans you have for your products or services such as how you plan to build awareness or retain customers. The next section is where you can go fully into details about your business’s marketing and sales plan.

6. Show and Explain Your Marketing and Sales Plan

Providing great products and services is wonderful, but it means nothing if you do not have a marketing and sales plan to inform your customers about them. Your marketing and sales plan is critical to the success of your business.

The sales and marketing section is where you show and offer a detailed explanation of your marketing and sales plan and how you plan to execute it. It covers your pricing plan, proposed advertising and promotion activities, activities and partnerships you need to make your business a success, and the benefits of your products and services.

There are several ways you can approach your marketing and sales strategy. Ideally, your marketing and sales strategy has to fit the unique needs of your business.

In this section, you describe how the plans your business has for attracting and retaining customers, and the exact process for making a sale happen. It is essential to thoroughly describe your complete marketing and sales plans because you are still going to reference this section when you are making financial projections for your business.

Outline Your Business’ Unique Selling Proposition (USP)

The sales and marketing section is where you outline your business’s unique selling proposition (USP). When you are developing your unique selling proposition, think about the strongest reasons why people should buy from you over your competition. That reason(s) is most likely a good fit to serve as your unique selling proposition (USP).

Target Market and Target Audience

Plans on how to get your products or services to your target market and how to get your target audience to buy them go into this section. You also highlight the strengths of your business here, particularly what sets them apart from your competition.

Before you start writing your marketing and sales plan, you need to have properly defined your target audience and fleshed out your buyer persona. If you do not first understand the individual you are marketing to, your marketing and sales plan will lack any substance and easily fall.

Creating a Smart Marketing and Sales Plan

Marketing your products and services is an investment that requires you to spend money. Like any other investment, you have to generate a good return on investment (ROI) to justify using that marketing and sales plan. Good marketing and sales plans bring in high sales and profits to your company.

Avoid spending money on unproductive marketing channels. Do your research and find out the best marketing and sales plan that works best for your company.

Your marketing and sales plan can be broken into different parts: your positioning statement, pricing, promotion, packaging, advertising, public relations, content marketing, social media, and strategic alliances.

Your Positioning Statement

Your positioning statement is the first part of your marketing and sales plan. It refers to the way you present your company to your customers.

Are you the premium solution, the low-price solution, or are you the intermediary between the two extremes in the market? What do you offer that your competitors do not that can give you leverage in the market?

Before you start writing your positioning statement, you need to spend some time evaluating the current market conditions. Here are some questions that can help you to evaluate the market

• What are the unique features or benefits that you offer that your competitors lack?
• What are your customers’ primary needs and wants?
• Why should a customer choose you over your competition? How do you plan to differentiate yourself from the competition?
• How does your company’s solution compare with other solutions in the market?

After answering these questions, then you can start writing your positioning statement. Your positioning statement does not have to be in-depth or too long.

All you need to explain with your positioning statement are two focus areas. The first is the position of your company within the competitive landscape. The other focus area is the core value proposition that sets your company apart from other alternatives that your ideal customer might consider.

Here is a simple template you can use to develop a positioning statement.

For [description of target market] who [need of target market], [product or service] [how it meets the need]. Unlike [top competition], it [most essential distinguishing feature].

For example, let’s create the positioning statement for fictional accounting software and QuickBooks alternative , TBooks.

“For small business owners who need accounting services, TBooks is an accounting software that helps small businesses handle their small business bookkeeping basics quickly and easily. Unlike Wave, TBooks gives small businesses access to live sessions with top accountants.”

You can edit this positioning statement sample and fill it with your business details.

After writing your positioning statement, the next step is the pricing of your offerings. The overall positioning strategy you set in your positioning statement will often determine how you price your products or services.

Pricing is a powerful tool that sends a strong message to your customers. Failure to get your pricing strategy right can make or mar your business. If you are targeting a low-income audience, setting a premium price can result in low sales.

You can use pricing to communicate your positioning to your customers. For example, if you are offering a product at a premium price, you are sending a message to your customers that the product belongs to the premium category.

Basic Rules to Follow When Pricing Your Offering

Setting a price for your offering involves more than just putting a price tag on it. Deciding on the right pricing for your offering requires following some basic rules. They include covering your costs, primary and secondary profit center pricing, and matching the market rate.

• Covering Your Costs: The price you set for your products or service should be more than it costs you to produce and deliver them. Every business has the same goal, to make a profit. Depending on the strategy you want to use, there are exceptions to this rule. However, the vast majority of businesses follow this rule.
• Primary and Secondary Profit Center Pricing: When a company sets its price above the cost of production, it is making that product its primary profit center. A company can also decide not to make its initial price its primary profit center by selling below or at even with its production cost. It rather depends on the support product or even maintenance that is associated with the initial purchase to make its profit. The initial price thus became its secondary profit center.
• Matching the Market Rate: A good rule to follow when pricing your products or services is to match your pricing with consumer demand and expectations. If you price your products or services beyond the price your customer perceives as the ideal price range, you may end up with no customers. Pricing your products too low below what your customer perceives as the ideal price range may lead to them undervaluing your offering.

Pricing Strategy

Your pricing strategy influences the price of your offering. There are several pricing strategies available for you to choose from when examining the right pricing strategy for your business. They include cost-plus pricing, market-based pricing, value pricing, and more.

• Cost-plus Pricing: This strategy is one of the simplest and oldest pricing strategies. Here you consider the cost of producing a unit of your product and then add a profit to it to arrive at your market price. It is an effective pricing strategy for manufacturers because it helps them cover their initial costs. Another name for the cost-plus pricing strategy is the markup pricing strategy.
• Market-based Pricing: This pricing strategy analyses the market including competitors’ pricing and then sets a price based on what the market is expecting. With this pricing strategy, you can either set your price at the low-end or high-end of the market.
• Value Pricing: This pricing strategy involves setting a price based on the value you are providing to your customer. When adopting a value-based pricing strategy, you have to set a price that your customers are willing to pay. Service-based businesses such as small business insurance providers , luxury goods sellers, and the fashion industry use this pricing strategy.

After carefully sorting out your positioning statement and pricing, the next item to look at is your promotional strategy. Your promotional strategy explains how you plan on communicating with your customers and prospects.

As a business, you must measure all your costs, including the cost of your promotions. You also want to measure how much sales your promotions bring for your business to determine its usefulness. Promotional strategies or programs that do not lead to profit need to be removed.

There are different types of promotional strategies you can adopt for your business, they include advertising, public relations, and content marketing.

Advertising

Your business plan should include your advertising plan which can be found in the marketing and sales plan section. You need to include an overview of your advertising plans such as the areas you plan to spend money on to advertise your business and offers.

Ensure that you make it clear in this section if your business will be advertising online or using the more traditional offline media, or the combination of both online and offline media. You can also include the advertising medium you want to use to raise awareness about your business and offers.

Some common online advertising mediums you can use include social media ads, landing pages, sales pages, SEO, Pay-Per-Click, emails, Google Ads, and others. Some common traditional and offline advertising mediums include word of mouth, radios, direct mail, televisions, flyers, billboards, posters, and others.

A key component of your advertising strategy is how you plan to measure the effectiveness and success of your advertising campaign. There is no point in sticking with an advertising plan or medium that does not produce results for your business in the long run.

Public Relations

A great way to reach your customers is to get the media to cover your business or product. Publicity, especially good ones, should be a part of your marketing and sales plan. In this section, show your plans for getting prominent reviews of your product from reputable publications and sources.

Your business needs that exposure to grow. If public relations is a crucial part of your promotional strategy, provide details about your public relations plan here.

Content Marketing

Content marketing is a popular promotional strategy used by businesses to inform and attract their customers. It is about teaching and educating your prospects on various topics of interest in your niche, it does not just involve informing them about the benefits and features of the products and services you have,

Businesses publish content usually for free where they provide useful information, tips, and advice so that their target market can be made aware of the importance of their products and services. Content marketing strategies seek to nurture prospects into buyers over time by simply providing value.

Your company can create a blog where it will be publishing content for its target market. You will need to use the best website builder such as Wix and Squarespace and the best web hosting services such as Bluehost, Hostinger, and other Bluehost alternatives to create a functional blog or website.

If content marketing is a crucial part of your promotional strategy (as it should be), detail your plans under promotions.

Including high-quality images of the packaging of your product in your business plan is a lovely idea. You can add the images of the packaging of that product in the marketing and sales plan section. If you are not selling a product, then you do not need to include any worry about the physical packaging of your product.

When organizing the packaging section of your business plan, you can answer the following questions to make maximum use of this section.

• Is your choice of packaging consistent with your positioning strategy?
• What key value proposition does your packaging communicate? (It should reflect the key value proposition of your business)
• How does your packaging compare to that of your competitors?

Social Media

Your 21st-century business needs to have a good social media presence. Not having one is leaving out opportunities for growth and reaching out to your prospect.

You do not have to join the thousands of social media platforms out there. What you need to do is join the ones that your customers are active on and be active there.

Businesses use social media to provide information about their products such as promotions, discounts, the benefits of their products, and content on their blogs.

Social media is also a platform for engaging with your customers and getting feedback about your products or services. Make no mistake, more and more of your prospects are using social media channels to find more information about companies.

You need to consider the social media channels you want to prioritize your business (prioritize the ones your customers are active in) and your branding plans in this section.

Strategic Alliances

If your company plans to work closely with other companies as part of your sales and marketing plan, include it in this section. Prove details about those partnerships in your business plan if you have already established them.

Strategic alliances can be beneficial for all parties involved including your company. Working closely with another company in the form of a partnership can provide access to a different target market segment for your company.

The company you are partnering with may also gain access to your target market or simply offer a new product or service (that of your company) to its customers.

Mutually beneficial partnerships can cover the weaknesses of one company with the strength of another. You should consider strategic alliances with companies that sell complimentary products to yours. For example, if you provide printers, you can partner with a company that produces ink since the customers that buy printers from you will also need inks for printing.

Steps Involved in Creating a Marketing and Sales Plan

1. Focus on Your Target Market

Identify who your customers are, the market you want to target. Then determine the best ways to get your products or services to your potential customers.

2. Evaluate Your Competition

One of the goals of having a marketing plan is to distinguish yourself from your competition. You cannot stand out from them without first knowing them in and out.

You can know your competitors by gathering information about their products, pricing, service, and advertising campaigns.

These questions can help you know your competition.

• What makes your competition successful?
• What are their weaknesses?
• What are customers saying about your competition?

3. Consider Your Brand

Customers' perception of your brand has a strong impact on your sales. Your marketing and sales plan should seek to bolster the image of your brand. Before you start marketing your business, think about the message you want to pass across about your business and your products and services.

4. Focus on Benefits

The majority of your customers do not view your product in terms of features, what they want to know is the benefits and solutions your product offers. Think about the problems your product solves and the benefits it delivers, and use it to create the right sales and marketing message.

Your marketing plan should focus on what you want your customer to get instead of what you provide. Identify those benefits in your marketing and sales plan.

5. Focus on Differentiation

Your marketing and sales plan should look for a unique angle they can take that differentiates your business from the competition, even if the products offered are similar. Some good areas of differentiation you can use are your benefits, pricing, and features.

Key Questions to Answer When Writing Your Marketing and Sales Plan

• What is your company’s budget for sales and marketing campaigns?
• What key metrics will you use to determine if your marketing plans are successful?
• What are your alternatives if your initial marketing efforts do not succeed?
• Who are the sales representatives you need to promote your products or services?
• What are the marketing and sales channels you plan to use? How do you plan to get your products in front of your ideal customers?
• Where will you sell your products?

You may want to include samples of marketing materials you plan to use such as print ads, website descriptions, and social media ads. While it is not compulsory to include these samples, it can help you better communicate your marketing and sales plan and objectives.

The purpose of the marketing and sales section is to answer this question “How will you reach your customers?” If you cannot convincingly provide an answer to this question, you need to rework your marketing and sales section.

7. Clearly Show Your Funding Request

If you are writing your business plan to ask for funding from investors or financial institutions, the funding request section is where you will outline your funding requirements. The funding request section should answer the question ‘How much money will your business need in the near future (3 to 5 years)?’

A good funding request section will clearly outline and explain the amount of funding your business needs over the next five years. You need to know the amount of money your business needs to make an accurate funding request.

Also, when writing your funding request, provide details of how the funds will be used over the period. Specify if you want to use the funds to buy raw materials or machinery, pay salaries, pay for advertisements, and cover specific bills such as rent and electricity.

In addition to explaining what you want to use the funds requested for, you need to clearly state the projected return on investment (ROI) . Investors and creditors want to know if your business can generate profit for them if they put funds into it.

Ensure you do not inflate the figures and stay as realistic as possible. Investors and financial institutions you are seeking funds from will do their research before investing money in your business.

If you are not sure of an exact number to request from, you can use some range of numbers as rough estimates. Add a best-case scenario and a work-case scenario to your funding request. Also, include a description of your strategic future financial plans such as selling your business or paying off debts.

Funding Request: Debt or Equity?

When making your funding request, specify the type of funding you want. Do you want debt or equity? Draw out the terms that will be applicable for the funding, and the length of time the funding request will cover.

Case for Equity

If your new business has not yet started generating profits, you are most likely preparing to sell equity in your business to raise capital at the early stage. Equity here refers to ownership. In this case, you are selling a portion of your company to raise capital.

Although this method of raising capital for your business does not put your business in debt, keep in mind that an equity owner may expect to play a key role in company decisions even if he does not hold a major stake in the company.

Most equity sales for startups are usually private transactions . If you are making a funding request by offering equity in exchange for funding, let the investor know that they will be paid a dividend (a share of the company’s profit). Also, let the investor know the process for selling their equity in your business.

Case for Debt

You may decide not to offer equity in exchange for funds, instead, you make a funding request with the promise to pay back the money borrowed at the agreed time frame.

When making a funding request with an agreement to pay back, note that you will have to repay your creditors both the principal amount borrowed and the interest on it. Financial institutions offer this type of funding for businesses.

Large companies combine both equity and debt in their capital structure. When drafting your business plan, decide if you want to offer both or one over the other.

Before you sell equity in exchange for funding in your business, consider if you are willing to accept not being in total control of your business. Also, before you seek loans in your funding request section, ensure that the terms of repayment are favorable.

You should set a clear timeline in your funding request so that potential investors and creditors can know what you are expecting. Some investors and creditors may agree to your funding request and then delay payment for longer than 30 days, meanwhile, your business needs an immediate cash injection to operate efficiently.

Additional Tips for Writing the Funding Request Section of your Business Plan

The funding request section is not necessary for every business, it is only needed by businesses who plan to use their business plan to secure funding.

If you are adding the funding request section to your business plan, provide an itemized summary of how you plan to use the funds requested. Hiring a lawyer, accountant, or other professionals may be necessary for the proper development of this section.

You should also gather and use financial statements that add credibility and support to your funding requests. Ensure that the financial statements you use should include your projected financial data such as projected cash flows, forecast statements, and expenditure budgets.

If you are an existing business, include all historical financial statements such as cash flow statements, balance sheets and income statements .

Provide monthly and quarterly financial statements for a year. If your business has records that date back beyond the one-year mark, add the yearly statements of those years. These documents are for the appendix section of your business plan.

8. Detail Your Financial Plan, Metrics, and Projections

If you used the funding request section in your business plan, supplement it with a financial plan, metrics, and projections. This section paints a picture of the past performance of your business and then goes ahead to make an informed projection about its future.

The goal of this section is to convince readers that your business is going to be a financial success. It outlines your business plan to generate enough profit to repay the loan (with interest if applicable) and to generate a decent return on investment for investors.

If you have an existing business already in operation, use this section to demonstrate stability through finance. This section should include your cash flow statements, balance sheets, and income statements covering the last three to five years. If your business has some acceptable collateral that you can use to acquire loans, list it in the financial plan, metrics, and projection section.

Apart from current financial statements, this section should also contain a prospective financial outlook that spans the next five years. Include forecasted income statements, cash flow statements, balance sheets, and capital expenditure budget.

If your business is new and is not yet generating profit, use clear and realistic projections to show the potentials of your business.

When drafting this section, research industry norms and the performance of comparable businesses. Your financial projections should cover at least five years. State the logic behind your financial projections. Remember you can always make adjustments to this section as the variables change.

The financial plan, metrics, and projection section create a baseline which your business can either exceed or fail to reach. If your business fails to reach your projections in this section, you need to understand why it failed.

Investors and loan managers spend a lot of time going through the financial plan, metrics, and projection section compared to other parts of the business plan. Ensure you spend time creating credible financial analyses for your business in this section.

Many entrepreneurs find this section daunting to write. You do not need a business degree to create a solid financial forecast for your business. Business finances, especially for startups, are not as complicated as they seem. There are several online tools and templates that make writing this section so much easier.

Use Graphs and Charts

The financial plan, metrics, and projection section is a great place to use graphs and charts to tell the financial story of your business. Charts and images make it easier to communicate your finances.

Accuracy in this section is key, ensure you carefully analyze your past financial statements properly before making financial projects.

Address the Risk Factors and Show Realistic Financial Projections

Keep your financial plan, metrics, and projection realistic. It is okay to be optimistic in your financial projection, however, you have to justify it.

You should also address the various risk factors associated with your business in this section. Investors want to know the potential risks involved, show them. You should also show your plans for mitigating those risks.

What You Should In The Financial Plan, Metrics, and Projection Section of Your Business Plan

The financial plan, metrics, and projection section of your business plan should have monthly sales and revenue forecasts for the first year. It should also include annual projections that cover 3 to 5 years.

A three-year projection is a basic requirement to have in your business plan. However, some investors may request a five-year forecast.

Your business plan should include the following financial statements: sales forecast, personnel plan, income statement, income statement, cash flow statement, balance sheet, and an exit strategy.

1. Sales Forecast

Sales forecast refers to your projections about the number of sales your business is going to record over the next few years. It is typically broken into several rows, with each row assigned to a core product or service that your business is offering.

One common mistake people make in their business plan is to break down the sales forecast section into long details. A sales forecast should forecast the high-level details.

For example, if you are forecasting sales for a payroll software provider, you could break down your forecast into target market segments or subscription categories.

Your sales forecast section should also have a corresponding row for each sales row to cover the direct cost or Cost of Goods Sold (COGS). The objective of these rows is to show the expenses that your business incurs in making and delivering your product or service.

Note that your Cost of Goods Sold (COGS) should only cover those direct costs incurred when making your products. Other indirect expenses such as insurance, salaries, payroll tax, and rent should not be included.

For example, the Cost of Goods Sold (COGS) for a restaurant is the cost of ingredients while for a consulting company it will be the cost of paper and other presentation materials.

2. Personnel Plan

The personnel plan section is where you provide details about the payment plan for your employees. For a small business, you can easily list every position in your company and how much you plan to pay in the personnel plan.

However, for larger businesses, you have to break the personnel plan into functional groups such as sales and marketing.

The personnel plan will also include the cost of an employee beyond salary, commonly referred to as the employee burden. These costs include insurance, payroll taxes , and other essential costs incurred monthly as a result of having employees on your payroll.

3. Income Statement

The income statement section shows if your business is making a profit or taking a loss. Another name for the income statement is the profit and loss (P&L). It takes data from your sales forecast and personnel plan and adds other ongoing expenses you incur while running your business.

Every business plan should have an income statement. It subtracts your business expenses from its earnings to show if your business is generating profit or incurring losses.

The income statement has the following items: sales, Cost of Goods Sold (COGS), gross margin, operating expenses, total operating expenses, operating income , total expenses, and net profit.

• Sales refer to the revenue your business generates from selling its products or services. Other names for sales are income or revenue.
• Cost of Goods Sold (COGS) refers to the total cost of selling your products. Other names for COGS are direct costs or cost of sales. Manufacturing businesses use the Costs of Goods Manufactured (COGM) .
• Gross Margin is the figure you get when you subtract your COGS from your sales. In your income statement, you can express it as a percentage of total sales (Gross margin / Sales = Gross Margin Percent).
• Operating Expenses refer to all the expenses you incur from running your business. It exempts the COGS because it stands alone as a core part of your income statement. You also have to exclude taxes, depreciation, and amortization. Your operating expenses include salaries, marketing expenses, research and development (R&D) expenses, and other expenses.
• Total Operating Expenses refers to the sum of all your operating expenses including those exemptions named above under operating expenses.
• Operating Income refers to earnings before interest, taxes, depreciation, and amortization. It is simply known as the acronym EBITDA (earnings before interest, taxes, depreciation, and amortization). Calculating your operating income is simple, all you need to do is to subtract your COGS and total operating expenses from your sales.
• Total Expenses refer to the sum of your operating expenses and your business’ interest, taxes, depreciation, and amortization.
• Net profit shows whether your business has made a profit or taken a loss during a given timeframe.

4. Cash Flow Statement

The cash flow statement tracks the money you have in the bank at any given point. It is often confused with the income statement or the profit and loss statement. They are both different types of financial statements. The income statement calculates your profits and losses while the cash flow statement shows you how much you have in the bank.

5. Balance Sheet

The balance sheet is a financial statement that provides an overview of the financial health of your business. It contains information about the assets and liabilities of your company, and owner’s or shareholders’ equity.

You can get the net worth of your company by subtracting your company’s liabilities from its assets.

6. Exit Strategy

The exit strategy refers to a probable plan for selling your business either to the public in an IPO or to another company. It is the last thing you include in the financial plan, metrics, and projection section.

You can choose to omit the exit strategy from your business plan if you plan to maintain full ownership of your business and do not plan on seeking angel investment or virtual capitalist (VC) funding.

Investors may want to know what your exit plan is. They invest in your business to get a good return on investment.

Your exit strategy does not have to include long and boring details. Ensure you identify some interested parties who may be interested in buying the company if it becomes a success.

Key Questions to Answer with Your Financial Plan, Metrics, and Projection

Your financial plan, metrics, and projection section helps investors, creditors, or your internal managers to understand what your expenses are, the amount of cash you need, and what it takes to make your company profitable. It also shows what you will be doing with any funding.

You do not need to show actual financial data if you do not have one. Adding forecasts and projections to your financial statements is added proof that your strategy is feasible and shows investors you have planned properly.

Here are some key questions to answer to help you develop this section.

• What is your sales forecast for the next year?
• When will your company achieve a positive cash flow?
• What are the core expenses you need to operate?
• How much money do you need upfront to operate or grow your company?
• How will you use the loans or investments?

9. Add an Appendix to Your Business Plan

Adding an appendix to your business plan is optional. It is a useful place to put any charts, tables, legal notes, definitions, permits, résumés, and other critical information that do not fit into other sections of your business plan.

The appendix section is where you would want to include details of a patent or patent-pending if you have one. You can always add illustrations or images of your products here. It is the last section of your business plan.

When writing your business plan, there are details you cut short or remove to prevent the entire section from becoming too lengthy. There are also details you want to include in the business plan but are not a good fit for any of the previous sections. You can add that additional information to the appendix section.

Businesses also use the appendix section to include supporting documents or other materials specially requested by investors or lenders.

You can include just about any information that supports the assumptions and statements you made in the business plan under the appendix. It is the one place in the business plan where unrelated data and information can coexist amicably.

If your appendix section is lengthy, try organizing it by adding a table of contents at the beginning of the appendix section. It is also advisable to group similar information to make it easier for the reader to access them.

A well-organized appendix section makes it easier to share your information clearly and concisely. Add footnotes throughout the rest of the business plan or make references in the plan to the documents in the appendix.

The appendix section is usually only necessary if you are seeking funding from investors or lenders, or hoping to attract partners.

People reading business plans do not want to spend time going through a heap of backup information, numbers, and charts. Keep these documents or information in the Appendix section in case the reader wants to dig deeper.

Common Items to Include in the Appendix Section of Your Business Plan

The appendix section includes documents that supplement or support the information or claims given in other sections of the business plans. Common items you can include in the appendix section include:

• Additional data about the process of manufacturing or creation
• Additional description of products or services such as product schematics
• Additional financial documents or projections
• Articles of incorporation and status
• Backup for market research or competitive analysis
• Bank statements
• Business registries
• Client testimonials (if your business is already running)
• Copies of insurances
• Credit histories (personal or/and business)
• Deeds and permits
• Equipment leases
• Examples of marketing and advertising collateral
• Industry associations and memberships
• Images of product
• Intellectual property
• Key customer contracts
• Legal documents and other contracts
• Letters of reference
• Links to references
• Market research data
• Organizational charts
• Photographs of potential facilities
• Professional licenses pertaining to your legal structure or type of business
• Purchase orders
• Resumes of the founder(s) and key managers
• State and federal identification numbers or codes
• Trademarks or patents’ registrations

Avoid using the appendix section as a place to dump any document or information you feel like adding. Only add documents or information that you support or increase the credibility of your business plan.

Tips and Strategies for Writing a Convincing Business Plan

To achieve a perfect business plan, you need to consider some key tips and strategies. These tips will raise the efficiency of your business plan above average.

1. Know Your Audience

When writing a business plan, you need to know your audience . Business owners write business plans for different reasons. Your business plan has to be specific. For example, you can write business plans to potential investors, banks, and even fellow board members of the company.

The audience you are writing to determines the structure of the business plan. As a business owner, you have to know your audience. Not everyone will be your audience. Knowing your audience will help you to narrow the scope of your business plan.

Consider what your audience wants to see in your projects, the likely questions they might ask, and what interests them.

• A business plan used to address a company's board members will center on its employment schemes, internal affairs, projects, stakeholders, etc.
• A business plan for financial institutions will talk about the size of your market and the chances for you to pay back any loans you demand.
• A business plan for investors will show proof that you can return the investment capital within a specific time. In addition, it discusses your financial projections, tractions, and market size.

2. Get Inspiration from People

Writing a business plan from scratch as an entrepreneur can be daunting. That is why you need the right inspiration to push you to write one. You can gain inspiration from the successful business plans of other businesses. Look at their business plans, the style they use, the structure of the project, etc.

To make your business plan easier to create, search companies related to your business to get an exact copy of what you need to create an effective business plan. You can also make references while citing examples in your business plans.

When drafting your business plan, get as much help from others as you possibly can. By getting inspiration from people, you can create something better than what they have.

3. Avoid Being Over Optimistic

Many business owners make use of strong adjectives to qualify their content. One of the big mistakes entrepreneurs make when preparing a business plan is promising too much.

The use of superlatives and over-optimistic claims can prepare the audience for more than you can offer. In the end, you disappoint the confidence they have in you.

In most cases, the best option is to be realistic with your claims and statistics. Most of the investors can sense a bit of incompetency from the overuse of superlatives. As a new entrepreneur, do not be tempted to over-promise to get the interests of investors.

The concept of entrepreneurship centers on risks, nothing is certain when you make future analyses. What separates the best is the ability to do careful research and work towards achieving that, not promising more than you can achieve.

To make an excellent first impression as an entrepreneur, replace superlatives with compelling data-driven content. In this way, you are more specific than someone promising a huge ROI from an investment.

4. Keep it Simple and Short

When writing business plans, ensure you keep them simple throughout. Irrespective of the purpose of the business plan, your goal is to convince the audience.

One way to achieve this goal is to make them understand your proposal. Therefore, it would be best if you avoid the use of complex grammar to express yourself. It would be a huge turn-off if the people you want to convince are not familiar with your use of words.

Another thing to note is the length of your business plan. It would be best if you made it as brief as possible.

You hardly see investors or agencies that read through an extremely long document. In that case, if your first few pages can’t convince them, then you have lost it. The more pages you write, the higher the chances of you derailing from the essential contents.

To ensure your business plan has a high conversion rate, you need to dispose of every unnecessary information. For example, if you have a strategy that you are not sure of, it would be best to leave it out of the plan.

5. Make an Outline and Follow Through

A perfect business plan must have touched every part needed to convince the audience. Business owners get easily tempted to concentrate more on their products than on other sections. Doing this can be detrimental to the efficiency of the business plan.

For example, imagine you talking about a product but omitting or providing very little information about the target audience. You will leave your clients confused.

To ensure that your business plan communicates your full business model to readers, you have to input all the necessary information in it. One of the best ways to achieve this is to design a structure and stick to it.

This structure is what guides you throughout the writing. To make your work easier, you can assign an estimated word count or page limit to every section to avoid making it too bulky for easy reading. As a guide, the necessary things your business plan must contain are:

• Table of contents
• Introduction
• Product or service description
• Target audience
• Market size
• Competition analysis
• Financial projections

Some specific businesses can include some other essential sections, but these are the key sections that must be in every business plan.

6. Ask a Professional to Proofread

When writing a business plan, you must tie all loose ends to get a perfect result. When you are done with writing, call a professional to go through the document for you. You are bound to make mistakes, and the way to correct them is to get external help.

You should get a professional in your field who can relate to every section of your business plan. It would be easier for the professional to notice the inner flaws in the document than an editor with no knowledge of your business.

In addition to getting a professional to proofread, get an editor to proofread and edit your document. The editor will help you identify grammatical errors, spelling mistakes, and inappropriate writing styles.

Writing a business plan can be daunting, but you can surmount that obstacle and get the best out of it with these tips.

Business Plan Examples and Templates That’ll Save You Tons of Time

1. hubspot's one-page business plan.

The one-page business plan template by HubSpot is the perfect guide for businesses of any size, irrespective of their business strategy. Although the template is condensed into a page, your final business plan should not be a page long! The template is designed to ask helpful questions that can help you develop your business plan.

Hubspot’s one-page business plan template is divided into nine fields:

• Business opportunity
• Company description
• Industry analysis
• Target market
• Implementation timeline
• Marketing plan
• Financial summary
• Funding required

2. Bplan’s Free Business Plan Template

Bplans' free business plan template is investor-approved. It is a rich template used by prestigious educational institutions such as Babson College and Princeton University to teach entrepreneurs how to create a business plan.

The template has six sections: the executive summary, opportunity, execution, company, financial plan, and appendix. There is a step-by-step guide for writing every little detail in the business plan. Follow the instructions each step of the way and you will create a business plan that impresses investors or lenders easily.

3. HubSpot's Downloadable Business Plan Template

HubSpot’s downloadable business plan template is a more comprehensive option compared to the one-page business template by HubSpot. This free and downloadable business plan template is designed for entrepreneurs.

The template is a comprehensive guide and checklist for business owners just starting their businesses. It tells you everything you need to fill in each section of the business plan and how to do it.

There are nine sections in this business plan template: an executive summary, company and business description, product and services line, market analysis, marketing plan, sales plan, legal notes, financial considerations, and appendix.

4. Business Plan by My Own Business Institute

My Own Business Institute (MOBI) which is a part of Santa Clara University's Center for Innovation and Entrepreneurship offers a free business plan template. You can either copy the free business template from the link provided above or download it as a Word document.

The comprehensive template consists of a whopping 15 sections.

• The Business Profile
• The Vision and the People
• Home-Based Business and Freelance Business Opportunities
• Organization
• Licenses and Permits
• Business Insurance
• Communication Tools
• Acquisitions
• Location and Leasing
• Accounting and Cash Flow
• Opening and Marketing
• Managing Employees
• Expanding and Handling Problems

There are lots of helpful tips on how to fill each section in the free business plan template by MOBI.

5. Score's Business Plan Template for Startups

Score is an American nonprofit organization that helps entrepreneurs build successful companies. This business plan template for startups by Score is available for free download. The business plan template asks a whooping 150 generic questions that help entrepreneurs from different fields to set up the perfect business plan.

The business plan template for startups contains clear instructions and worksheets, all you have to do is answer the questions and fill the worksheets.

There are nine sections in the business plan template: executive summary, company description, products and services, marketing plan, operational plan, management and organization, startup expenses and capitalization, financial plan, and appendices.

The ‘refining the plan’ resource contains instructions that help you modify your business plan to suit your specific needs, industry, and target audience. After you have completed Score’s business plan template, you can work with a SCORE mentor for expert advice in business planning.

6. Minimalist Architecture Business Plan Template by Venngage

The minimalist architecture business plan template is a simple template by Venngage that you can customize to suit your business needs .

There are five sections in the template: an executive summary, statement of problem, approach and methodology, qualifications, and schedule and benchmark. The business plan template has instructions that guide users on what to fill in each section.

7. Small Business Administration Free Business Plan Template

The Small Business Administration (SBA) offers two free business plan templates, filled with practical real-life examples that you can model to create your business plan. Both free business plan templates are written by fictional business owners: Rebecca who owns a consulting firm, and Andrew who owns a toy company.

There are five sections in the two SBA’s free business plan templates.

• Executive Summary
• Company Description
• Service Line
• Marketing and Sales

8. The $100 Startup's One-Page Business Plan

The one-page business plan by the $100 startup is a simple business plan template for entrepreneurs who do not want to create a long and complicated plan . You can include more details in the appendices for funders who want more information beyond what you can put in the one-page business plan.

There are five sections in the one-page business plan such as overview, ka-ching, hustling, success, and obstacles or challenges or open questions. You can answer all the questions using one or two sentences.

9. PandaDoc’s Free Business Plan Template

The free business plan template by PandaDoc is a comprehensive 15-page document that describes the information you should include in every section.

There are 11 sections in PandaDoc’s free business plan template.

• Executive summary
• Business description
• Products and services
• Operations plan
• Management organization
• Financial plan
• Conclusion / Call to action
• Confidentiality statement

You have to sign up for its 14-day free trial to access the template. You will find different business plan templates on PandaDoc once you sign up (including templates for general businesses and specific businesses such as bakeries, startups, restaurants, salons, hotels, and coffee shops)

PandaDoc allows you to customize its business plan templates to fit the needs of your business. After editing the template, you can send it to interested parties and track opens and views through PandaDoc.

10. Invoiceberry Templates for Word, Open Office, Excel, or PPT

InvoiceBerry is a U.K based online invoicing and tracking platform that offers free business plan templates in .docx, .odt, .xlsx, and .pptx formats for freelancers and small businesses.

Before you can download the free business plan template, it will ask you to give it your email address. After you complete the little task, it will send the download link to your inbox for you to download. It also provides a business plan checklist in .xlsx file format that ensures you add the right information to the business plan.

Alternatives to the Traditional Business Plan

A business plan is very important in mapping out how one expects their business to grow over a set number of years, particularly when they need external investment in their business. However, many investors do not have the time to watch you present your business plan. It is a long and boring read.

Luckily, there are three alternatives to the traditional business plan (the Business Model Canvas, Lean Canvas, and Startup Pitch Deck). These alternatives are less laborious and easier and quicker to present to investors.

Business Model Canvas (BMC)

The business model canvas is a business tool used to present all the important components of setting up a business, such as customers, route to market, value proposition, and finance in a single sheet. It provides a very focused blueprint that defines your business initially which you can later expand on if needed.

The sheet is divided mainly into company, industry, and consumer models that are interconnected in how they find problems and proffer solutions.

Segments of the Business Model Canvas

The business model canvas was developed by founder Alexander Osterwalder to answer important business questions. It contains nine segments.

• Key Partners: Who will be occupying important executive positions in your business? What do they bring to the table? Will there be a third party involved with the company?
• Key Activities: What important activities will production entail? What activities will be carried out to ensure the smooth running of the company?
• The Product’s Value Propositions: What does your product do? How will it be different from other products?
• Customer Segments: What demography of consumers are you targeting? What are the habits of these consumers? Who are the MVPs of your target consumers?
• Customer Relationships: How will the team support and work with its customer base? How do you intend to build and maintain trust with the customer?
• Key Resources: What type of personnel and tools will be needed? What size of the budget will they need access to?
• Channels: How do you plan to create awareness of your products? How do you intend to transport your product to the customer?
• Cost Structure: What is the estimated cost of production? How much will distribution cost?
• Revenue Streams: For what value are customers willing to pay? How do they prefer to pay for the product? Are there any external revenues attached apart from the main source? How do the revenue streams contribute to the overall revenue?

Lean Canvas

The lean canvas is a problem-oriented alternative to the standard business model canvas. It was proposed by Ash Maurya, creator of Lean Stack as a development of the business model generation. It uses a more problem-focused approach and it majorly targets entrepreneurs and startup businesses.

Lean Canvas uses the same 9 blocks concept as the business model canvas, however, they have been modified slightly to suit the needs and purpose of a small startup. The key partners, key activities, customer relationships, and key resources are replaced by new segments which are:

• Problem: Simple and straightforward number of problems you have identified, ideally three.
• Solution: The solutions to each problem.
• Unfair Advantage: Something you possess that can't be easily bought or replicated.
• Key Metrics: Important numbers that will tell how your business is doing.

Startup Pitch Deck

While the business model canvas compresses into a factual sheet, startup pitch decks expand flamboyantly.

Pitch decks, through slides, convey your business plan, often through graphs and images used to emphasize estimations and observations in your presentation. Entrepreneurs often use pitch decks to fully convince their target audience of their plans before discussing funding arrangements.

Considering the likelihood of it being used in a small time frame, a good startup pitch deck should ideally contain 20 slides or less to have enough time to answer questions from the audience.

Unlike the standard and lean business model canvases, a pitch deck doesn't have a set template on how to present your business plan but there are still important components to it. These components often mirror those of the business model canvas except that they are in slide form and contain more details.

Using Airbnb (one of the most successful start-ups in recent history) for reference, the important components of a good slide are listed below.

• Cover/Introduction Slide: Here, you should include your company's name and mission statement. Your mission statement should be a very catchy tagline. Also, include personal information and contact details to provide an easy link for potential investors.
• Problem Slide: This slide requires you to create a connection with the audience or the investor that you are pitching. For example in their pitch, Airbnb summarized the most important problems it would solve in three brief points – pricing of hotels, disconnection from city culture, and connection problems for local bookings.
• Solution Slide: This slide includes your core value proposition. List simple and direct solutions to the problems you have mentioned
• Customer Analysis: Here you will provide information on the customers you will be offering your service to. The identity of your customers plays an important part in fundraising as well as the long-run viability of the business.
• Market Validation: Use competitive analysis to show numbers that prove the presence of a market for your product, industry behavior in the present and the long run, as well as the percentage of the market you aim to attract. It shows that you understand your competitors and customers and convinces investors of the opportunities presented in the market.
• Business Model: Your business model is the hook of your presentation. It may vary in complexity but it should generally include a pricing system informed by your market analysis. The goal of the slide is to confirm your business model is easy to implement.
• Marketing Strategy: This slide should summarize a few customer acquisition methods that you plan to use to grow the business.
• Competitive Advantage: What this slide will do is provide information on what will set you apart and make you a more attractive option to customers. It could be the possession of technology that is not widely known in the market.
• Team Slide: Here you will give a brief description of your team. Include your key management personnel here and their specific roles in the company. Include their educational background, job history, and skillsets. Also, talk about their accomplishments in their careers so far to build investors' confidence in members of your team.
• Traction Slide: This validates the company’s business model by showing growth through early sales and support. The slide aims to reduce any lingering fears in potential investors by showing realistic periodic milestones and profit margins. It can include current sales, growth, valuable customers, pre-orders, or data from surveys outlining current consumer interest.
• Funding Slide: This slide is popularly referred to as ‘the ask'. Here you will include important details like how much is needed to get your business off the ground and how the funding will be spent to help the company reach its goals.
• Appendix Slides: Your pitch deck appendix should always be included alongside a standard pitch presentation. It consists of additional slides you could not show in the pitch deck but you need to complement your presentation.

It is important to support your calculations with pictorial renditions. Infographics, such as pie charts or bar graphs, will be more effective in presenting the information than just listing numbers. For example, a six-month graph that shows rising profit margins will easily look more impressive than merely writing it.

Lastly, since a pitch deck is primarily used to secure meetings and you may be sharing your pitch with several investors, it is advisable to keep a separate public version that doesn't include financials. Only disclose the one with projections once you have secured a link with an investor.

Advantages of the Business Model Canvas, Lean Canvas, and Startup Pitch Deck over the Traditional Business Plan

• Time-Saving: Writing a detailed traditional business plan could take weeks or months. On the other hand, all three alternatives can be done in a few days or even one night of brainstorming if you have a comprehensive understanding of your business.
• Easier to Understand: Since the information presented is almost entirely factual, it puts focus on what is most important in running the business. They cut away the excess pages of fillers in a traditional business plan and allow investors to see what is driving the business and what is getting in the way.
• Easy to Update: Businesses typically present their business plans to many potential investors before they secure funding. What this means is that you may regularly have to amend your presentation to update statistics or adjust to audience-specific needs. For a traditional business plan, this could mean rewriting a whole section of your plan. For the three alternatives, updating is much easier because they are not voluminous.
• Guide for a More In-depth Business Plan: All three alternatives have the added benefit of being able to double as a sketch of your business plan if the need to create one arises in the future.

Business Plan FAQ

Business plans are important for any entrepreneur who is looking for a framework to run their company over some time or seeking external support. Although they are essential for new businesses, every company should ideally have a business plan to track their growth from time to time.  They can be used by startups seeking investments or loans to convey their business ideas or an employee to convince his boss of the feasibility of starting a new project. They can also be used by companies seeking to recruit high-profile employee targets into key positions or trying to secure partnerships with other firms.

Business plans often vary depending on your target audience, the scope, and the goals for the plan. Startup plans are the most common among the different types of business plans.  A start-up plan is used by a new business to present all the necessary information to help get the business up and running. They are usually used by entrepreneurs who are seeking funding from investors or bank loans. The established company alternative to a start-up plan is a feasibility plan. A feasibility plan is often used by an established company looking for new business opportunities. They are used to show the upsides of creating a new product for a consumer base. Because the audience is usually company people, it requires less company analysis. The third type of business plan is the lean business plan. A lean business plan is a brief, straight-to-the-point breakdown of your ideas and analysis for your business. It does not contain details of your proposal and can be written on one page. Finally, you have the what-if plan. As it implies, a what-if plan is a preparation for the worst-case scenario. You must always be prepared for the possibility of your original plan being rejected. A good what-if plan will serve as a good plan B to the original.

A good business plan has 10 key components. They include an executive plan, product analysis, desired customer base, company analysis, industry analysis, marketing strategy, sales strategy, financial projection, funding, and appendix. Executive Plan Your business should begin with your executive plan. An executive plan will provide early insight into what you are planning to achieve with your business. It should include your mission statement and highlight some of the important points which you will explain later. Product Analysis The next component of your business plan is your product analysis. A key part of this section is explaining the type of item or service you are going to offer as well as the market problems your product will solve. Desired Consumer Base Your product analysis should be supplemented with a detailed breakdown of your desired consumer base. Investors are always interested in knowing the economic power of your market as well as potential MVP customers. Company Analysis The next component of your business plan is your company analysis. Here, you explain how you want to run your business. It will include your operational strategy, an insight into the workforce needed to keep the company running, and important executive positions. It will also provide a calculation of expected operational costs.  Industry Analysis A good business plan should also contain well laid out industry analysis. It is important to convince potential investors you know the companies you will be competing with, as well as your plans to gain an edge on the competition. Marketing Strategy Your business plan should also include your marketing strategy. This is how you intend to spread awareness of your product. It should include a detailed explanation of the company brand as well as your advertising methods. Sales Strategy Your sales strategy comes after the market strategy. Here you give an overview of your company's pricing strategy and how you aim to maximize profits. You can also explain how your prices will adapt to market behaviors. Financial Projection The financial projection is the next component of your business plan. It explains your company's expected running cost and revenue earned during the tenure of the business plan. Financial projection gives a clear idea of how your company will develop in the future. Funding The next component of your business plan is funding. You have to detail how much external investment you need to get your business idea off the ground here. Appendix The last component of your plan is the appendix. This is where you put licenses, graphs, or key information that does not fit in any of the other components.

The business model canvas is a business management tool used to quickly define your business idea and model. It is often used when investors need you to pitch your business idea during a brief window.

A pitch deck is similar to a business model canvas except that it makes use of slides in its presentation. A pitch is not primarily used to secure funding, rather its main purpose is to entice potential investors by selling a very optimistic outlook on the business.

Business plan competitions help you evaluate the strength of your business plan. By participating in business plan competitions, you are improving your experience. The experience provides you with a degree of validation while practicing important skills. The main motivation for entering into the competitions is often to secure funding by finishing in podium positions. There is also the chance that you may catch the eye of a casual observer outside of the competition. These competitions also provide good networking opportunities. You could meet mentors who will take a keen interest in guiding you in your business journey. You also have the opportunity to meet other entrepreneurs whose ideas can complement yours.

Exlore Further

• 12 Key Elements of a Business Plan (Top Components Explained)
• 13 Sources of Business Finance For Companies & Sole Traders
• 5 Common Types of Business Structures (+ Pros & Cons)
• How to Buy a Business in 8 Steps (+ Due Diligence Checklist)

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Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

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What is a product plan and how to create one in 6 steps

Whenever I read about the next hot, new start-up with unicorn potential, I can’t help but think of Pinky and the Brain .

Both titular characters in the mid-90s animated TV series are genetically modified laboratory mice. Brain is hyper-intelligent; Pinky, not so much.

Brain’s primary objective? World domination:

Pinky : Gee, Brain. What are we going to do tonight? Brain : The same thing we do every night, Pinky. Try to take over the world.

In each episode, Brain devises a diabolical yet half-baked plan — for example, manipulating the world’s biggest magnet to form discarded satellites to spell “Brain is your ruler” — that invariably ends up foiled.

What does this have to do with product management?

Devise a product plan to take over the world

If you want to make an impact with your product and solve all your customers’ problems, don’t be like Brain; take the time to devise a product plan before you make your first move on your quest for market domination.

Creating roadmaps and backlogs is a great start, but product planning covers a much wider scope.

In this guide, we’ll define what product planning means, why it’s important, and the components and steps involved in creating a product plan.

What is a product plan?

Product planning covers all the steps, activities, and decisions a company must perform and make to develop a successful product.

A product can be defined as an input-outcome device. The input is the customer value proposition and the outcome is the company’s profit. Product planning includes everything you need to do internally to get from input to outcome.

It starts with a recognized customer need — after all, customers don’t just buy a product, they buy what the product will do for them to solve a problem they are having. It ends when the product has reached the end of its usefulness from a business perspective.

What is the purpose of product planning?

Product planning encompasses the actions and components that contribute to achieving a specific outcome. Product management is all about realizing outcomes.

Before jumping into the how and what, let’s first understand why product planning is important by outlining its six objectives:

• Company survival
• Meet customer needs
• Increase sales
• Understand and manage strengths and weaknesses
• Better manage capacity
• Plan effectively

1. Company survival

The eye of the tiger, survival of the fittest — or as P. Diddy said, it’s all about the Benjamins .

Product planning allows you to focus, remain viable, and understand your ability to innovate. It also helps you clarify how to introduce, grow, and sunset products in highly competitive markets.

2. Meet customer needs

The customer is at the heart of any product. Thorough product planning will set you up to understand and meet your customers’ needs. This, in turn, helps you quickly move customers from evaluators to champions through the product-led growth flywheel .

3. Increase sales

Your product can be lightyears ahead with brilliant solutions to customer problems, yet if they are not interested in the solution and don’t buy the product, your product fails.

For example, virtual reality seems to have finally found product-market fit . VR technology though, is not new.

In the 90s, VR was on the rise and forecasted sales potential was off the charts. Unfortunately, VR systems such as the Virtual Boy failed to deliver; its poor ergonomics and underwhelming stereoscopic effect gave users terrible headaches.

With better product planning, Nintendo might’ve been able to craft a more sophisticated product that satisfied customer expectations and, as a result, increased sales.

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4. Understand and manage strengths and weaknesses

Product planning allows you to look introspectively and analyze your strengths and weaknesses in light of market requirements. What does your product do really well? What qualities distinguish it from competitors? What does your product lack and what do competitors do better?

By asking and answering questions like these, you’ll gain a better understanding of what you can take advantage of and what you need to improve in your product.

5. Better manage capacity

What’s one thing every company has in common? Limited resources in terms of capital, material, and human resources. Product planning enables you to plan these optimally and get the most out of them.

6. Plan effectively

When you’re building products, you have many competing priorities . Will you invest in new features, enhance and improve existing ones, reduce technical debt , or spend more time on improving discovery and delivery processes ? Product planning allows you to meet your long-term strategic plans.

6 considerations for product planning

Now that we understand why product planning is essential, how do you go about doing it?

Creating a successful product plan involves the following considerations:

• Research before development
• Choose a delivery method
• Coordinate activities
• Set a price
• Commercialize the product
• Abandon unprofitable products

1. Research before development

Energy to get going: Check. Confidence it will work out: Check.

Validation that the idea will deliver what customers need? [Buzzer sounds].

Before jumping into the deep end of product development, start with extendive market and user research. The insights gathered therein will help you establish what characteristics and requirements your product must fulfil to meet customers’ needs.

2. Choose a delivery method

All roads lead to Rome. The question is, which is the most efficient?

This is even more applicable when it comes to product delivery. Which delivery method will enable you to develop your product or feature exact how the customer needs it to be?

3. Coordinate activities

Product planning aims to coordinate all the initiatives and activities around the product and its investments. Doing so allows you to improve your competitive position and strive for market leadership. It also helps you quickly respond to changing market conditions.

4. Set a price

Product planning helps you determine the ideal price point for your product.

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The insights gathered during product planning can help you determine the best pricing strategy. For example, is your product most suitable for value-based, competitive, price skimming, cust-plus, penetration, economy, or dynamic pricing?

5. Commercialize the product

Product planning helps you uncover and validate the viability, feasibility, and desirability of your product.

Desirability speaks to satisfaction of customer needs and the commercialization of the product. This measure helps you ensure viability and, hopefully, rake in profits.

Product planning also considers how to best introduce the product to the market and continuously measure success post-launch .

6. Abandon unprofitable products

All good things eventually come to an end. Every decision in a product is a business decision, and there will come a time that further investment in a product or product feature becomes unprofitable.

At that point, a decision has to be made whether or not to sunset the product or feature.

Good product planning throughout the product lifecycle helps you recognize when it is time to abandon the product and sunset it in a structured way with minimal impact on customers.

How to create a product plan in 6 steps

OK, enough small talk. It’s time to deep-dive into the product planning process.

Product planning involves six steps:

• Market and user research
• Concept ideation
• Screening and testing
• Introduction and launch
• Product lifecycle

1. Market and user research

Before you start to build, it’s crucial to understand the problem you’re trying to solve, the market drivers, competitors, and customer needs. You can generate insights on all of the above through market research.

Competitive analysis , a subset of market research, is a structured approach to identifying and analyzing competitors.

Both are conducted to identify markets, investigate market positioning , and analyze the business’s success.

Through customer segmentation research, which is especially important to new businesses, larger customer groups are divided into different groups with personas.

The personas form the basis of user research, which is aimed at understanding potential customers’ problems, habits, interests, motivations, and more.

2. Concept ideation

A great product starts with a great concept and initial validation of that concept. This step is arguably the most fun and creative step.

During the concept development stage, you define what you are trying to build by figuring out how well it solves the identified problem, how easy it is to use, what it will cost the customer, the look and feel of the application, and so on.

A key step in this process step is product discovery and a continuation of user research, which enables you to uncover the problems the persona faces and the solution to aim for.

Concept ideation sources can be both external and internal. Externally, market and user research influence concept ideation. Internally, concept ideas originate from sales, customer support, marketing, engineering, designers, user research, executives, and investors.

3. Screening and testing

During screening and testing, the ideas generated during the concept ideation phase are critically evaluated.

The goal is to groom out ideas that are either inconsistent with the product vision , undesirable, and/or impractical.

After evaluation, the next step is to rigorously prioritize ideas . As the Highlander said, “ There can only be one .” This is not to say you should only test one idea; it just means you should pursue the most promising tests first.

There are plenty of prioritization frameworks to choose from with some of the most commonly used include:

• Value vs. effort
• MoSCoW method
• Opportunity scoring

Once you have a prioritized list, you should devise a hypothesis and experiment to verify or disprove it.

In product testing, customers are given an opportunity to try a prototype. This helps you understand whether customers understand the product idea, what they like or dislike about it, and whether they would ultimately buy and use it.

The concept ideation, screening, and testing as a whole are often covered in the Double Diamond approach, which is a design process to help you discover, define, develop and deliver solutions.

4. Introduction and launch

After a few iterations of screening and testing, the new features and usability improvements deemed ready to pursue and develop trickle through and are ready for development and launch.

In this step, the idea is converted into a product. It’s the PM’s job to schedule activities to ensure a successful product launch with a high adoption rate .

When ready, the product is launched and commercialized. If your product planning is sound, it should be poised to compete with existing products and maximize market share and profits.

5. Product lifecycle

After the product is launched, the real fun begins. Now it’s time to measure and analyze usage to gather new insights about whether or not your product launch was successful.

Using these insights, you can modify and enhance the product, introduce new features, improve usability, and help the product move from introduction to growth.

At a certain point, you’ll reach product maturity. The number of customers and sales will stabilize. Eventually, new investments in the product will have a harder time generating additional revenue. It will become increasingly challenging to compete.

Eventually, the product will decline, and the number of customers and sales along with it. This might be due to existing competition or the introduction of new products that are more advanced and better serve the customer’s needs.

Think about how the Walkman was surpassed by the Discman, which was overtaken by the mp3 player, and, eventually, an app on your phone.

6. Sunsetting

When a product is in decline, it’s time to sunset it. Sunsetting is also known as the end of life and usually involves deprecating the product.

Though it might feel difficult to say goodbye to a product that you birthed, nurtured, and watched grow, sunsetting a product is a perfectly natural part of the product lifecycle.

During the sunsetting phase, it is important to be diligent. You should devise a playbook or checklist to ensure all activities, such as communication, code clean-ups, and so on are covered during the end-of-life period.

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How to write Amazon titles and product descriptions that convert – with real examples

What are Amazon product listings and why do they matter?

Why focus on amazon’s product titles, ‘about this item’ sections, and descriptions, what makes a good amazon product listing (examples).

• How to write product listings according to Amazon's guidelines

How to know if your product listings work (Examples)

Leveraging ai tools to optimize product listings (example), standing out in a crowded marketplace, amazon product titles cheatsheet.

• Amazon 'About this item' section cheatsheet

Amazon product descriptions cheatsheet

Crafting the perfect product listing for Amazon isn’t just about writing down features – it’s about making a connection with your customer. In Amazon, where endless options are just a click away, well-written titles, descriptions, and ‘About this item’ sections can be the difference between a sale and a scroll past. 

In this guide, we’ll show you how to write product listings that not only stand out, but also convert.

A product listing is your chance to show customers exactly why they need your product. It’s made up of several key elements: the product title, the ‘about this item’ section, and the product description.

The product title is the first thing a customer sees, so it needs to be clear, concise, and informative, often including keywords to improve searchability . 

The ‘About this item’ section offers a quick overview of key features, helping customers make snap decisions.

Finally, the product description dives a bit deeper; it’s the detailed copy that explains the product’s features, benefits, and why it’s worth purchasing. A great description does more than just inform, though – it engages potential buyers and nudges them toward making a purchase . 

Together, these components shape first impressions, impact search rankings, and ultimately drive conversions. They can make your products easy to find and hard to resist.

Amazon is the world’s largest online marketplace, which makes it an incredible opportunity but also an enormous challenge for sellers. Unlike smaller platforms, Amazon’s sheer volume of listings means that competition is fierce, and standing out is crucial. 

The product title grabs immediate attention, helping customers find your listing through relevant keywords.

The ‘About this item’ section offers a snapshot of your product’s most important features, allowing buyers to make quick, informed decisions.

Meanwhile, your product description plays a pivotal role. Not only does it need to capture a customer’s attention quickly, but it must also appeal to Amazon’s algorithm . This means incorporating the right keywords and phrases to ensure your product ranks higher in search results.

A well-written product listing on Amazon is like a first impression – it can determine whether someone selects your brand or keeps scrolling. It’s also an important factor in converting browsers into buyers. And while design and imagery are important, it’s the words that seal the deal. 

By focusing on crafting an Amazon-specific listing, you’re increasing the chances of both being found and making sales.

A good Amazon product listing is all about clarity, persuasion, and structure, starting with the product title . A great title is clear, concise, and loaded with relevant keywords that improve searchability. It should include the brand name, key features, and the product type without feeling cluttered or too promotional.

In this Amazon example, there’s a clear use of strategic keywords, it includes the brand’s name and the exact products in the kit, and there are no promotional adjectives that may hurt the original cause of the product title.

Next, the ‘About this item’ section provides a high-level overview of key benefits, features, and specifications in a scannable format. This is where bullet points shine – organizing information in this skimmable structure makes it easy for customers to digest quickly.

This example is a good representation of what makes a good ‘About this item’ section – it mentions and explains the key features and benefits in a digestible format. Bullet points are embedded to make the information skimmable and less unappealing than a giant ‘text wall.’

Once you’ve captured attention with your title and provided a quick overview, the product description is where you dive deeper. According to PickFu , clear and concise language is key – get to the point quickly without overwhelming potential buyers. Focus on the product’s benefits, explaining how it solves a problem or improves a customer’s life. SEO is essential here, with keywords naturally integrated to increase visibility on the platform.

A good Amazon product description balances clarity and persuasion. Amazon’s Seller Central emphasizes the importance of formatting, including bullet points to avoid overwhelming buyers with large blocks of text. Short paragraphs make it easier for customers to scan and understand key information.

In this example from BENEWY’s ME540 USB C headphones, the seller carefully segments the text into digestible categories and incorporates visuals for readability. The visuals and text work together to create a more user-friendly experience.

In all parts of the listing, making information easily digestible – using short paragraphs, bullet points, and clear headings – is key to capturing attention and leading customers to purchase. Whether your tone is fun and quirky or technical and professional, it should align with your brand and convince the customer that your product is the right choice.

Might also interest you :

• How to write product titles and descriptions that convert
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How to write product listings according to Amazon’s guidelines

Amazon has strict guidelines for crafting product listings, and following them is essential for visibility and compliance. 

Product titles should stay within Amazon’s character limits (200 characters) and include important keywords, while avoiding promotional terms like ‘best’ or ‘guaranteed.’ Overstuffing titles can hurt readability, so clarity is key.

In the ‘About this item’ section, bullet points should be concise yet informative, highlighting key features without exaggeration or making false claims.

Finally, the product description should adhere to Amazon’s 2,000-character limit. Better World Products suggest using all characters to maximize impact – the reason behind this is that taking up space can help you outshine your brand and listing compared to your competitors’ advertising. Amazon, on the other hand, recommends concise, accurate descriptions that avoid prohibited terms such as ‘free’ or ‘bonus.’ Misleading information can lead to negative customer experiences and even listing suspension.

According to Seller Central , using promotional language like ‘best’ or ‘guaranteed’ is also inadvisable. Accuracy is key – don’t exaggerate or make claims that can’t be backed up. Misleading descriptions can lead to poor customer experiences or even listing suspension.

Transparency and clarity are vital across all components, ensuring customers know exactly what they’re purchasing. Following Amazon’s category-specific guidelines helps protect your listings and build trust with potential buyers.

To determine the effectiveness of your Amazon product listings, monitor key metrics such as conversion rates, click-through rates (CTR), sales, and your product’s ranking in search results. A high CTR but low conversion rate could signal that your title or ‘About this item’ section is compelling but your description fails to connect with customers.

A/B testing can help refine both titles and descriptions by testing different versions to see what resonates best with your audience. Finally, don’t underestimate the value of customer feedback – reviews and questions offer insights on where your listing may need improvement, from better descriptions to clearer product titles.

AI tools like ChatGPT can be game-changers when optimizing all components of your Amazon product listing. Whether generating keyword-rich titles , crafting engaging ‘About this item’ sections, or producing tailored descriptions , AI helps streamline the process.

AI tools are particularly valuable for SEO optimization, placing keywords naturally to boost search visibility. For sellers with large inventories, AI offers scalability by creating consistent, high-quality listings across multiple products. This saves time and ensures that each listing is optimized for conversions.

In this example, it’s easy to see just how simple and time-efficient working with AI tools like ChatGPT can be. It was able to produce a high-quality and Amazon platform-fitting description in mere seconds, which is something you should consider when writing up any component of your Amazon product listings.

In a marketplace as vast as Amazon, standing out requires a strategic blend of creativity and clarity. One effective method is storytelling – paint a picture of how your product solves a problem or enhances the customer’s life. Focus on specific benefits that resonate with your target audience. 

Your brand voice should be distinct and consistent, giving your listing personality and setting you apart from competitors – experiment with engaging language or unexpected product features to create memorable descriptions. 

Lastly, stay adaptable. Regularly updating your titles, ‘About this item’ sections, and descriptions based on customer preferences and emerging trends keeps your listings fresh and relevant.

Key elements –

• Primary keyword : Include the main keyword for which the product is likely to be searched.
• Brand name : Place the brand name at the beginning or end.
• Product type : Clearly describe what the product is.
• Key features : Highlight important features or benefits.
• Size / quantity : Include this if relevant to the purchase decision.

Best practices –

• Use title case : Capitalize major words in the title.
• Be concise : Aim for a title length of 150-200 characters.
• Avoid keyword stuffing : Make the title readable and natural.

Examples –

• “Instant Pot Duo 7-in-1 Electric Pressure Cooker, 6 Quart – Slow Cooker, Rice Cooker, Steamer, Saute Pan, and More”
• “Organic Green Tea Leaves – 100% Pure Loose Leaf Tea – 8 Oz – Non-GMO, Caffeine-Free, Naturally Antioxidant-Rich”

Amazon ‘About this item’ section cheatsheet

• Bullet points : Use bullet points for clarity and readability.
• Key features : Include the most important features and benefits.
• Unique selling points : What makes this product stand out?
• Usage instructions : Briefly mention how to use the product, if applicable.
• Start with the most important features : Lead with what buyers care about most.
• Be specific : Provide precise details about features and benefits.
• Include customer pain points : Address common concerns or issues the product solves.

1. Example 1:

• 7-in-1 Functionality: Pressure cooks, slow cooks, steams, and more.
• 6-Quart Capacity: Perfect for families or meal prepping.
• Easy-to-Use Controls: Adjustable settings for customizable cooking.
• Dishwasher-Safe Parts: Hassle-free cleaning.

2. Example 2:

• 100% Organic: No artificial additives or preservatives.
• Rich in Antioxidants: Boosts health with every cup.
• Loose Leaf Tea: More flavorful than bagged tea.
• Reusable Packaging: Eco-friendly and sustainable.
• Engaging introduction : Hook the reader with a compelling opening.
• Detailed features : Provide a thorough explanation of features.
• Benefits : Explain how the features translate to benefits for the user.
• Usage instructions : Briefly guide the user on how to use the product.
• Call to action : Encourage the customer to make a purchase.
• Use persuasive language : Focus on how the product improves the customer’s life.
• Incorporate keywords : Ensure the description is SEO-friendly without keyword stuffing.
• Be concise yet informative : Provide all necessary details without overwhelming the reader.
• Transform Your Cooking Experience : The Instant Pot Duo 7-in-1 Electric Pressure Cooker combines the functionality of seven kitchen appliances in one compact unit. Whether you’re looking to make a quick weeknight dinner or prepare a gourmet meal, this versatile cooker makes it easy with its customizable settings and large 6-quart capacity.
• Versatile and Efficient : From pressure cooking and slow cooking to steaming and sautéing, the Instant Pot Duo covers all your cooking needs. Its user-friendly interface allows you to effortlessly switch between functions, while the included recipe book offers a variety of meal ideas.
• Built for Convenience : Enjoy easy cleanup with dishwasher-safe components and spend more time savoring your meals. Plus, the keep-warm function ensures your food stays hot until you’re ready to serve.

2. Example 2:

• Experience the Purest Green Tea : Our Organic Green Tea Leaves deliver a fresh, invigorating flavor that you can only get from 100% pure, loose leaf tea. Free from additives and preservatives, this tea is perfect for those who value natural health benefits.
• Health Benefits in Every Sip : Packed with antioxidants, our green tea helps support a healthy lifestyle. Enjoy a cup any time of day to boost your energy levels and enhance your well-being.
• Eco-Friendly Choice : We prioritize sustainability with our reusable packaging, reducing environmental impact. Plus, our tea leaves are sourced from environmentally responsible farms.

Crafting the perfect Amazon product listing is part science, part art; it’s the fine balance of what customers want to see with what Amazon’s algorithm needs. By mastering concise, benefits-driven copy, staying compliant with platform rules, and integrating AI tools, your listings will not only capture attention – they will actually convert. 

If you’re still not sure how to do it, we implore you to take inspiration from this article’s informative title – we do our best to follow these guidelines ourselves!

However, it’s important to note that product titles, ‘About this item’ sections, and descriptions are just one piece of the puzzle. As you optimize your business, 8fig is here to support your growth with flexible funding and smart financial tools that scale with you; let us help you grow your business seamlessly with personalized financial solutions.

Have article ideas, requests, or collaboration proposals? Reach out to us at  [email protected]  – we’d love to hear from you.

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The Secrets to Writing a Killer Product Description (2024)

Product descriptions inform so much of a consumer’s purchasing decisions. Don’t believe me? Convertcart reports that 87% of shoppers will not buy from a company again if they use inaccurate descriptions.

That’s pretty much as cut and dried as it gets. If you write accurate product descriptions, your eCommerce business can collect more sales, convert more leads, and drive your business forward.

However, what is a good product description? What separates the best ones from the descriptions that are simply mediocre and inspire abandoned carts?

In this blog post, we’ll share top actionable tips, best practices, and unique insights into creating winning product descriptions.

Table of Contents

Key Takeaways

• Writing product descriptions that convert requires you to know your audience, write with passion and authenticity, optimize your content for SEO, and add visual elements like videos and images.
• The next step in producing better descriptions is audience research, followed by drafting a few descriptions according to the guidance in this post.

Understanding the Basics

I like to start with a good foundation to ensure you understand what you’re getting into, as that can help you write a great description when the time comes.

Product descriptions 101

A product description is self-explanatory. It’s a blurb, usually of up to 300 words, that describes your product, what it does, how it works, and why you should buy it.

It sounds simple, but there’s a difference between writing technical jargon no one understands (or cares about) and writing in an engaging way that draws people in and keeps them reading. You’ll master that difference by the time you’re done here today.

Why product descriptions matter

A solid product description is the difference between a website visitor purchasing your products and not.

It’s your opportunity to sell to the prospective customer. By telling them why they need your product and how it will enrich their lives, they should hopefully feel inspired to purchase immediately.

Thus, product descriptions influence your conversion rate. If you spot a lot of abandoned carts, you have about a billion different areas you can check, from your marketing to your website design and sales message, but don’t forget to review your descriptions. They could use some optimization.

Speaking of optimization, well-put-together descriptions also positively influence SEO. Inserting the keywords you’ve researched naturally into the content will signal search engines to rank you for that term.

Read more: Customer Profile — How to Create One Using CRM Software

Key Elements of a Great Product Description

Let’s dive into the many elements required to make your product descriptions shine.

Target audience identification

You’ve got to know who you’re writing for. And no, the answer isn’t search engines, even if you want a high rank. It’s people.

However, not just any people. You need to dig into your audience’s pain points, opinions, needs, beliefs, and budget to determine who among them are the most viable candidates to purchase your product.

Those are the people you need to write for. Build a customer avatar or persona to put a face and name on this group, then write with that person in mind.

At the very least, your description needs to discuss what your product is and what it does. You can also use the features section to explain how it works.

Despite this straightforward information, now is not the time for a boring, formulaic copy. You must keep the entire description engaging if you want people to read to the end.

Here is the real star of your product description. Your reader knows what the product does by now, but why do they need it? This is what the benefits section is all about.

As you describe a feature, you can naturally attach a benefit to it.

For example, if you sell a vacuum cleaner with a pet hair nozzle, the benefit is no more pet hair floating around the house and getting on your clothes and furniture.

Tone and branding

Your product description must be branded, as that’s part of what makes it unique (you know, besides your products). That means using the right tone.

You should have already identified your brand tone, but if you haven’t, here are some directions to take it:

• Authoritative
• Informative
• Professional
• Straightforward
• Conversational
• Down-to-earth
• Sympathetic

Besides your brand voice, the graphics used on your page should also be branded. That means including your brand logo and colors. If you have a catchphrase or saying, that should also go into your description.

Branding consistency is important in establishing and strengthening your brand in people’s minds, so if you have multiple people on your team, they must be aware of your brand. A brand guide could be helpful here.

Read more: 9 Types of Branding And What They Really Mean

Remember, there’s no need for your description to exceed 300 words. At some point, you have to let your products speak for themselves. Consider adding an explainer video if your descriptions are too long and you aren’t sure what to cut out.

Visual media

Your product description requires visual media to sell your product. At the very least, you need images of the product in question, but videos are also beneficial. After all, almost half of internet users will look for a product video before they buy.

The visual media included on your product page should be high-res but compressed enough that it improves the loading speed of your site (more on that later when I talk about SEO optimization for product pages ).

Images and videos should show your product from various angles and, in the case of videos, how the product is used. This proves that anyone can pick up and use your product and begin benefitting from it immediately.

Read also: A Complete eCommerce SEO Guide for Beginners

SEO Best Practices for Product Descriptions

What kinds of keywords do you use in your product pages? How you answer that question could be the difference between ranking well or landing on the second page of results, where you’re practically invisible.

Search engine results are not random. Crawlers for Google and other search engines will review various criteria to determine your rank, one of which is keyword usage and the other of which is metadata.

I’ll explain both so you can optimize your product pages for better SEO rankings.

Keyword research and placement

The keywords you target can influence where your eCommerce store website ranks, so you can’t choose just any term. You need to find the terms your audience is looking for, which means starting with keyword research .

Tools like Google Trends, Ahrefs, SEMrush, and Google Keyword Planner can help you discover relevant terms your audience searches for. As you begin unearthing keywords, you’ll notice that some have higher difficulty than others.

Keyword difficulty refers to how much search volume a term gets. A high-difficulty term with a difficulty score of 61% to 100% has a lot of steep competition. That can make it tougher for a newer eCommerce site like yours to rank well for that term.

While low-difficulty terms between 0% and 30% might seem the right answer, they aren’t always. These terms are sometimes bereft of competition because no one searches for them.

Instead, aim for terms with a medium difficulty between 31% and 60%. These keywords have some competition but not so much that it’s insurmountable for a small eCommerce store like yourself to break in.

Once you’ve identified the right keywords to target, you have to place them properly. So, where do they go? Here are some places for your terms:

Meta descriptions

• In the body content, especially within the first 200 words

It would be best if you didn’t use your keywords excessively, as that’s known as keyword stuffing. Search engines penalize that behavior rather than reward it. When adding keywords to the body copy especially, you should only use them in a product description once or twice, tops.

A meta description is a short, succinct overview of your product within 150 and 160 characters. While you can use AI to generate them, they don’t always come out as good as needed. You’ll probably have to improve the content a little.

A good meta description uses your keyword and motivates people to keep reading.

Read more: eCommerce Marketing — 8 Fantastic Strategies for Success

Writing Techniques for Engaging Descriptions

By now, you’ve got the bones of your product description ready to go. Now, you need to make it appealing so your audience can’t wait to learn more about your products. That involves using these techniques.

Storytelling

Every brand is unique, meaning it has a special story. Product descriptions allow you to share your story, draw people in, and inspire them to try your brand.

Weaving a narrative into your product descriptions should always make the customer the hero of the story with your business as a helpful guide to get them the results they want.

Sensory words

The trouble with online shopping is that people can’t hold a product in their hands, feel its weight, and see its shine. They can’t rub their fingers over its texture and turn it on. They have to rely on videos and images.

Incorporating sensory words into your product description is like putting the product in the prospective customer’s hands. That, combined with AR “try before you buy” previews, will help them make a purchasing decision they can feel confident and proud of.

What kinds of sensory words will have the most impact? That depends on which of the senses you’re trying to invoke.

For example, if you specialize in snacks or treats, you can whet a reader’s appetite by using taste-related sensory terms like:

And if yours is a touch-based product, use the following sensory words:

• Impenetrable

Does your eCommerce store sell items that are known for their lovely aromas? Try the following olfactory-related sensory terms:

These sensory terms are related to hearing:

Oh, and don’t forget your basic sight-related sensory words:

Writing and publishing a product description aims to get people to read it and make a purchase decision. However, as good as your information is, it will not make a difference if formatted incorrectly. Your bounce rate will still be high.

So, how do you increase it? Let’s take a look!

• Use bullet points: Did you notice how this article uses bullet points to illustrate points and break up the text? Your product descriptions also need bullets, especially when covering the product features and benefits.
• Add subheads: While you don’t need too many subheads (the product description should only be 300 words, you’ll remember), one or two will keep the product page neat and your marketing copy focused.
• Whitespace is your friend: Whitespace separates elements and keeps your product page contents neat so readers can focus on the words on the page.
• Incorporate media: Media is also great for breaking up your written product copy, especially an explainer video or relevant image inserted in the right spot.
• Shorten paragraphs: A paragraph should only be three or four sentences. If yours are too long, they’ll impact readability.

Read more: Mastering Brand Storytelling — Strategies and Examples

Optimizing for Conversion

Earning conversions requires a dose of optimization, which is quite a big dose. These measures will set up your product descriptions for success.

No product page is complete without calls to action or CTAs. Depending on length, you might implement a few text CTAs in your product description.

A CTA must be succinct and clear. The anchor text should explain what happens when the user clicks on it, such as “Check Out Our Newest Items” or “Shop the Sale NOW.”

Writing clear, straightforward CTAs like this will encourage more purchases.

Social proof

Trust is hard to come by among online shoppers, especially as a new eCommerce brand . Adding social proof to your product descriptions can give you a leg up.

If you have user-generated content or UGC, put it front and center. The same goes for testimonials and reviews. And if you don’t have any social proof yet, you need to get it first.

Contact potential buyers or those who recently purchased your product and ask if they will take five minutes to leave you a review. Offer an incentive, such as 10% off their next order.

And why does social proof matter, you ask? Well, 70% of consumers trust the opinions of their fellow strangers, and 92% trust the opinions of their friends.

In other words, there’s more trust among fellow customers than in your words as a company trying to make money. You need that social proof to signify to prospective customers that your product is worth buying.

Trust signals

You can bolster your social proof through trust signals. If your business has any relevant certifications or awards, share them above the fold. It would be best to have a clear return policy on the product page.

Does your eCommerce company offer guarantees? Put this information on the product page as well.

Mobile optimization

It shouldn’t be surprising that most consumers who connect with your page will do so through mobile. If your product pages aren’t ready to accommodate them, you will lose them, probably forever.

While mobile optimization goes beyond what’s in your product descriptions and includes the product pages, it’s still something to build into your preparation before your next promotional campaign.

While at it, be sure to A/B test your product pages before they go live. Sometimes, rearranging specific elements and making other small tweaks is all it takes for better audience reception. In other cases, you need the entire product page overhauled.

The only way to be sure is to test. Using a sample audience to gauge your page’s performance is always better than your real audience. They’ll only see the best version of your product descriptions.

Read more: Best CTA Examples for Small Businesses To Learn From

The Best Product Description Examples

I don’t know about you, but I love a good example to inspire me in a new direction. These product description examples can help your eCommerce business forge a unique path and draw an audience that’s ready to buy.

Ember thermoses and bottles have smartphone-controlled temperature options, which is awesome. Its product page, as shown above, sells the product beautifully.

The headline, “Precision in the palm of your hands,” inspires curiosity. The image to the right of the copy showing someone holding a phone and adjusting their Ember thermos temp is related to the copy.

The description is a short paragraph that uses words like “smarter,” “customize presets,” “desired temperature,” and “personalize” to inspire purchases.

The background of the product page is pure white, with an orange line separating the headline and product description. You’ll also notice the CTA button is orange, complementing the hue of the smartphone app in the photo.

Unearth Women

Talk about building a connection with your audience! Unearth Women takes a one-on-one approach when writing its product description, focusing on its goal of supporting women. To that end, Unearth mentions the mug is women-designed.

Below the paragraph describing the features and measurements of the mug is another shorter, bold paragraph mentioning that a customer’s purchase will help the Unearth Women platform.

The rest of the product page is simple. There is no headline used here besides the product’s name, and no videos either, only several images of the mug. Despite that, this page works excellently for its intended purpose.

Lilly’s Kitchen

Talk about a purrfect product description! Lily’s Kitchen, specializing in pet food, sells its Chicken Treats with an awesomely written description.

Sure, it’s a touch lengthy yet never long-winded. Part of what helps is how descriptive and sensory the copy is. For example, there’s a mention of how cats “twirl their tails” and how the treats are “perfectly formed pillow-shaped…with a crunchy shell and soft center.”

The other two paragraphs are cutesy and story-driven, discussing how you can use the treats as bribe treats, such as when your kitty is napping but you want to cuddle them.

That leads to a nice tie-in about how healthy the treats are for guilt-free pet snacking.

Products like grills don’t have a lot of room to let a brand’s personality shine, right? Wrong! Just ask Weber, one of the biggest names in grilling products, how to make a product description about grills personable and enjoyable to read.

I love how this product description starts with “opening the door to grilling with crazy good food and friends coming together.” That’s what grilling is all about at the end of the day, and Weber sums it up in that opener.

Naturally, with such a strong beginning, you’ll want to continue reading. The rest of the paragraph includes product details while still discussing benefits like gathering friends.

The UK drink brand Innocent knows how to write copy that converts. Look no further than this product description!

It starts by introducing a situation we can all relate to – how annoying it was to consume our greens as a kid. That intro coalesces into a product description, with Innocent focusing on how convenient it is now to get your greens on the go.

Beneath the copy are a few checkmarks mentioning how healthy the shake is, and beside that are two images of the shake. Besides some green text in the title, this product page uses a lot of whitespace.

Read also: Dropshipping Product Description Guide For Beginners

Common Mistakes to Avoid

Now you’ve gotten the hang of it, writing product descriptions should get easier with each one you do. That said, there are always mistakes to stay cognizant of and avoid. I’ve got you covered.

Here are some errors you don’t want anywhere near your product descriptions.

Overuse of jargon

Look, I get why there’s a temptation to use jargon. It makes you sound professional and like you know what you’re discussing.

However, your audience doesn’t know what you’re talking about. It’s like speaking another language.

No matter your industry, you can simplify jargon into everyday terms. Reducing the complexity ensures that prospective customers understand what you’re saying.

Ignoring mobile users

With so many people coming your way from smartphones, tablets, and the like, you can’t afford to skip mobile optimization. Your site must provide every user with a seamless loading and browsing experience, or you won’t get half the sales your products could achieve.

Duplicate content

Have you ever seen a product description that copies the manufacturer’s description verbatim? Not only are those kinds of descriptions uninteresting, but they’re also duplicate content.

Search engine crawlers don’t like duplicate content and can ding your rank if you have it.

Plus, like I said, those descriptions are dry and boring to read. They’re usually full of technical jargon and details only manufacturers care about, not consumers. Write your descriptions moving forward.

Tools and Resources

Improving one’s copywriting skills isn’t an overnight process. Fortunately, besides the great pointers in this guide, you have plenty of other resources at your fingertips for improving.

Copywriting tools

As a fellow copywriter, I love the Hemingway Editor. It will pick up on your spelling errors, grammar mistakes, and other gaffes in your writing so you can improve them. Best of all, you can use it for free, although the paid edition is more thorough.

I also like Grammarly, which can clean up your copy until it sparkles. Oh, and try Copyscape, too. It will comb through internet content to ensure yours is 100% original.

Mastering SEO is tough. The rules always change, so having a tool or two in your corner goes a long way.

To that end, you can’t go wrong with Semrush, which has a library of tools for becoming an SEO guru. Choose from:

• Technical and on-page SEO tools such as On-Page SEO Checker, Listing Management, and Site Audit.
• Keyword research tools like Organic Traffic Insights, Position Tracking, Keyword Strategy Builder, Keyword Magic, and Keyword Overview.
• Link-building tools include Bulk Analysis, Link Building Tools, Backlink Audit, and Backlink Analytics.
• Competitive research tools, including Backlink Gap, Keyword Gap, Organic Research, Traffic Analytics, and Domain Overview.

Besides Semrush, you can also try Moz, Yoast SEO, Ahrefs, and Surfer.

Learning resources

Check out the Grammarly blog and Copyhackers to learn new copywriting skills and sharpen those you already have.

Quality product descriptions require a continuous effort to optimize and maximize. The techniques I discussed today will put you on the right track. Once you’ve implemented them, begin monitoring your results.

Be sure to subscribe to EngageBay’s blog for more copywriting and eCommerce tips!

EngageBay is an all-in-one marketing, sales, and customer support software for small businesses, startups, and solopreneurs. You get email marketing, marketing automation , landing page and email templates , segmentation and personalization, sales pipelines, live chat, and more. 

Sign up for free with EngageBay or book a demo with our experts.

Frequently Asked Questions (FAQ)

1. how long should a product description be.

The sweet spot for a product description is up to 300 words. That’s just enough space to write about the product succinctly without going overboard.

2. What are the best tools for writing product descriptions?

You can use product notes, specs, and a word-processing document or rely on AI tools or product description generators. You have plenty of options to get the ball rolling.

3. How can I make my product descriptions SEO-friendly?

Your descriptions need a good ratio of keyword usage, clear headers and subheads, and metadata to rank well.

4. Should I include technical specifications in my product descriptions?

To an extent, you can, such as measurements for a product, but don’t go too deep into the technical specs when writing your description. You will turn prospective customers away.

5. How do I write product descriptions for different target audiences?

It would be best to segment your audience first, then identify their pain points and challenges based on your research.

6. Can I use the manufacturer’s description for my products?

You can use it as a starting point, but don’t copy the manufacturer’s description verbatim. Your SEO rank could drop, and your bounce rate could increase.

7. How often should I update my product descriptions?

As often as required, such as when changing or updating your product.

8. What role do images play in product descriptions?

Well, images help the prospective customer visualize the product, for starters. Product photos also break up copy and help leads make a purchasing decision.

9. How do I write product descriptions for products with multiple variations?

Many eCommerce platforms, such as Shopify, have apps for writing descriptions for each product variant, making your life much easier.

10. What is the impact of product descriptions on conversion rates?

Product descriptions help sell a product and can inspire higher conversion rates than pages that use generic descriptions from the manufacturer.

About The Author

Nicole Malczan

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The University of Chicago The Law School

Meet the class: zachary jordan, ’27, brown grad excited to combine business smarts with law.

Zachary Jordan, ’27, from Santa Barbara, California, has a unique portfolio of professional experiences since graduating from Brown University with a business and biology degree, including working as an EMT, an engineer, and as the founder of a start-up. He is excited to merge his business background with an interdisciplinary legal education to empower his pursuits in the business world.

Please describe your professional background and path.

My interests have always been varied, and my professional path has been commensurately non-linear. Throughout my undergraduate education and in the years preceding law school, I worked as an EMT, a startup founder and employee, a “namer,” and most recently, an engineer. At my last company, I served as a staff engineer and director of Business Operations, chiefly negotiating and executing contracts to build and repair walls, roads, and other infrastructure in the San Francisco Bay Area.

What key experiences have shaped you?

My first true career was as an engineer, but before that, I worked as a “namer” in linguistic branding. Companies, products, taglines, babies—we named them all. The two experiences provided valuable—but very different—perspectives on the value of a formal legal education. While in different fields of practice, I was struck by the clarity that our lawyers brought to situations otherwise fraught with indecision and uncertainty.

What motivated your decision to go to law school?

It has become abundantly apparent to me through my work that the law is both the backdrop for the resolution of nearly all intellectual and business disputes and a powerful mechanism with which to foresee and prevent potentially critical issues. Achieving fluency with the legal lexicon will empower me to make a real difference in people’s lives as they navigate a complex and sometimes counterintuitive legal system with far-reaching consequences.

Why did you select the University of Chicago Law School?

One of the offerings that drew me so strongly to the University of Chicago Law School was the Doctoroff Business Leadership Program . I am honored and excited to have the opportunity to learn not only from some of the world’s most preeminent legal scholars but also from the renowned professors at Booth School of Business. Given my business background and career goals, I strongly believe interdisciplinary study will provide the ideal opportunity to learn how to best put my prior experiences to good use as an attorney.

What do you plan to do with your legal education?

I know from personal experience (and mistakes) how integral a proper understanding of the law can be in making responsible and informed business decisions. Given my background in engineering, entrepreneurship, and linguistic branding, I am drawn to intellectual property law and business law, particularly as they pertain to the formation, growth, and transformation of companies.

What is the thing you are most looking forward to about being a law student?

The talent that the University of Chicago attracts is incredibly unique and diverse. I look forward to learning from my future colleagues, who undoubtedly have incredible experiences and perspectives to share. Especially given the University of Chicago’s commitment to diversity of thought and free expression, I fully expect to find my ideas and views challenged. It is this rigorous process of discussion and revision that I believe will help me grow as a person and as a professional throughout law school.

What are some of your hobbies or interests?

I’ve been racing sailboats for almost twenty years, and the water has been a fundamental part of my life for as long as I can remember. During the summers, you’ll find me out on Lake Michigan! When it’s too cold to sail, I get my fill of outdoor adventure by skiing with my fiancée.

What is a “fun fact” about you?

As an avid epic fantasy reader, my signed Brandon Sanderson book is one of my most prized possessions.

Anything else you’d like to share?

I am honored to be attending the University of Chicago and I can’t wait to meet everyone in the fall!