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A business plan is a written document that describes in detail how a business—usually a new one—is going to achieve its goals.A business plan lays out a written plan from a marketing, financial and operational viewpoint.But they all tend to have the same elements, including an executive summary of the business and a detailed description of the business, its services and/or products.
According to the Small Business Administration, the traditional business plan is the most common.
They are standard, with much more detail in each section.
For example, Tesla Motors.'s electric car business essentially began only as a business plan.
A business plan is not meant to be a static document.
A complete business plan must include a set of financial projections for the business.
These forward-looking projected financial statements are often called pro-forma financial statements or simply the "pro-formas." They include the overall budget, current and projected financing, a market analysis, and its marketing strategy approach.Usually, banks and venture capital firms make a viable business plan a prerequisite to the investment of funds in a business.Even though it may work, operating without a business plan is not a good idea.In fact, very few companies are able to last without one.There are definitely more benefits to creating and sticking to a business plan including being able to think through ideas without putting too much money into them—and, ultimately, losing in the end.They also act as a means to get people to work with and invest in the business.Although there are no right or wrong business plans, they can fall into two different categories—traditional or lean startup.Although they're especially useful for new companies, every company should have a business plan.Ideally, a company would revisit the plan periodically to see if goals have been met or have changed and evolved.These business plans are short—as short as one page—and have very little detail.If a company uses this kind of plan, they should expect to provide more detail if an investor or lender requests it.