Business plans? Aren’t those boring and tedious and just for bankers? I’m a freelancer! I don’t need a business plan.
Said pretty much every freelancer when asked about a business plan.
While business plans have a bad rap, even the small but mighty freelancer can benefit from a business plan.
A business plan is a document that lays out all of the goals that you have for your freelance business for the next three to five years. Those goals include your financial projections.
In addition to writing down your goals, your business plan also acts as an outline for how you intend on achieving those goals.
Starting your business without a plan would be a lot like going on a road trip without a navigation app. It might sound like an adventure, but after the tenth wrong turn and dead end, you’re over it.
So get ready to be rocked by business plans (they’re cooler than you think, really). Below we’ve laid out some easy steps for writing a business plan that won’t bore you to death.
Bear in mind that, although we’ve made every effort to ensure that this information is accurate and up-to-date, it doesn’t constitute legal advice and shouldn’t be considered a substitute for legal advice. Always consult with your attorney if you have any questions regarding your business.
The Benefits of Having a Business Plan
Just writing a business plan can increase your odds of success as a freelancer.
That’s because your business plan can help you:
- Determine whether, and when, your business will become profitable
- Estimate your startup costs and how much money you’ll need to borrow and/or obtain from investors
- Estimate the revenue you expect to earn during the first three to five years
- Devise effective marketing strategies
- Identify competitors
- Anticipate potential problems
Sounds pretty sweet, right? Are you warming up to business plans yet?
Pro tip: If you need to raise money from investors, or you just want to get a bank loan, having a detailed, formal business plan is a must. That’s because you have to show investors your plan in order to convince them that your business is worth their investment.
Pro tip 2: Not aiming to raise outside funding? Then you might still need a formal business plan. But it can be a much shorter mini-plan, which is also referred to as a lean startup plan. Even if you never show your plan to anyone, it will still help you by forcing you to think about your goals and how you’ll achieve them.
What’s Inside a Business Plan?
Now that you know a few of the reasons why you need a business plan, it’s time to cover what goes into it.
There’s no single best way to write your plan, but most plans will contain the following:
The most important section of your plan!
Here’s the truth: many people only read this summary and nothing else.
Your executive summary should be no more than one page long. It’s the written equivalent of the elevator pitch for your business. Make it interesting, and be concise!
Here’s a breakdown of what to include in your executive summary:,
- First paragraph: Introduce your business, including your business name, a description of the products and/or services you plan to sell, and how your business will meet the needs of clients/customers.
- Additional paragraphs: Summarize the key points about your business that are covered in greater detail in other sections of your plan. This would include projected sales and profits, profitability, and keys to success. Also, if you have a mission statement, include it here.
Tip: Even though this will be the first thing in your business plan, it’s often best to write it last.
Description of Business
This is a high-level narrative overview of your business.
What does that mean? Well, the goal is to show that selling your product or service can definitely be a viable business opportunity.
A lot of people have what seems like good business ideas, but those ideas don’t translate into reality and end up failing. You need to prove that your idea can be turned into an actual business that will survive.
Here’s what you should briefly cover in this section:
- The owner(s) of the business
- The legal organization of the business (sole proprietorship, LLC, S corporation, corporation)
- The location of the business (if you haven’t chosen one yet, list the criteria for choosing a location)
- The target clients or customers for the business
- The background or experience that will help your business succeed
Remember, these topics will be covered in greater detail in subsequent sections of your plan, so you don’t have to go into too many specifics just yet.
Management and Organization
In this section, you cover the following:
- How your business is legally organized
- Who’s working in this business (is it just you, or do you have independent contractors or employees to help?)
- Your qualifications to successfully operate your business
- The qualifications of any other members of your team
Here’s where you should:
- Define your target market of consumers
- Project your market share
- Identify any direct or indirect competitors
- Discuss how you’ll price your products or services
- Identify communications, sales, and distribution channels
In this section, you show how you intend to market your products or services. Be sure to explain the following:
- The types of sales efforts you’ll try, such as advertising, direct mail, and social media
- How you’ll set your marketing budget
- How you’ll track the results of your efforts
- How you’ll set sales targets and the deadlines for meeting those targets
This is the section that discusses when your business will start earning a profit.
Remember, a lot of businesses don’t make profits right away because of the upfront costs.
Key elements for this section of your plan include:
- Startup costs (This is how much money it will cost to launch your business, so consider listing a range of numbers for the funds you need.)
- Projected monthly profit and loss for the first 12 months
- Projected quarterly cash flow for the first three years
- Projected balance sheet at startup, as well as at the end of each year for three years
- Break-even analysis
Ah, you’ve finally reached the end of your business plan! This is the final section that you need to create.
Basically, the appendix contains detailed financial information that is too lengthy to include within the main body of your plan.
For example, you might include a more detailed list of your startup expenses.
How to Write Your Business Plan
Word of advice: don’t write up a generic cookie-cutter plan! Tailor your plan to your particular business and its needs.
Before creating your plan, take a look at a few plans for other businesses that are similar to yours. There are lots of examples of complete business plans available online. To get started, check out this site.
Once you have a better idea of what you want your plan to look like, there are a few ways to make writing your business plan easier.
Business Plan Templates
One of the most affordable ways to write a business plan is by finding one of the hundreds of free business plan templates online. There are even templates that are designed for specific businesses and industries.
The right template will give you a format that you can follow, so it’s a matter of merely filling in the blanks. And the best ones will even include detailed instructions to further guide you. Super simple!
Check out some of our favorite sources for free business plan templates::
- The Small Business Administration has a free online business plan template. It’s called the Business Plan Tool.
- SCORE is a nonprofit business mentorship program. They’ve created business planning templates for startups and established businesses. You can even find mentors to give you advice on the planning process.
- Browse the Microsoft Office website for free business plan templates.
- Visit BPlans.com, where you can find commercial business plan software and a free downloadable business plan template.
- Visit BizGym.com, which also provides commercial software, to find a free business plan template.
Business Plan Software
Using commercial business plan software is a great way to put together your plan. It costs more than templates, which are often free, but the right software can be easy to use and give you better results.
The best software will have plenty of features to guide you through the process and show you how to create the ideal plan for your business. Video tutorials, easy chart creation, and financial forecasting are a few examples of these features.
You can even find software that compares your financials with other businesses in your industry to see how you stack up against your competitors.
There are a lot of software options available, but we recommend checking out these to get started:
Note: Subscription services are also an option, with a great example being GoSmallBiz. These often offer a variety of tools that include business plan software, website construction, document creation, and more.
Professional Business Plan Writing Services
Don’t want to write your business plan yourself? Then you can hire a pro to do it for you!
Depending on the person you hire, this service could cost as little as a few hundred dollars, so it can be a great investment. After all, leaving the hard work up to a professional means you know the job will be done right.
To find business plan writing services, you can do a simple search online. You might be surprised by all of the options you discover!
Finally, you can find books that have been written by business pros for startups and freelancers.
Books about business plans have a ton of detailed tips and advice on how to create your plan for your particular business.
One of our favorite books on writing a business plan is How to Write a Business Plan by Mike P. McKeever.
Bonus: you can always refer back to these valuable resources at any time.
Get Extra Help with Planning Your Business
Launching a new business is daunting. As excited as you are to get started, there SO MANY steps that you need to take and details to cover before you can officially start working.
That’s where Hyke comes in.
When you sign up for an account with Hyke, we help you with every aspect of getting your business going, from choosing the right legal entity to filing important documents on time.
We’ll even provide you with a dashboard that you can use to track business details, including income and expenses, so you can compare what’s happening with what you’ve written in your business plan.
Don’t Neglect the Importance of a Business Plan
Crafting a well-written business plan is just one of many things you can do to establish a freelance business that will thrive. And hopefully, you’re feeling a bit more warmed up to the idea of writing a business plan.
If you’re still on the fence rest assured that there are plenty of resources and experts that you can turn to for guidance.
And, once your plan is in place, you’ll be able to refer to it, tweak it, and use it as your map to long-term success.