How many pages should a business plan be? 10, 25, 50, 100 or more? Here is a quick comparison of the business plan types available and their optimum length.
A lot of new entrepreneurs often wonder how long is too long for a business plan. Most business experts and counselors say it should be 30 to 50 pages, as a minimum, while others give a more or lesser number than the one named above. One thing you have to understand is that there is no specific number a business plan should be before it is considered perfect. Everything depends on your audience and what you intend to use the business plan for.
According to the United States’ Small Business Association, ‘a business plan needs to be whatever length is required to excite the financing source, prove that management truly understands the market, and detail the execution strategy’.
From various surveys done by many organizations and professionals, it was concluded that a workable business plan should be in the ranges of 25 to 100 pages, depending on the various factors involved in writing the plan. Some of these factors may include; targeted markets, difficult assumptions or non-industry data, industry risk, poor credit factors that require additional explanation or documentation, financing source, etc.
Using the SBA model, a business plan can range in size from 38 to 50 pages for a basic plan to as high as 80 to 100 pages for complex plans. On the other hand, venture contests have come to the conclusion that an effective business plan should be around 30 pages, sometimes 40, but rarely 50 – and that includes detailed financials in the appendices.
Page Length Expectation for Various Kinds of Business Plans
The various kinds of business plans in existence have their own page length expectation according to experts. They usually fall within these indices;
- For small internal reports, the page length is usually Ten to fifteen pages
- For corporate business plans, the page length allowed can be up to hundred and even over
- Startup and expansion plans used for potential investors, vendors or other business partners can be 20 to 40 pages.
- Venture contests limit page length (including the appendix with financial information), at a minimum 30 pages, and in some rare instances as many as 50 pages.
A Breakdown of the Pages of a Business Plan
The SBA model allows business plans to run from 38 pages to as much as hundred pages depending on the kind of plan in question. The pages of the typical business plan are broken down as follows;
- Part 1: Introduction (3 to 5 pages)
- Part 2: Market Analysis (9 to 22 pages)
The market analysis section illustrates the knowledge about the particular industry in question. It presents general highlights and conclusions of any marketing research data that have been have collected; however, the specific details of the marketing research studies should be moved to the appendix section of the business plan.
- Part 3: Company Description (1 to 2 pages)
Without going into detail, this section usually includes a high-level look at how all of the different elements of the business fits together. The company description section should include information about the nature of the business as well as list the primary factors that is believe will make the business a success.
- Part 4: Organization and Management (3 to 5 pages)
This section should include the company’s organizational structure, details about the ownership of the company, profiles of the management team, and the qualifications of the board of directors.
- Part 5: Marketing and Sales Strategies (4 to 6 pages)
Marketing is the process of creating customers, and customers are the lifeblood of a business. In this section, the first thing to do is define the company’s marketing strategy. There is no single way to approach a marketing strategy; the strategy should be part of an ongoing self-evaluation process and unique to the company.
- Part 6: Product or Service (4 to 10 pages)
What is the company selling? What is their service? In this section, describe the service or product, emphasizing the benefits to potential and current customers. Focus on the areas where it has a distinct advantage. Identify the problem in your target market for which your service or product provides a solution. Give the reader hard evidence that people are, or will be, willing to pay for your solution.
- Part 7: Equity Investment and Funding Request (2 to 4 pages)
In this section, you will identify how much you plan or have already invested in the business. Identify the exact amount of funding you will need to start and make sure it ties specifically to your Financial Plan.
If necessary, you can include different funding scenarios, such as a best and worst case scenarios, but remember that later, in the financial section, you must be able to back up these requests and scenarios with corresponding financial statements and projections.
- Part 8: Financial Information (12 to 25 pages)
This section is considered the most important part of your business plan and requires significant effort. Make sure your financial information is reviewed by a professional such as your accountant. The financials should be developed after you’ve analyzed the market and set clear objectives. That’s when you can allocate resources efficiently.