Business Plans: How to Write One That Holds Up and Shows You the Gaps

2026-10-31 • 5 MIN READ

A business plan is not written for the bank. It is written so you find out where your numbers fail — and finding that out in a document is far cheaper than finding it out after six months of trading.

The test of whether yours is useful: did it change a decision? If you wrote it and nothing changed, you probably described what you wanted to be true.

Want us to check your assumptions?

Send us your plan and we will tell you which numbers do not hold up.

What goes in it, realistically

Eight sections. Fifteen pages at most — longer ones do not get read.

#SectionWhat it answers
1SummaryWhat you do, for whom, what you are asking for — one page
2Problem and solutionWho is in pain and how much
3MarketHow big, which customers, on what evidence
4CompetitionWho exists and what you do differently
5Revenue modelHow you make money, at what prices
6OperationsHow it gets produced and delivered
7TeamWho does it and why you
8FinancialsProjections, cash flow, break-even

The first section gets written last and is the only one everybody will read. If it does not fit on one page, you do not have clarity yet.

The fourth section is not written from memory — the method is in competitive analysis.

The numbers that have to hold up

Most projections collapse at four points. Check these before anything else.

1. Where the customers come from. Not “1% of the market”. How many from each channel, at what cost per customer — the calculation is in digital marketing ROI.

2. Gross margin. At full cost, not just the cost of goods. The method is in pricing.

3. Break-even. How many sales a month cover your fixed costs:

Fixed costs ÷ gross margin per sale = sales needed to break even

Example: €3,500 in fixed costs, €18 margin per order → 195 orders a month. If that strikes you as a lot, you found it now rather than in six months.

4. Cash flow. A profitable plan means nothing if money comes in at 60 days and goes out at 15. Most businesses close because of liquidity, not losses.

Three scenarios, not one

A single scenario always reads as the optimistic one. Write three:

ScenarioAssumptionWhat it tests
Conservative50% of targetsWhether you survive
RealisticThe base planWhether it is worth doing
Optimistic150%Whether you can carry the growth

The third surprises most people. Faster growth demands more working capital — stock, staff, deposits. Plenty of businesses get into trouble because they did better than plan.

And one number to know by heart: how many months you last on zero revenue. Below six, the plan carries risk however good it is.

What banks and investors look at

They differ substantially, and the same document rarely persuades both:

 BankInvestor
Main questionWill it be repaid?How big can it get?
FocusCash flow, securityMarket, team, pace
HorizonThe term of the loan5–7 years
What kills the pitchInconsistent numbersA small market

Both check the same thing first: whether your assumptions connect to each other. If you project a tripling of sales on flat staff costs, the plan is rejected without further reading.

For available funding programmes and their conditions, speak to an accountant or adviser — they change often and the detail decides eligibility.

Want a second look before you send it?

Send us your financial projections and we will tell you where a reader will stop.

The five mistakes that kill it

  1. “1% of the market”. That is not a projection, it is a wish. Build bottom-up: channels, conversion, customers.
  2. Revenue from month one. Almost never. Add a 3–6 month delay.
  3. No mention of competitors. “We have no competition” reads as “we did not look”.
  4. A forgotten founder salary. If you are not paid, the plan is not viable — it is subsidised by you.
  5. A plan never reopened. If you never compare it with reality, it was an exercise.

The fifth is solved with one habit: compare forecast against actuals every quarter, on the same measures — see how that gets tracked in dashboards.

Frequently asked questions

How long should it be?

10–15 pages plus appendices. For internal use, 5 pages is enough.

Do I need an accountant for the financials?

For the projections you can manage alone. For tax and company structure, yes — and early.

How far ahead do I project?

Three years, the first monthly and the rest quarterly. Beyond that it is guesswork.

What if the model changes?

Normal. You update the plan — its value is in the thinking, not the document.

Is it the same as a business model canvas?

No. The canvas is one page for a quick sketch; the business plan carries the financials and the assumptions.

The first step

Work out your break-even with the formula above, before you write anything else.

If the resulting sales figure looks unrealistic to you, you do not need a better plan — you need a different model, and you learned that in ten minutes.

Next step

Book a free 30-minute call with the team at The Dev Alley. We will look at your assumptions and tell you what gets tested first.

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