You have worked tooth and nail over the last five years to float your business through the ebbs and flows of the startup phase. Your business has now gained a bit of a foothold in the market and stands among startups that surpass the five-year death knells. Congratulations!
It’s now time to grow in the market, stand out of the competition and venture into new markets. As a savvy entrepreneur, you know you can’t just go in but need to access small business financing. Yes, you need an expansion business plan to outline, manage, measure, and achieve your growth goals. That’s vital.
Writing an expansion plan really helps when you want to pitch your growth strategy to potential lenders to obtain small business financing. Lenders and investors need a way to gauge where your business has come from, current standing, and future potential. That’s what a plan does. It convinces lenders that investing in your business is a smart choice, and they can expect to get a good ROI. Thus, they can let their financial streams flow with confidence.
The 10 key components of an expansion business plan
So how do you write a plan to obtain small business financing from potential lenders? This guide outlines the key components of an expansion business plan and what should go into each section.
This section summarises the whole expansion idea, so talk about the whole expansion strategy here. It’s best written last so that you can outline a summary of everything from the beginning to the end.
Tell your business story here. Why did you start the company, what does it stand for, vision, mission, core values, what are your competitors, target clients, your industry, and product/service offerings? Then describe how your expansion will help your company grow.
This section takes after the company description. Dive deep into the products/services your business offers, why they are important, and how they help your customers/clients solve their daily pain points.
Use this section to talk about your business’s current standing in the market, growth trends in your industry, and tech changes or factors pioneering growth in your vertical. In short, this section gives detailed facts, stats, and trends in the industry, the whole market size, and your current position in it.
What strategies do you intend to use to penetrate the market and increase your market share? Outline your plans to adopt new technology, innovate new products/services, advertising/marketing strategies, strategies to improve customer experience, plans for new partnerships or collaborations, and any other touchpoint strategies you’ve in store to penetrate the market.
Organization and management
Here, talk about your plans to improve your internal business structures and processes to increase efficiency and boost productivity. It’s more about your business structure, workplace culture, management team, employees, and everything you’ll do to ensure your company delivers to its full potential to drive up efficiency and productivity.
Describe what goes on in your business daily. How many customers do you serve per day, what are your hours of operation, how long does it take to serve a customer. Then, detail plans you’ve in place to improve and expand your day-day business operations.
Talk about how your finances have grown over time and the strategies you’ve used to bring your business finances so far. Things like customer acquisition costs, advertising costs vs ROI, budget cuts, profit/loss, monthly or annual business revenues, and past successful business campaigns go here.
Use this section to project your business’s financial potential. Include things like cash flow projections, estimated business expenditures, cost analysis, projected profit/loss in the next 12 months, and how to maintain financial efficiency and productivity in the next 3-5 years.
Any material or documents you’ve used to draw inspiration while building your business plan goes here, including resumes, letters of support, brochures, leases, blueprints, contracts, permits, and any cited industry studies.
Write your expansion business plan
That’s how easy it’s to write a plan to grow your business. You need one before you get into an ambitious expansion plan to outline, manage, measure, and achieve your expansion goals. A business plan also comes in handy if you want to obtain small business financing from lenders. So go ahead and write it!