One of the most important jobs of CEOs and business owners is coming up with a business plan. Whether they are working for a small or big business, a business plan is a vital document that helps tie all the pieces of a business together. Leaders in the business world know that having an effective business plan can make or break their business.
One of the frequently asked questions concerning about business plans is how long they should be. Business owners are aware that if the plan is too short, they could be missing vital data or not be specific enough. They also know that if the plan is too long it could take too long to read through and include unnecessary information. While there is no perfect length of a business plan, there are optimal lengths that can help it be thorough but also to-the-point. Of course, any good business plan should also contain a financial model of the business. This will help you greatly in your future as it’s important to know exactly where your money is going. Financial modeling can be used in many situations as described in this Wall Street Prep guide.
How Long Should a Business Plan Be?
Small business owners should not discount the importance of a business plan. While their operations are much smaller than larger businesses and corporations, the best way to have clear goals and detail the different financial elements that come along with running a small business.
When it comes to the length of a small business plan, it’s important to remember its purpose in the first place. One of the primary goals of a business plan is to promote interest in a company. How long it takes a small business owner to do that will depend on the nature of their own business.
A business plan will consist of text and graphics, both of which are vital for communicating the parts of the business. The text portion of a small business plan should be 15-25 pages, but overall it may be up to 40 pages once graphs and graphics are included. That is a wide range of lengths, but somewhere within there is that sweet balance where a small business owner can effectively communicate their plan without saying too much or too little.
For a CEO or an owner of a big business, coming up with a business plan is a bit different. However, the goal is still the same: promote interest in the company and excite potential investors. A big business could need a longer business plan, but the more effectively and efficiently they are able to communicate their ideas, the better.
For big businesses, the text portion of the business plan could be up to 30 pages long, and should not be shorter than 20 pages. There are simply too many things to include for it to go any shorter. One thing that can definitely help is taking advantage of graphics, pictures, and charts. These can help summarize information in a way that helps an investor process it quicker.
Overall, the business plan for a large business can be up to 50 pages. There is a lot of financial information like sales and projections to include, and it’s important that potential investors can to get a good grasp on the ins and outs of the business.
Remember that a business plan is not about word count or the number of pages. A 30-page business plan full of dense blocks of text will be much more difficult to read than a 45-page business plan with a nice balance of graphics, charts, and text.
When the time comes to make your own business plan, don’t worry too much about length as you do about content. If your business plan is engaging, thorough, and communicates its points effectively, it will be great as long as it falls somewhere between the 25 and 50-page range!