OK, so again, far too big a topic for a light-hearted business ramble but of course, your business plan is effectively the centrepiece of your business so I am obliged to mention it.
In my thousand or so years in the finance business I have seen all sorts of business plans from ranging from true 'fag-packets' to several hundreds of glossy pages, neatly bound and , presumably costing several thousands of pounds to create. So, which do I prefer? Well, if pushed, I would probably err in favour of the fag packet on the basis that its creators probably know what they're doing.
The issues, of course are far bigger than that; it might be that 100 pages are actually necessary to present your case, or that your fag packet plan is intended for a major VC - who clearly won't be impressed; to an extent your plan does need to be geared to a specific audience,though I would not agree with the assertion that you need 2 plans, one for yourself and one for investors.
Primarily, you plan must be for yourself (inward facing) - and for this to work it must be realistic, achievable, sensibly ambitious and mindful of variables, risks and pitfalls.
Second; the plan is for investors, funders, clients (possibly), potential key staff etc (outward facing). For this to work it must be realistic, achievable, sensibly........ - you get my point. Despite what you may think, lenders and investors aren't stupid and they will question your assumptions far harder than you will. - which can of course provide useful input for you.
Incidentally, we used to play a little game with business plans called 'spot the fact' - in one 100+ page plan we identified just 3 quantifiable facts the remainder was just bullsh!t and pretty pictures (in another case I received a 2-page plan which, to this day, I've no idea what the business was supposed to do).
So here is my recipe for a simple, adaptable plan:
Executive summary: Think of it as your 3 minute pitch; a brief overview of what, who, where, why, how. (remember your audience - whoever they are - will have a shorter attention span than you - this is your chance to engage them).
Body of the plan: Puts more flesh on the bones but needn't go into excessive detail so, for example 'our Chief Executive has 15 years experience in petrochemicals and has licensed 2 applications' will probably suffice at this point. Similarly 'Year 2 we aim to achieve £3 million turnover and net profit of £50,000' the breakdown comes later.
My personal advice on headings is always to use those that make sense and are relevant to you; unfortunately I was once tripped up on this by a certain bank, who insisted that every section of the plan was completed. Very silly indeed...
Appendices: This is the section where you can adapt and customise your content to your target audience; for example if you are pitching your new paint technology to Ford, it might well be appropriate to include a 100-page technical overview, whereas if you are pitching for bank funding, a letter from Ford expressing interest will be more appropriate.
Some appendix staples are cashflow/p & l projections, director/key person CVs, balance sheets, and SWOT analysis.
SWOT analysis: By far the most abused yet potentially valuable part of your plan! In the vast majority of cases, we see lots of strengths and opportunities, with a few threats and weaknesses, which are shrugged off. The bad news is that your business model can fall over and if you haven't found the fall-over point, you haven't tested it sufficiently. The good news is that even Microsoft's business can fall over - but it seems OK at the moment. To put that into context, every new car model is tested to destruction - this testing makes the product better, not worse.
So, in a nutshell:
If you want your plan to be read, it has to be readable.
Bullshit might baffle brains, but a baffled brain is unlikely to buy.
You can target your plan without re-writing it.
If your plan is infallible, it is definitely wrong.
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