How to Write a Business Plan in 7 Easy Steps  

Writing a business plan can be crucial and, in some cases, even required when applying for government-guaranteed commercial lending programs, such as a Small Business Administration (SBA) loan or a USDA Rual Development loan. These loans are an excellent way for business owners to launch, grow, or acquire a business. By supporting loans to businesses with commercial loan guarantees, the SBA and USDA promote economic development across the country.  

Understanding how to write a business plan for a government-guaranteed commercial loan can not only increase your chances of qualifying but also maximize your potential funding amount. With that in mind, use this seven-step guide to help you.  

1. Create an executive summary. This is exactly what it sounds like, a brief overview of your business plan. Even though it is the first page of your plan, it is usually better to write it last after you have pulled together all the information in the other areas of your plan. Keep it simple and concise (aim for one page). Include:  

• Business name and location  

• Products and services offered 

• Mission and vision statements*  

• Summary of growth plans*  

• Loan amount and brief statement on how funds will be used  

*Whether involving a new business, existing business, business acquisition, conversion, or business development, it is especially important to identify how your business will contribute to preserving or creating jobs and contributing to the overall economic prosperity and well-being of the community.   

2. Write a company description. In this section, you begin to describe your company in more detail.  

• Corporate structure of your business (LLC, S-Corp, Sole Proprietorship, Partnership, etc.)  

• Identify all owners, partners, or shareholders (Note: For all owners with a 20% equity stake, your government-guaranteed loan application will require personal financial statements dated within the last 30 days, along with supporting documentation of assets – bank statements, W-2s, etc.)  

• Identify key team members  

• Provide a brief history of a pre-existing business  

• Describe the nature of the business  

• Market it serves and the demand it meets  

• How it supplies the market with its products and services  

• How the business makes a profit  

Wherever possible, include statistics that support your plan.  

3. Define your business goals. In this section, you succinctly spell out your short- and long-term business objectives. Specify your growth goals and identify in clear, specific terms, the need for funding: what it will be used for and how it will help you meet your growth goals. Describe how you expect your company to evolve and what will that look like in the short-term (1-5 years) and long-term (5-10+ years).   

• Short- and long-term business  

• Future growth goals  

• Spell out the clear need for the funds  

• Elaborate on the planned use of the funds   

4. Describe your products and services. This is when you deep-dive into the details of your products and services.   

• Detailed description of your products and services  

• Benefits to the customer  

• Any unique patents, processes, or other relevant information   

5. Provide market analysis. A market analysis is a thorough assessment of the market within your specific industry. It is an analysis of the dynamics of the market based on things like potential customers, competitors, historical sales patterns, and other trends; and how these things, in tandem with the unique selling points of your products and services, will allow you the opportunity to be able to sell them successfully. This is where you will present any market research you have.  

• Market research and statistics  

• Historical or projected sales trends  

• Industry outlook  

• Identify competitors  

• Product differentiation (What makes your products/services stand out?)  

• Market opportunity  

6. Outline your sales and marketing plan. Explain how you will go about marketing and selling your products and services. How will you promote and grow your business?  

• Promotional plans  

• Plans for marketing and advertising  

• Details about pricing, special promotions, and upselling  

7. Provide a business financial analysis that includes financial projections. Here is where the assistance of an accountant may be helpful. This section includes the critical financial details that ensure your business plan is viable and that you will be able to repay your government-guaranteed loan according to the agreed-upon terms. The financial analysis must include historical financial information for existing businesses and projections for future business. Finally, it will provide information about the collateral being used to back the loan amount.  

• Historical financial data – Financial data prepared according to GAAP  

• Balance sheet: 2 years historical and year-to-date  

• P&L Statements: 2 years historical and year-to-date  

• Pro Formas: 2-3 years  

• Realistic prospective financial information:  

• Forecasted income statement  

• Cash-flow statement  

• Forecasted capital expenditures  

• Schedule of debt  

• Historical and projected  

• Collateral  

• Estimate and breakdown of projected collateral  

• Appraisals and Reports  

• Appraisals  

• Environmental studies, if applicable  

• Feasibility studies, if applicable  

Once you have developed your business plan and completed your documentation, your commercial loan application is complete. Before putting together a completed business plan, our expert government-guaranteed lending team at Veritex Community Bank can walk you through the pre-qualification process to ensure that you meet initial qualifying criteria, saving you time.  

Veritex Bank Government Lending supports small businesses in all industries across the U.S. Contact us today to applying for an SBA or USDA commercial loan.