business plan for a remodeling company

Remodeling Business Plan Template

Written by Dave Lavinsky

Remodeling Business Plan

Over the past 20+ years, we have helped over 1,000 entrepreneurs and business owners create business plans to start and grow their remodeling businesses. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a business plan template step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Remodeling Business Plan?

A business plan provides a snapshot of your remodeling business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Remodeling Company

If you’re looking to start a Remodeling business, or grow your business, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your remodeling business in order to improve your chances of success. Your business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Remodeling Businesses

With regards to funding, the main sources of funding for a remodeling business are personal savings, credit cards, bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for remodeling businesses.

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How to write a business plan for a remodeling company.

If you want to start a remodeling business or expand your current one, you need a business plan. Below we describe what should be included in each section of a business plan for your remodeling company:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of remodeling business you are operating and the status. For example, are you a startup, do you want to grow your business, or are you operating remodeling businesses in multiple markets?

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the remodeling industry. Discuss the type of remodeling business you are operating. Detail your direct competitors. Give an overview of your target market. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.  

Company Analysis

In your company analysis, you will detail the type of remodeling company you are operating.

For example, you might operate one of the following types of remodeling businesses:

• Residential Remodeling : this type of remodeling business focuses on renovations strictly for home-based projects, such as kitchens and bathrooms.
• Design-Build and Whole House Remodeling: this type of remodeling are residential general contractors that are responsible for the architecture, design, and construction management of major home remodeling projects.
• Restoration: Restoration contractors specialize in working with insurance companies, and focus specifically on fire, wind, or water damage to restore the home to its original condition before the occurrence.

In addition to explaining the type of remodeling company you will operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of projects completed, number of positive reviews, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the Remodeling industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the remodeling industry educates you. It helps you understand the market in which you are operating. 

Secondly, market research can improve your strategy, particularly if your research identifies market trends.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your remodeling company business plan:

• How big is the remodeling industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your remodeling company? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: homeowners looking to add on or update their home, those who have suffered a recent weather damage occurrence, and new homeowners who have purchased an older home that is in need of updates.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of remodeling company you operate. Clearly, homeowners would respond to different marketing promotions than help those affected by weather-related incidents, for example.

Try to break out your target market in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve.

Psychographic profiles explain the wants and needs of your target market. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other remodeling businesses. 

Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes new home builders and large construction general contractors. You need to mention such competition as well.

With regards to direct competition, you want to describe the other remodeling businesses with which you compete. Most likely, your direct competitors will be remodeling businesses located very close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What type of remodeling businesses are they?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide shorter project times?
• Will you provide services that your competitors don’t offer?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a remodeling company, your marketing plan should include the following:

Product : In the product section, you should reiterate the type of remodeling company that you documented in your Company Analysis. Then, detail the specific products you will be offering. For example, in addition to temodeling, will you provide call design and architecture, project management, and any other services?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the services you offer and their prices.

Place : Place refers to the location of your remodeling company. Document your location and mention how the location will impact your success. For example, is your remodeling business located in a high traffic area, a business district, a standalone office, etc. Discuss how your location might be the ideal location for your customers.

Promotions : The final part of your Remodeling marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Advertising in local papers and magazines
• Reaching out to websites 
• Social media marketing
• Local radio advertising

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your remodeling business, including offering free remodeling quotes, sourcing materials and labor, organizing subcontractors, client communication, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to land your Xth client, or when you hope to reach $X in revenue. It could also be when you expect to expand your remodeling business to a new city.  

Management Team

To demonstrate your remodeling business’ ability to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company. 

Ideally you and/or your team members have direct experience in managing remodelings. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your management team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a remodeling businesses or successfully running a construction company.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you take on one new client at a time or multiple new clients ? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your Remodeling business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. 

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing your business:

• Cost of contracting licenses and permitting.
• Cost of equipment and supplies.
• Payroll or salaries paid to staff and subcontractors .
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include past remodeling projects or project quotes of client projects you are working on.  

Putting together a business plan for your remodeling business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the remodeling industry, your competition, and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful remodeling business.  

Remodeling Business Plan FAQs

What is the easiest way to complete my remodeling business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily complete your Remodeling Business Plan.

What is the Goal of a Business Plan's Executive Summary?

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of remodeling business you are operating and the status; for example, are you a startup, do you have a remodeling business that you would like to grow, or are you operating a chain of remodeling businesses?

Don’t you wish there was a faster, easier way to finish your Remodeling business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to see how Growthink’s professional business plan consulting services can create your business plan for you.

Other Helpful Business Plan Articles & Templates

How to Start a Remodeling Business

Your remodeling business might be a one person show where you personally complete kitchen, bathroom, bedroom remodels or additions to homes and businesses. In another business model, you could serve as a general contractor and hire employees or subcontractors to help complete jobs in a more efficient manner.

Learn how to start your own Remodeling Business and whether it is the right fit for you.

Ready to form your LLC? Check out the Top LLC Formation Services .

Start a remodeling business by following these 10 steps:

• Plan your Remodeling Business
• Form your Remodeling Business into a Legal Entity
• Register your Remodeling Business for Taxes
• Open a Business Bank Account & Credit Card
• Set up Accounting for your Remodeling Business
• Get the Necessary Permits & Licenses for your Remodeling Business
• Get Remodeling Business Insurance
• Define your Remodeling Business Brand
• Create your Remodeling Business Website
• Set up your Business Phone System

We have put together this simple guide to starting your remodeling business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas .

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

What will you name your business?

• What are the startup and ongoing costs?
• Who is your target market?

How much can you charge customers?

Luckily we have done a lot of this research for you.

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Remodeling Business Name Generator

If you operate a sole proprietorship , you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name , we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability .

It's very important to secure your domain name before someone else does.

Want some help naming your remodeling business?

Business name generator, what are the costs involved in opening a remodeling business.

If you are simply offering up your own skills and time as a part-time remodeler, the start-up cost will be around $50,000 to $75,000 as you will need a complete set of tools, a vehicle for transporting tools and supplies, and the proper licensing and insurance in order to operate in your state and locality.  If you are looking to enter the business world offering major renovation services, expect to have start-up capital of $250,000 to $500,000 as you'll need to be able to purchase your first few orders of materials and hire staff before your customer pays you for the completed job.

What are the ongoing expenses for a remodeling business?

You will need to maintain accounts with material suppliers, pay your crews on a regular basis, and maintain vehicles and tools. Fortunately, your office space can be fairly minimal.

Who is the target market?

Home and business owners who are seeking to have their property professionally renovated and are willing to pay a fair price for labor and materials. Large businesses that need renovating may have more space, allowing you to charge more for your work.

How does a remodeling business make money?

Your remodeling business generates income by charging your customers for labor and materials for their renovation. You are responsible for providing your own tools, as part of your trade.  However paint, hardware, lumber, flooring, and other supplies are purchased by you at wholesale prices and then you charge your customer for them at a premium price.  Your hourly labor costs will be determined by level of expertise, the type of job that is being completed, and local competitive rates.

Your rates will vary depending on size and complexity of the job. Rates vary from $45/hr to $85/hr and can be lower or higher. You will want to complete an extensive competitive comparison to ensure your client is getting a good value. The average renovation project costs between $3,000 and $15,000.

How much profit can a remodeling business make?

The typical markup on materials is 15%.  Income for a one-man company can be around $20,000 a year working part-time while a large contractor with multiple crews can see income in the seven figure range when they complete multiple large jobs over the year.

How can you make your business more profitable?

Ensuring quality work that completely satisfies your customer is the number one means of generating more business, and therefore additional profit. You will need to ensure the quality control and customer service are always of top priority for your successful remodeling business.

Want a more guided approach? Access TRUiC's free Small Business Startup Guide - a step-by-step course for turning your business idea into reality. Get started today!

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship , partnership , limited liability company (LLC) , and corporation .

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your remodeling business is sued.

Form Your LLC

Read our Guide to Form Your Own LLC

Have a Professional Service Form your LLC for You

Two such reliable services:

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services . You can choose to hire a registered agent or act as your own.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

You can acquire your EIN through the IRS website . If you would like to learn more about EINs, read our article, What is an EIN?

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil .

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Recommended: Read our Best Banks for Small Business review to find the best national bank or credit union.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history , which can be useful to raise money later on.

Recommended: Apply for an easy approval business credit card from BILL and build your business credit quickly.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a remodeling business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits .

Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses .

Services Contract

Remodeling businesses should require clients to sign a services agreement before starting a new project.  This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership. Here is an example of one such services agreement.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance . This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance . If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

FInd out what types of insurance your Remodeling Business needs and how much it will cost you by reading our guide Business Insurance for Remodeling Business.

STEP 8: Define your brand

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners , we'll give you helpful tips and advice for creating the best unique logo for your business.

Recommended : Get a logo using Truic's free logo Generator no email or sign up required, or use a Premium Logo Maker .

If you already have a logo, you can also add it to a QR code with our Free QR Code Generator . Choose from 13 QR code types to create a code for your business cards and publications, or to help spread awareness for your new website.

How to promote & market a remodeling business

Direct Mail campaigns can help your name appear in front of local homeowners. Ask to sponsor a do-it-yourself workshop at your local big box store.  Make sure to add your company name on the side of all the vehicles that appear at the job site and where you order supplies. Consider joining groups such as the National Association of Home Builders or the National Association of the Remodeling Industry to add their advertising power to your own.

How to keep customers coming back

Potential clients love to see an example of the work they might hire you to complete.  Position signs in front of homes that you are working on or have recently completed. Ask satisfied customers if you can add pictures of their new kitchen to your website and social media. Encourage customer feedback, as their word will carry far more weight than a simple advertisement. Be willing to return to the jobsite to complete touch ups for up to a year, as that happy customer is the most likely individual who will hire you again. Always provide professionally prepared contracts and business cards and make sure your phones are answered in a businesslike manner.

STEP 9: Create your business website

After defining your brand and creating your logo the next step is to create a website for your business .

While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.

Here are the main reasons why you shouldn’t delay building your website:

• All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
• Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
• Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.

Recommended : Get started today using our recommended website builder or check out our review of the Best Website Builders .

Other popular website builders are: WordPress , WIX , Weebly , Squarespace , and Shopify .

STEP 10: Set up your business phone system

Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.

There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use. Check out our review of the Best Business Phone Systems 2023 to find the best phone service for your small business.

Recommended Business Phone Service: Phone.com

Phone.com is our top choice for small business phone numbers because of all the features it offers for small businesses and it's fair pricing.

Is this Business Right For You?

A remodeling business is a great investment for the person who has a passion for home improvement, with extensive knowledge of multiple construction skills and enjoys a background of business and accounting.  Dedication to completing work thoroughly with close attention to detail while providing superior customer service is also required.

Want to know if you are cut out to be an entrepreneur?

Take our Entrepreneurship Quiz to find out!

Entrepreneurship Quiz

What happens during a typical day at a remodeling business?

Whether you simply manage the business or are swinging a hammer with the crew, you might be expected to:

• Participate in demolition, installation of flooring, walls, and cabinetry
• Source supplies and materials for the job site
• Maintain open communication channels with the customer, updating them on progress
• Schedule your reliable crews and subcontractors in a time-efficient manner
• Maintain proper licensing to operate in your state
• Train new crew members to maintain your high standards
• Complete punch lists after you finish a job
• Establish relationships with tool and materials vendors/suppliers
• Maintain payroll records/pay your crews on a timely basis
• Collect payment from customers
• Create contracts for customer approval
• Promote your business to generate new jobs for the future

What are some skills and experiences that will help you build a successful remodeling business?

Your remodeling business will find greater success when you have a wide range of skills under your belt as the owner/operator. These may include, but are not limited to:

• Solid understanding and experience in construction techniques with regards to kitchen, bathrooms, siding, windows, additions, and flooring
• Appreciation and knowledge of quality materials and their fair pricing structure
• Good accounting knowledge to maintain accurate records for accounts payable/receivable and payroll requirements
• Excellent time management that lines up additional crews to complete the next phase of construction without waiting
• Good ability to establish and maintain positive relationships with customers by providing clear and honest communication throughout the remodel
• Ability to identify experienced crew members you are hiring as subcontractors or as employees
• Knowledge of safety standards, permits, and licenses required to operate a safe workplace

What is the growth potential for a remodeling business?

Some individuals work on a part-time basis by themselves completing renovations for local homeowners.  However, with the right business model in place you can be responsible for finishing interiors of apartment buildings, entire subdivisions, and large commercial spaces. The quality of your work and responsiveness of service will build your reputation, helping to land larger contracts able to expand your small business into a major general contracting business.

TRUiC's YouTube Channel

For fun informative videos about starting a business visit the TRUiC YouTube Channel or subscribe to view later.

Take the Next Step

Find a business mentor.

One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.

Having a support network in place to turn to during tough times is a major factor of success for new business owners.

Learn from other business owners

Want to learn more about starting a business from entrepreneurs themselves? Visit Startup Savant’s startup founder series to gain entrepreneurial insights, lessons, and advice from founders themselves.

Resources to Help Women in Business

There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:

If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.

What are some insider tips for jump starting a remodeling business?

You will need to network with other contractors and potential customers. Attend the next Home Show and rent a booth as an exhibitor to get your name out and about. Ask to leave your flyer and business contact at local hardware/DIY stores and reach out to local plumbers, electricians, and even general contractors who may need help on their next big job. Word of mouth is often responsible for finding your next customer, so you'll need to work hard to build a positive reputation.

How and when to build a team

As soon as you cannot keep up with demand, start putting out feelers for qualified carpenters and installers.  Do not hesitate to complete background checks and ask for references from verifiable sources.

Useful Links

Industry opportunities.

• Membership in the National Association of the Remodeling Industry
• Remodeling Franchise Opportunity with DreamMaker Bath & Kitchen Remodeling Franchise

Real World Examples

• Wel-Vant construction & Remodeling
• Remodeling Business With Specialty in Remodeling Homes for Seniors and Physically Challenged People
• Luxury Remodels Company

Further Reading

• Tips for Moving Forward With Your Remodeling Business
• Hiring People You Can Trust With Your Business

Have a Question? Leave a Comment!

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Remodeling Business Plan Template

Published Dec.21, 2020

Updated Apr.24, 2024

By: Noor Muhammad

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Table of Content

Remodeling business plan for starting your own building company

Whether it’s about increasing one’s property value or boosting one’s lifestyle, remodeling is the way to go. Remodeling is a type of business that can be started with simple services at the residential level. And can be expanded to performing complicated renovations needed by commercial buildings and businesses.

No matter how large or how small your startup is, you would have to create a remodeling business plan for remodeling. Creating a comprehensive business plan before you open a remodeling business will help you in:

• Recognizing the latest trends
• Acquiring the right expertise
• Avoiding troublesome situations
• Efficiently manage finances

To help you in creating a business plan that covers all the essential aspects, we’re providing a sample business plan of a startup ‘Model-It Solutions’.

Executive Summary

2.1 the business.

Model-It Solutions will be a registered, licensed, and insured remodeling business startup based in Buffalo, New York. The business will comprise expert contractors, architects, and engineers to enhance the aesthetic and comfort level of residential as well as commercial structures.

Simply put, we build what you dream!

2.2 Management of Remodeling business

As a business owner, you can’t rest after setting up a remodeling company. You have to be proactive in organizing and analyzing various business operations. In the case of a remodeling business, you need efficient management to complete given projects in time. To make sure that clients get the work done according to their expectations, you have to properly manage communication, finances, and resources among various channels.

2.3 Customers of Remodeling business

Exploring who are going to be your customers is extremely important. Before you search for how to start a remodeling company, you should identify your customers.

The target customers of Model-It Solutions will be the homeowners, construction firms , contractors, and government agencies. To turn them into our potential customers, we will be taking effective steps.

2.4 Business Target

Our major targets are:

• To maintain a customer return rate of 20% throughout our service years
• To maintain a CSAT score of above 85%

Our financial targets to cover our expenses and investments through the profits earned are summarized in this table.

Company Summary

3.1 company owner.

Anna Huston will be the owner of Model-It Solutions. Anna is an MBA. After completing her education at Stanford University, she started working in Skanska.

But 5 years into the service, she decided to start a remodeling business of her own.

3.2 Why the remodeling business is being started

Anna always remained a woman of creative ideas. After serving in a multinational firm, she decided to move to her hometown and serve people with her talent. She realized that the remodeling business has never-ending scope in the years to come as people keep thinking of bringing improvement to their property.

3.3 How the remodeling business will be started

Step1: Plan your business

As the first step, Anna studied various business plan examples for remodeling company to make a business plan for remodeling. From analyzing the market shares to creating a financial plan, Anna put everything on her business plan.

Through this remodeling business plan sample you can study the business’ requirements, balance sheets, personnel plan, and other aspects of Model-It Solutions.

Step2: Define your brand

The second step after creating a remodeling business plan is to get your business registered. You will have to acquire the required licenses and permits. Moreover, this is the time when you have to physically establish your business office.

Step3: Hire the staff

The third step is to conduct interviews and tests to hire the most competent employees.

Step4: Get ready to promote & market

The next step is to promote your services and competitive aspects to reach your target customers. This step also involves the strategy you will adopt to gain and retain your client base.

Step5: Establish a web presence

In this age, people use Google to find the right service provider whenever they need any service. Therefore, it has become essential that you establish a strong social media and web presence.

Anna decided to hire a professional IT expert to create a website for Model-It Solutions. The website will also enable users to make online bookings. Moreover, the website will also keep a record of repeat customers so that Anna could evaluate her business performance time-to-time.

Our startup expenses including costs of all the things we could need for the startup are given below:

Before exploring how to start your own remodeling business, you should decide your services. Deciding your services even before the launch can help you in identifying the ways through which you can facilitate your customers.

To give you a notion of services you can provide as a remodeling firm, we are enlisting the services provided by Model-It Solutions in this remodeling business plan template.

• Full House Remodeling: Our primary service will be to do the whole house remodeling. In this, we will work to redesign an old building to fulfill modern needs such as increasing the living space or making the interior/ exterior more appealing.

Depending on the clients’ needs we will remodel their kitchen, laundry, bath, deck, and more. We also install sidings, flooring, new windows and doors, cabinets, and whatever else our customers would need.

• Handyman Remodeling: This service will include doing minor changes in homes such as installing a modern lighting system, carpeting, painting the walls and cabinets, installing wallpapers, and doing small repairs.
• Historic Home Remodeling: Our third service will be to remodel historic and significant architectural buildings without affecting their historic aspects.
• Individual Structural Re-design: We will offer the services of adding/ removing the bathroom, room, kitchen, and laundry, installing a staircase, modern roofing, etc.

Marketing Analysis of Remodeling Business

Marketing analysis is an important part of a remodeling contractor’s business plan as it enables the business owner to keep pace with the demands of their customers. Through efficient marketing analysis, you can recognize remodeling domains that have high demand. Moreover, this part also gives you a clear idea of your customers before you open a remodeling business.

5.1 Market Trends

According to a report by IBISWorld, remodeling businesses have seen a growth rate of 1.7% in the past five years. More than 455 thousand remodeling companies are operating throughout the United States. The market size, according to the same outlet, is reported to be $97 billion.

The market stats are quite satisfying and the growth rate also indicates that there is still room for other startups to join the venture. If you want to ensure that you get customers from the very beginning of your startup, you should study the market trends of individual locations. That will help you locate an area where competition is low and people who need remodeling service are greater in number.

5.2 Marketing Segmentation

Identifying your customers before investigating how to write a business plan for remodeling is necessary. Dividing the wide populations into distinct groups can help you in recognizing their demands. And thus enabling you to plan ways to fulfill their expectations.

The groups that were identified by Model-It Solutions as potential customers are given below:

5.2.1 Real Estate Owners: Our primary customers will be the people who own any sort of building. They can need our services in two cases:

• They want to enhance the interior design / exterior for themselves.
• They want to remodel the property to increase its value so that it could be sold at a greater price.

In any of the cases, we’ll go to all extents to make sure they are happy and satisfied with our remodeling services. For them, we’ll provide full property remodeling services as well as individual services like installing new cabinets and remodeling the kitchen, etc.

5.2.2 Contractors & Construction Companies: The second group of our target customers will include contractors and construction companies. They will need our services whenever they get some project or even when they are building some structure from scratch.

5.2.3 Government Agencies : Our third category comprises government agencies who will be needing us to remodel structures of historic, artistic, and cultural importance – in a way that their integrity and historic aspects are maintained.

The detailed market analysis of our potential customers is given in the following table:

5.3 Business Target

Anna set her business financial and other goals before starting a remodeling company. She realized that by doing so, she would be able to provide a direction to her resources and talent.

The business targets of Model-It Solutions are

• To earn a net profit of $24k per month by the end of the first year
• To lower the costs of our operations by 5% by the end of the 3 years by improving our techniques and methods

5.4 Product Pricing

The prices of our services will be lesser than those of our competitors. It is because we want to capture as many customers as possible in the initial phases of our startup.

Marketing Strategy

A remodeling business plan is incomplete unless you include in it, the ways to capture the attention of your target audience. In this marketing plan for remodeling business we are enlisting the exclusive sales strategy plan of Model-It Solutions.

6.1 Competitive Analysis

Anna realized that hundreds of remodeling firms are already operating in Buffalo. Therefore, she decided to come up with distinct features to outperform her business rivals.

The competitive aspects of Model-It Solutions are:

• We are highly client-oriented. We will always be willing to amend the remodeling designs as per our clients’ wants and needs.
• Our workers are highly skilled and highly collaborative.
• We provide online booking and payment facilities to our customers.
• Our repeat customers will be offered several discounts.
• Our prices are lower than our competitors, so you can easily try our services for a minor/ major task.

6.2 Sales Strategy

To get introduced to our target customers, we will:

• Advertise our startup through local newspapers, Google Local ads service, and social media
• Keep our prices lower than our competitors
• Establish a strong web presence using SEO techniques
• Provide a 25% discount to our repeat customers on every second visit

6.3 Sales Yearly

6.4 Sales Monthly

6.5 Sales Forecast

Personnel plan

While writing a business plan for remodeling, you should also define your employees, their job responsibilities, and requirements. It will enable you to judge the applicants on a definite criterion when you are going through the hiring phase.

7.1 Company Staff

Anna will manage the business herself. However, she’ll hire the following staff:

• 1 Co-Manager
• 1 Architect to design/ remodel complicated projects
• 2 Contractors to implement remodeling designs
• 5 Field Workers to work as laborers
• 1 Accountant to maintain financial records
• 1 Technician to maintain the machinery
• 1 IT Expert to manage the company’s website, online record, and social sites
• 1 Driver to provide transportation

7.2 Average Salary of Employees

Financial plan.

In the last part of your business plan, you should analyze your estimated cash flows. Before you make a remodeling business plan, you should have a clear idea of how much amount you intend to spend on which aspect of your business. Moreover, you should also have a plan to achieve your business goals by optimizing your profits.

In this business plan sample, you can explore the financial projections, break-even analysis, business ratios, gross margins, and other financial estimations done by Model-It Solutions to gauge its progress and business value.

However, while you go through this financial plan, remember, its projections are based on the assumption that there will be no major recession in the coming 5 years.

8.1 Important Assumptions

8.2 brake-even analysis.

8.3 Projected Profit and Loss

8.3.1 profit monthly.

8.3.2 Profit Yearly

8.3.3 Gross Margin Monthly

8.3.4 Gross Margin Yearly

8.4 Projected Cash Flow

8.5 Projected Balance Sheet

8.6 business ratios.

Download Remodeling Business Plan Template in pdf

OGS capital professional writers specialized also in themes such as engineering consulting , HVAC business plan, real estate flipping business plan ,  architecture firm business plan etc.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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How To Write a Business Plan for Remodeling in 9 Steps: Checklist

By henry sheykin, resources on remodeling.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan
• Bundle Business Plan & Fin Model

Remodeling has become a booming industry in the United States, with homeowners investing billions of dollars into transforming their living spaces. Whether it's a small bathroom renovation or a complete home overhaul, the demand for remodeling services is on the rise. If you're thinking of starting a remodeling business, it's essential to have a solid plan in place to ensure your success. In this blog post, we will guide you through the 9 crucial steps to writing a business plan for your remodeling company.

Before diving into the steps, let's take a look at some interesting statistics about the remodeling industry. According to recent reports, the remodeling market in the US is projected to reach a staggering $380 billion by 2023 . This exponential growth can be attributed to the increasing number of homeowners choosing to renovate their properties rather than move.

Now, let's get down to business. The first step in writing your business plan is to research the market and identify your target customer base. Understanding who your potential clients are and what they're looking for will help you tailor your services and marketing strategies to meet their needs.

Next, it's crucial to analyze and understand your competition. Take a close look at other remodeling companies in your area and learn from both their successes and failures. This knowledge will give you a competitive edge and allow you to differentiate your business.

One of the key aspects of your business plan is defining your unique selling proposition (USP) and value proposition. Clearly articulating what sets your remodeling company apart from others will help attract customers and build your brand.

A SWOT analysis is another essential step. By identifying your strengths, weaknesses, opportunities, and threats, you can make informed decisions and develop strategies that capitalize on your strengths and opportunities while minimizing weaknesses and threats.

Setting clear and measurable business goals and objectives is crucial for success. Whether it's achieving a certain revenue target or expanding your client base, having defined goals will guide your actions and keep you focused.

Developing a pricing strategy for the services you offer is another vital step. Research pricing trends in the industry, consider your costs, and determine a competitive yet profitable pricing structure.

No remodeling business can thrive without the necessary resources and equipment. Identify what you'll need to deliver top-notch services to your clients and factor these requirements into your business plan.

Your marketing and advertising plan is your roadmap to get the word out about your business. Identify your target audience, determine the most effective channels to reach them, and create a comprehensive plan to promote your services.

Lastly, assessing the financial feasibility of your business and making projections is crucial. Consider factors such as startup costs, ongoing expenses, and revenue projections to ensure your business is financially viable.

By following these 9 steps, you'll lay the foundation for a successful remodeling business. Stay tuned for our upcoming blog posts, where we'll dive deeper into each step to help you craft a comprehensive business plan.

Research The Market And Identify A Target Customer Base

Before starting a remodeling business, it is crucial to research the market and identify a target customer base. Understanding the needs, preferences, and demographics of potential customers will help you tailor your services to meet their specific requirements, increasing your chances of success in the industry.

Here are some important steps to consider in this process:

• Identify the target market: Determine the segment of the population that is most likely to be interested in remodeling services. Consider factors such as age, income level, location, and lifestyle preferences. This will help you create a more focused and effective marketing strategy.
• Analyze market trends: Stay updated on the latest trends in the remodeling industry. This includes understanding popular design styles, materials, and technologies. By identifying what is in demand, you can position your business to attract customers who are seeking these unique features.
• Conduct market research: Use surveys, interviews, and other research methods to gather insights from potential customers. Understand their pain points, expectations, and preferences when it comes to remodeling projects. This information will help you tailor your services to meet their specific needs.
• Competitor analysis: Analyze your competitors in the market. Identify their target customer base, pricing strategies, and unique selling propositions. This will help you differentiate your business and create a competitive advantage.
• Seek customer feedback: Engage with potential customers and gather their feedback on your business concept and services. This will provide valuable insights and help you refine your offerings to better meet their expectations.
• Consider partnering with local interior designers or real estate agents to gain insights into the preferences of your target customer base.
• Attend industry trade shows and events to network with professionals and gain a deeper understanding of the remodeling market.
• Utilize online platforms and social media channels to gather feedback and engage with potential customers.

Analyze And Understand The Competition

When starting a remodeling business, it's crucial to analyze and understand the competition in your local market. This step will provide valuable insights into the current market landscape and help you identify opportunities and potential challenges to overcome. Here are some important factors to consider when analyzing your competitors:

• Identify Competitors: Begin by identifying the key competitors in your area who are offering similar remodeling services. This could include both large remodeling companies and smaller local contractors.
• Study Their Offerings: Take the time to thoroughly research and understand what services your competitors are offering. Look at their portfolio, website, and customer reviews to gain insights into their strengths and weaknesses.
• Evaluate Pricing: Analyze the pricing strategies of your competitors. Compare their rates and packages with yours to determine if there are any gaps or opportunities for differentiation.
• Assess Market Positioning: Consider how your competitors position themselves in the market. Are they targeting a specific niche or offering a wide range of remodeling services? Understanding their positioning will help you define your unique selling proposition.
• Observe Marketing Strategies: Take note of the marketing and advertising methods your competitors are using. This could include online advertising, social media presence, or collaborations with local interior designers. By understanding their strategies, you can craft a more effective marketing plan for your own business.

Tips to Consider:

• Stay updated: Continuously monitor your competition to stay informed about any changes in their offerings or strategies.
• Identify gaps in the market: Identify areas where your competitors may be lacking or not meeting the needs of your target customers. Use this knowledge to differentiate your business.
• Enhance your unique selling proposition: Differentiate yourself from the competition by clearly defining your unique selling proposition. Highlight what sets you apart and why customers should choose your remodeling services.

By thoroughly analyzing and understanding your competition, you can develop a solid business plan that takes into account the current market dynamics. This knowledge will enable you to position your remodeling business effectively and create strategies that give you a competitive edge.

Define The Unique Selling Proposition And Value Proposition

Defining the unique selling proposition (USP) and value proposition is essential for any business, including remodeling companies. These two factors differentiate your business from competitors and showcase the value you offer to potential clients. Your USP highlights what sets you apart, while your value proposition explains the benefits and advantages of choosing your remodeling services.

In order to define your USP, you need to identify your strengths and what makes your remodeling business unique. Consider your expertise, experience, and any specializations you have. This could be a particular design style, innovative construction techniques, or excellent customer service. Use this information to craft a clear and concise statement that sets you apart in the industry.

• Focus on the strengths that resonate most with your target customer base.
• Consider what problems or pain points your USP solves for clients.
• Make sure your USP is memorable and easy to understand.

Next, your value proposition should clearly communicate the benefits that clients can expect from choosing your remodeling services. This could include factors such as high-quality workmanship, attention to detail, on-time project completion, or a commitment to customer satisfaction. Essentially, your value proposition should answer the question: 'Why should clients choose us over our competitors?'

• Research your target customer base to understand their needs and desires.
• Highlight the specific benefits that your remodeling services provide.
• Ensure your value proposition aligns with your USP.

Remember, your USP and value proposition should be clear, compelling, and unique to your business. These statements will serve as the foundation for your marketing and sales efforts, helping you attract and retain clients in the highly competitive remodeling industry.

Conduct A SWOT Analysis To Determine Strengths, Weaknesses, Opportunities, And Threats

A SWOT analysis is an essential step in developing a comprehensive business plan for remodeling. It allows you to assess the internal and external factors that can impact your business's success. By conducting a SWOT analysis, you can identify your strengths , weaknesses , opportunities , and threats , which will help you make informed decisions and develop strategies to maximize your chances of success.

Here are some tips for conducting a SWOT analysis:

• Start by assessing your strengths . These are the factors that give your business a competitive advantage over others. They can include your expertise in remodeling, strong relationships with suppliers, or a highly skilled team. Identifying your strengths will help you capitalize on them and differentiate your business in the market.
• Next, analyze your weaknesses . These are the areas where your business may lag behind your competitors. It could be limited resources, lack of brand recognition, or a narrow customer base. By recognizing your weaknesses, you can develop strategies to overcome them and improve your competitive position.
• Identify the opportunities in the market that you can leverage to grow your business. This could be an increasing demand for remodeling services due to a booming real estate market or a growing trend towards eco-friendly renovations. By understanding the opportunities, you can align your business and marketing strategies to capitalize on them.
• Lastly, assess the threats that may pose risks to your business. These could include emerging competitors, economic downturns, or regulatory changes that can impact the remodeling industry. By identifying potential threats, you can develop contingency plans and strategies to mitigate their effects.

Remember, a thorough SWOT analysis will provide valuable insights into your business's internal capabilities and external environment. It will serve as a foundation for developing a strategic plan that addresses your weaknesses, capitalizes on your strengths, maximizes opportunities, and mitigates threats. Use the information gathered from the SWOT analysis to refine your business goals, objectives, and strategies to ensure long-term success in the remodeling industry.

Define The Business Goals And Objectives

Defining clear business goals and objectives is essential for the success of your remodeling business. These goals provide a roadmap for your company and help guide your decision-making process. Here are some important steps to consider when defining your business goals and objectives:

• Set specific and measurable goals: Clearly define what you want to achieve for your remodeling business. For example, you may set a goal to increase revenue by a certain percentage or to complete a specific number of projects within a given timeframe. Ensure that your goals are measurable so that you can track your progress.
• Align goals with your company's mission and values: Your business goals should be in alignment with the overall mission and values of your company. This ensures that your goals are consistent with the core principles that guide your business.
• Break down goals into actionable objectives: Once you have defined your goals, break them down into smaller, actionable objectives. These objectives should be specific tasks or milestones that contribute to the achievement of your larger goals.
• Set realistic and achievable targets: It's important to set goals that are attainable within a reasonable timeframe. Avoid setting unrealistic targets that may be demotivating or unattainable given your resources and capabilities.
• Regularly review and update your goals: Business goals should not be set in stone. As your business evolves and the market conditions change, it is essential to review and update your goals accordingly. Regularly assess your progress and make necessary adjustments.
• Involve key stakeholders: Include input from key stakeholders, such as management and employees, when defining your goals and objectives. This encourages a sense of ownership and commitment from your team.
• Ensure goals are SMART: Make sure your goals are Specific, Measurable, Achievable, Relevant, and Time-bound. This framework helps in setting clear goals that maximize efficiency.
• Communicate goals to your team: Clearly communicate your goals and objectives to your team members. This fosters a shared understanding and motivates everyone to work towards the same vision.
• Monitor progress regularly: Establish a system for tracking and monitoring your progress towards your goals. Regularly review your performance and make adjustments as needed.

Defining the business goals and objectives provides a clear direction for your remodeling business. It helps you stay focused, make informed decisions, and measure your success. Take the time to carefully define your goals and objectives, and regularly evaluate and update them to ensure continued growth and profitability.

Develop A Pricing Strategy For Services Offered

Developing a pricing strategy for your remodeling services is a crucial step in creating a successful business plan. Your pricing strategy will determine the value you provide to your clients and ultimately impact your profitability. Here are some important considerations to keep in mind:

• Understand your costs: Before setting your prices, it's essential to have a clear understanding of all your costs, including materials, labor, permits, and overhead expenses. This will ensure that you are pricing your services accurately and covering your expenses.
• Consider market trends and competition: Research the current market rates for remodeling services in your area and analyze your competitors' pricing strategies. Understanding the market and your competitors' pricing can help you determine where you stand and how you can position yourself to attract customers.
• Determine your value proposition: What sets your remodeling services apart from your competitors? Identifying your unique selling proposition will help you establish a pricing strategy that reflects the value you provide to customers. Whether it's exceptional craftsmanship, attention to detail, or fast turnaround times, make sure your pricing aligns with the value you offer.
• Consider different pricing models: There are various pricing models you can explore, such as fixed pricing, cost-plus pricing, or value-based pricing. Each model has its advantages and disadvantages, so it's important to choose the one that aligns with your business goals and customer expectations.
• Offer transparency: Provide your clients with clear and detailed pricing information. Transparency builds trust and helps customers understand the value they will receive for their investment. Provide a breakdown of costs, including material and labor expenses, to showcase your pricing's fairness and competitiveness.

Tips for Developing a Pricing Strategy:

• Consider offering different pricing packages or tiers to appeal to a wider range of customers.
• Regularly review and adjust your pricing strategy to adapt to changing market conditions and costs.
• Offer incentives or discounts for repeat customers or referrals as a way to encourage loyalty and word-of-mouth marketing.
• Consider bundling additional services or incentives into your pricing to provide added value to your clients.

By carefully developing a pricing strategy for your remodeling services, you can ensure that your business is profitable, competitive, and attractive to your target customers.

Identify The Required Resources And Equipment Needed

When starting a remodeling business, it is crucial to identify the necessary resources and equipment needed to successfully complete projects. These resources and equipment will vary depending on the type and scale of remodeling projects the business plans to undertake. Here are a few key considerations to keep in mind:

• Assess the scope of your projects: Take into account the size and complexity of the remodeling projects you plan to take on. Will you be primarily focused on smaller residential renovations or larger commercial remodels? This will determine the scale of resources and equipment needed.
• Invest in quality tools: To ensure efficient and high-quality work, it's important to invest in the right tools for the job. Depending on your specialization, you may need a variety of tools such as power tools, hand tools, measuring equipment, safety gear, and more. Consider the specific requirements of the remodeling work you will be doing and invest in reliable and durable equipment.
• Establish relationships with suppliers: Building relationships with suppliers is essential to ensure a consistent and reliable supply of materials. Identify reputable suppliers who can provide the necessary materials for your remodeling projects. This includes building materials, fixtures, fittings, appliances, and any other components required for the specific types of projects you will be undertaking.
• Consider hiring skilled labor: Depending on the size and complexity of your projects, you may need to hire skilled labor such as carpenters, electricians, plumbers, or other specialized tradespeople. Identify the skill sets required for your projects and plan for the necessary labor resources. Additionally, consider investing in training programs to develop the skills of your existing workforce or yourself.
• Regularly assess and update your equipment inventory to ensure that you have the necessary tools for each project.
• Consider the possibility of renting or leasing equipment for infrequently used or specialized tools to minimize upfront costs.
• Research and compare prices from different suppliers to ensure you are getting the best quality materials at the most competitive prices.
• Establish partnerships or subcontracting arrangements with other professionals or businesses to supplement your resources, especially for specific trade skills that you may not have in-house.

By identifying the required resources and equipment for your remodeling business, you can ensure that you are adequately prepared to tackle projects efficiently and effectively. Investing in the right tools, materials, and labor resources will contribute to the success and growth of your business.

Create A Marketing And Advertising Plan

A well-executed marketing and advertising plan is crucial for the success of a remodeling business. It helps to increase brand awareness, attract potential clients, and generate leads for new projects. Here are some important steps to consider when creating a marketing and advertising plan:

• Identify target audience: Define the ideal customer for your remodeling services. Determine their demographics, preferences, and needs. This will help you tailor your marketing efforts to reach the right audience.
• Research marketing channels: Explore different marketing channels such as online platforms, social media, print media, and local advertising opportunities. Consider which channels are most effective for reaching your target audience and allocate your marketing budget accordingly.
• Build a consistent brand: Develop a cohesive brand identity that reflects your company's values, expertise, and unique selling proposition. This includes creating a logo, website, and promotional materials that convey a professional and trustworthy image.
• Create a comprehensive online presence: In today's digital age, having a strong online presence is essential. Build a user-friendly website that showcases your previous remodeling projects, testimonials from satisfied clients, and contact information. Utilize search engine optimization (SEO) techniques to improve your website's visibility in search engine results.
• Utilize social media: Leverage social media platforms such as Facebook, Instagram, and Houzz to showcase your remodeling projects, engage with potential clients, and share valuable content related to home improvement and design. Consider running targeted advertising campaigns on these platforms to reach a wider audience.
• Network within the industry: Attend local trade shows, industry conferences, and networking events to establish relationships with potential clients, suppliers, and industry professionals. Word-of-mouth referrals are often powerful in the remodeling business.

Tips for Creating an Effective Marketing and Advertising Plan:

• Regularly update your website and social media platforms with new content and projects to keep your audience engaged.
• Consider offering educational workshops or seminars on topics related to remodeling to position yourself as an industry expert.
• Monitor and track the effectiveness of your marketing efforts using analytics tools to evaluate which strategies are generating the best results.
• Don't underestimate the power of customer testimonials and before-and-after photos to showcase your expertise and quality of work.

Assess Financial Feasibility And Make Projections

Assessing the financial feasibility of your remodeling business is a crucial step in the business planning process. It allows you to determine whether your business idea is financially viable and helps you make informed decisions about the future of your business.

When assessing the financial feasibility of your remodeling business, it is important to consider several key factors. First, you need to determine your start-up costs, including the cost of equipment, materials, insurance, and any necessary permits or licenses. This will give you a clear understanding of the initial investment required to get your business up and running.

In addition to start-up costs, you should also analyze your operating expenses. This includes regular expenses such as rent, utilities, employee wages, and marketing costs. By accurately estimating your operating expenses, you can determine the amount of revenue you need to generate to cover these costs and achieve profitability.

Furthermore, making financial projections is essential for understanding the potential future performance of your remodeling business. This involves forecasting your sales revenue, expenses, and profits over a specific period of time, typically one to three years. Financial projections allow you to identify potential challenges and opportunities, and help you make informed decisions about pricing, budgeting, and resource allocation.

Tips for Assessing Financial Feasibility and Making Projections:

• Consider consulting with a financial advisor or accountant to ensure the accuracy and reliability of your financial projections.
• Research industry benchmarks and market trends to make realistic assumptions about your sales revenue and expenses.
• Regularly review and update your financial projections as your business grows and market conditions change.

By thoroughly evaluating the financial feasibility of your remodeling business and making accurate projections, you can establish a solid foundation for success and navigate the financial challenges of the industry with confidence. This step is essential for demonstrating your business's potential to investors, lenders, and potential partners.

In conclusion, writing a business plan for a remodeling company is essential for success in the industry. By following the nine steps outlined in this checklist, you can ensure that your business is well-prepared and positioned to thrive. From researching the market and understanding the competition to developing a marketing plan and assessing financial feasibility, each step plays a crucial role in shaping your business's direction and growth. By carefully considering these factors and making informed decisions, you will be on your way to building a successful remodeling business.

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7 Steps for Creating a Remodeling Business Plan

A remodeling business plan can make the difference between success or merely surviving. It’s a roadmap that can take your remodeling business from the first spark of an idea to a rousing success.

Simone Toth

Staff Contributor

Strategic Planning

Are you ready to start your own remodeling business or reorganize your existing company? Get off to a great start by creating a business plan. A remodeling business plan can make the difference between success or merely surviving.

Here’s why. According to a 2021 LendingTree survey , “lack of financing” is the biggest roadblock for 40% of prospective startups. Thirty-three percent said that “anxiety and fear it won’t work out” kept them from following their dream.

A well-thought-out business plan can take these roadblocks out of the equation. Discover how to create a plan that can ease your fears and provide you with a solid financial footing.

Related Article

How to Start a Remodeling Company

What is a remodeling business plan, and why do you need one.

A remodeling business plan documents the information you need to put your business on the right foot. It outlines how you’ll structure your business, run it, and grow it.

It’s a roadmap that will take your remodeling business from the first spark of an idea to a successful operation that will last for years to come.

Why You Need a Business Plan for Your Remodeling Business

If you went on a trip without a roadmap, you’d probably take a few wrong turns before you arrive at your destination. Similarly, starting a business without actionable guidelines also can lead to mistakes.

In the remodeling industry, where equipment doesn’t come cheap, those wrong turns will cost you time and money.

An effective business plan, though, will guide you through each step of getting your business off the ground. Following it can help you manage it and grow it to the next level. The right business plan can make the difference between getting funding or a cold “No thanks.”

Do you need investors to fund your business? If so, a detailed plan will help them see that your company will likely reap a healthy return on the investors’ investments.

Do you plan to partner with others? A well-thought-out business plan can convince them that working with you is the path to success in home renovation.

Types of Business Plans

Business plans fall into two categories: traditional business plans and lean startup plans.

You might start with a lean startup plan at the outset. Then, fill in the details later in a conventional plan that meets all your stakeholders’ requirements.

Traditional Business Plan

A traditional plan covers every detail. Organize it in sections to make it easier for stakeholders to read.

Usually, traditional business plans are several pages long. They cover details of interest to potential investors, lenders, partners, or even customers.

Lean Startup Plan

A lean startup plan states only the essential parts of your business plan. Usually, you can sketch it in less than a day using a visual diagram or short outline on a single page.

The only drawback is that some lenders and investors might want to see greater detail. So, you should set aside some time to fill in the blanks if you need more information.

The Components of a Traditional Remodeling Business Plan

While you might be an expert at residential remodeling, you might feel out of your league when it comes to running a business. Business plan templates can help. Find them at the US Small Business Administration and Score.org websites.

Here are the steps you need to include when creating a traditional business plan.

1. Create an Executive Summary

An executive summary is a brief description of your company and what it does for its clients. If you have a mission statement, include it.

Also, add an overview of your work, key team members, location, a summary of your financial information, and your plans for growth and expansion.

2. Describe Your Remodeling Company’s Work in Detail

In this section, focus on what you do for your clients. Dive into what specific types of challenges you help them solve. Also, state the strengths you bring to the table to solve those problems.

If you already have customers, look for commonalities and list the types of clients you serve.

Do you have a specific niche that you focus on? If so, describe the focus of your work. If you specialize in kitchen remodeling products or restoring vintage homes, provide details.

Investors and lenders will want to evaluate your community’s need for such services. That information will help them decide if your remodeling business will likely succeed.

From One of Our Partners

3 Reasons Home Builders and Remodelers Should Focus On Customer Follow-up

3. outline your goals and objectives.

List in detail what you want to accomplish with your business. Keep the stakeholders’ interests in mind as you list your goals. They need to see goals that are specific , measurable, achievable, relevant, and have a definite endpoint.

Specify only goals that you have an excellent chance to achieve.

You’ll also need to state the road you’ll take to achieve your objectives. A brief outline of your project management workflow should help stakeholders see that your goals are not just pipe dreams. They will be able to see that you can achieve them.

4. Determine, Analyze, and Document Your Target Market

Your target market consists of all the types of homeowners you typically will serve.

For example, if you specialize in high-end home remodels, you needn’t include the under-$50K per year demographic. On the other hand, if you primarily work on older homes, you need to consider income groups that can only afford fixer-uppers.

Conduct a deep analysis of your target market to see if there are enough potential clients in your local area to make your business profitable. If not, consider expanding your reach into other market segments (potential customer groups) if you have the skills to serve them.

There’s no substitute for extensive market research to determine whether your business is likely to succeed.

Doing your homework before you sink a lot of cash into your business can save you a world of headaches later. Getting it on paper makes it easier for both you and your stakeholders to see the big picture.

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5. research your competition.

Potential stakeholders will want to know how well you stack up against your competitors. Discover their strengths, weaknesses, and the unique value they bring to their clients.

Then, sketch out a strategy to get ahead of them in each area.

Along with researching your competitors , conduct a similar in-depth analysis of your company. Shore up your weaknesses. Emphasize what you’re great at, and jot down what you do better than your local competitors.

Noting those factors can make you stand out in your prospective stakeholders’ eyes.

6. Structure Your Company

Your business plan should also include how you plan to structure your business. Include both your company’s legal structure and your organizational structure. 

State the talents, experience, and education your team brings to your organization. You don’t need to provide complete CVs or resumes but do include their career highlights.

Consider including your hiring guidelines for both subcontractors and employees. For tax purposes, define how you distinguish between the two categories.

5 Hiring Tips for Home Services Providers

7. state how you will market your new remodeling business.

Revolve your marketing strategy around your prospective customers. As Amazon founder Jeff Bezos put it, be “ customer-obsessed ” in your focus.

Look at how the top names in the home services field attract and retain customers. Then, evaluate their marketing strategies by their strengths and weaknesses.

Document how you plan to reach out to prospective clients, turn them into paying customers, and keep them loyal for life.

4 Digital Marketing Tips for Remodeling Contractors

Additional information you might need on your remodeling business plan.

It also pays to include your financial strategy and projections if you’re looking for funding or potential investors. Be sure to specify the amount of funding you’re looking for, along with what you plan to use it for and how you plan to leverage it to drive profits upward.

Also, include visuals. Create an appendix. There, list graphs, charts, and photos of completed renovations that might interest investors.

Finally, include your permits, licenses, and other pertinent information in the appendix. It will help prospective investors build trust in your company.

With an effective, detailed business plan in hand and a dedication to following it through, you can bring your vision to life. Start creating your remodeling business plan today!

About the Author

Simone is passionately committed to clear copy—no matter who the reader is or what’s being communicated. When she isn’t arguing over semantics, you can find her running, managing too many pets, or wearing passive aggressive t-shirts on video calls.

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How to Start a Home Renovation Business

If you are passionate about home improvements, starting a home renovation, repair, or re-construction business can be an exciting and rewarding venture. There’s nothing quite like being your own boss while doing something meaningful and fulfilling. Play your cards right, and you’ll also get to make a decent income and career out of it. 

The home renovation space is teeming with lucrative opportunities. Many homeowners will pay top dollar for room additions and improvements, bathroom and kitchen makeovers, landscaping , roofing and flooring, décor, HVAC services , and more. The US home remodeling market grew to $340 billion in 2020. And it could reach $450 billion by 2027, with the Do-It-For-Me (DIFM) segment taking a 60+ percent market share.

So, where do you begin? Starting any business calls for careful planning and finessing. Even a small contracting business has several moving parts. And it’s your job to put everything together that makes the business work.

This is more than a guide on how to start a home renovation business. It will take you through all the necessary steps, worthy considerations, and pitfalls to avoid when establishing a home remodeling business.

Let’s get started.

Step-by-Step Guide to Starting a Home Remodeling Business

Before you make any moves toward starting your own home contractor business, it’s important to understand what you’re getting into. Get the lay of the land and learn what to expect. So, take a step back and ask yourself the following questions:

• Why am I getting into the business?
• How will I be involved in the business?
• What will I sell?
• Where will I sell and to whom?
• What unique value does the business bring to the market?
• Who are my potential competitors?
• Is my idea financially feasible?
• What will it take to make the venture work?
• How big can the business really get? 
• What challenges lay ahead? 

Conduct some rough preliminary research into the home remodeling scene in your target area or market. You need a good picture of the market’s size, dynamics, and potential competitors. Find out what consumers want, what they’re getting, and how much they’re paying for it. After that, you can identify the market holes or niches that your business could fill. Then build your business model and unique selling points from there.

Going into any business also requires the right mindset. For starters, check your expectations, anticipate challenges, and set realistic and achievable goals.

With that in mind, here are steps to start a remodeling business.

Draft a Solid Business Plan

A business plan is a formal document that serves as a roadmap for your new business. It’s a dynamic guide that describes how to structure, run, and grow the enterprise. Business planning essentially fleshes out your business idea and represents it as a digestible and actionable blueprint. This should help you get an overview of the renovation business and spot its potential strengths and challenges.

There are generally two ways to write a business plan. One, you can draft a comprehensive traditional business plan detailing every aspect of the business. But for a small home improvement business, it’s better to keep things simple at first with a lean business plan. This type of business plan is more compact and concise. It covers just the core business elements in a few short pages.

These are the key components you should include in your lean business plan:

• Business overview – Give a general description of the business model.
• Key activities – Outline the home renovation services you’ll be offering and your role in the business. Will you be doing the work yourself or contracting outsourced professionals?
• Resources available – What key resource will your home renovation business leverage? It could be your skills and expertise in the home improvement industry, a capable labor force, construction/renovation equipment, or a proprietary asset.
• Value proposition – Explain the unique value your business brings to the consumers. These are your unique selling points (USP), the attractive qualities that distinguish you from competitors.
• Customer segments – Narrow down your target customers. Your ideal customer might be a fresh homeowner looking to turn their new house into a home. Or anyone wanting to raise their property’s value for an upcoming appraisal or sale.
• Revenue streams – Paint a picture of how the business will make money remodeling homes.
• Cost structure – Design a cost structure fitting your business model and its services. More importantly, set an affordable and competitive price point.
• General financial plan – Work out what it’ll cost to launch and run the business, how you’ll get the money, and what the cash flow will look like.
• Goals and objectives – You should have a clear vision for your new business. How far do you want to take it?

Pick a Name and Get Registered

Choose a catchy name for your business and get it registered in your state. However, there’s much more to registering a new business than simply picking a killer name.

First, you have to choose a business structure under which to register your home remodeling venture. There are several business structures to choose from. But sole proprietorship and LLC (limited liability company) are the best structures for a small home renovation business.

Registering a Sole Proprietorship

A sole proprietorship is a business that’s owned and controlled by one person. It’s also the simplest of all business structures. To register a sole proprietorship, you can either put up your own name or pick a fictitious name by filing a DBA (“doing business as”). Registering an LLC

Unlike a sole proprietorship, an LLC separates your personal and business identities, legally speaking. That means you won’t be personally liable for the business’s legal or financial obligations, such as debts and lawsuits. However, registering an LLC is a lot more involved than a sole proprietorship.

With an LLC, you’ll have to nominate (depending on your state) a “registered agent” to submit and receive legal papers on your behalf. You’ll also have to file two documents: Articles of Organization (also known as Certificate of Formation or Certificate of Organization) and an LLC Operating Agreement, though this is not required in every state.

In either case, you also need an Employer Identification Number (EIN) to hire workers, file federal taxes, open a business bank account, and apply for business permits. The federal government also requires every business with employees to have unemployment, workers’ comp, and disability insurance. Remember, business insurance laws vary from state to state. But compulsory or not, insurance is essential in the home renovation business. So, consider insuring your business anyway.

Learn more about business structures and registration in this article by the SBA.

Secure the Necessary Permits and Licenses

Every business needs a license in order to operate anywhere in the country. Business licenses are issued by local government agencies, usually the city or municipal office. But a license only allows you to do business. You’ll also need various business permits to carry out home renovation projects in specific states, cities, municipalities, or zones.

The permit requirements for your home contractor business will depend on its specialization and location. You may also need temporary work permits for specific projects. But generally, most states and cities require builders and contractors to have a professional license/certificate, health and safety permits, and general contractor permits. Check with your local industry and government authorities to see the permits you’ll need.

Nail Down the Business Logistics and Resources

By this stage, you already have a fundamental business framework. Now is the time to gather all the resources you’ll need to get going. This will obviously depend on your business model, size, and service scope. Top-of-the-list items might include:

• Funding – Get the funds to start and run the business until it can stand on its own. You can bootstrap the venture or apply for financing from banks or alternative lenders.
• Labor – Start hiring subcontractors, handypersons, project managers, etc., if needed. But you don’t have to make permanent hires right away. It’s safer and more cost-efficient to hire staff on a contract basis at first.
• Suppliers – Find the best suppliers for any construction, plumbing, or electrical materials you’ll need for various home renovation projects. Remember to consider reliability and quality above pricing when selecting suppliers.
• Assets – Acquire all the equipment, machinery, and tools you’ll need to start work (specialized construction equipment, vehicles, hand tools, etc.). Buy what you can afford and hire the more expensive machinery, such as trucks and power tools, only when needed. These assets can also include the tools needed to run a business, like an estimating and invoicing app, or setting up a template in Excel.

Define Your Remodeling Business Brand

Branding is a way of setting your business apart from its competitors. It’s a means for customers to identify and associate with your business. Branding also forms the basis for marketing. Anything that identifies your business is part of your branding, from its name and logo to USPs.

However, there’s more to branding than just the business name and logo. Branding extends beyond mere recognition to the customers’ perception of the business. Customers prefer to engage with the businesses they trust, and you can build that trust through strong branding.

Your brand should represent what your renovation business stands for, expressing its qualities, strengths, values, and personality. In other words, instill customer confidence through your business’s presentation. Make assurances, quality guarantees, and value-added advantages part of your business identity.

Start Marketing

Once everything is set up, you can start a rigorous marketing campaign. Focus your marketing efforts on spreading brand awareness and generating leads to score your first customers. That means presenting your brand to the relevant audiences and getting people excited about signing up for your home remodeling services. You can do this in any number of ways.

Here are some proven marketing ideas worth trying out:

• Create a website and optimize it for local search within your service area.
• Get your business on social media: Facebook, YouTube, Instagram, Nextdoor, Twitter, and LinkedIn.
• Involve yourself in local community activities.
• Brand your vehicles, machinery, and work sites.
• Cold pitch to homeowners using direct mail.
• Hand out flyers and branded merchandise at local gatherings and events.
• Get your business listed in local and online directories.
• Join various home remodeling and construction groups/associations to build your credibility and leverage their advertising muscle.
• Consider taking out paid ads in local publications and on the internet.
• Entice first-time customers with irresistible home renovation discounts and offers.

Avoid These 8 Rookie Mistakes

Fundera calculates that about 20% of small businesses fail in their first year. Meanwhile, about half never make it past five years. Worryingly, start-ups in the construction industry have relatively low survival rates. Only 35% of small construction businesses make it through their fifth year.

These grim figures are not meant to scare or discourage you from starting your home renovation venture. In business, failure is always an opportunity to learn, even the failures of others. And there’s a lot you can learn from failed businesses when starting your own. On that note, here are some of the costly mistakes that can easily run you out of business as a home improvement contractor:

Starting with Too Little Cash

Running out of cash is one of the top reasons many small start-ups fail. Don’t underestimate your business’s financial needs. Ensure you have enough capital to begin with and avoid unnecessary purchases or drawing money out of the business during its infancy.

Underestimating the Competition

Understand your competitors before going up against them. The home improvement sector is often a highly crowded commercial space. So, carefully gauge the possibility of carving out a niche for your business. Check whether your value proposition and unique selling points are a match for what’s already available in your target market.

Lacking a Solid Business Plan

Starting any business without a solid plan is like wandering blindly into dangerous waters. A good business plan lays out a clear path to your goals, sets up contingencies around potential obstacles, and puts guardrails to keep the business on track to success.

Ignoring Customer Satisfaction

Praise for home renovation businesses largely spreads through word of mouth and referral from past clients. Therefore, customer satisfaction is a big part of passive marketing. Plus, happy customers are more likely to contract your business again in the future. The rules of customer satisfaction are pretty simple: work on customer service, promise and deliver, and never compromise quality.

Doing Everything Yourself

A contractor business doesn’t have to be a one-man show. Besides, you surely can’t expect to juggle every aspect of the business yourself. Don’t hesitate to seek wise counsel, outside financing, subcontractors, and labor whenever you need it. Surround yourself with people and resources that support your enterprise.

Setting the Wrong Price

Writing price estimates for home renovation services is a delicate balancing act between competing and profiting. The trick is to set a price that not only best represents the value of your services but also fairs well against competitors’ benchmarks.

Poor Project Management

Develop an efficient project management strategy that prevents delays, cost overruns, and poor-quality delivery even when handling multiple projects at a time. Also, accept only the projects you’re sure can be completed in time and within budget.

Focusing on Rapid Growth

This may seem counterintuitive, but rapid growth can lead to all sorts of problems. Expanding too fast can deplete your cash reserve faster than the business can replenish it and introduce sudden risks, choices, or opportunities you were not prepared to handle. Aim for homogenous and organic growth that’s more sustainable and manageable.

Wrapping Up

Running your own home renovation business can be rewarding and liberating. However, these rewards and freedom come with great responsibility. It takes a lot just to start a business, let alone run it for years and years. But although it may be challenging, it becomes easier once you break everything down and take it one step at a time.

Once you’re ready to get started, use this guide for help and let Joist save you time, win more jobs, and get paid faster with quicker remodeling estimates , professional invoices, and payment tracking.

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How to Start a Remodeling Business

If you're wondering how to start your own home renovation business, this guide on starting a remodeling business is best for you..

Are you considering starting a renovation company but are concerned about the amount of competition? Don’t worry about it.

There’s plenty of opportunity in the remodeling and home renovation world for contractors who accomplish as little as $100,000 in total volume per year and work their way up.

In this article, we’ll go over some of the steps you’ll need to do to get started in the remodeling business. 

We’ll also go over some helpful hints for starting and growing a remodeling business in this industry.

So, if you’re considering to change career and becoming a contractor, keep reading!

Step 1. Decide on a specialty

All general contractors specialize in one or two services and then subcontract out the rest of the work. Which services you plan to fulfill yourself and which services you plan to contract out to subs should be addressed in your remodeling business plan. 

For example, you may want to start remodeling your kitchen and bathroom, but you will only be able to do the tile work yourself. You’d have to hire others to do the electrical, plumbing, cabinetry, and finishing work. The amount of work you need to sub out will determine how big or small projects you can take on.

Larger projects usually mean more money, but if you have to contract out a lot of work, you may lose more money than you gain.

Step 2: Make a budget plan ahead of time

Home renovation businesses, in contrast to construction businesses, which are typically large corporations, are easier to manage financially. However, don’t expect everything to go smoothly. With so many other entrepreneurs in your field doing the same work as you, the most important thing you can do is make sure you have enough money to cover your initial costs.

This budget should include the wages of your employees (direct labor), overhead expenses (the total cost of all the tools you’ll need to complete the job), and direct materials (pretty self-explanatory). When you’ve figured out all of your upfront costs, it’s time to look into financing options. 

Make appointments with several banks to see if they can provide you with some reasonably priced business loans. Additionally, look into government grants for small businesses. Even if you don’t qualify for one right now, knowing what options you have in the future is beneficial.

If you’re just offering your time and skills as a part-time re modeler, the start-up cost will be around $50,000 to $75,000 , as you’ll need a full set of tools, a vehicle to transport tools and supplies, and the necessary licencing and insurance to operate in your state and locality. If you are starting a remodeling business providing major renovation services, you’ll need $250,000 to $500,000 in start-up capital, as you’ll need to buy your first few orders of materials and hire staff before your customer pays you for the job.

Step 3: Your remodeling business name

Choosing the right business name is crucial and difficult. If you run a sole proprietorship , you should consider using a different remodeling business name than your own.

When registering a business name, we recommend conducting the following research:

• The business records of your state
• Platforms for social media
• Records of federal and state trademarks
• The availability of a web domain.

Step 4. Create a legal business entity

• Sole Proprietor
• C Corporation
• General Partnership

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• Maryland LLC
• Massachusetts LLC
• Michigan LLC
• Minnesota LLC
• Mississippi LLC
• Missouri LLC
• Montana LLC
• Nebraska LLC
• New Hampshire LLC
• New Jersey LLC
• New Mexico LLC
• New York LLC
• North Carolina LLC
• North Dakota LLC
• Oklahoma LLC
• Pennsylvania LLC
• Rhode Island LLC
• South Carolina LLC
• South Dakota LLC
• Tennessee LLC
• Vermont LLC
• Virginia LLC
• Washington LLC
• West Virginia LLC
• Wisconsin LLC
• Wyoming LLC

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Step 5. Acquire the required licenses and insurances

You may discover that your state requires you to obtain a contractor’s licence if you Google how to start a remodeling business. You might be able to skip this step if you’re only doing finishing and cosmetic work. If you plan to make any structural changes to homes or buildings, install roofing or siding, or perform electrical or plumbing work, you will need to be properly certified.

In addition, you should purchase general liability insurance. Even if some states don’t require it for all contractors, it’s a good idea to have one in case something goes wrong and the homeowner or business owner decides to blame you. 

For example, if you remodel a bathroom and the pipes burst two weeks later, you may be liable for property damage. General liability insurance could protect you from having to pay for a priceless heirloom out of your own pocket if one of your employees steals from a homeowner.

Ready to Protect Your Remodeling Business

Let us help you with your business insurance needs.

• General business liability insurance
• Medical insurance
• Term life insurance
• Workers’ Comp
• Surety bonds
• Commercial auto

Step 6. Make friendship with subcontractors and suppliers

People who provide you with the materials you need for your home renovation business, as well as your collaborators, should be treated as family. Despite the fact that it is a business partnership, it should be built on mutual trust and support.

The most important rule to follow is that you should always pay your suppliers and collaborators on time. Your company will rely on them just as much as it will rely on your own abilities. 

For example, you could use online invoicing to speed up the payment process and your company’s workflow. These practical tools not only help with workflow, but they also help with cash flow, resulting in smooth and quick business collaboration. If you need invoice templates, visit our invoice template page to download the professional free invoice templates.

Many new businesses can be found in the home renovation market. While becoming a successful business owner in this field will take a lot of time and effort, there is plenty of room for (both personal and professional) growth. As a result, take the plunge and start your own remodeling business.

Step 7. Create a business bank account and a credit card for it

Personal asset protection necessitates the use of dedicated business banking and credit accounts. When your personal and business accounts are mixed, your personal assets (such as your home, car, and other valuables) are put at risk if your company is sued. This is referred to as piercing your corporate veil in business law.

Furthermore, learning how to build business credit can help you obtain business credit cards and other financing in your business’s name (rather than your own), lower interest rates, and increase credit lines, among other benefits.

Open a bank account for your business

• Separates your personal assets from your company’s assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Create a net 30 account

Get a credit card for your remodeling business.

• Put all of your business expenses in one place to separate personal and business expenses.
• Build your company’s credit history, which will come in handy if you need to raise money in the future.

Step 8. Set up a phone system for your business

Getting a business phone is one of the most effective ways to keep your personal and professional lives separate and private. That isn’t the only advantage; it also aids in the automation of your business, provides legitimacy to your company, and makes it easier for potential customers to locate and contact you.

Wise business plans offer a variety of features for businesses, including Toll-free numbers, Coverage in US and Canada, team messaging and more. Try our business phone services today.

Step 9: Promote your expertise

Your company will require excellent marketing in order for people to be aware of and use the services you provide. One of the things you should do in the first few months of your remodeling business is market it.

You can advertise your business by handing out flyers, putting up billboards, or using the internet. Putting your brand on Craigslist is the best way to market today. You’ll get more leads and make more money if you use online marketing.

Tips for Growing a Remodeling Business

Here are some tips for contractors on how to handle increased demand and expand their remodeling business during a recession.

1. Keep your money safe

2. keep your lien rights safe, 3. carefully select remodeling clients, 4. make a precise bid, 5. keep track of your financial results, 6. don’t use your cash flow as a source of funding, 7. set up proper deposit and billing schedules, 8. make invoicing and payment collection more efficient, 9. learn the fundamentals of accounting, 10. make a backup plan , 11.  examine the length of your sales cycles, 4 key success factors.

• Possessing a high success rate in the past (including completed prior contracts):  Companies with a strong reputation for having the financial, managerial, and technical capacity for remodeling projects attract potential clients. Successful remodeling companies can show a portfolio of previous work and testimonials from happy clients.
• Workforce that is multi-skilled and adaptable:  Reputable tradespeople and subcontractors are available on a project-by-project basis for successful remodeling companies.
• Controlling costs effectively: Successful remodeling businesses maintain tight cost controls and have access to low-cost input materials to maintain competitive pricing.
• Product promotion which effective: To generate publicity and new contracts, successful remodeling companies have a strong marketing department.

The highlights of our recently developed remodeling business plan

Market analysis summary: remodeling business plan.

Over the five years to 2020, operators in the Commercial Property Remodeling industry have benefited from increased demand as a result of falling office rental vacancy rates and rising consumer spending, at least through 2019. 

Furthermore, in recent years, rising corporate profits have prompted businesses to renovate commercial properties, boosting demand for industry services. 

As a result, IBISWorld expects industry revenue to grow at a 4.4% annualized rate to $35.8 billion over the forecast period. However, the spread of COVID-19 (corona virus) has brought the global economy and, with it, industry activity to a halt in 2020. 

Industry revenue is expected to fall in 2020 due to expected decreases in the value of private nonresidential construction and corporate profit. At the same time, due to the rise in stay-at-home orders, office rental vacancies have increased.  As a result, revenue growth is expected to slow by 11.3% in 2020.

Product and Services

Interior room additions and alterations will account for 22.3 percent of industry revenue in 2020, according to industry contractors. Interior room alterations and additions are required for all downstream markets, including office buildings, commercial buildings, and other structures. 

When businesses relocate, commercial property contractors, for example, renovate their office interiors. Removing walls, doors, and other interior infrastructure can also help industry operators expand warehouses and other facilities. 

Over the last five years, demand for interior alterations and additions has risen in tandem with a rise in commercial construction spending.

Frequently Asked Questions

You’ll need to keep track of your material suppliers’ accounts, pay your crews on time, and keep your vehicles and tools in good working order. Fortunately, you can keep your office space to a minimum.

Owners of residential and commercial properties who want their property professionally renovated and are willing to pay a reasonable price for labor and materials. Large businesses that require renovations may have more space, allowing you to charge a higher rate.

Customers pay you for labor and materials for their renovation, which is how your remodeling business makes money. As part of your trade, you are responsible for providing your own tools. Paint, hardware, lumber, flooring, and other supplies, on the other hand, are purchased at wholesale prices and then charged to your customer at a premium. Your hourly labor costs will be determined by your level of expertise, the type of job you’re doing, and local labor rates.

The size and complexity of the job will determine your rates. Rates range from $45 to $85 per hour, with the possibility of lower or higher rates. To ensure that your client is getting a good deal, you should conduct a thorough competitive analysis. Between $3,000 and $15,000 is the average cost of a renovation project.

The standard markup on materials is 15%. A one-man company with multiple crews can earn around $20,000 per year working part-time, while a large contractor with multiple crews can earn in the seven figures when they complete multiple large jobs throughout the year.

Providing high-quality work that completely satisfies your customers is the most effective way to increase business and profit. For a successful remodeling business, you’ll need to make sure that quality control and customer service are always top priorities.

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How To Start A Home Remodeling Business: A Comprehensive Guide

In 2022, the home remodeling industry saw a staggering growth of 5.5%, with homeowners spending more time indoors and looking for ways to enhance their living spaces. If you’ve ever considered diving into this lucrative market, you might be wondering How To Start a Home Remodeling Business . This comprehensive guide is here to illuminate the path for budding entrepreneurs like you. Dive in to discover the essentials of setting up, running, and growing a successful home remodeling venture. Let’s embark on this transformative journey together!

Essential Skills and Qualifications

Necessary Skills for Starting a Remodeling Business

Beyond the hammer and nails, a successful remodeling business owner needs a keen eye for design, strong project management skills, and a dash of salesmanship.

Training and Certifications to Consider

While a degree in construction might give you a head start, various certifications, like the Certified Remodeler (CR) designation, can boost your credibility.

Importance of Hands-on Experience

There’s no substitute for getting your hands dirty. Before diving in, consider working on a few projects or shadowing a seasoned pro. It’s the best way to learn the ropes and avoid rookie mistakes.

Crafting a Business Plan

Importance of a Well-Defined Business Plan

A business without a plan is like a house without a foundation. Wobbly and risky! Crafting a solid business plan is the first step to ensure your remodeling business stands tall and sturdy.

Key Components to Include

From financial projections to marketing strategies, your business plan should cover all bases. And don’t forget to include an analysis of your competition. Knowledge is power, after all.

Setting Clear Objectives and Goals

Where do you see your business in 5 years? Whether it’s opening a showroom or expanding to multiple cities, setting clear objectives will keep you on track.

For more insights on designing the perfect spaces, check out How to design floor plans . And if you’re looking for a deeper dive into starting a remodeling business, this guide on How to start a remodeling business is a goldmine.

Legal Considerations and Licensing

Choosing a business structure.

So, you’ve decided to take the plunge and How To Start a Home Remodeling Business . First things first, let’s talk structure. Whether you’re leaning towards an LLC for its liability protection or considering the simplicity of a sole proprietorship, your choice will have tax implications and determine your level of personal liability.

Obtaining Necessary Licenses and Permits

No one likes red tape, but it’s a necessary evil. Depending on your state, you’ll need specific licenses to operate legally. And remember, working without the required permits can lead to hefty fines. So, always better to be safe than sorry!

Importance of Insurance for Remodeling Business

Accidents happen! Whether it’s a misplaced hammer or an unexpected plumbing issue, having the right insurance can save you from a financial nightmare. Consider general liability and workers’ compensation as your safety nets.

Building a Brand and Online Presence

Crafting a memorable business name and logo.

Your brand is more than just a name; it’s the first impression you make. So, choose a name that resonates with your target audience and a logo that’s as unique as your services.

Setting Up a Professional Website

In today’s digital age, if you’re not online, you’re invisible. A sleek, user-friendly website can be your most potent marketing tool. And hey, while you’re at it, check out these Best free home design apps to give your site that extra oomph!

Utilizing Social Media for Marketing and Engagement

From Pinterest boards of dream homes to Instagram’s before-and-after shots, social media is where your audience is. Engage, inspire, and watch your client list grow!

Financing and Budgeting

Initial investment and startup costs.

Starting a business isn’t cheap. From tools to advertising, the costs add up. On average, initial investments can range from $10,000 to $50,000. But remember, every penny you put in is a step towards building your empire.

Securing Loans or Grants

Unless you’ve got a money tree in your backyard, you might need some financial help. Research loans tailored for small businesses or grants that support local entrepreneurs.

Importance of Budgeting and Financial Planning

A successful business is as much about smart spending as it is about earning. Budgeting isn’t just about cutting costs; it’s about maximizing profits. For more insights, this guide on How to start a home renovation business is a treasure trove of information.

How To Start Home Remodeling Business: Marketing Strategies

Traditional vs digital marketing.

In the age of TikTok and Instagram, it’s easy to dismiss traditional marketing methods like billboards and radio ads. But guess what? They still pack a punch! However, combining them with digital marketing strategies can give your business the edge it needs. Think of it as a PB&J sandwich – classic yet timeless.

Importance of Word-of-Mouth Referrals

Ever heard the saying, “A happy customer tells a friend; an unhappy customer tells the world”? Word-of-mouth referrals are the gold standard in marketing. Happy clients become your brand ambassadors, and their recommendations are worth their weight in gold.

Collaborating with Real Estate Agents and Contractors

Real estate agents and contractors can be your ticket to a steady stream of clients. Build strong relationships with them, and watch your client list grow faster than you can say “remodel”!

Building a Portfolio and Client Testimonials

Importance of showcasing your best work.

Your portfolio is your business card. It’s what potential clients will judge you on. So, make it count! Showcase a variety of projects to demonstrate your versatility and expertise.

Collecting and Displaying Client Testimonials

Nothing screams trust like genuine client testimonials. Encourage your satisfied clients to leave reviews. And for the love of all things DIY, please don’t be tempted to fake them!

Leveraging Before-and-After Photos

A picture is worth a thousand words, but a before-and-after photo? That’s priceless. It not only showcases your skills but also gives potential clients a tangible sense of what you can achieve. For more insights, check out Surviving a major home renovation .

Challenges and Solutions in the Remodeling Business

Common challenges faced by new businesses.

From managing client expectations to navigating the maze of permits, starting a remodeling business isn’t a walk in the park. But hey, if it were easy, everyone would do it!

Strategies to Overcome These Challenges

Knowledge is power. Stay updated with industry trends, attend workshops, and never stop learning. And when in doubt, seek advice. There’s no shame in asking for help.

Importance of Continuous Learning and Adaptation

The remodeling industry is ever-evolving. What’s trendy today might be passé tomorrow. Continuous learning and adaptation are not just buzzwords; they’re your ticket to long-term success. For a deeper dive into the world of home renovation, this guide on How to start a home renovation business is a must-read.

Frequently Asked Questions

What do i need to start a home remodeling business.

Starting a home remodeling business requires a combination of skills, certifications, a well-defined business plan, and the necessary licenses and permits.

How much capital is needed to begin?

Typically, the initial investment can range from $10,000 to $50,000, depending on the scale and location of your business.

Is experience in construction necessary?

While having construction experience is beneficial, it’s not mandatory. Many successful entrepreneurs start with a passion for design and then acquire the necessary skills.

How do I market my home remodeling business?

Marketing strategies can include digital advertising, word-of-mouth referrals, collaborations with real estate agents, and showcasing a strong portfolio.

What challenges can I expect in this business?

Common challenges include managing client expectations, staying updated with industry trends, and handling unexpected project complications.

How long before I start seeing profits?

Most businesses take about 1-2 years to break even and start seeing consistent profits, depending on their strategies and market conditions.

How can I ensure the growth and sustainability of my business?

Continuous learning, adapting to market needs, and focusing on customer satisfaction are key to ensuring the growth and sustainability of your home remodeling business.

Embarking on the journey of How To Start a Home Remodeling Business can be both challenging and rewarding. With the right strategies, dedication, and this comprehensive guide at your side, you’re well-equipped to carve a niche for yourself in this booming industry. Ready to transform homes and lives? Dive deeper into our guide and take the first step toward your entrepreneurial dream today!

Thank you for reading!

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How to write a business plan for your home renovation company.

Starting a home renovation company is a great idea as it allows you to offer professional renovation services to homeowners, updating and refreshing the look of their homes.

It also provides an opportunity to increase the value of their homes, making it a great investment for them in the long run.

However, prior to launching your home renovation company, you must have a comprehensive business plan.

Creating a business plan before starting a home renovation company can help ensure that your venture is successful by providing a clear outline of your company's goals, budget, timeline, and resources needed. Additionally, it can help identify potential risks and ensure that your projects are completed within the allocated budget.

In short, a good business plan will help ensure the profitability of your home renovation company .

What should be included in the business plan of a home renovation company? What's the ideal arrangement for the structure? What metrics should be considered for the financial assessment? What strategies can I use to expedite the creation of a comprehensive business plan?

The article you're reading will cover all these questions and provide answers!

One last thing: starting your business plan from scratch is not required.

Instead, you can download our business plan for a home renovation company and adapt it to suit your business needs.

Preparing a business plan for a home renovation company

Do you require a business plan for your home renovation company.

Yes, you need a business plan for your home renovation company.

Establishing a strong business plan will afford you the chance to:

• get familiar with the home renovation market
• grasp the pulse of the industry's new trends
• highlight what makes a home renovation company viable
• understand homeowners' renovation goals and design preferences to create personalized and stunning living spaces
• find a unique value proposition for your house remodeling endeavors
• examine competitor market share
• identify strategic advantages for your home renovation company
• find a business model that will make you profitable
• design and implement a robust and strategic action plan for business advancement
• identify and manage risks specific to a home renovation company, including construction delays, budget overruns, and contractor reliability
• establish the solid business case of your company

Our team has created a business plan for a home renovation company that is designed to make it easier for you to achieve all the elements listed.

How to organize a business plan for a home renovation company?

A business plan includes a wide array of relevant data and metrics. It must be presented in a structured format, to make it easy to read and digest.

When we designed our business plan for a home renovation company , we made sure to set it up correctly.

The structure is divided into 5 sections: Opportunity, Project, Market Research, Strategy, and Finances.

1. Market Opportunity

The opening section is referred to as "Market Opportunity."

Discover important data and figures about the home renovation market in this section, helping you understand market trends and consumer preferences.

We keep this section updated to ensure fresh data.

2. Project Presentation

In the "Project" section, you can present your home renovation company, describing the types of renovations you specialize in (e.g., kitchen, bathroom, whole-house), design and remodeling expertise, quality materials, project management, client collaboration, and the unique value proposition that transforms houses into dream homes with functional and aesthetic enhancements.

At the end of this section, provide a brief introduction about yourself and your expertise in home renovations.

Explain your commitment to transforming living spaces, your range of renovation services, and how you plan to provide exceptional home renovation solutions to clients. Highlight your attention to detail, your skilled team of contractors, and your dedication to delivering beautiful and functional homes that exceed clients' expectations through your home renovation company.

Our business plan has written material. Adapt it to suit your concept precisely.

3. Market Research

Then, we reach the "Market Research" section.

This section describes the target audience for your home renovation company.

It includes a comprehensive analysis of competitors in the home renovation industry and emphasizes your company's unique renovation services and competitive advantages.

A tailored SWOT analysis is provided as well.

4. Strategy

Within the "Strategy" section, a 3-year development plan is outlined, specifying the necessary initiatives to make your home renovation company highly profitable.

Additionally, you'll find a marketing strategy, a risk management approach, and a Business Model Canvas tailored to a home renovation company in this section.

5. Finances

Finally, you'll arrive at the "Finances" section, which presents the financial metrics and calculations for your company.

How to make the Executive Summary for a home renovation company?

The Executive Summary provides a condensed preview of the business plan of your home renovation company.

Keep it short and clear, with a maximum of 2 pages. Focus on the key aspects.

The purpose of this document is to make the reader want to read your business plan.

In the Executive Summary of your home renovation company, provide answers to these questions: what is your company about? who is your target market? are there other home renovation companies in the area? what funding do you require ?

How to do the market analysis for a home renovation company?

The market study of your home renovation company helps you understand external factors such as homeowner demands for remodeling services, competition within the construction industry, and emerging trends in home improvement.

By conducting a thorough market study, a home renovation company can understand homeowner preferences, offer professional renovation services, optimize pricing strategies, and execute targeted marketing campaigns, ultimately leading to a loyal customer base, increased project contracts, and a prominent position in the local home renovation industry.

Here is what we've put in the "Market Research" section of our business plan for a home renovation company :

• interesting data points and market insights about home renovation projects, including popular remodeling trends, home improvement costs, and ROI
• a list of potential audiences for a home renovation company
• the competitive analysis
• the competitive advantages to target for a home renovation company
• the SWOT analysis for a home renovation company

The key points of the business plan for a home renovation company

What's the business model of a home renovation company, business model of a home renovation company.

A home renovation company involves improving or remodeling existing residential properties. The business model can vary depending on the scope and scale of the projects undertaken. Revenue is generated through project contracts or fees charged based on the complexity of renovations and materials used.

The business model focuses on assessing client needs, providing design and construction expertise, sourcing quality materials, managing project timelines and budgets, and ensuring client satisfaction with the completed renovations. Success depends on building a strong reputation, establishing relationships with suppliers and subcontractors, delivering high-quality work, and effective project management.

Business model vs Business plan

Please don't mix up the terms "business plan" and "business model."

A business model is a blueprint for how a company operates and makes money.

In a business plan, you articulate your business model through a framework known as the Business Model Canvas.

Rest assured, there is a Business Model Canvas (already completed) in our business plan for a home renovation company .

How do you identify the market segments of a home renovation company?

Segmenting the market for your home renovation company involves dividing your potential customers into different groups based on their renovation needs, project scope, and preferences.

These categories may include factors such as kitchen renovations, bathroom renovations, full house remodeling, or customers seeking specific design styles or features (e.g., eco-friendly, smart home technology).

By segmenting your market, you can offer a range of renovation services and solutions that cater to each segment's specific requirements. For example, you might specialize in kitchen renovations and offer design and installation services for customers looking to transform their kitchen space, provide bathroom remodeling solutions that cater to different design preferences and functional needs, offer comprehensive services for customers seeking full house renovations or additions, or focus on incorporating eco-friendly and sustainable features or smart home technology into renovation projects.

Market segmentation allows you to effectively target your marketing efforts, showcase your expertise in specific renovation areas, and deliver personalized and high-quality renovation experiences that meet the unique needs and preferences of each customer segment.

In the business plan for a home renovation company , you will find a complete market segmentation that allows you to identify your potential customers effectively.

How to conduct a competitor analysis for a home renovation company?

Undoubtedly, you won't be the only home renovation company in your market. There are other contractors and companies offering renovation services to homeowners.

Include a thorough evaluation of your competitors' strengths and weaknesses in your business plan to gain an edge.

Recognize their weaknesses (such as poor project planning, inadequate contractor management, or limited construction expertise).

Why should you focus on these elements? Well, these weaknesses can hinder the success of home renovation projects. By addressing these aspects, you can offer comprehensive renovation services, provide skilled contractors and designers, and deliver quality workmanship and timely project completion, establishing your home renovation company as a trusted and preferred choice for transforming and enhancing living spaces.

It's what we call competitive advantages—focus on nurturing them to gain a competitive edge.

Here are some examples of competitive advantages for a home renovation company: innovative and creative designs, efficient project management, skilled and reliable contractors, quality materials and finishes, personalized customer service, positive client reviews and satisfaction, on-time and on-budget completion.

You will find all these elements in our business plan for a home renovation company .

How to draft a SWOT analysis for a home improvement company?

A SWOT analysis can help identify internal strengths and weaknesses, as well as external opportunities and threats, to create a plan for successful home renovation.

As you can guess, there is indeed a completed and editable SWOT matrix in our business plan for a home renovation company .

The strengths for a home renovation company

S represents Strengths in SWOT, referring to the company's internal factors that contribute to its positive performance.

For a home renovation company, potential strengths could include budgeting, organization, communication, and problem-solving.

The weaknesses for a home renovation company

When we use the "W," we mean Weaknesses, which are the areas or aspects of the company that can be improved.

For a home renovation company, potential weaknesses could include inadequate budgeting, lack of skilled labor, inadequate materials, and poor communication.

The opportunities for a home renovation company

When we refer to the "O" in SWOT, we mean Opportunities, which are the external chances or possibilities for the company's success.

In the case of a home renovation company, potential opportunities could include replacing outdated appliances, remodeling a kitchen or bathroom, adding a deck or patio, and installing new flooring.

The threats for a home renovation company

The letter "T" in SWOT signifies Threats, highlighting the potential roadblocks or harmful factors that the company needs to consider.

When it comes to a home renovation company, potential threats could include budget overruns, delays in construction, unsatisfactory workmanship, and unexpected costs.

How to elaborate a marketing strategy for a home improvement company?

Creating a marketing strategy allows entrepreneurs to identify their unique selling points and communicate them effectively to their target audience.

A home improvement company can connect with homeowners in need of renovation or remodeling services by developing an effective marketing approach that showcases the company's expertise in various home improvement projects, high-quality craftsmanship, and satisfied customer testimonials.

Homeowners won't choose your home improvement company without effective marketing; showcasing your expertise in renovations, quality craftsmanship, and customer satisfaction is necessary.

Have you considered implementing creative marketing initiatives for your home improvement company? Organize home renovation seminars or DIY workshops, showcase before-and-after transformations on your website or social media, and partner with local home decor or hardware stores for cross-promotion.

Don't stress if you're not naturally inclined towards marketing and communication.

Actually, there is an exhaustive marketing strategy, tailored to the industry, in our business plan for a home renovation company .

How to build a solid financial plan for a home improvement company?

A solid business plan must include financial data to provide an accurate assessment of the company's potential success.

When constructing your business plan, it is crucial to incorporate revenue projections for your home renovation company.

The revenue forecast needs to be coherent and easily understandable.

Our financial plan for a home renovation company is straightforward and equipped with automated checks, enabling you to validate and adjust your assumptions easily. This way, we make sure you're building solid financial projections.

Without a doubt, you'll need to come up with a basic budget for starting your home renovation company. Make certain to include all expenses without exception - you can find them all listed in our financial plan!

The break-even analysis is an essential component of your financial plan, as it provides an indication of whether your home renovation company will be profitable or not.

Make this exercise 10x easier by using our financial plan for a home renovation company .

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Home Remodeling Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business Plans » Construction & Engineering

Are you about starting a home remodeling company ? If YES, here is a complete sample home remodeling business plan template & feasibility report you can use for FREE .

If you are thinking of starting a business with huge returns on investment, then one of your best bets is to venture into the real estate industry. Of course, there are several money spinning business opportunities in the real estate industry and one of them is to start a home remodeling company.

Just like all other investment vehicle, there are potential down sides that you need to look out for as a home remodeling agent. One of the major risks in home remodeling business is a sudden downturn in the economy.

A Sample Home Remodeling Business Plan Template

1. industry overview.

The real estate industry of which home remodeling line of business is sub set of is indeed one of the many industries that are a major contributor to the growth of the economy of many nations of the world; there is hardly any country where the real estate industry is not pretty active.

Players in the Home Remodeling industry primarily engage in the remodeling and renovating the interiors and exterior of residential buildings ( i.e. single-family homes and multifamily apartment building units ). Remodeling consist of additions, alterations, reconstruction, maintenance and repair work.

General contractors, operative remodelers, remodeling design-build firms and remodeling project construction management companies are all part of the home remodeling industry while commercial building remodeling is not included in the industry.

If you are a closer watcher of the Home Remodeling industry, you will agree that the industry’s foundation shook as the housing bubble burst, with several factors contributing to discourage consumers from spending on home improvements.

Experts projected that the home remodeling industry recovery will be driven by improvements in employment and per capita disposable income.

In the united states and in most countries of the world, home prices are expected to continue to rise, facilitating growth in demand for home remodeling industry services because homeowners often leverage the value of their homes through loans to fund remodeling projects.

The Bureau of Labor Statistics (United States of America) projects 11.1 percent job growth for real estate industry between 2012 and 2022, which is about as fast as average.

During that time, an additional 38,000 jobs will open up in the industry. Hence any home remodeling company that is well equipped and positioned will sure rakes in huge revenues from this industry within this period and of course the future is bright.

The Home Remodeling cum Real Estate industry is indeed a large industry and pretty much active in countries such as United States of America, United Kingdom, Germany, France, Italy, Holland, Switzerland, Australia and Canada et al.

Statistics has it that in the United States of America alone, there are about 415,994registered and licensed home remodeling companies scattered all across the United States responsible for employing about 652,647and the industry rakes in a whopping sum of $75 billion annually.

The industry is projected to grow at 4.2 percent annual growth within 2011 and 2016. It is important to state that there is no establishment in this industry that has a lion market share.

A recent report published by IBISWORLD shows that the Home Remodeling industry is very labor-oriented, as it relies on employees to carry out most industry activities. Therefore, the industry requires a low level of capital investment and instead allocates much of its cost structure to labor payments, which accounts for 23.1 percent of revenue.

Purchases account for 56.9 percent of industry revenue. The report further stated that these costs are largely related to materials, components and supplies used during service requests as well as the costs associated with contracting work out to third-party subcontractors.

Depreciation absorbs only 1.0 percent of industry revenue, and capital purchases are largely limited to vehicles and computers used in sales offices.

The home remodeling cum real estate industry is highly regulated in the United States of America and anyone who aspires to start a home remodeling company must apply and obtain a license before they can legally operate in the industry.

Lastly, as a home remodeling professional, it is very important to be creative, to be able to use your ideas to meet the rapidly changing needs of the society when it comes to properties; you should be able to convert a slum into a beautiful city if indeed you want to become a major player in the house remodeling cum real estate industry.

2. Executive Summary

Zoe McLaurin® Home Remodeling Company is a U.S. based and licensed home remodeling company. Our head office will be located in a standard and centrally located office facility in the heart of Annapolis – Maryland.

Although our Head Office will be located in Annapolis – Maryland, but we will open our branch offices in major cities in all regions of the United States of America – within the first two years of operation we would have set up our offices in the following locations; New York City, Los Angeles, Florida, North Dakota, Boston, Dallas and Washington.

Zoe McLaurin® Home Remodeling Company is going to be a self-administered and a self-managed real estate investment trust (REIT).

We will engage in home remodeling services such as residential additions, alterations and renovations, construction management for residential remodeling, fire and flood restoration, home improvement, porch construction, sunroom additions, kitchen and bathroom upgrades, systems and equipment, disaster repairs and other remodeling projects.

We will work towards becoming one of the largest home remodeling companies in the United States of America with active presence in major cities.

We are quite aware that home remodeling business requires huge capital base, which is why we have perfect plans for steady flow of cash from private investors who are interested in working with us. We can confidently say that we have a robust financial standing and we are ready to take on any opportunity that comes our way in the real estate industry.

As part of our plans to make our customers our number one priority and to become one of the leading home remodeling company in the United States of America, we have perfected plans to adopt international best practices that can favorable compete with the best in the industry.

Zoe McLaurin® Home Remodeling Company have overtime perfected plans that will help us to become a specialist in turning slums into beautiful cities and turning a run –down and dilapidated building into a master piece and that hopefully will be our brand and signature.

Zoe McLaurin® Home Remodeling Company will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible.

We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely. We will cultivate a working environment that provides a human, sustainable approach to earning a living, and living in our world, for our partners, employees and for our clients.

Zoe McLaurin® Home Remodeling Company will be owned majorly by Zoe McLaurin and her immediate family members. Zoe McLaurin has a Degree in Building Engineering and she is a property guru that has worked with top Real Estate Companies in the United States of America for many years prior to starting her own business.

Other investors with same investment ideology whose name cannot be mentioned here for obvious reasons are going to be part of the business especially as it relates to pooling cash together for property acquisitions, renovations and beautification.

3. Our Products and Services

Zoe McLaurin® Home Remodeling Company is going to offer varieties of services within the scope of the home remodeling industry in the United States of America. Our intention of starting our home remodeling company is to favorably compete with leading players in the home remodeling cum real estate industry both in the United States of America and in the world at large.

We are well prepared to make profits from the industry and we will do all that is permitted by the law in the United States to achieve our business goals, aim and ambition. Our business offerings are listed below;

• Residential additions, alterations and renovations
• Construction management for residential remodeling
• Fire and flood restoration
• Home improvement
• Porch construction
• Sunroom additions
• Kitchen and bathroom upgrades
• Other remodeling projects
• Systems and equipment
• Disaster repairs
• Real estate consultancy and advisory services

4. Our Mission and Vision Statement

• Our vision is to become one of the top 10 home remodeling companies in the United States of America within the first 10 years of starting Zoe McLaurin® Home Remodeling Company.
• Our mission and values are to help people, businesses and property owners and clients in the United States of America and throughout the world remodel their homes to fit into the ideal mental pictures they have of how a world – class home should be.

Our Business Structure

Our company’s structure is not entirely different from what is obtainable in the real estate industry, as a matter of priority, we have decided to create a structure that will allow for easy growth for all our employees and also, we have created platforms that will enable us attract some of the best hands in the industry.

We are quite aware that the success of any business lies in the foundation on which the business is built on, which is why we have decided to build our home remodeling company on the right business foundation. We will ensure that we only hire people that are qualified, honest, hardworking, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders (the owners, workforce, and customers).

As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more depending how fast we meet our set target.

Zoe McLaurin® Home Remodeling Company is fully aware of the modus operandi in the real estate industry cum home remodeling line of business, hence adequate provision and competitive packages has been prepared for independent sales agents. Our marketing department will be responsible for managing this aspect of our business structure.

Below is the business structure we will build Zoe McLaurin® Home Remodeling Company on;

• Chief Executive Officer

Project Manager

• Company’s Lawyer / Secretary

Admin and HR Manager

• Head of Construction and Renovation
• Business Developer / Sales and Marketing
• Customer Service Executive / Front Desk Officer

5. Job Roles and Responsibilities

Chief Executive Officer – CEO (President):

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions; providing educational opportunities.
• Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization
• Reports to the board
• Responsible for the planning, management and coordinating all projects on behalf of the company
• Supervise renovation projects
• Ensure compliance during project executions
• Provides advice on the management of projects
• Responsible for carrying out risk assessment
• Uses IT systems and software to keep track of people and progress of ongoing projects
• Responsible for overseeing the accounting, costing and billing of every project
• Represent the organization’s interest at various stakeholders’ meetings
• Ensures that project desired result is achieved, the most efficient resources are utilized and different interests involved are satisfied.

Company’s Lawyer / Secretary / Legal Counsel

• Responsible for drawing up contracts and other legal documents for the company
• Consult and handle all corporate legal processes (e.g. intellectual property, mergers & acquisitions, financial / securities offerings, compliance issues, transactions, agreements, lawsuits and patents et al)
• Develops company policy and position on legal issues
• Researches, anticipates and guards company against legal risks
• Represent company in legal proceedings (administrative boards, court trials et al)
• Plays a part in business deals negotiation and take minutes of meetings
• Responsible for analyzing legal documents on behalf of the company
• Prepares annual reports for the company
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Designs job descriptions with KPI to drive performance management for clients
• Regularly hold meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products.
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Defines job positions for recruitment and managing interviewing process
• Carries out staff induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Updates job knowledge by participating in educational opportunities; reading professional publications; maintaining personal networks; participating in professional organizations.
• Oversees the smooth running of the daily office activities.

Renovations / Construction Engineers

• Responsible for handling home remodeling services such as residential additions, alterations and renovations, construction management for residential remodeling, fire and flood restoration, home improvement, porch construction, sunroom additions, kitchen and bathroom upgrades, systems and equipment, disaster repairs and other remodeling projects
• Establishes and enforces company’s engineering and construction standards
• Ensures that renovation / construction work meets or exceeds standards within a designated geographic area.
• Provides overall direction on assigned construction projects; reviews and makes recommendations on planning and design of projects; negotiates contracts or participates in contract negotiations; monitors day‐to‐day progress and activities on project construction sites.

Marketing and Sales Executive / Business Developer

• Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
• Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of development projects.
• Responsible for supervising implementation, advocate for the customer’s need s, and communicate with clients
• Finds and qualifies land for development based on company’s land requirements; maintains a land search database; initiates discussions with property owners about the possible sale of property
• Develops, executes and evaluates new plans for expanding increase sales
• Documents all customer contact and information
• Represents the company in strategic meetings
• Helps to increase sales and growth for the company
• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managers with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting for one or more properties.
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensuring compliance with taxation legislation
• Handles all financial transactions for the company
• Serves as internal auditor for the company

Front Desk / Customer’s Service Officer

• Receives Visitors / clients on behalf of the organization
• Receives parcels / documents for the company
• Handles enquiries via e-mail and phone calls for the organization
• Distributes mails in the organization
• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the line manager in an effective and timely manner
• Consistently stays abreast of any new information on the company’s properties that are put – up for sale, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries

6. SWOT Analysis

The fact that home remodeling business is a very rewarding business does not mean that there are no challenges in the industry. Starting a home remodeling business in the United States of America comes with its own fair share of challenges, you would have to abide by the law and also compete with loads of other entrepreneurs in the real estate business value chain who also are interested in making a living and building a business in the US.

In order to compete favorably in the home remodeling cum real estate industry as a home remodeling company we have been able to hire the services of tested and trusted business and HR consultants to help us conduct critical SWOT analysis for us.

We intend maximizing our strengths, explore all opportunities we will come across, properly manage our weakness and confront our threats. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Zoë McLaurin® Home Remodeling Company;

Some of our strength that we will be bringing to the table in the home remodeling cum real estate industry is our robust relations with home owners and properties investment moguls in the whole of the United States of America.

Our access to funding and also, we have a team of experts who have cut their teeth in the real estate industry cum home remodeling line of business. Our commission structure and relationship with freelance real estate agents in Annapolis – Maryland and other state in the US will also count towards our advantage.

As a newbie in the home remodeling line of business cum real estate industry, we might have some challenges competing with big time property developers and other home remodeling companies that have been in the industry for many years; that perhaps is part of our weakness.

• Opportunities:

The opportunities in the home remodeling cum real estate industry especially as a home remodeling company is massive considering the numbers of home owners who have the financial capacity to renovate their homes as at when due. We are well – positioned and ready to take advantage of any opportunity that comes our way.

Some of the threats that we are likely going to face as a home remodeling company are unfavorable government policies , and global economic downturn; global economic downturn usually affect spending power and the real estate industry cum home remodeling line of business is known to encounter decline in sales and profits during this period.

Selling properties could take a period of two to three years from conception to completion depending on the size of the project and the cash flow. As a matter of fact, some home remodeling projects could even take much longer than that.

Because of the time frame involved in renovating and decorating a property from start to finish, loads of un – anticipated things could crop up and it fall in the thick of property cum economy downturn which is not good for the business considering the investment that has gone into the project.

Another factor that is of major concerns and a threat to home remodeling business generally could be cost increase as a result of inflation, currency devaluation and economic challenges. Unforeseen delays from the part of government agencies, litigation and also delays from contractors could lead to substantial cost increase especially if the project is heavily dependent on bank loans.

If perhaps during this period, there is a change in the supply and demand dynamics of the property sector the project could be affected negatively. There is hardly anything we could do as regards these threats other than to be optimistic that things will continue to work for our good.

7. MARKET ANALYSIS

• Market Trends

The market trends in the real estate industry or within home remodeling companies are that, there are no fixed profits projections when engaging in a home remodeling deal.

The profit you stand to gain depends on loads of factors amongst which are your attention to details, ability to turn a slum or a ransack facility into an edifice and knowing exactly when to seal a home remodeling deal, the kind of renovations and decoration to be done on the property.

If you are able to get all the above stated factors right as a home remodeling company, your gains will always be far more than your loss.

Another obvious trend that is common with home remodeling companies in the United States of America is that most of them are improvising on more means of making money in the real estate industry and as matter of fact they are also acting as property developers and home staging agents amongst many other functions that they are involved in.

Lastly, one thing is certain for every home remodeling company; if they are hardworking, creative and proactive, they will always generate enough income to meet all their overhead and operational cost, keep their business going without struggle and make reasonable profits from all business deals that they are involved in.

8. Our Target Market

As a home remodeling company, our target market cuts across people (home owners) of different class and people from all walks of life.

We are coming into the home remodeling cum real estate industry with a business concept that will enable us work with the highly – placed people in the country and at the same with the lowly placed people who are only interested in renovating their homes at an affordable price.

As a matter of fact, our target market is the whole of the United States of America and we have put plans in place to recruit freelance agents (brokers) nationally to represent our business interest wherever they are located in the United States of America.

Below is a list of the people and organizations that we have specifically design our products and services for;

• Families who are interested in acquiring a decent and well renovated home
• Corporate organizations who are interested in acquiring their own property / properties
• Home Owners who are interested in remodeling and selling off their home
• Properties Owners who are interested in remodeling and selling off their properties
• Foreign investors who are interested in owning properties in the United States of America and remodeling the property
• The government of the United States of America (Government contracts)
• Managers of public facilities who would want to engage home remodeling companies to help them remodel properties under their care.

Our competitive advantage

No doubt, the home remodeling cum real estate industry is indeed a very prolific and highly competitive industry. Clients will only hire your services if they know that you can successfully help them remodel their homes to fit into the picture of the ideal home they have in mind.

We are quite aware that to be highly competitive in the home remodeling industry means that you should be able to deliver consistent quality home remodeling jobs and you should be able to meet the expectations of your clients at all times.

Zoe McLaurin® Home Remodeling Company might be a new home remodeling company in the home remodeling cum real estate industry, but the management team and the owner of the business are considered gurus in the industry, professional who have what it takes to grow a business from scratch to become a top brand within the shortest time possible.

They are people who are core professionals, licensed and highly qualified, people that can successfully help her clients remodel their homes to fit into the ideal picture of a 21 st century home. These are part of what will count as a competitive advantage for us.

Aside from our robust experience and expertise of our team of experts, we have a very strong online presence that will enable us attract clients from all across the United States of America. Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category (startups home remodeling companies in the United States) in the industry.

It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives. We will also engage freelance marketing agents on a commission level to help us market our services.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Zoe McLaurin® Home Remodeling Company is established with the aim of maximizing profits in the home remodeling cum real estate industry. Although we are a home remodeling company, but part of our work force is also licensed real estate agents hence we intend generating additional income from diverse means in the real estate agency.

We have successfully built a vibrant real estate network that covers the whole of the United States of America so as to help us build a profitable business. Below are the sources we intend exploring to generate income for Zoe McLaurin® Home Remodeling Company;

10. Sales Forecast

It is a known fact that as long as there are homeowners in the United States of America, there will always be need to for them to remodel their homes from time to time to conform with the trends in the neighborhood or city. Hence the demand for the services of home remodeling companies to help them solve these needs.

We are well positioned to take on the challenges that are synonymous to home remodeling businesses in the United States, and we are quite optimistic that we will meet out set target of generating enough income / profits from the first month or operations and grow the business beyond Maryland to other states in the United States of America within record time.

We have been able to critically examine the real estate market cum house remodeling line of business and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. The sales projection is based on information gathered on the field and some assumptions peculiar to similar start – ups in Maryland;

Below are the sales projections for Zoe McLaurin® Home Remodeling Company. It is based on the location of our business and the home remodeling and related services within the real estate cum home remodeling industry that we will be offering;

• First Fiscal Year-: $500,000
• Second Fiscal Year-: $1.2 million
• Third Fiscal Year-: $1.7 million

N.B : This projection is done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and any major competitor offering same additional services as we do within the locations where we have a strong business presence.

Please note that the above projection might be lower and at the same time it might be higher since some factors are beyond our control.

• Marketing Strategy and Sales Strategy

We quite mindful of the fact that there are stiffer competitions in the home remodeling cum real estate market in the United States of America, hence we have been able to hire some of the best business developer to handle our sales and marketing.

Our sales and marketing team will be recruited based on their vast experience in the industry and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall goal of the organization. The training is not restricted to only our full – time employees but also all our freelance brokers that are scattered all over the United States of America.

Our goal is to become one of the leading home remodeling companies in the United States of America which is why we have mapped out strategies that will help us take advantage of the available market and grow to become a major force in the industry.

Zoe McLaurin® Home Remodeling Company is set to make use of the following marketing and sales strategies;

• Introduce our business by sending introductory letters alongside our brochure to stake holders in the real estate industry and also property owners and potential clients through the United States of America
• Promptness in bidding for homes / properties that are put up for remodeling
• Advertise our business in real estate / properties magazines and websites
• List our business on yellow pages (local directories)
• Attend real estate related expos, seminars, and business fairs et al
• Create different packages for different category of clients in order to successfully remodel their homes / properties
• Leverage on the internet (social media platforms) and our official website to promote our business
• Encourage word of mouth marketing especially when we have a home for sale.

11. Publicity and Advertising Strategy

We have been able to work with our consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.

We are set to take the home remodeling cum real estate industry by storm which is why we have made provisions for effective publicity and advertisement of our company. Below are the platforms we intend to leverage on to promote and advertise our home remodeling business;

• Place adverts on both print and electronic media platforms
• Place our flexi banners with our company’s logo and contacts in every property we put up for sale
• Sponsor relevant TV shows so as to be able to communicate our brand and what we do
• Maximize our company’s website to promote our business
• Leverage on the internet and social media platforms like; Instagram, Facebook ,Twitter, LinkedIn,  Badoo, Google+  and other platforms (real estate online forums) to promote our business and list our properties for sale and for lease.
• Install our Bill Boards on strategic locations
• Distribute our fliers and handbills in targeted areas from time to time
• Attend landlord and residence association meetings with the aim of networking and introducing our business.
• Ensure that all our workers wear our branded shirts and all our vehicles and ambulances are well branded with our company’s logo et al

12. Our Pricing Strategy

Part of our business strategy is to ensure that we work within the budget of our potential clients to help them remodel their homes to meet their expectations. It is the practice in most parts of the world for properties to be valued by professionals based on the area the facility is located, the type of facility and other factors.

Since we are not directly in control of the pricing system in the real estate industry we can only abide by what is obtainable when it comes to fixing a price for a home remodeling contract. But one thing is certain, we will ensure that we deliver excellent jobs when have we are contracted to do so.

Lastly, we will ensure that we keep our fees below the average market rate for all of our clients by keeping our overhead low and by collecting payment in advance.  In addition, we will also offer special discounted rates to our clients from time to time especially when they recommend clients to us.

• Payment Options

At Zoe McLaurin® Home Remodeling Company our payment policy is all inclusive because we are quite aware that different people prefer different payment options as it suits them but at the same time, we will not accept payment by cash because of the volume of cash that will be involved in most of our transactions.

Real estate deals usually involves huge amount of money. Here are the payment options that Zoe McLaurin® Home Remodeling Company will make available to her clients;

• Payment by via bank transfer
• Payment via online bank transfer
• Payment via check
• Payment via bank draft

In view of the above, we have chosen banking platforms that will help us achieve our plans without any itches and we will also pay our freelance sales agents (real estate brokers) with same platforms. Our bank account numbers will be made available on our website and promotional materials to clients who may want to deposit cash or make online transfer for our services.

Any agent who intend paying with cash will be directed to deposit the money into our corporate account and then present their payment tellers to us.

13. Startup Expenditure (Budget)

In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your employees are well taken care of, and that your facility is conducive enough for workers to be creative and productive.

This means that the start-up can either be low or high depending on your goals, vision and aspirations for your business. The tools and equipment that will be used are nearly the same cost everywhere, and any difference in prices would be minimal and can be overlooked.

As for the detailed cost analysis for starting a home remodeling company; it might differ in other countries due to the value of their money However, this is what it would cost us to set up Zoe McLaurin® Home Remodeling Company in the United States of America;

• The total fee for incorporating the business in The United States of America – $750.
• The budget for permits and license – $2,000
• The cost for hiring Consultant – $2,500.
• The cost for computer software apps (Accounting Software, Payroll Software, CRM Software, Microsoft Office, QuickBooks Pro, drug interaction software, Physician Desk Reference software) – $7,000
• The budget for insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $5,400.
• Cost for payment of rent for a suitable Office facility with enough space in Annapolis – Maryland for 12 month at $1.76 per square feet in the total amount of – $105,600.
• The cost for office remodeling (construction of racks and shelves) – $20,000.
• The cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) – $15,000
• Other start-up expenses including stationery ($500) and phone and utility deposits ( $2,500 ).
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000
• The cost of Launching our official Website – $600
• Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $5,000

Going by the report from the market research and feasibility studies conducted, we will need over two hundred and fifty thousand ( 250,000 ) U.S. dollars to successfully set – up a small scale but standard home remodeling company in the United States of America. Please note that the salaries of all our staff members for the first month are included in the expenditure.

Generating Funds / Startup Capital for Zoe McLaurin® Home Remodeling Company

Zoe McLaurin® Home Remodeling Company is a business that will be owned and managed by Zoe McLaurin, her immediate family members and other business partners. They are the sole financial of the business which is why they decided to restrict the sourcing of the start – up capital for the business to just three major sources.

These are the areas we intend generating our start – up capital;

• Generate part of the start – up capital from personal savings and sale of his stocks
• Generate part of the start – up capital from friends and other extended family members
• Generate a larger chunk of the startup capital from the bank (loan facility).

N.B: We have been able to generate about $100,000 ( Personal savings $80,000 and soft loan from family members $20,000 ) and we are at the final stages of obtaining a loan facility of $150,000 from our bank. All the papers and document has been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.

14. Sustainability and Expansion Strategy

The future of a business lies in the numbers of loyal customers that they have the capacity and competence of the employees, their investment strategy and the business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business close shop.

One of our major goals of starting Zoe McLaurin® Home Remodeling Company is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.

We know that one of the ways of gaining approval and winning customers over is to offer our home remodeling services a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.

Zoe McLaurin® Home Remodeling Company will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and re – training of our workforce is at the top burner.

As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List / Milestone

• Business Name Availability Check: Completed
• Business Incorporation: Completed
• Opening of Corporate Bank Accounts various banks in the United States: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of All form of Insurance for the Business: Completed
• Renting of Office Facility and remodeling the facility in Annapolis – Maryland: Completed
• Conducting Feasibility Studies: Completed
• Generating capital from the CEO / President and Business Partners: Completed
• Applications for Loan from our Bankers: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents and other relevant Legal Documents: In Progress
• Design of The Company’s Logo: Completed
• Graphic Designs and Printing of Packaging Marketing / Promotional Materials: Completed
• Recruitment of employees: In Progress
• Purchase of the Needed furniture, office equipment, electronic appliances and facility facelift: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business (Business PR): In Progress
• Health and Safety and Fire Safety Arrangement: In Progress
• Establishing business relationship with key players in the industry (networking and membership of relevant real estate bodies): In Progress

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Remodeling Business Plan

No matter how beautiful a building design is, there will always come a time that the owners of that building will decide to have it remodeled, not because it is bad or ugly, but it is just a human nature to be always changing, to always look for something fresh, something new. If you are a remodeler – a remodeling business agent, you will likely have a good chance of getting a lot of clients.

Remodeling Contractor

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There is a niche in remodeling business transaction that is more frequent than the others, and that is the remodeling business in interior designing. And that probably will get you to the busy world of remodeling. Imagine how many boutiques are there in a mall. There are restaurants, there are cinemas, there are staff offices, and there is the whole building itself. In short, this is big business. This is money. If, and that is a big if, you can propose to them with a business plan.

In this article, let us use architectural design to demonstrate our purpose here. The word remodel can be understood to mean remodel a business. But remodeling a house, office design is the easiest way to demonstrate the point.

Remodeling harvard

Preliminary Steps to a Business Plan

Client Connection

They say, a business plan is a “documented set of business goals, objectives, target market information and financial forecasts that you are aiming to achieve over a certain period of time.” This is only attainable when you can reach out to the audience, to the prospective clients. But getting connected to the clients should be part of the whole business plan. That should be the start of it. That is an unwritten section of the business plan – establishing connection with the clients.

Prioritization

Now, you have a rough idea of who these prospective clients are. You need to look for clients whose place, boutiques, office, needs some restoration, modification. You need to prioritize these business establishments. Imagine yourself as a doctor, and these are your patients. Your patients, your clients are the ones that needs your service, not the healthy ones, and not the newly build, decorated places.

Remodeling Building Business

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Familiarization

So you have your target already. You have found your prospective clients. Your next step is to zoom in your lens, to get closer to the subject, to get familiar with these prospective clients. remember, your selling point is that you can make ugly beautiful. You need to check the following:

• The kind of business establishment or institution.  Like a doctor, you make sick people healthy. You need to check what is it that these establishment needs help.
• The kind of clients.  What do you think these clients are looking for. What do they want? Do they want to have a clean office? Do they want to make their rooms look like new ones.
• The kind of operators or owners.  You also need to know who their clients are. Who are their frequenter.

This is the stage where you need to tabulate your clients’ strengths and weakness. You have not made a business plan yet. But making notes is very useful when you intend to make a business plan. This is your draft to making a business plan.

Now you already have a rough idea on which office, place to remodel. Your next step is to make a proposal. And your proposal may already include an abstract of your business plan. The proposal is somehow the serious of them all before making a business plan. This is where you ask from your clients to be considered in your business plan. This is where you introduce yourself either as a document or in person.

So now you have the proposal, what should your business plan be like? What is a business plan?

Planning and Managing Construction Renovation Project

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Business Plan

A business plan, they say “is a written document that describes in detail how a  business , usually a new one, is going to achieve its goals, or a written document that describes your core business objectives and how you plan to achieve them over a set period of time.”

In a remodeling business plan, your goal is to demonstrate to the clients (as well as your self, if you are to remodel your own) that you can improve the current situation.

Business-like Problematization

Before starting your business plan, you probably will start with some questions in your head, such as:

• How will I be able to change the current situation?
• What solution will I give to the current problem?
• Do I have the best program to beautify a place, to improve a business, to solve team problem?
• Will I be able to do it in time?
• Will I be able to provide what my client is looking for?

Remodeling Start up

Steps in Making a Business Plan

Research, research, research.  Any plan requires a lot of research. Even your plan to go to another country, that requires research. We made mentioned earlier, you need to study, research, be familiar with the subject that you want to do something about. In an exam, if you want to pass, all you do is study and research. The same case with a business plan.

Determine the purpose of your plan.  You do need to do a lot of research because you want to know what you want to do, you want to be clear with your purpose, you want to visualize what needs to be done. You need to know what you want to offer to your client. And you also need your client to know what you can offer to them. They need to know your plans.

Create a company profile.  But they also need to know you what you are as a businessman, or as a company. So make a profile about you as a remodeler.

Document all aspects of your business.  That includes the projects you have done. This will strengthen your credibility as a remodeler. Show to the clients how you have transformed one thing to another for the good of the company.

Have a strategic marketing plan in place.  The marketing plan will define in specific details on how you will realize you whole business plan. This is how you state your proposal.  And this is how you specify your action. This is where your blueprint is for remodeling an institution.

Make it adaptable based on your audience.  Your plans may be good, and impressive, but are they realistic? Here, you consider the cost, the time table, the people involved. How much will it cost for the whole business plan to realize? Is the time table practical? How many people does it require to re organize the team.

Explain why you care.  It is a good thing to admit that you are doing this for money. But for the clients, they would love to imagine that you are doing the project because you care, that it is your passion. Let them feel that you love what you are doing, that you love to be of help to others.

Kinds of Remodeling Business

There are many kinds of remodeling. Earlier, we made use of the physical remodeling, that is remodeling of a building’s interior design.

Physical Interior Remodeling.  This is an interior remodeling, that is basically the job of an Interior Designer. The job is simple but it requires creativity. You need to be able to transcend in the world of beauty, without compromising the practical and functional aspects of designing.

Structural Building Remodeling. Like in a physical interior building only this is an engineering aspect of remodeling. This is usually done by an Architect, with an Engineer.

Staff or Personnel Remodeling. It is a remodeling of the team, a restructuring of the members. This is done when something is wrong with how the business is done, and there might be a need to reorient the members of the company. There is a preventive way of doing this, and that is team building.

Why use an Interior Designer for Remodeling?

Unlike architects and engineers, and including the building owner, interior designers focus less about everything. In short they can focus on not so many things, and with only one thing in mind, designing the interior of a building. An architect may focus bigger things of the building, from the inside and outside of the building, as well as it design in general. An engineer may focus too much on the planning, the calculation of plans, and all kinds of mathematics. And the owner may have the best ideas for everything, but he may not be able to put it in actuality. That is where you need an interior designer.

An interior designer will try to understand what is in your head, what you want to show in your building, office. He can bring what it is that you want to portray in a room.

And all this he can do artistically. Because there is nothing too much technical about interior designing, he can do anything about it artistically as per the client requires, or suggested.

• Avoid the costs of moving. Instead of building a new one, why not renovate an old one.  The old saying goes, why fix if ain’t broke. In a remodeling, you do not actually fix something, you just make something beautiful. There may be changes, but it is more of a superficial change. Something new for the eyes to see. If ain’t broke, why make a new one. How about a little cleaning, polishing, “rejuvenating” of your house instead of making a new one.
• Enhance the returns on an investment property. If you are a business – minded person, you will always think of your unit as an investment. And you can do this by making it look good.
• Increase your property’s value. If your building looks good, chances are, it will retain its value when appraised. And it is a matter of maintenance. If you neglect it, it will rot. If you maintain it, you can demand a higher resale price. If you like, you can hire an interior designer. An interior designer can make something cheap look expensive. And that is always part of a marketing. To make something look great, at the eye level.
• Achieve a higher sale price for your property. This is only possible if you can maintain your unit, plus some regular care from the owner.
• Restore a character home. Or if you want to change mood, your best option is to renovate, remodel.
• Make your home more eco-friendly. You do not just maintain your home, you make an update. Updating your home means to be sensitive with the things around it

There are some other kinds of remodeling. When you decide to make some changes of yourself, either physically (that is done by work out) or spiritually, when you improve and change how you make relationship with the Supreme Being. Whatever remodeling you are into, having a business plan will make the job simpler. It will make it easier for you to realize your goals. You can visualize it. But also, if you have a team, the members of the team will be able to know what they need to do. You can prioritize things according to what the business plan has indicated.

Remodeling a building or its interior is a good example of a remodeling because it is a very physical example. You can always expect to see a physical change. But remodeling does not always have to be a physical one, just like the remodeling of the personnel and staff in a company. The change of oneself from a normal to a better person is also a remodeling.  But the keyword is always to use a business plan. No matter how you remodel something if it is not part of a bigger plan, if it has not business plan, and if it is not intended for business, the remodeling may just become a waste.

wafed remodeling book

Text prompt

• Instructive
• Professional

Create a study plan for final exams in high school

Develop a project timeline for a middle school science fair.

Construction Business Plan Template

Written by Dave Lavinsky

Construction Business Plan

You’ve come to the right place to create your construction business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their construction companies.

Sample Construction Business Plan Outline

Below is a construction business plan example to help you create each section of your own construction business plan:

Executive Summary

Business overview.

VB Residential Construction Company is a startup construction company located in Milwaukee, Wisconsin. The company is founded by two cousins, Victor Martinez and Ben Schmidt. Together they have over 20 years of experience in constructing homes from design concept, remodeling and renovating homes. They are highly skilled in all aspects of construction and have garnered a positive reputation in the local construction community for their ethical practices and competitive skill set. Now that Victor and Ben have an extensive network of clients and contacts, they have decided to begin their own residential construction company.

Product Offering

The following are the services that VB Residential Construction Company will provide:

• Custom home building/design build
• Home remodeling and renovation
• Project Management
• Kitchen and bath construction

Customer Focus

VB Residential Construction Company will target those individuals and industry professionals requiring home construction services in Milwaukee, Wisconsin. Those individuals are landowners looking to develop homes on their lots, architects who have clients needing homes built, developers who have the vision but need a company to make it a reality, and households needing home remodeling services.

Management Team

VB Residential Construction Company will be led by Victor Martinez and Ben Schmidt. Together they have over twenty years of construction experience, primarily in residential builds, remodeling, and renovation. They both started at a young age working and learning from their fathers. When they graduated from high school, their fathers got them jobs at the construction company they were employed at. The four family members worked together for ten years at the construction company. The fathers recently decided they were going to retire from the industry which prompted Victor and Ben to branch out on their own and start their own residential construction company.

Success Factors

VB Residential Construction Company will be able to achieve success by offering the following competitive advantages:

• Friendly and knowledgeable contractors who are able to take any project from concept to reality.
• Unbeatable pricing – Clients will receive the best pricing in town for services on any project while maintaining the best quality and customer satisfaction.

Financial Highlights

VB Residential Construction Company is seeking $200,000 in debt financing to launch its construction business. The funding will be dedicated towards securing a small office space, purchasing two trucks, and purchasing all the construction equipment and supplies. Funding will also be dedicated towards the advertising agency and three months of overhead costs to include payroll of the staff, rent, working capital, and monthly fees to the accounting and human resources firm. The breakout of the funding is below:

• Trucks: $40,000
• Construction equipment, supplies, and materials: $100,000
• Advertising agency in charge of promotions: $10,000
• Three months of overhead expenses (rent, payroll, HR and accounting firms): $40,000
• Working capital: $10,000

Company Overview

Who is vb residential construction company.

VB Residential Construction Company is a newly established contracting company located in Milwaukee, Wisconsin. Founded by cousins, Victor Martinez and Ben Schmidt, they have over 20 years experience in the construction industry. VB specializes in residential remodeling, kitchen and bath construction, as well as custom home building. VB Residential Construction Company also offers residential design, construction, and project management services. VB prides itself in delivering a level of expert craftsmanship to fulfill the vision for the client while exceeding expectations at exceptional value.

Company History

VB comes from the initials of the owners, Victor Martinez and Ben Schmidt, two cousins who have been working in the construction industry most of their lives. Both of their fathers spent decades as contractors and raised their sons working and learning the construction trade. The four have been working for another residential contractor in Milwaukee and have built and remodeled numerous homes for multiple builders and clients. Now that both of their fathers are retiring from the construction industry, Victor and Ben have decided to start their own residential construction company and use their years of experience, expertise, and contacts to be an independent residential contractor.

Since incorporation, VB Residential Construction Company has achieved the following milestones:

• Registered VB Residential Construction Company, LLC to transact business in the state of Wisconsin.
• Located a small office space to have a physical address for the company as well as a receptionist.
• Reached out to their numerous contacts to include real estate agents, developers, architects, and landowners to advise them on their upcoming construction company in order to start getting construction contracts.
• Began pricing out costs for trucks and necessary construction equipment.
• Began recruiting a team of contractors that cover different areas of construction to include mechanical, plumbing, electricians, and roofing.

The following will be the services VB Residential Construction Company will provide:

Industry Analysis

Revenue for the Construction industry is expected to continue growing over the five years as demand for new housing expands. Revenues are expected to reach $107 billion.

Relatively low interest rates, coupled with rising per capita disposable income, is expected to support individual investment in new homes, providing an opportunity for industry revenue growth over the next five years.

Per capita disposable income is expected to rise steadily over the next five years, while concurrently, unemployment will drop, proving favorable conditions for industry growth.

Housing starts are expected to rise an annualized 2.9% and this growth is projected to stem partly from forward-looking consumers that choose to purchase homes while interest rates are low. Relatively low housing stock and relatively low interest rates are expected to lead demand for industry services to increase over the next five years.

Customer Analysis

Demographic profile of target market.

The precise demographics for Milwaukee, Wisconsin are:

Customer Segmentation

VB Residential Construction Company will primarily target the following customer profiles:

• Households in search of home remodeling services
• Landowners who would like to build homes on their lots
• Architects who have clients that need home building or remodeling services
• Developers who have already partnered with landowners and/or architects and are in search of a residential contractor

Competitive Analysis

Direct and indirect competitors.

VB Residential Construction Company will face competition from other companies with similar business profiles. A description of each competitor company is below.

JM Remodeling

JM Remodeling has been in business in Milwaukee, Wisconsin since 1990. They are a full-service design and build company. JM Remodeling specializes in residential and commercial restoration and renovation including custom carpentry, kitchens, bathrooms, roofing, siding, dormers, additions, home gyms, home offices, porches and decks, and mechanical services. JM Remodeling carries a staff of plumbers, electricians, journeymen carpenters, restoration specialists, roofers, siders, sheet metal workers, and expert estimators. JM Remodeling also has an apprenticeship program to train employees within the company. They are licensed, bonded and insured and also part of the National Association of Remodeling Industry (NARI). JM Remodeling also provides warranties on all their services. The work is guaranteed by labor warranties, factory warranties, and extended warranties.

Cream City Construction

Cream City Construction has more than 50 years experience in home design, remodeling and renovation in the Greater Milwaukee area and Southeastern Wisconsin. The home remodeling services they provide are additions, whole house remodeling, kitchens, bathrooms, lower levels, master suites and historic renovations. Cream City Construction is a design build company that works with the client to create the design plans, generate project costs, and build the project.

Cream City Construction is owned and managed by Todd Badovski and Jim Grote. Together they have decades of experience and have spent years refining the skills required to run a high end, quality driven remodeling company. The majority of their projects come from repeat business or referrals from clients delighted with their previous service. Cream City Construction is also a member of the National Association of Remodeling Industry (NARI) as well as the Historic Milwaukee Incorporated.

Sazama Design Build Remodel, LLC

Former restaurant owner Don Sazama established Sazama Design Build Remodel, LLC in 1987 after becoming a Master Carpenter. He wanted to merge his passions of business and design and expand his skills in carpentry and architecture. Don’s firm has completed over 700 homes and won 11 awards from the Milwaukee Home and Living magazine. Sazama Design Build Remodel builds homes that are modern and luxurious and have completed many large remodels of bathroom and kitchen renovations. Sazama likes to collaborate with firms such as Ivy Interiors and an award-winning landscape designer, Gingko Leaf Studio. Sazama Design Build Remodel can build and design all aspects of a home – from a home office, outdoor entertaining area, serene spas, and inviting kitchens. The team at Sazama is able to do a historic renovation, build or renovate into something modern and posh, or keep it traditional.

Competitive Advantage

VB Residential Construction Company will be able to offer the following advantages over their competition:

Marketing Plan

Brand & value proposition.

VB Residential Construction Company will offer the unique value proposition to its clientele:

• Highly trusted and professional contractors with over 20 years of experience remodeling, renovating, and building homes.
• Unbeatable pricing to its clients – VB Residential Construction Company does not mark up its services at a large percentage. They will offer the lowest prices in town.

Promotions Strategy

The promotions strategy for VB Residential Construction Company is as follows:

Word of Mouth/Referrals

Victor and Ben have built up an extensive list of contacts over the years providing home construction services for numerous highly satisfied clients. Most of the clients are repeat customers and have also referred them to other associates for home projects. These referrals and repeat customers are very likely to use VB Residential Construction Company instead of the previous construction company Victor and Ben were employed at.

Professional Associations and Networking

VB Residential Construction Company will become a member of construction and professional associations such as the National Association of Remodeling Industry (NARI) and the Milwaukee Chamber of Commerce. VB will also become a member in associations where other builders, developers, and architects are a part of. They will focus their networking efforts on expanding their client network.

Print Advertising/Billboard

VB Residential Construction Company will invest in professionally designed print ads to display in programs or flyers at industry networking events. They will also invest in two billboards to display in highly trafficked areas of town.

Website/SEO Marketing

VB Residential Construction Company will utilize the same advertising company that designed their print ads and billboards to also design their website. The website will be well organized, informative, and list all their services that VB is able to provide. The website will also list their contact information and a gallery of pictures that show their previous projects. The advertising company will also manage VB’s website presence with SEO marketing tactics so that anytime someone types in the Google or Bing search engine “Milwaukee residential contractor”, “contractor near me”, or “residential contractor near me”, VB Residential Construction Company will be listed at the top of the search results.

The pricing of VB Residential Construction Company will be moderate and on par with competitors so customers feel they receive value when purchasing their services.

Operations Plan

The following will be the operations plan for VB Residential Construction Company.

Operation Functions:

• Victor Martinez and Ben Schmidt will be the owners and managers of the company. They will oversee all staff, contractors, and subcontractors. They will also act as project managers for every job they receive and handle all pricing and bids to the client.
• Victor and Ben will employ a team of contractors under them that will have an array of skill sets. The contractors will be trained and experienced either in plumbing, mechanical, electrical, roofing, or siding. Not all contractors need to be certified in all trades, but they need to be certified in at least one of the trades.
• Office manager/assistant to be located at the small office. This person will handle all incoming calls, assist with visiting clients, bookkeeping and maintain files.
• Victor and Ben will utilize a third-party human resources company to handle all hiring, onboarding, payroll, and benefits for the staff. The HR company will also handle all employee issues.
• Victor and Ben will also pay a third-party accounting firm to manage all the high level accounting and tax payments.

Milestones:

VB Residential Construction Company will have the following milestones complete in the next six months.

3/1/202X – Finalize contract to lease small office space

3/15/202X – Execute advertising agency contract 4/1/202X – Begin networking and placing bids for construction jobs

5/1/202X – Begin recruiting and hiring team of contractors

5/15/202X – Purchase all necessary construction equipment, supplies, and trucks

6/1/202X – Start on first official job as VB Residential Construction Company

Victor and Ben are highly skilled at project management and residential construction. They are also both certified in plumbing, electrical, and mechanical. In the next few years, they will be certified as Master Carpenters.

Financial Plan

Key revenue & costs.

The revenue drivers for VB Residential Construction Company are the upcharge they will charge to the clients for their services. VB will purchase or subcontract a service at cost and will charge a 15% markup in order to obtain the markup fee. 15% is below the normal 25%-30% that other competing residential contractors charge.

The cost drivers will be the overhead costs required in order to maintain a construction company. The expenses will be the costs to purchase and maintain construction equipment and trucks, payroll and overhead costs for the staff, and rent and utilities. Other expenses will be the cost for the advertising agency, accounting firm, human resources firm, and membership association fees.

Funding Requirements and Use of Funds

VB Residential Construction Company is seeking $200,000 in debt financing to launch its construction business. The funding will be dedicated towards securing a small office space, purchasing two trucks, and purchasing all the construction equipment and supplies. Funding will also be dedicated towards the advertising agency and three months of overhead costs to include payroll of the staff, rent, and monthly fees to the accounting and human resources firm. The breakout of the funding is below:

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.

• Initial Monthly Average Contract Amount: $20,000
• Growth in Average Monthly Contracts: 10%

Financial Projections

Income statement, balance sheet, cash flow statement, construction business plan faqs, what is a construction business plan.

A construction business plan is a plan to start and/or grow your construction business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your construction business plan using our Construction Business Plan Template here .

What Are the Main Types of Construction Companies?

Construction companies can be classified according to the type of constructions that they perform. Some are small renovation contractors, others are new home builders and others are commercial construction companies.

What Are the Main Sources of Revenues and Expenses for a Construction Company?

Construction companies get their primary source of revenue from individual contracts for new homes, remodeling projects or commercial projects.

The key expenses for construction companies are office space rent, salaries and wages, and equipment costs. 

How Do You Get Funding for Your Construction Business Plan?

There are many options for financing a construction company like SBA loans, commercial loans, personal loans, or line of credit. There are also equipment funding opportunities that cover expenses associated with necessary tools, machinery and other equipment. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start a Construction Business?

Starting a construction business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop A Construction Business Plan - The first step in starting a business is to create a detailed construction business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your construction business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your construction business is in compliance with local laws.

3. Register Your Construction Business - Once you have chosen a legal structure, the next step is to register your construction business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your construction business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Construction Equipment & Supplies - In order to start your construction business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your construction business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful construction business:

• How to Start a Construction Business

Where Can I Get a Construction Business Plan PDF?

You can download our free construction business plan template PDF here . This is a sample construction business plan template you can use in PDF format.

Other Business Plan Templates

Food Truck Business Plan Template

Event Venue Business Plan Template

Tips for a Simple Interior Design Business Plan to get you Started

So you’ve decided you’re going to start your own interior design business. Congratulations! But have you thought about putting together a business plan for your new venture? 

Writing down what you’re trying to achieve, the services you’ll offer, and other important factors will help you streamline your business strategy, keep you focused on your goals, and (perhaps most importantly) make sure your idea makes sense.

It’s a good idea to create a business plan before investing money in your new business; that way, you’ll have a better understanding of how it’ll make money and whether it’s likely to be profitable.

Throughout this guide, I’m going to explain the importance of having a business plan for your interior design business and take you through what information to include.

Here’s to a well-planned and successful interior design business!

What's in the article

Why do I Need an Interior Design Business Plan?

There are various benefits of putting together an interior design business plan before going ahead with your new venture, but it really boils down to two factors:

• Helping you understand your business
• Helping you explain your business to others

Helping you Understand your Business

Before you do anything, you need to get your thoughts in order to ensure you have a viable business idea. Writing things down usually helps them make sense, and it’s no different with a business plan.

Your interior design business plan will help you:

• Summarise your business idea:  What you’re trying to achieve, what services you’ll offer, how you’ll operate etc.
• Identify goals and potential problems: Set out goals and how you’ll achieve them, and identify any risks and how to overcome them.
• Plan your business operations: From sales and marketing to onboarding staff.
• Get your finances in order: Estimate your revenue, business expenses, and any financing you’ll require to get your business off the ground.
• Pinpoint your priorities and identify any gaps in the business 

Helping you Explain your Business to Other People

A business plan can also help you convince other people to back your business. This includes:

• Financial assistance: If you’re planning on getting financial backing from investors or securing a bank loan for your interior design business, you’ll need to present a well-formed business plan.
• Employees and suppliers: Potential employees and suppliers are unlikely to work with a business if they don’t know what it does. A business plan will help you explain this so you can onboard staff and suppliers before getting started.
• Explaining your business: Writing down a business summary will help you better explain your business to other people, so next time you’re asked what your business does (or will do), you won’t fumble over your words.

Interior Design Business Plan Top Tips

Before writing your business plan, keep the following points in mind:

Write it for an Outsider

Write your business plan as if the person who’s reading it knows nothing about you, your business or the interior design industry. This will likely be the case when it comes to getting investment.

Keep it Concise

Don’t go into too much unnecessary detail. Keep it to the point and focus on the sections listed below. After all, you want people to read it!

Be Realistic

Avoid skimming over potential risks and problems, and be honest and realistic about finances. Being over-optimistic might get you the loan you’re after, but it could lead to problems in the future.

Know your Market

Make sure to include market research, details on competitors, where your business fits into the interior design market and what makes it different to what’s already out there.

What to Include in your Interior Design Business Plan

When it comes to writing your business plan, try to use the following structure: 

Executive summary

Elevator pitch

About the business owner

Products and services

Business structure

The market: Customers, competitors and market overview

Section 7: 

Sales and marketing strategy

Business operations

• Business expenses

Section 10: 

Financial forecasts 

Let’s go into a bit more detail on each section:

1. Executive Summary

An executive summary is essentially a summary of your interior design business plan, so it’s best to write this section last. It should include key points, so if someone were to only read this section, they’d still have an understanding of your business and what you’re trying to achieve.

Your executive summary should include:

• Business name and type of business (e.g. sole trader or LTD company)
• A summary of the services you’ll offer and/or products you intend to sell
• Mission statement: What is the aim of your business? (e.g. become the number one interior design service in your area)
• Goals and objectives: It’s good to include short, mid, and long-term goals. (e.g. generate [amount] of profit in the first year)
• Financial summary: Financial goals and any secured or required funding 
• Keys to success: How will you achieve your objectives? (e.g. provide high-quality services and first-class communication)

2. Elevator Pitch

An elevator pitch is a short summary of your business. It’s what you’ll tell people when they ask what your business does. Writing down an elevator pitch will help ensure you have a clear idea of your business direction and enable you to give a concise, well-formed description when you explain your business to others.

It should include:

• What your business does
• Who your target audience is
• Your unique selling point (USP): What sets you apart from competitors?

3. About the Business Owner

Add a bit about yourself, why you want to start an interior design business, and any experience you have in the industry. Things to cover include:

• Who are you? 
• Why do you want to start this business?
• What experience do you have?
• Relevant qualifications and training
• Relevant hobbies and interests

4. Services you’ll Offer

How is your business going to make its money? Explain the different interior design services your business will offer and whether you’ll also sell any physical products. 

• A list of services you’ll offer as an interior designer
• Any products you’ll sell
• Plans for future products and services

5. Business Structure

Will you work as a sole trader and hire contractors to help, or will you hire employees? Do you have a network of suppliers in place to help you carry out your projects? Include information on your employees, contractors, suppliers, and their roles in this section:

• Whether you’ll hire full-time employees or outsource to contractors
• Job roles and responsibilities
• List of suppliers needed to help fulfil projects

6. Market Summary

The market summary section of your business plan should include information about the current market and market trends, your target audience, and competitors. This section will not only help outsiders understand your target market, but it’ll also help you understand how best to advertise your products and services.

Your market summary can be split into a few sections:

Target customers

• Target customer profile: Who are your target customers?
• Who are you selling to? (e.g. businesses or individuals, residential or commercial)
• Why do they/will they buy from you?
• Any already confirmed orders 

Competitors

• Who are your competitors?
• What’s your USP? What makes your business different? 
• SWOT analysis: Strengths, Weaknesses, Opportunities and Threats 

Market research

• Size of market
• Market trends
• Field research (Ask prospective customers what they think about your business idea)

7. Sales and Marketing Strategy

How will you reach your target customers, and what channels will you sell your products through? What price point will you sell your services at? The sales and marketing strategy section should cover:

• Sources of income: How will you sell your products and services? (E.g. online services, products, commercial and residential projects)
• Marketing channels: How will you advertise your products and services?

 (E.g. word of mouth, social media, direct mail, trade shows)

• Pricing strategy: What price point and why?
• Are you likely to get repeat customers or retainer clients?

8. Business Operations

This section covers the day-to-day running of your business, what’s involved in each interior design project or the production of any products you sell, where your business will operate, what equipment and insurance you’ll need, etc.

• Production/projects: How long will it take, how much will it cost you?
• Payment: How will customers pay? (e.g. upfront, deposit, payment plan)
• List of suppliers: Who are your suppliers?
• Business premises: Where will your business operate from?
• Equipment needed: What equipment do you need for your business to operate?
• Licenses and insurance: What licenses and insurance do you need for your business to operate?

There are various expenses involved in running a business, so you’ll need to list these. Your expenses will include things like:

• Business premises
• Employee/contractor wages
• Merchandise production
• Loan repayments
•  Financial Forecasts 

Financial forecasts can be tricky if you’re just starting out, but try to put together a realistic calculation for the next three to five years. Essentially, you need to prove that your business will survive and become profitable. If you’re a small business or startup, speaking to an adviser at your bank may help with forecasting.

Your financial forecasts should include:

• Historical sales figures from the last three to five years (if applicable)
• Sales forecast: How much money you expect the business to take
• Profit forecast:  How much profit you expect the business to make
• Monthly cash flow and business bank balance
• Balance sheet: Your business’ assets, liabilities and stockholders’ equity (smaller businesses may not require this

As you can see, a lot goes into starting your own interior design business. And while creating a business plan might seem like a long process, it’ll definitely help you in the long run. 

About The Author

Freddie Chatt

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How to Write a Business Plan in 9 Steps (+ Template and Examples)

Every successful business has one thing in common, a good and well-executed business plan. A business plan is more than a document, it is a complete guide that outlines the goals your business wants to achieve, including its financial goals . It helps you analyze results, make strategic decisions, show your business operations and growth.

If you want to start a business or already have one and need to pitch it to investors for funding, writing a good business plan improves your chances of attracting financiers. As a startup, if you want to secure loans from financial institutions, part of the requirements involve submitting your business plan.

Writing a business plan does not have to be a complicated or time-consuming process. In this article, you will learn the step-by-step process for writing a successful business plan.

You will also learn what you need a business plan for, tips and strategies for writing a convincing business plan, business plan examples and templates that will save you tons of time, and the alternatives to the traditional business plan.

Let’s get started.

What Do You Need A Business Plan For?

Businesses create business plans for different purposes such as to secure funds, monitor business growth, measure your marketing strategies, and measure your business success.

1. Secure Funds

One of the primary reasons for writing a business plan is to secure funds, either from financial institutions/agencies or investors.

For you to effectively acquire funds, your business plan must contain the key elements of your business plan . For example, your business plan should include your growth plans, goals you want to achieve, and milestones you have recorded.

A business plan can also attract new business partners that are willing to contribute financially and intellectually. If you are writing a business plan to a bank, your project must show your traction , that is, the proof that you can pay back any loan borrowed.

Also, if you are writing to an investor, your plan must contain evidence that you can effectively utilize the funds you want them to invest in your business. Here, you are using your business plan to persuade a group or an individual that your business is a source of a good investment.

2. Monitor Business Growth

A business plan can help you track cash flows in your business. It steers your business to greater heights. A business plan capable of tracking business growth should contain:

• The business goals
• Methods to achieve the goals
• Time-frame for attaining those goals

A good business plan should guide you through every step in achieving your goals. It can also track the allocation of assets to every aspect of the business. You can tell when you are spending more than you should on a project.

You can compare a business plan to a written GPS. It helps you manage your business and hints at the right time to expand your business.

3. Measure Business Success

A business plan can help you measure your business success rate. Some small-scale businesses are thriving better than more prominent companies because of their track record of success.

Right from the onset of your business operation, set goals and work towards them. Write a plan to guide you through your procedures. Use your plan to measure how much you have achieved and how much is left to attain.

You can also weigh your success by monitoring the position of your brand relative to competitors. On the other hand, a business plan can also show you why you have not achieved a goal. It can tell if you have elapsed the time frame you set to attain a goal.

4. Document Your Marketing Strategies

You can use a business plan to document your marketing plans. Every business should have an effective marketing plan.

Competition mandates every business owner to go the extraordinary mile to remain relevant in the market. Your business plan should contain your marketing strategies that work. You can measure the success rate of your marketing plans.

In your business plan, your marketing strategy must answer the questions:

• How do you want to reach your target audience?
• How do you plan to retain your customers?
• What is/are your pricing plans?
• What is your budget for marketing?

How to Write a Business Plan Step-by-Step

1. create your executive summary.

The executive summary is a snapshot of your business or a high-level overview of your business purposes and plans . Although the executive summary is the first section in your business plan, most people write it last. The length of the executive summary is not more than two pages.

Generally, there are nine sections in a business plan, the executive summary should condense essential ideas from the other eight sections.

A good executive summary should do the following:

• A Snapshot of Growth Potential. Briefly inform the reader about your company and why it will be successful)
• Contain your Mission Statement which explains what the main objective or focus of your business is.
• Product Description and Differentiation. Brief description of your products or services and why it is different from other solutions in the market.
• The Team. Basic information about your company’s leadership team and employees
• Business Concept. A solid description of what your business does.
• Target Market. The customers you plan to sell to.
• Marketing Strategy. Your plans on reaching and selling to your customers
• Current Financial State. Brief information about what revenue your business currently generates.
• Projected Financial State. Brief information about what you foresee your business revenue to be in the future.

The executive summary is the make-or-break section of your business plan. If your summary cannot in less than two pages cannot clearly describe how your business will solve a particular problem of your target audience and make a profit, your business plan is set on a faulty foundation.

Avoid using the executive summary to hype your business, instead, focus on helping the reader understand the what and how of your plan.

View the executive summary as an opportunity to introduce your vision for your company. You know your executive summary is powerful when it can answer these key questions:

• Who is your target audience?
• What sector or industry are you in?
• What are your products and services?
• What is the future of your industry?
• Is your company scaleable?
• Who are the owners and leaders of your company? What are their backgrounds and experience levels?
• What is the motivation for starting your company?
• What are the next steps?

Writing the executive summary last although it is the most important section of your business plan is an excellent idea. The reason why is because it is a high-level overview of your business plan. It is the section that determines whether potential investors and lenders will read further or not.

The executive summary can be a stand-alone document that covers everything in your business plan. It is not uncommon for investors to request only the executive summary when evaluating your business. If the information in the executive summary impresses them, they will ask for the complete business plan.

If you are writing your business plan for your planning purposes, you do not need to write the executive summary.

2. Add Your Company Overview

The company overview or description is the next section in your business plan after the executive summary. It describes what your business does.

Adding your company overview can be tricky especially when your business is still in the planning stages. Existing businesses can easily summarize their current operations but may encounter difficulties trying to explain what they plan to become.

Your company overview should contain the following:

• What products and services you will provide
• Geographical markets and locations your company have a presence
• What you need to run your business
• Who your target audience or customers are
• Who will service your customers
• Your company’s purpose, mission, and vision
• Information about your company’s founders
• Who the founders are
• Notable achievements of your company so far

When creating a company overview, you have to focus on three basics: identifying your industry, identifying your customer, and explaining the problem you solve.

If you are stuck when creating your company overview, try to answer some of these questions that pertain to you.

• Who are you targeting? (The answer is not everyone)
• What pain point does your product or service solve for your customers that they will be willing to spend money on resolving?
• How does your product or service overcome that pain point?
• Where is the location of your business?
• What products, equipment, and services do you need to run your business?
• How is your company’s product or service different from your competition in the eyes of your customers?
• How many employees do you need and what skills do you require them to have?

After answering some or all of these questions, you will get more than enough information you need to write your company overview or description section. When writing this section, describe what your company does for your customers.

The company description or overview section contains three elements: mission statement, history, and objectives.

• Mission Statement

The mission statement refers to the reason why your business or company is existing. It goes beyond what you do or sell, it is about the ‘why’. A good mission statement should be emotional and inspirational.

Your mission statement should follow the KISS rule (Keep It Simple, Stupid). For example, Shopify’s mission statement is “Make commerce better for everyone.”

When describing your company’s history, make it simple and avoid the temptation of tying it to a defensive narrative. Write it in the manner you would a profile. Your company’s history should include the following information:

• Founding Date
• Major Milestones
• Location(s)
• Flagship Products or Services
• Number of Employees
• Executive Leadership Roles

When you fill in this information, you use it to write one or two paragraphs about your company’s history.

Business Objectives

Your business objective must be SMART (specific, measurable, achievable, realistic, and time-bound.) Failure to clearly identify your business objectives does not inspire confidence and makes it hard for your team members to work towards a common purpose.

3. Perform Market and Competitive Analyses to Proof a Big Enough Business Opportunity

The third step in writing a business plan is the market and competitive analysis section. Every business, no matter the size, needs to perform comprehensive market and competitive analyses before it enters into a market.

Performing market and competitive analyses are critical for the success of your business. It helps you avoid entering the right market with the wrong product, or vice versa. Anyone reading your business plans, especially financiers and financial institutions will want to see proof that there is a big enough business opportunity you are targeting.

This section is where you describe the market and industry you want to operate in and show the big opportunities in the market that your business can leverage to make a profit. If you noticed any unique trends when doing your research, show them in this section.

Market analysis alone is not enough, you have to add competitive analysis to strengthen this section. There are already businesses in the industry or market, how do you plan to take a share of the market from them?

You have to clearly illustrate the competitive landscape in your business plan. Are there areas your competitors are doing well? Are there areas where they are not doing so well? Show it.

Make it clear in this section why you are moving into the industry and what weaknesses are present there that you plan to explain. How are your competitors going to react to your market entry? How do you plan to get customers? Do you plan on taking your competitors' competitors, tap into other sources for customers, or both?

Illustrate the competitive landscape as well. What are your competitors doing well and not so well?

Answering these questions and thoughts will aid your market and competitive analysis of the opportunities in your space. Depending on how sophisticated your industry is, or the expectations of your financiers, you may need to carry out a more comprehensive market and competitive analysis to prove that big business opportunity.

Instead of looking at the market and competitive analyses as one entity, separating them will make the research even more comprehensive.

Market Analysis

Market analysis, boarding speaking, refers to research a business carried out on its industry, market, and competitors. It helps businesses gain a good understanding of their target market and the outlook of their industry. Before starting a company, it is vital to carry out market research to find out if the market is viable.

The market analysis section is a key part of the business plan. It is the section where you identify who your best clients or customers are. You cannot omit this section, without it your business plan is incomplete.

A good market analysis will tell your readers how you fit into the existing market and what makes you stand out. This section requires in-depth research, it will probably be the most time-consuming part of the business plan to write.

• Market Research

To create a compelling market analysis that will win over investors and financial institutions, you have to carry out thorough market research . Your market research should be targeted at your primary target market for your products or services. Here is what you want to find out about your target market.

• Your target market’s needs or pain points
• The existing solutions for their pain points
• Geographic Location
• Demographics

The purpose of carrying out a marketing analysis is to get all the information you need to show that you have a solid and thorough understanding of your target audience.

Only after you have fully understood the people you plan to sell your products or services to, can you evaluate correctly if your target market will be interested in your products or services.

You can easily convince interested parties to invest in your business if you can show them you thoroughly understand the market and show them that there is a market for your products or services.

How to Quantify Your Target Market

One of the goals of your marketing research is to understand who your ideal customers are and their purchasing power. To quantify your target market, you have to determine the following:

• Your Potential Customers: They are the people you plan to target. For example, if you sell accounting software for small businesses , then anyone who runs an enterprise or large business is unlikely to be your customers. Also, individuals who do not have a business will most likely not be interested in your product.
• Total Households: If you are selling household products such as heating and air conditioning systems, determining the number of total households is more important than finding out the total population in the area you want to sell to. The logic is simple, people buy the product but it is the household that uses it.
• Median Income: You need to know the median income of your target market. If you target a market that cannot afford to buy your products and services, your business will not last long.
• Income by Demographics: If your potential customers belong to a certain age group or gender, determining income levels by demographics is necessary. For example, if you sell men's clothes, your target audience is men.

What Does a Good Market Analysis Entail?

Your business does not exist on its own, it can only flourish within an industry and alongside competitors. Market analysis takes into consideration your industry, target market, and competitors. Understanding these three entities will drastically improve your company’s chances of success.

You can view your market analysis as an examination of the market you want to break into and an education on the emerging trends and themes in that market. Good market analyses include the following:

• Industry Description. You find out about the history of your industry, the current and future market size, and who the largest players/companies are in your industry.
• Overview of Target Market. You research your target market and its characteristics. Who are you targeting? Note, it cannot be everyone, it has to be a specific group. You also have to find out all information possible about your customers that can help you understand how and why they make buying decisions.
• Size of Target Market: You need to know the size of your target market, how frequently they buy, and the expected quantity they buy so you do not risk overproducing and having lots of bad inventory. Researching the size of your target market will help you determine if it is big enough for sustained business or not.
• Growth Potential: Before picking a target market, you want to be sure there are lots of potential for future growth. You want to avoid going for an industry that is declining slowly or rapidly with almost zero growth potential.
• Market Share Potential: Does your business stand a good chance of taking a good share of the market?
• Market Pricing and Promotional Strategies: Your market analysis should give you an idea of the price point you can expect to charge for your products and services. Researching your target market will also give you ideas of pricing strategies you can implement to break into the market or to enjoy maximum profits.
• Potential Barriers to Entry: One of the biggest benefits of conducting market analysis is that it shows you every potential barrier to entry your business will likely encounter. It is a good idea to discuss potential barriers to entry such as changing technology. It informs readers of your business plan that you understand the market.
• Research on Competitors: You need to know the strengths and weaknesses of your competitors and how you can exploit them for the benefit of your business. Find patterns and trends among your competitors that make them successful, discover what works and what doesn’t, and see what you can do better.

The market analysis section is not just for talking about your target market, industry, and competitors. You also have to explain how your company can fill the hole you have identified in the market.

Here are some questions you can answer that can help you position your product or service in a positive light to your readers.

• Is your product or service of superior quality?
• What additional features do you offer that your competitors do not offer?
• Are you targeting a ‘new’ market?

Basically, your market analysis should include an analysis of what already exists in the market and an explanation of how your company fits into the market.

Competitive Analysis

In the competitive analysis section, y ou have to understand who your direct and indirect competitions are, and how successful they are in the marketplace. It is the section where you assess the strengths and weaknesses of your competitors, the advantage(s) they possess in the market and show the unique features or qualities that make you different from your competitors.

Many businesses do market analysis and competitive analysis together. However, to fully understand what the competitive analysis entails, it is essential to separate it from the market analysis.

Competitive analysis for your business can also include analysis on how to overcome barriers to entry in your target market.

The primary goal of conducting a competitive analysis is to distinguish your business from your competitors. A strong competitive analysis is essential if you want to convince potential funding sources to invest in your business. You have to show potential investors and lenders that your business has what it takes to compete in the marketplace successfully.

Competitive analysis will s how you what the strengths of your competition are and what they are doing to maintain that advantage.

When doing your competitive research, you first have to identify your competitor and then get all the information you can about them. The idea of spending time to identify your competitor and learn everything about them may seem daunting but it is well worth it.

Find answers to the following questions after you have identified who your competitors are.

• What are your successful competitors doing?
• Why is what they are doing working?
• Can your business do it better?
• What are the weaknesses of your successful competitors?
• What are they not doing well?
• Can your business turn its weaknesses into strengths?
• How good is your competitors’ customer service?
• Where do your competitors invest in advertising?
• What sales and pricing strategies are they using?
• What marketing strategies are they using?
• What kind of press coverage do they get?
• What are their customers saying about your competitors (both the positive and negative)?

If your competitors have a website, it is a good idea to visit their websites for more competitors’ research. Check their “About Us” page for more information.

If you are presenting your business plan to investors, you need to clearly distinguish yourself from your competitors. Investors can easily tell when you have not properly researched your competitors.

Take time to think about what unique qualities or features set you apart from your competitors. If you do not have any direct competition offering your product to the market, it does not mean you leave out the competitor analysis section blank. Instead research on other companies that are providing a similar product, or whose product is solving the problem your product solves.

The next step is to create a table listing the top competitors you want to include in your business plan. Ensure you list your business as the last and on the right. What you just created is known as the competitor analysis table.

Direct vs Indirect Competition

You cannot know if your product or service will be a fit for your target market if you have not understood your business and the competitive landscape.

There is no market you want to target where you will not encounter competition, even if your product is innovative. Including competitive analysis in your business plan is essential.

If you are entering an established market, you need to explain how you plan to differentiate your products from the available options in the market. Also, include a list of few companies that you view as your direct competitors The competition you face in an established market is your direct competition.

In situations where you are entering a market with no direct competition, it does not mean there is no competition there. Consider your indirect competition that offers substitutes for the products or services you offer.

For example, if you sell an innovative SaaS product, let us say a project management software , a company offering time management software is your indirect competition.

There is an easy way to find out who your indirect competitors are in the absence of no direct competitors. You simply have to research how your potential customers are solving the problems that your product or service seeks to solve. That is your direct competition.

Factors that Differentiate Your Business from the Competition

There are three main factors that any business can use to differentiate itself from its competition. They are cost leadership, product differentiation, and market segmentation.

1. Cost Leadership

A strategy you can impose to maximize your profits and gain an edge over your competitors. It involves offering lower prices than what the majority of your competitors are offering.

A common practice among businesses looking to enter into a market where there are dominant players is to use free trials or pricing to attract as many customers as possible to their offer.

2. Product Differentiation

Your product or service should have a unique selling proposition (USP) that your competitors do not have or do not stress in their marketing.

Part of the marketing strategy should involve making your products unique and different from your competitors. It does not have to be different from your competitors, it can be the addition to a feature or benefit that your competitors do not currently have.

3. Market Segmentation

As a new business seeking to break into an industry, you will gain more success from focusing on a specific niche or target market, and not the whole industry.

If your competitors are focused on a general need or target market, you can differentiate yourself from them by having a small and hyper-targeted audience. For example, if your competitors are selling men’s clothes in their online stores , you can sell hoodies for men.

4. Define Your Business and Management Structure

The next step in your business plan is your business and management structure. It is the section where you describe the legal structure of your business and the team running it.

Your business is only as good as the management team that runs it, while the management team can only strive when there is a proper business and management structure in place.

If your company is a sole proprietor or a limited liability company (LLC), a general or limited partnership, or a C or an S corporation, state it clearly in this section.

Use an organizational chart to show the management structure in your business. Clearly show who is in charge of what area in your company. It is where you show how each key manager or team leader’s unique experience can contribute immensely to the success of your company. You can also opt to add the resumes and CVs of the key players in your company.

The business and management structure section should show who the owner is, and other owners of the businesses (if the business has other owners). For businesses or companies with multiple owners, include the percent ownership of the various owners and clearly show the extent of each others’ involvement in the company.

Investors want to know who is behind the company and the team running it to determine if it has the right management to achieve its set goals.

Management Team

The management team section is where you show that you have the right team in place to successfully execute the business operations and ideas. Take time to create the management structure for your business. Think about all the important roles and responsibilities that you need managers for to grow your business.

Include brief bios of each key team member and ensure you highlight only the relevant information that is needed. If your team members have background industry experience or have held top positions for other companies and achieved success while filling that role, highlight it in this section.

A common mistake that many startups make is assigning C-level titles such as (CMO and CEO) to everyone on their team. It is unrealistic for a small business to have those titles. While it may look good on paper for the ego of your team members, it can prevent investors from investing in your business.

Instead of building an unrealistic management structure that does not fit your business reality, it is best to allow business titles to grow as the business grows. Starting everyone at the top leaves no room for future change or growth, which is bad for productivity.

Your management team does not have to be complete before you start writing your business plan. You can have a complete business plan even when there are managerial positions that are empty and need filling.

If you have management gaps in your team, simply show the gaps and indicate you are searching for the right candidates for the role(s). Investors do not expect you to have a full management team when you are just starting your business.

Key Questions to Answer When Structuring Your Management Team

• Who are the key leaders?
• What experiences, skills, and educational backgrounds do you expect your key leaders to have?
• Do your key leaders have industry experience?
• What positions will they fill and what duties will they perform in those positions?
• What level of authority do the key leaders have and what are their responsibilities?
• What is the salary for the various management positions that will attract the ideal candidates?

Additional Tips for Writing the Management Structure Section

1. Avoid Adding ‘Ghost’ Names to Your Management Team

There is always that temptation to include a ‘ghost’ name to your management team to attract and influence investors to invest in your business. Although the presence of these celebrity management team members may attract the attention of investors, it can cause your business to lose any credibility if you get found out.

Seasoned investors will investigate further the members of your management team before committing fully to your business If they find out that the celebrity name used does not play any actual role in your business, they will not invest and may write you off as dishonest.

2. Focus on Credentials But Pay Extra Attention to the Roles

Investors want to know the experience that your key team members have to determine if they can successfully reach the company’s growth and financial goals.

While it is an excellent boost for your key management team to have the right credentials, you also want to pay extra attention to the roles they will play in your company.

Organizational Chart

Adding an organizational chart in this section of your business plan is not necessary, you can do it in your business plan’s appendix.

If you are exploring funding options, it is not uncommon to get asked for your organizational chart. The function of an organizational chart goes beyond raising money, you can also use it as a useful planning tool for your business.

An organizational chart can help you identify how best to structure your management team for maximum productivity and point you towards key roles you need to fill in the future.

You can use the organizational chart to show your company’s internal management structure such as the roles and responsibilities of your management team, and relationships that exist between them.

5. Describe Your Product and Service Offering

In your business plan, you have to describe what you sell or the service you plan to offer. It is the next step after defining your business and management structure. The products and services section is where you sell the benefits of your business.

Here you have to explain how your product or service will benefit your customers and describe your product lifecycle. It is also the section where you write down your plans for intellectual property like patent filings and copyrighting.

The research and development that you are undertaking for your product or service need to be explained in detail in this section. However, do not get too technical, sell the general idea and its benefits.

If you have any diagrams or intricate designs of your product or service, do not include them in the products and services section. Instead, leave them for the addendum page. Also, if you are leaving out diagrams or designs for the addendum, ensure you add this phrase “For more detail, visit the addendum Page #.”

Your product and service section in your business plan should include the following:

• A detailed explanation that clearly shows how your product or service works.
• The pricing model for your product or service.
• Your business’ sales and distribution strategy.
• The ideal customers that want your product or service.
• The benefits of your products and services.
• Reason(s) why your product or service is a better alternative to what your competitors are currently offering in the market.
• Plans for filling the orders you receive
• If you have current or pending patents, copyrights, and trademarks for your product or service, you can also discuss them in this section.

What to Focus On When Describing the Benefits, Lifecycle, and Production Process of Your Products or Services

In the products and services section, you have to distill the benefits, lifecycle, and production process of your products and services.

When describing the benefits of your products or services, here are some key factors to focus on.

• Unique features
• Translating the unique features into benefits
• The emotional, psychological, and practical payoffs to attract customers
• Intellectual property rights or any patents

When describing the product life cycle of your products or services, here are some key factors to focus on.

• Upsells, cross-sells, and down-sells
• Time between purchases
• Plans for research and development.

When describing the production process for your products or services, you need to think about the following:

• The creation of new or existing products and services.
• The sources for the raw materials or components you need for production.
• Assembling the products
• Maintaining quality control
• Supply-chain logistics (receiving the raw materials and delivering the finished products)
• The day-to-day management of the production processes, bookkeeping, and inventory.

Tips for Writing the Products or Services Section of Your Business Plan

1. Avoid Technical Descriptions and Industry Buzzwords

The products and services section of your business plan should clearly describe the products and services that your company provides. However, it is not a section to include technical jargons that anyone outside your industry will not understand.

A good practice is to remove highly detailed or technical descriptions in favor of simple terms. Industry buzzwords are not necessary, if there are simpler terms you can use, then use them. If you plan to use your business plan to source funds, making the product or service section so technical will do you no favors.

2. Describe How Your Products or Services Differ from Your Competitors

When potential investors look at your business plan, they want to know how the products and services you are offering differ from that of your competition. Differentiating your products or services from your competition in a way that makes your solution more attractive is critical.

If you are going the innovative path and there is no market currently for your product or service, you need to describe in this section why the market needs your product or service.

For example, overnight delivery was a niche business that only a few companies were participating in. Federal Express (FedEx) had to show in its business plan that there was a large opportunity for that service and they justified why the market needed that service.

3. Long or Short Products or Services Section

Should your products or services section be short? Does the long products or services section attract more investors?

There are no straightforward answers to these questions. Whether your products or services section should be long or relatively short depends on the nature of your business.

If your business is product-focused, then automatically you need to use more space to describe the details of your products. However, if the product your business sells is a commodity item that relies on competitive pricing or other pricing strategies, you do not have to use up so much space to provide significant details about the product.

Likewise, if you are selling a commodity that is available in numerous outlets, then you do not have to spend time on writing a long products or services section.

The key to the success of your business is most likely the effectiveness of your marketing strategies compared to your competitors. Use more space to address that section.

If you are creating a new product or service that the market does not know about, your products or services section can be lengthy. The reason why is because you need to explain everything about the product or service such as the nature of the product, its use case, and values.

A short products or services section for an innovative product or service will not give the readers enough information to properly evaluate your business.

4. Describe Your Relationships with Vendors or Suppliers

Your business will rely on vendors or suppliers to supply raw materials or the components needed to make your products. In your products and services section, describe your relationships with your vendors and suppliers fully.

Avoid the mistake of relying on only one supplier or vendor. If that supplier or vendor fails to supply or goes out of business, you can easily face supply problems and struggle to meet your demands. Plan to set up multiple vendor or supplier relationships for better business stability.

5. Your Primary Goal Is to Convince Your Readers

The primary goal of your business plan is to convince your readers that your business is viable and to create a guide for your business to follow. It applies to the products and services section.

When drafting this section, think like the reader. See your reader as someone who has no idea about your products and services. You are using the products and services section to provide the needed information to help your reader understand your products and services. As a result, you have to be clear and to the point.

While you want to educate your readers about your products or services, you also do not want to bore them with lots of technical details. Show your products and services and not your fancy choice of words.

Your products and services section should provide the answer to the “what” question for your business. You and your management team may run the business, but it is your products and services that are the lifeblood of the business.

Key Questions to Answer When Writing your Products and Services Section

Answering these questions can help you write your products and services section quickly and in a way that will appeal to your readers.

• Are your products existing on the market or are they still in the development stage?
• What is your timeline for adding new products and services to the market?
• What are the positives that make your products and services different from your competitors?
• Do your products and services have any competitive advantage that your competitors’ products and services do not currently have?
• Do your products or services have any competitive disadvantages that you need to overcome to compete with your competitors? If your answer is yes, state how you plan to overcome them,
• How much does it cost to produce your products or services? How much do you plan to sell it for?
• What is the price for your products and services compared to your competitors? Is pricing an issue?
• What are your operating costs and will it be low enough for you to compete with your competitors and still take home a reasonable profit margin?
• What is your plan for acquiring your products? Are you involved in the production of your products or services?
• Are you the manufacturer and produce all the components you need to create your products? Do you assemble your products by using components supplied by other manufacturers? Do you purchase your products directly from suppliers or wholesalers?
• Do you have a steady supply of products that you need to start your business? (If your business is yet to kick-off)
• How do you plan to distribute your products or services to the market?

You can also hint at the marketing or promotion plans you have for your products or services such as how you plan to build awareness or retain customers. The next section is where you can go fully into details about your business’s marketing and sales plan.

6. Show and Explain Your Marketing and Sales Plan

Providing great products and services is wonderful, but it means nothing if you do not have a marketing and sales plan to inform your customers about them. Your marketing and sales plan is critical to the success of your business.

The sales and marketing section is where you show and offer a detailed explanation of your marketing and sales plan and how you plan to execute it. It covers your pricing plan, proposed advertising and promotion activities, activities and partnerships you need to make your business a success, and the benefits of your products and services.

There are several ways you can approach your marketing and sales strategy. Ideally, your marketing and sales strategy has to fit the unique needs of your business.

In this section, you describe how the plans your business has for attracting and retaining customers, and the exact process for making a sale happen. It is essential to thoroughly describe your complete marketing and sales plans because you are still going to reference this section when you are making financial projections for your business.

Outline Your Business’ Unique Selling Proposition (USP)

The sales and marketing section is where you outline your business’s unique selling proposition (USP). When you are developing your unique selling proposition, think about the strongest reasons why people should buy from you over your competition. That reason(s) is most likely a good fit to serve as your unique selling proposition (USP).

Target Market and Target Audience

Plans on how to get your products or services to your target market and how to get your target audience to buy them go into this section. You also highlight the strengths of your business here, particularly what sets them apart from your competition.

Before you start writing your marketing and sales plan, you need to have properly defined your target audience and fleshed out your buyer persona. If you do not first understand the individual you are marketing to, your marketing and sales plan will lack any substance and easily fall.

Creating a Smart Marketing and Sales Plan

Marketing your products and services is an investment that requires you to spend money. Like any other investment, you have to generate a good return on investment (ROI) to justify using that marketing and sales plan. Good marketing and sales plans bring in high sales and profits to your company.

Avoid spending money on unproductive marketing channels. Do your research and find out the best marketing and sales plan that works best for your company.

Your marketing and sales plan can be broken into different parts: your positioning statement, pricing, promotion, packaging, advertising, public relations, content marketing, social media, and strategic alliances.

Your Positioning Statement

Your positioning statement is the first part of your marketing and sales plan. It refers to the way you present your company to your customers.

Are you the premium solution, the low-price solution, or are you the intermediary between the two extremes in the market? What do you offer that your competitors do not that can give you leverage in the market?

Before you start writing your positioning statement, you need to spend some time evaluating the current market conditions. Here are some questions that can help you to evaluate the market

• What are the unique features or benefits that you offer that your competitors lack?
• What are your customers’ primary needs and wants?
• Why should a customer choose you over your competition? How do you plan to differentiate yourself from the competition?
• How does your company’s solution compare with other solutions in the market?

After answering these questions, then you can start writing your positioning statement. Your positioning statement does not have to be in-depth or too long.

All you need to explain with your positioning statement are two focus areas. The first is the position of your company within the competitive landscape. The other focus area is the core value proposition that sets your company apart from other alternatives that your ideal customer might consider.

Here is a simple template you can use to develop a positioning statement.

For [description of target market] who [need of target market], [product or service] [how it meets the need]. Unlike [top competition], it [most essential distinguishing feature].

For example, let’s create the positioning statement for fictional accounting software and QuickBooks alternative , TBooks.

“For small business owners who need accounting services, TBooks is an accounting software that helps small businesses handle their small business bookkeeping basics quickly and easily. Unlike Wave, TBooks gives small businesses access to live sessions with top accountants.”

You can edit this positioning statement sample and fill it with your business details.

After writing your positioning statement, the next step is the pricing of your offerings. The overall positioning strategy you set in your positioning statement will often determine how you price your products or services.

Pricing is a powerful tool that sends a strong message to your customers. Failure to get your pricing strategy right can make or mar your business. If you are targeting a low-income audience, setting a premium price can result in low sales.

You can use pricing to communicate your positioning to your customers. For example, if you are offering a product at a premium price, you are sending a message to your customers that the product belongs to the premium category.

Basic Rules to Follow When Pricing Your Offering

Setting a price for your offering involves more than just putting a price tag on it. Deciding on the right pricing for your offering requires following some basic rules. They include covering your costs, primary and secondary profit center pricing, and matching the market rate.

• Covering Your Costs: The price you set for your products or service should be more than it costs you to produce and deliver them. Every business has the same goal, to make a profit. Depending on the strategy you want to use, there are exceptions to this rule. However, the vast majority of businesses follow this rule.
• Primary and Secondary Profit Center Pricing: When a company sets its price above the cost of production, it is making that product its primary profit center. A company can also decide not to make its initial price its primary profit center by selling below or at even with its production cost. It rather depends on the support product or even maintenance that is associated with the initial purchase to make its profit. The initial price thus became its secondary profit center.
• Matching the Market Rate: A good rule to follow when pricing your products or services is to match your pricing with consumer demand and expectations. If you price your products or services beyond the price your customer perceives as the ideal price range, you may end up with no customers. Pricing your products too low below what your customer perceives as the ideal price range may lead to them undervaluing your offering.

Pricing Strategy

Your pricing strategy influences the price of your offering. There are several pricing strategies available for you to choose from when examining the right pricing strategy for your business. They include cost-plus pricing, market-based pricing, value pricing, and more.

• Cost-plus Pricing: This strategy is one of the simplest and oldest pricing strategies. Here you consider the cost of producing a unit of your product and then add a profit to it to arrive at your market price. It is an effective pricing strategy for manufacturers because it helps them cover their initial costs. Another name for the cost-plus pricing strategy is the markup pricing strategy.
• Market-based Pricing: This pricing strategy analyses the market including competitors’ pricing and then sets a price based on what the market is expecting. With this pricing strategy, you can either set your price at the low-end or high-end of the market.
• Value Pricing: This pricing strategy involves setting a price based on the value you are providing to your customer. When adopting a value-based pricing strategy, you have to set a price that your customers are willing to pay. Service-based businesses such as small business insurance providers , luxury goods sellers, and the fashion industry use this pricing strategy.

After carefully sorting out your positioning statement and pricing, the next item to look at is your promotional strategy. Your promotional strategy explains how you plan on communicating with your customers and prospects.

As a business, you must measure all your costs, including the cost of your promotions. You also want to measure how much sales your promotions bring for your business to determine its usefulness. Promotional strategies or programs that do not lead to profit need to be removed.

There are different types of promotional strategies you can adopt for your business, they include advertising, public relations, and content marketing.

Advertising

Your business plan should include your advertising plan which can be found in the marketing and sales plan section. You need to include an overview of your advertising plans such as the areas you plan to spend money on to advertise your business and offers.

Ensure that you make it clear in this section if your business will be advertising online or using the more traditional offline media, or the combination of both online and offline media. You can also include the advertising medium you want to use to raise awareness about your business and offers.

Some common online advertising mediums you can use include social media ads, landing pages, sales pages, SEO, Pay-Per-Click, emails, Google Ads, and others. Some common traditional and offline advertising mediums include word of mouth, radios, direct mail, televisions, flyers, billboards, posters, and others.

A key component of your advertising strategy is how you plan to measure the effectiveness and success of your advertising campaign. There is no point in sticking with an advertising plan or medium that does not produce results for your business in the long run.

Public Relations

A great way to reach your customers is to get the media to cover your business or product. Publicity, especially good ones, should be a part of your marketing and sales plan. In this section, show your plans for getting prominent reviews of your product from reputable publications and sources.

Your business needs that exposure to grow. If public relations is a crucial part of your promotional strategy, provide details about your public relations plan here.

Content Marketing

Content marketing is a popular promotional strategy used by businesses to inform and attract their customers. It is about teaching and educating your prospects on various topics of interest in your niche, it does not just involve informing them about the benefits and features of the products and services you have,

Businesses publish content usually for free where they provide useful information, tips, and advice so that their target market can be made aware of the importance of their products and services. Content marketing strategies seek to nurture prospects into buyers over time by simply providing value.

Your company can create a blog where it will be publishing content for its target market. You will need to use the best website builder such as Wix and Squarespace and the best web hosting services such as Bluehost, Hostinger, and other Bluehost alternatives to create a functional blog or website.

If content marketing is a crucial part of your promotional strategy (as it should be), detail your plans under promotions.

Including high-quality images of the packaging of your product in your business plan is a lovely idea. You can add the images of the packaging of that product in the marketing and sales plan section. If you are not selling a product, then you do not need to include any worry about the physical packaging of your product.

When organizing the packaging section of your business plan, you can answer the following questions to make maximum use of this section.

• Is your choice of packaging consistent with your positioning strategy?
• What key value proposition does your packaging communicate? (It should reflect the key value proposition of your business)
• How does your packaging compare to that of your competitors?

Social Media

Your 21st-century business needs to have a good social media presence. Not having one is leaving out opportunities for growth and reaching out to your prospect.

You do not have to join the thousands of social media platforms out there. What you need to do is join the ones that your customers are active on and be active there.

Businesses use social media to provide information about their products such as promotions, discounts, the benefits of their products, and content on their blogs.

Social media is also a platform for engaging with your customers and getting feedback about your products or services. Make no mistake, more and more of your prospects are using social media channels to find more information about companies.

You need to consider the social media channels you want to prioritize your business (prioritize the ones your customers are active in) and your branding plans in this section.

Strategic Alliances

If your company plans to work closely with other companies as part of your sales and marketing plan, include it in this section. Prove details about those partnerships in your business plan if you have already established them.

Strategic alliances can be beneficial for all parties involved including your company. Working closely with another company in the form of a partnership can provide access to a different target market segment for your company.

The company you are partnering with may also gain access to your target market or simply offer a new product or service (that of your company) to its customers.

Mutually beneficial partnerships can cover the weaknesses of one company with the strength of another. You should consider strategic alliances with companies that sell complimentary products to yours. For example, if you provide printers, you can partner with a company that produces ink since the customers that buy printers from you will also need inks for printing.

Steps Involved in Creating a Marketing and Sales Plan

1. Focus on Your Target Market

Identify who your customers are, the market you want to target. Then determine the best ways to get your products or services to your potential customers.

2. Evaluate Your Competition

One of the goals of having a marketing plan is to distinguish yourself from your competition. You cannot stand out from them without first knowing them in and out.

You can know your competitors by gathering information about their products, pricing, service, and advertising campaigns.

These questions can help you know your competition.

• What makes your competition successful?
• What are their weaknesses?
• What are customers saying about your competition?

3. Consider Your Brand

Customers' perception of your brand has a strong impact on your sales. Your marketing and sales plan should seek to bolster the image of your brand. Before you start marketing your business, think about the message you want to pass across about your business and your products and services.

4. Focus on Benefits

The majority of your customers do not view your product in terms of features, what they want to know is the benefits and solutions your product offers. Think about the problems your product solves and the benefits it delivers, and use it to create the right sales and marketing message.

Your marketing plan should focus on what you want your customer to get instead of what you provide. Identify those benefits in your marketing and sales plan.

5. Focus on Differentiation

Your marketing and sales plan should look for a unique angle they can take that differentiates your business from the competition, even if the products offered are similar. Some good areas of differentiation you can use are your benefits, pricing, and features.

Key Questions to Answer When Writing Your Marketing and Sales Plan

• What is your company’s budget for sales and marketing campaigns?
• What key metrics will you use to determine if your marketing plans are successful?
• What are your alternatives if your initial marketing efforts do not succeed?
• Who are the sales representatives you need to promote your products or services?
• What are the marketing and sales channels you plan to use? How do you plan to get your products in front of your ideal customers?
• Where will you sell your products?

You may want to include samples of marketing materials you plan to use such as print ads, website descriptions, and social media ads. While it is not compulsory to include these samples, it can help you better communicate your marketing and sales plan and objectives.

The purpose of the marketing and sales section is to answer this question “How will you reach your customers?” If you cannot convincingly provide an answer to this question, you need to rework your marketing and sales section.

7. Clearly Show Your Funding Request

If you are writing your business plan to ask for funding from investors or financial institutions, the funding request section is where you will outline your funding requirements. The funding request section should answer the question ‘How much money will your business need in the near future (3 to 5 years)?’

A good funding request section will clearly outline and explain the amount of funding your business needs over the next five years. You need to know the amount of money your business needs to make an accurate funding request.

Also, when writing your funding request, provide details of how the funds will be used over the period. Specify if you want to use the funds to buy raw materials or machinery, pay salaries, pay for advertisements, and cover specific bills such as rent and electricity.

In addition to explaining what you want to use the funds requested for, you need to clearly state the projected return on investment (ROI) . Investors and creditors want to know if your business can generate profit for them if they put funds into it.

Ensure you do not inflate the figures and stay as realistic as possible. Investors and financial institutions you are seeking funds from will do their research before investing money in your business.

If you are not sure of an exact number to request from, you can use some range of numbers as rough estimates. Add a best-case scenario and a work-case scenario to your funding request. Also, include a description of your strategic future financial plans such as selling your business or paying off debts.

Funding Request: Debt or Equity?

When making your funding request, specify the type of funding you want. Do you want debt or equity? Draw out the terms that will be applicable for the funding, and the length of time the funding request will cover.

Case for Equity

If your new business has not yet started generating profits, you are most likely preparing to sell equity in your business to raise capital at the early stage. Equity here refers to ownership. In this case, you are selling a portion of your company to raise capital.

Although this method of raising capital for your business does not put your business in debt, keep in mind that an equity owner may expect to play a key role in company decisions even if he does not hold a major stake in the company.

Most equity sales for startups are usually private transactions . If you are making a funding request by offering equity in exchange for funding, let the investor know that they will be paid a dividend (a share of the company’s profit). Also, let the investor know the process for selling their equity in your business.

Case for Debt

You may decide not to offer equity in exchange for funds, instead, you make a funding request with the promise to pay back the money borrowed at the agreed time frame.

When making a funding request with an agreement to pay back, note that you will have to repay your creditors both the principal amount borrowed and the interest on it. Financial institutions offer this type of funding for businesses.

Large companies combine both equity and debt in their capital structure. When drafting your business plan, decide if you want to offer both or one over the other.

Before you sell equity in exchange for funding in your business, consider if you are willing to accept not being in total control of your business. Also, before you seek loans in your funding request section, ensure that the terms of repayment are favorable.

You should set a clear timeline in your funding request so that potential investors and creditors can know what you are expecting. Some investors and creditors may agree to your funding request and then delay payment for longer than 30 days, meanwhile, your business needs an immediate cash injection to operate efficiently.

Additional Tips for Writing the Funding Request Section of your Business Plan

The funding request section is not necessary for every business, it is only needed by businesses who plan to use their business plan to secure funding.

If you are adding the funding request section to your business plan, provide an itemized summary of how you plan to use the funds requested. Hiring a lawyer, accountant, or other professionals may be necessary for the proper development of this section.

You should also gather and use financial statements that add credibility and support to your funding requests. Ensure that the financial statements you use should include your projected financial data such as projected cash flows, forecast statements, and expenditure budgets.

If you are an existing business, include all historical financial statements such as cash flow statements, balance sheets and income statements .

Provide monthly and quarterly financial statements for a year. If your business has records that date back beyond the one-year mark, add the yearly statements of those years. These documents are for the appendix section of your business plan.

8. Detail Your Financial Plan, Metrics, and Projections

If you used the funding request section in your business plan, supplement it with a financial plan, metrics, and projections. This section paints a picture of the past performance of your business and then goes ahead to make an informed projection about its future.

The goal of this section is to convince readers that your business is going to be a financial success. It outlines your business plan to generate enough profit to repay the loan (with interest if applicable) and to generate a decent return on investment for investors.

If you have an existing business already in operation, use this section to demonstrate stability through finance. This section should include your cash flow statements, balance sheets, and income statements covering the last three to five years. If your business has some acceptable collateral that you can use to acquire loans, list it in the financial plan, metrics, and projection section.

Apart from current financial statements, this section should also contain a prospective financial outlook that spans the next five years. Include forecasted income statements, cash flow statements, balance sheets, and capital expenditure budget.

If your business is new and is not yet generating profit, use clear and realistic projections to show the potentials of your business.

When drafting this section, research industry norms and the performance of comparable businesses. Your financial projections should cover at least five years. State the logic behind your financial projections. Remember you can always make adjustments to this section as the variables change.

The financial plan, metrics, and projection section create a baseline which your business can either exceed or fail to reach. If your business fails to reach your projections in this section, you need to understand why it failed.

Investors and loan managers spend a lot of time going through the financial plan, metrics, and projection section compared to other parts of the business plan. Ensure you spend time creating credible financial analyses for your business in this section.

Many entrepreneurs find this section daunting to write. You do not need a business degree to create a solid financial forecast for your business. Business finances, especially for startups, are not as complicated as they seem. There are several online tools and templates that make writing this section so much easier.

Use Graphs and Charts

The financial plan, metrics, and projection section is a great place to use graphs and charts to tell the financial story of your business. Charts and images make it easier to communicate your finances.

Accuracy in this section is key, ensure you carefully analyze your past financial statements properly before making financial projects.

Address the Risk Factors and Show Realistic Financial Projections

Keep your financial plan, metrics, and projection realistic. It is okay to be optimistic in your financial projection, however, you have to justify it.

You should also address the various risk factors associated with your business in this section. Investors want to know the potential risks involved, show them. You should also show your plans for mitigating those risks.

What You Should In The Financial Plan, Metrics, and Projection Section of Your Business Plan

The financial plan, metrics, and projection section of your business plan should have monthly sales and revenue forecasts for the first year. It should also include annual projections that cover 3 to 5 years.

A three-year projection is a basic requirement to have in your business plan. However, some investors may request a five-year forecast.

Your business plan should include the following financial statements: sales forecast, personnel plan, income statement, income statement, cash flow statement, balance sheet, and an exit strategy.

1. Sales Forecast

Sales forecast refers to your projections about the number of sales your business is going to record over the next few years. It is typically broken into several rows, with each row assigned to a core product or service that your business is offering.

One common mistake people make in their business plan is to break down the sales forecast section into long details. A sales forecast should forecast the high-level details.

For example, if you are forecasting sales for a payroll software provider, you could break down your forecast into target market segments or subscription categories.

Your sales forecast section should also have a corresponding row for each sales row to cover the direct cost or Cost of Goods Sold (COGS). The objective of these rows is to show the expenses that your business incurs in making and delivering your product or service.

Note that your Cost of Goods Sold (COGS) should only cover those direct costs incurred when making your products. Other indirect expenses such as insurance, salaries, payroll tax, and rent should not be included.

For example, the Cost of Goods Sold (COGS) for a restaurant is the cost of ingredients while for a consulting company it will be the cost of paper and other presentation materials.

2. Personnel Plan

The personnel plan section is where you provide details about the payment plan for your employees. For a small business, you can easily list every position in your company and how much you plan to pay in the personnel plan.

However, for larger businesses, you have to break the personnel plan into functional groups such as sales and marketing.

The personnel plan will also include the cost of an employee beyond salary, commonly referred to as the employee burden. These costs include insurance, payroll taxes , and other essential costs incurred monthly as a result of having employees on your payroll.

3. Income Statement

The income statement section shows if your business is making a profit or taking a loss. Another name for the income statement is the profit and loss (P&L). It takes data from your sales forecast and personnel plan and adds other ongoing expenses you incur while running your business.

Every business plan should have an income statement. It subtracts your business expenses from its earnings to show if your business is generating profit or incurring losses.

The income statement has the following items: sales, Cost of Goods Sold (COGS), gross margin, operating expenses, total operating expenses, operating income , total expenses, and net profit.

• Sales refer to the revenue your business generates from selling its products or services. Other names for sales are income or revenue.
• Cost of Goods Sold (COGS) refers to the total cost of selling your products. Other names for COGS are direct costs or cost of sales. Manufacturing businesses use the Costs of Goods Manufactured (COGM) .
• Gross Margin is the figure you get when you subtract your COGS from your sales. In your income statement, you can express it as a percentage of total sales (Gross margin / Sales = Gross Margin Percent).
• Operating Expenses refer to all the expenses you incur from running your business. It exempts the COGS because it stands alone as a core part of your income statement. You also have to exclude taxes, depreciation, and amortization. Your operating expenses include salaries, marketing expenses, research and development (R&D) expenses, and other expenses.
• Total Operating Expenses refers to the sum of all your operating expenses including those exemptions named above under operating expenses.
• Operating Income refers to earnings before interest, taxes, depreciation, and amortization. It is simply known as the acronym EBITDA (earnings before interest, taxes, depreciation, and amortization). Calculating your operating income is simple, all you need to do is to subtract your COGS and total operating expenses from your sales.
• Total Expenses refer to the sum of your operating expenses and your business’ interest, taxes, depreciation, and amortization.
• Net profit shows whether your business has made a profit or taken a loss during a given timeframe.

4. Cash Flow Statement

The cash flow statement tracks the money you have in the bank at any given point. It is often confused with the income statement or the profit and loss statement. They are both different types of financial statements. The income statement calculates your profits and losses while the cash flow statement shows you how much you have in the bank.

5. Balance Sheet

The balance sheet is a financial statement that provides an overview of the financial health of your business. It contains information about the assets and liabilities of your company, and owner’s or shareholders’ equity.

You can get the net worth of your company by subtracting your company’s liabilities from its assets.

6. Exit Strategy

The exit strategy refers to a probable plan for selling your business either to the public in an IPO or to another company. It is the last thing you include in the financial plan, metrics, and projection section.

You can choose to omit the exit strategy from your business plan if you plan to maintain full ownership of your business and do not plan on seeking angel investment or virtual capitalist (VC) funding.

Investors may want to know what your exit plan is. They invest in your business to get a good return on investment.

Your exit strategy does not have to include long and boring details. Ensure you identify some interested parties who may be interested in buying the company if it becomes a success.

Key Questions to Answer with Your Financial Plan, Metrics, and Projection

Your financial plan, metrics, and projection section helps investors, creditors, or your internal managers to understand what your expenses are, the amount of cash you need, and what it takes to make your company profitable. It also shows what you will be doing with any funding.

You do not need to show actual financial data if you do not have one. Adding forecasts and projections to your financial statements is added proof that your strategy is feasible and shows investors you have planned properly.

Here are some key questions to answer to help you develop this section.

• What is your sales forecast for the next year?
• When will your company achieve a positive cash flow?
• What are the core expenses you need to operate?
• How much money do you need upfront to operate or grow your company?
• How will you use the loans or investments?

9. Add an Appendix to Your Business Plan

Adding an appendix to your business plan is optional. It is a useful place to put any charts, tables, legal notes, definitions, permits, résumés, and other critical information that do not fit into other sections of your business plan.

The appendix section is where you would want to include details of a patent or patent-pending if you have one. You can always add illustrations or images of your products here. It is the last section of your business plan.

When writing your business plan, there are details you cut short or remove to prevent the entire section from becoming too lengthy. There are also details you want to include in the business plan but are not a good fit for any of the previous sections. You can add that additional information to the appendix section.

Businesses also use the appendix section to include supporting documents or other materials specially requested by investors or lenders.

You can include just about any information that supports the assumptions and statements you made in the business plan under the appendix. It is the one place in the business plan where unrelated data and information can coexist amicably.

If your appendix section is lengthy, try organizing it by adding a table of contents at the beginning of the appendix section. It is also advisable to group similar information to make it easier for the reader to access them.

A well-organized appendix section makes it easier to share your information clearly and concisely. Add footnotes throughout the rest of the business plan or make references in the plan to the documents in the appendix.

The appendix section is usually only necessary if you are seeking funding from investors or lenders, or hoping to attract partners.

People reading business plans do not want to spend time going through a heap of backup information, numbers, and charts. Keep these documents or information in the Appendix section in case the reader wants to dig deeper.

Common Items to Include in the Appendix Section of Your Business Plan

The appendix section includes documents that supplement or support the information or claims given in other sections of the business plans. Common items you can include in the appendix section include:

• Additional data about the process of manufacturing or creation
• Additional description of products or services such as product schematics
• Additional financial documents or projections
• Articles of incorporation and status
• Backup for market research or competitive analysis
• Bank statements
• Business registries
• Client testimonials (if your business is already running)
• Copies of insurances
• Credit histories (personal or/and business)
• Deeds and permits
• Equipment leases
• Examples of marketing and advertising collateral
• Industry associations and memberships
• Images of product
• Intellectual property
• Key customer contracts
• Legal documents and other contracts
• Letters of reference
• Links to references
• Market research data
• Organizational charts
• Photographs of potential facilities
• Professional licenses pertaining to your legal structure or type of business
• Purchase orders
• Resumes of the founder(s) and key managers
• State and federal identification numbers or codes
• Trademarks or patents’ registrations

Avoid using the appendix section as a place to dump any document or information you feel like adding. Only add documents or information that you support or increase the credibility of your business plan.

Tips and Strategies for Writing a Convincing Business Plan

To achieve a perfect business plan, you need to consider some key tips and strategies. These tips will raise the efficiency of your business plan above average.

1. Know Your Audience

When writing a business plan, you need to know your audience . Business owners write business plans for different reasons. Your business plan has to be specific. For example, you can write business plans to potential investors, banks, and even fellow board members of the company.

The audience you are writing to determines the structure of the business plan. As a business owner, you have to know your audience. Not everyone will be your audience. Knowing your audience will help you to narrow the scope of your business plan.

Consider what your audience wants to see in your projects, the likely questions they might ask, and what interests them.

• A business plan used to address a company's board members will center on its employment schemes, internal affairs, projects, stakeholders, etc.
• A business plan for financial institutions will talk about the size of your market and the chances for you to pay back any loans you demand.
• A business plan for investors will show proof that you can return the investment capital within a specific time. In addition, it discusses your financial projections, tractions, and market size.

2. Get Inspiration from People

Writing a business plan from scratch as an entrepreneur can be daunting. That is why you need the right inspiration to push you to write one. You can gain inspiration from the successful business plans of other businesses. Look at their business plans, the style they use, the structure of the project, etc.

To make your business plan easier to create, search companies related to your business to get an exact copy of what you need to create an effective business plan. You can also make references while citing examples in your business plans.

When drafting your business plan, get as much help from others as you possibly can. By getting inspiration from people, you can create something better than what they have.

3. Avoid Being Over Optimistic

Many business owners make use of strong adjectives to qualify their content. One of the big mistakes entrepreneurs make when preparing a business plan is promising too much.

The use of superlatives and over-optimistic claims can prepare the audience for more than you can offer. In the end, you disappoint the confidence they have in you.

In most cases, the best option is to be realistic with your claims and statistics. Most of the investors can sense a bit of incompetency from the overuse of superlatives. As a new entrepreneur, do not be tempted to over-promise to get the interests of investors.

The concept of entrepreneurship centers on risks, nothing is certain when you make future analyses. What separates the best is the ability to do careful research and work towards achieving that, not promising more than you can achieve.

To make an excellent first impression as an entrepreneur, replace superlatives with compelling data-driven content. In this way, you are more specific than someone promising a huge ROI from an investment.

4. Keep it Simple and Short

When writing business plans, ensure you keep them simple throughout. Irrespective of the purpose of the business plan, your goal is to convince the audience.

One way to achieve this goal is to make them understand your proposal. Therefore, it would be best if you avoid the use of complex grammar to express yourself. It would be a huge turn-off if the people you want to convince are not familiar with your use of words.

Another thing to note is the length of your business plan. It would be best if you made it as brief as possible.

You hardly see investors or agencies that read through an extremely long document. In that case, if your first few pages can’t convince them, then you have lost it. The more pages you write, the higher the chances of you derailing from the essential contents.

To ensure your business plan has a high conversion rate, you need to dispose of every unnecessary information. For example, if you have a strategy that you are not sure of, it would be best to leave it out of the plan.

5. Make an Outline and Follow Through

A perfect business plan must have touched every part needed to convince the audience. Business owners get easily tempted to concentrate more on their products than on other sections. Doing this can be detrimental to the efficiency of the business plan.

For example, imagine you talking about a product but omitting or providing very little information about the target audience. You will leave your clients confused.

To ensure that your business plan communicates your full business model to readers, you have to input all the necessary information in it. One of the best ways to achieve this is to design a structure and stick to it.

This structure is what guides you throughout the writing. To make your work easier, you can assign an estimated word count or page limit to every section to avoid making it too bulky for easy reading. As a guide, the necessary things your business plan must contain are:

• Table of contents
• Introduction
• Product or service description
• Target audience
• Market size
• Competition analysis
• Financial projections

Some specific businesses can include some other essential sections, but these are the key sections that must be in every business plan.

6. Ask a Professional to Proofread

When writing a business plan, you must tie all loose ends to get a perfect result. When you are done with writing, call a professional to go through the document for you. You are bound to make mistakes, and the way to correct them is to get external help.

You should get a professional in your field who can relate to every section of your business plan. It would be easier for the professional to notice the inner flaws in the document than an editor with no knowledge of your business.

In addition to getting a professional to proofread, get an editor to proofread and edit your document. The editor will help you identify grammatical errors, spelling mistakes, and inappropriate writing styles.

Writing a business plan can be daunting, but you can surmount that obstacle and get the best out of it with these tips.

Business Plan Examples and Templates That’ll Save You Tons of Time

1. hubspot's one-page business plan.

The one-page business plan template by HubSpot is the perfect guide for businesses of any size, irrespective of their business strategy. Although the template is condensed into a page, your final business plan should not be a page long! The template is designed to ask helpful questions that can help you develop your business plan.

Hubspot’s one-page business plan template is divided into nine fields:

• Business opportunity
• Company description
• Industry analysis
• Target market
• Implementation timeline
• Marketing plan
• Financial summary
• Funding required

2. Bplan’s Free Business Plan Template

Bplans' free business plan template is investor-approved. It is a rich template used by prestigious educational institutions such as Babson College and Princeton University to teach entrepreneurs how to create a business plan.

The template has six sections: the executive summary, opportunity, execution, company, financial plan, and appendix. There is a step-by-step guide for writing every little detail in the business plan. Follow the instructions each step of the way and you will create a business plan that impresses investors or lenders easily.

3. HubSpot's Downloadable Business Plan Template

HubSpot’s downloadable business plan template is a more comprehensive option compared to the one-page business template by HubSpot. This free and downloadable business plan template is designed for entrepreneurs.

The template is a comprehensive guide and checklist for business owners just starting their businesses. It tells you everything you need to fill in each section of the business plan and how to do it.

There are nine sections in this business plan template: an executive summary, company and business description, product and services line, market analysis, marketing plan, sales plan, legal notes, financial considerations, and appendix.

4. Business Plan by My Own Business Institute

My Own Business Institute (MOBI) which is a part of Santa Clara University's Center for Innovation and Entrepreneurship offers a free business plan template. You can either copy the free business template from the link provided above or download it as a Word document.

The comprehensive template consists of a whopping 15 sections.

• The Business Profile
• The Vision and the People
• Home-Based Business and Freelance Business Opportunities
• Organization
• Licenses and Permits
• Business Insurance
• Communication Tools
• Acquisitions
• Location and Leasing
• Accounting and Cash Flow
• Opening and Marketing
• Managing Employees
• Expanding and Handling Problems

There are lots of helpful tips on how to fill each section in the free business plan template by MOBI.

5. Score's Business Plan Template for Startups

Score is an American nonprofit organization that helps entrepreneurs build successful companies. This business plan template for startups by Score is available for free download. The business plan template asks a whooping 150 generic questions that help entrepreneurs from different fields to set up the perfect business plan.

The business plan template for startups contains clear instructions and worksheets, all you have to do is answer the questions and fill the worksheets.

There are nine sections in the business plan template: executive summary, company description, products and services, marketing plan, operational plan, management and organization, startup expenses and capitalization, financial plan, and appendices.

The ‘refining the plan’ resource contains instructions that help you modify your business plan to suit your specific needs, industry, and target audience. After you have completed Score’s business plan template, you can work with a SCORE mentor for expert advice in business planning.

6. Minimalist Architecture Business Plan Template by Venngage

The minimalist architecture business plan template is a simple template by Venngage that you can customize to suit your business needs .

There are five sections in the template: an executive summary, statement of problem, approach and methodology, qualifications, and schedule and benchmark. The business plan template has instructions that guide users on what to fill in each section.

7. Small Business Administration Free Business Plan Template

The Small Business Administration (SBA) offers two free business plan templates, filled with practical real-life examples that you can model to create your business plan. Both free business plan templates are written by fictional business owners: Rebecca who owns a consulting firm, and Andrew who owns a toy company.

There are five sections in the two SBA’s free business plan templates.

• Executive Summary
• Company Description
• Service Line
• Marketing and Sales

8. The $100 Startup's One-Page Business Plan

The one-page business plan by the $100 startup is a simple business plan template for entrepreneurs who do not want to create a long and complicated plan . You can include more details in the appendices for funders who want more information beyond what you can put in the one-page business plan.

There are five sections in the one-page business plan such as overview, ka-ching, hustling, success, and obstacles or challenges or open questions. You can answer all the questions using one or two sentences.

9. PandaDoc’s Free Business Plan Template

The free business plan template by PandaDoc is a comprehensive 15-page document that describes the information you should include in every section.

There are 11 sections in PandaDoc’s free business plan template.

• Executive summary
• Business description
• Products and services
• Operations plan
• Management organization
• Financial plan
• Conclusion / Call to action
• Confidentiality statement

You have to sign up for its 14-day free trial to access the template. You will find different business plan templates on PandaDoc once you sign up (including templates for general businesses and specific businesses such as bakeries, startups, restaurants, salons, hotels, and coffee shops)

PandaDoc allows you to customize its business plan templates to fit the needs of your business. After editing the template, you can send it to interested parties and track opens and views through PandaDoc.

10. Invoiceberry Templates for Word, Open Office, Excel, or PPT

InvoiceBerry is a U.K based online invoicing and tracking platform that offers free business plan templates in .docx, .odt, .xlsx, and .pptx formats for freelancers and small businesses.

Before you can download the free business plan template, it will ask you to give it your email address. After you complete the little task, it will send the download link to your inbox for you to download. It also provides a business plan checklist in .xlsx file format that ensures you add the right information to the business plan.

Alternatives to the Traditional Business Plan

A business plan is very important in mapping out how one expects their business to grow over a set number of years, particularly when they need external investment in their business. However, many investors do not have the time to watch you present your business plan. It is a long and boring read.

Luckily, there are three alternatives to the traditional business plan (the Business Model Canvas, Lean Canvas, and Startup Pitch Deck). These alternatives are less laborious and easier and quicker to present to investors.

Business Model Canvas (BMC)

The business model canvas is a business tool used to present all the important components of setting up a business, such as customers, route to market, value proposition, and finance in a single sheet. It provides a very focused blueprint that defines your business initially which you can later expand on if needed.

The sheet is divided mainly into company, industry, and consumer models that are interconnected in how they find problems and proffer solutions.

Segments of the Business Model Canvas

The business model canvas was developed by founder Alexander Osterwalder to answer important business questions. It contains nine segments.

• Key Partners: Who will be occupying important executive positions in your business? What do they bring to the table? Will there be a third party involved with the company?
• Key Activities: What important activities will production entail? What activities will be carried out to ensure the smooth running of the company?
• The Product’s Value Propositions: What does your product do? How will it be different from other products?
• Customer Segments: What demography of consumers are you targeting? What are the habits of these consumers? Who are the MVPs of your target consumers?
• Customer Relationships: How will the team support and work with its customer base? How do you intend to build and maintain trust with the customer?
• Key Resources: What type of personnel and tools will be needed? What size of the budget will they need access to?
• Channels: How do you plan to create awareness of your products? How do you intend to transport your product to the customer?
• Cost Structure: What is the estimated cost of production? How much will distribution cost?
• Revenue Streams: For what value are customers willing to pay? How do they prefer to pay for the product? Are there any external revenues attached apart from the main source? How do the revenue streams contribute to the overall revenue?

Lean Canvas

The lean canvas is a problem-oriented alternative to the standard business model canvas. It was proposed by Ash Maurya, creator of Lean Stack as a development of the business model generation. It uses a more problem-focused approach and it majorly targets entrepreneurs and startup businesses.

Lean Canvas uses the same 9 blocks concept as the business model canvas, however, they have been modified slightly to suit the needs and purpose of a small startup. The key partners, key activities, customer relationships, and key resources are replaced by new segments which are:

• Problem: Simple and straightforward number of problems you have identified, ideally three.
• Solution: The solutions to each problem.
• Unfair Advantage: Something you possess that can't be easily bought or replicated.
• Key Metrics: Important numbers that will tell how your business is doing.

Startup Pitch Deck

While the business model canvas compresses into a factual sheet, startup pitch decks expand flamboyantly.

Pitch decks, through slides, convey your business plan, often through graphs and images used to emphasize estimations and observations in your presentation. Entrepreneurs often use pitch decks to fully convince their target audience of their plans before discussing funding arrangements.

Considering the likelihood of it being used in a small time frame, a good startup pitch deck should ideally contain 20 slides or less to have enough time to answer questions from the audience.

Unlike the standard and lean business model canvases, a pitch deck doesn't have a set template on how to present your business plan but there are still important components to it. These components often mirror those of the business model canvas except that they are in slide form and contain more details.

Using Airbnb (one of the most successful start-ups in recent history) for reference, the important components of a good slide are listed below.

• Cover/Introduction Slide: Here, you should include your company's name and mission statement. Your mission statement should be a very catchy tagline. Also, include personal information and contact details to provide an easy link for potential investors.
• Problem Slide: This slide requires you to create a connection with the audience or the investor that you are pitching. For example in their pitch, Airbnb summarized the most important problems it would solve in three brief points – pricing of hotels, disconnection from city culture, and connection problems for local bookings.
• Solution Slide: This slide includes your core value proposition. List simple and direct solutions to the problems you have mentioned
• Customer Analysis: Here you will provide information on the customers you will be offering your service to. The identity of your customers plays an important part in fundraising as well as the long-run viability of the business.
• Market Validation: Use competitive analysis to show numbers that prove the presence of a market for your product, industry behavior in the present and the long run, as well as the percentage of the market you aim to attract. It shows that you understand your competitors and customers and convinces investors of the opportunities presented in the market.
• Business Model: Your business model is the hook of your presentation. It may vary in complexity but it should generally include a pricing system informed by your market analysis. The goal of the slide is to confirm your business model is easy to implement.
• Marketing Strategy: This slide should summarize a few customer acquisition methods that you plan to use to grow the business.
• Competitive Advantage: What this slide will do is provide information on what will set you apart and make you a more attractive option to customers. It could be the possession of technology that is not widely known in the market.
• Team Slide: Here you will give a brief description of your team. Include your key management personnel here and their specific roles in the company. Include their educational background, job history, and skillsets. Also, talk about their accomplishments in their careers so far to build investors' confidence in members of your team.
• Traction Slide: This validates the company’s business model by showing growth through early sales and support. The slide aims to reduce any lingering fears in potential investors by showing realistic periodic milestones and profit margins. It can include current sales, growth, valuable customers, pre-orders, or data from surveys outlining current consumer interest.
• Funding Slide: This slide is popularly referred to as ‘the ask'. Here you will include important details like how much is needed to get your business off the ground and how the funding will be spent to help the company reach its goals.
• Appendix Slides: Your pitch deck appendix should always be included alongside a standard pitch presentation. It consists of additional slides you could not show in the pitch deck but you need to complement your presentation.

It is important to support your calculations with pictorial renditions. Infographics, such as pie charts or bar graphs, will be more effective in presenting the information than just listing numbers. For example, a six-month graph that shows rising profit margins will easily look more impressive than merely writing it.

Lastly, since a pitch deck is primarily used to secure meetings and you may be sharing your pitch with several investors, it is advisable to keep a separate public version that doesn't include financials. Only disclose the one with projections once you have secured a link with an investor.

Advantages of the Business Model Canvas, Lean Canvas, and Startup Pitch Deck over the Traditional Business Plan

• Time-Saving: Writing a detailed traditional business plan could take weeks or months. On the other hand, all three alternatives can be done in a few days or even one night of brainstorming if you have a comprehensive understanding of your business.
• Easier to Understand: Since the information presented is almost entirely factual, it puts focus on what is most important in running the business. They cut away the excess pages of fillers in a traditional business plan and allow investors to see what is driving the business and what is getting in the way.
• Easy to Update: Businesses typically present their business plans to many potential investors before they secure funding. What this means is that you may regularly have to amend your presentation to update statistics or adjust to audience-specific needs. For a traditional business plan, this could mean rewriting a whole section of your plan. For the three alternatives, updating is much easier because they are not voluminous.
• Guide for a More In-depth Business Plan: All three alternatives have the added benefit of being able to double as a sketch of your business plan if the need to create one arises in the future.

Business Plan FAQ

Business plans are important for any entrepreneur who is looking for a framework to run their company over some time or seeking external support. Although they are essential for new businesses, every company should ideally have a business plan to track their growth from time to time.  They can be used by startups seeking investments or loans to convey their business ideas or an employee to convince his boss of the feasibility of starting a new project. They can also be used by companies seeking to recruit high-profile employee targets into key positions or trying to secure partnerships with other firms.

Business plans often vary depending on your target audience, the scope, and the goals for the plan. Startup plans are the most common among the different types of business plans.  A start-up plan is used by a new business to present all the necessary information to help get the business up and running. They are usually used by entrepreneurs who are seeking funding from investors or bank loans. The established company alternative to a start-up plan is a feasibility plan. A feasibility plan is often used by an established company looking for new business opportunities. They are used to show the upsides of creating a new product for a consumer base. Because the audience is usually company people, it requires less company analysis. The third type of business plan is the lean business plan. A lean business plan is a brief, straight-to-the-point breakdown of your ideas and analysis for your business. It does not contain details of your proposal and can be written on one page. Finally, you have the what-if plan. As it implies, a what-if plan is a preparation for the worst-case scenario. You must always be prepared for the possibility of your original plan being rejected. A good what-if plan will serve as a good plan B to the original.

A good business plan has 10 key components. They include an executive plan, product analysis, desired customer base, company analysis, industry analysis, marketing strategy, sales strategy, financial projection, funding, and appendix. Executive Plan Your business should begin with your executive plan. An executive plan will provide early insight into what you are planning to achieve with your business. It should include your mission statement and highlight some of the important points which you will explain later. Product Analysis The next component of your business plan is your product analysis. A key part of this section is explaining the type of item or service you are going to offer as well as the market problems your product will solve. Desired Consumer Base Your product analysis should be supplemented with a detailed breakdown of your desired consumer base. Investors are always interested in knowing the economic power of your market as well as potential MVP customers. Company Analysis The next component of your business plan is your company analysis. Here, you explain how you want to run your business. It will include your operational strategy, an insight into the workforce needed to keep the company running, and important executive positions. It will also provide a calculation of expected operational costs.  Industry Analysis A good business plan should also contain well laid out industry analysis. It is important to convince potential investors you know the companies you will be competing with, as well as your plans to gain an edge on the competition. Marketing Strategy Your business plan should also include your marketing strategy. This is how you intend to spread awareness of your product. It should include a detailed explanation of the company brand as well as your advertising methods. Sales Strategy Your sales strategy comes after the market strategy. Here you give an overview of your company's pricing strategy and how you aim to maximize profits. You can also explain how your prices will adapt to market behaviors. Financial Projection The financial projection is the next component of your business plan. It explains your company's expected running cost and revenue earned during the tenure of the business plan. Financial projection gives a clear idea of how your company will develop in the future. Funding The next component of your business plan is funding. You have to detail how much external investment you need to get your business idea off the ground here. Appendix The last component of your plan is the appendix. This is where you put licenses, graphs, or key information that does not fit in any of the other components.

The business model canvas is a business management tool used to quickly define your business idea and model. It is often used when investors need you to pitch your business idea during a brief window.

A pitch deck is similar to a business model canvas except that it makes use of slides in its presentation. A pitch is not primarily used to secure funding, rather its main purpose is to entice potential investors by selling a very optimistic outlook on the business.

Business plan competitions help you evaluate the strength of your business plan. By participating in business plan competitions, you are improving your experience. The experience provides you with a degree of validation while practicing important skills. The main motivation for entering into the competitions is often to secure funding by finishing in podium positions. There is also the chance that you may catch the eye of a casual observer outside of the competition. These competitions also provide good networking opportunities. You could meet mentors who will take a keen interest in guiding you in your business journey. You also have the opportunity to meet other entrepreneurs whose ideas can complement yours.

Exlore Further

• 12 Key Elements of a Business Plan (Top Components Explained)
• 13 Sources of Business Finance For Companies & Sole Traders
• 5 Common Types of Business Structures (+ Pros & Cons)
• How to Buy a Business in 8 Steps (+ Due Diligence Checklist)

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Martin luenendonk.

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.

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How to Create a Social Media Marketing Strategy in 9 Easy Steps [Free Template]

Creating your social media marketing strategy doesn’t need to be painful. Create an effective plan for your business in 9 simple steps.

A social media marketing strategy is a summary of everything you plan to do and hope to achieve on social media. It guides your actions and lets you know whether you’re succeeding or failing.

The more specific your plan is, the more effective it will be. Keep it concise. Don’t make it so lofty and broad that it’s unattainable or impossible to measure.

In this post, we’ll walk you through a nine-step plan to create a winning social media strategy of your own. We’ve even got expert insights from Amanda Wood, Hootsuite’s Senior Manager of Social Marketing.

How to create a social media strategy:

Bonus: Get a free social media strategy template   to quickly and easily plan your own strategy. Also use it to track results and present the plan to your boss, teammates, and clients.

What is a social media marketing strategy?

A social media strategy is a document outlining your social media goals, the tactics you will use to achieve them and the metrics you will track to measure your progress.

Your social media marketing strategy should also list all of your existing and planned social media accounts along with goals specific to each platform you’re active on. These goals should align with your business’s larger digital marketing strategy.

Finally, a good social media plan should define the roles and responsibilities within your team and outline your reporting cadence.

Create. Schedule. Publish. Engage. Measure. Win.

Creating your own social media marketing strategy (video guide)

No time to read the whole article? Let Amanda, Hootsuite’s own Senior Manager of Social Media Marketing, guide you through our free social media marketing strategy template in less than 10 minutes:

How to create a social media marketing strategy in 9 steps

Step 1. choose goals that align to business objectives, set s.m.a.r.t. goals.

The first step to creating a winning social media strategy is to establish clear objectives and goals. Without goals, you have no way to measure success and return on investment (ROI) .

Each of your social media marketing goals should be SMART : s pecific, m easurable, a ttainable, r elevant and t ime-bound.

Psst: Need help getting started? We’ve got social strategy guides for small businesses , financial services , government , higher education , healthcare , real estate , law firms , and non-profits .

Oh, and if you need examples of smart social media goals , we’ve got you covered there too.

Once you’ve decided on your goals, track them in a social media strategy doc — grab our free template if you don’t have one already.

Track meaningful metrics

Vanity metrics like number of followers and likes are easy to track, but it’s hard to prove their real value. Instead, focus on things like engagement, click-through, and conversion rates.

For inspiration, take a look at these 19 essential social media metrics .

You may want to track different goals for different social media networks, or even different uses for each network.

For example, if you use LinkedIn to drive traffic to your website, you would measure click-throughs. If Instagram is for brand awareness, you might track the number of Instagram Story views. And if you advertise on Facebook, cost-per-click (CPC) is a common success metric.

Social media goals should align with your overall marketing objectives. This makes it easier to show the value of your work and secure buy-in from your boss.

Start developing a successful social media marketing plan by writing down at least three goals for social media.

“ It’s easy to get overwhelmed by deciding what to post and which metrics to track, but you need to focus on what you want to get out of social media to begin with,” says Amanda Wood, Hootsuite’s Senior Manager of Social Marketing. “Don’t just start posting and tracking everything: match your goals to your business, and your metrics to your goals.”

Step 2. Learn everything you can about your audience

Get to know your fans, followers, and customers as real people with real wants and needs, and you will know how to target and engage them on social media.

When it comes to your ideal customer, you should know things like:

• Average income
• Typical job title or industry

Here’s a simple guide and template for creating audience/buyer personas .

Don’t forget to document this information in your strategy doc!

Social media analytics can also provide a ton of valuable information about who your followers are, where they live, and how they interact with your brand on social media. These insights allow you to refine your strategy and better target your audience.

Jugnoo, an Uber-like service for auto-rickshaws in India, used Facebook Analytics to learn that 90% of their users who referred other customers were between 18- and 34-years-old, and 65% of that group was using Android. They used that information to target their ads, resulting in a 40% lower cost per referral.

Check out our guide to using social media analytics and the tools you need to track them .

Step 3. Get to know your competition

Odds are your competitors are already using social media, and that means you can learn from what they’re doing.

Conduct a competitive analysis

A competitive analysis allows you to understand who the competition is and what they’re doing well (and not so well). You’ll get a good sense of what’s expected in your industry, which will help you set social media targets of your own.

It will also help you spot opportunities and weaknesses you can document in your social strategy doc.

Maybe one of your competitors is dominant on Facebook, for example, but has put little effort into X (Twitter) or Instagram. You might want to focus on the social media platforms where your audience is underserved, rather than trying to win fans away from a dominant player.

Use social media listening

Social listening is another way to keep an eye on your competitors.

Do searches of the competition’s company name, account handles, and other relevant keywords on social media. Find out what they’re sharing and what other people are saying about them. If they’re using influencer marketing, how much engagement do those campaigns earn them?

Pro tip : Use Hootsuite Streams to monitor relevant keywords, hashtags and accounts in real-time.

Try Hootsuite for free. You can cancel anytime.

As you track, you may notice shifts in how your competitors and industry leaders are using social media. You may come across new, exciting trends. You might even spot specific social content or a campaign that really hits the mark—or totally bombs.

Use this kind of intel to optimize and inform your own social media marketing strategy.

Just don’t go overboard on the spy tactics, Amanda advises. “ Make sure you aren’t ALWAYS comparing yourself to the competition — it can be a distraction. I’d say checking in on a monthly basis is healthy. Otherwise, focus on your own strategy and results.”

Step 4. Do a social media audit

If you’re already using social media, take stock of your efforts so far. Ask yourself the following questions:

• What’s working, and what’s not?
• Who is engaging with you?
• What are your most valuable partnerships?
• Which networks does your target audience use?
• How does your social media presence compare to the competition?

Once you collect that information, you’ll be ready to start thinking about ways to improve.

We’ve created an easy-to-follow social media audit guide and template to walk you through each step of this process.

Your audit should give you a clear picture of what purpose each of your social accounts serves. If the purpose of an account isn’t clear, think about whether it’s worth keeping.

To help you decide, ask yourself the following questions:

• Is my audience here?
• If so, how are they using this platform?
• Can I use this account to help achieve my goals?

Asking these tough questions will keep your social media strategy focused.

Look for impostor accounts

During the audit, you may discover fake accounts using your business name or the names of your products.

These imposters can be harmful to your brand—never mind that they’re capturing followers that should be yours.

You may want to get your accounts verified too to ensure your fans know they are dealing with the real you.

Here’s how to get verified on:

• X (Twitter)

Step 5. Set up accounts and improve profiles

Decide which networks to use.

As you decide which social networks to use, you will also need to define your strategy for each.

Benefit Cosmetics’ social media manager, Angela Purcaro, told eMarketer : “For our makeup tutorials … we’re all about Snapchat and Instagram Stories. [X], on the other hand, is designated for customer service.”

Hootsuite’s own social team even designates different purposes for formats within networks. On Instagram, for example, they use the feed to post high-quality educational infographics and product announcements and Stories to cover live events or quick social media updates.

View this post on Instagram A post shared by Hootsuite 🦉 (@hootsuite)

Pro tip : Write out a mission statement for each network. A one-sentence declaration to keep you focused on a specific goal.

Example: “We will use X for customer support to keep email and call volumes down.”

Or: “We will use LinkedIn for promoting and sharing our company culture to help with recruitment and employee advocacy.”

One more: “We will use Instagram to highlight new products and repost quality content from influencers.”

If you can’t create a solid mission statement for a particular social media channel, you may want to ask yourself if it’s worth it.

Note : While larger businesses can and do tackle every platform, small businesses may not be able to — and that’s ok! Prioritize social platforms that will have the most impact on your business and make sure your marketing team has the resources to handle content for those networks. If you need help focusing your efforts, check out our 18-minute social media plan .

Set up your profiles

Once you’ve decided which networks to focus on, it’s time to create your profiles. Or improve existing ones so they align with your strategy.

• Make sure you fill out all profile fields
• Include keywords people would use to search for your business
• Use consistent branding (logos, images, etc.) across networks so your profiles are easily recognizable

Pro tip : Use high-quality images that follow the recommended dimensions for each network. Check out our always-up-to-date social media image size cheat sheet for quick reference.

We’ve also got step-by-step guides for each network to walk you through the process:

• Create a Facebook business page
• Create an Instagram business account
• Create a TikTok account
• Create a X (Twitter) business account
• Create a Snapchat account
• Create a LinkedIn Company Page
• Create a Pinterest business account
• Create a YouTube channel

Don’t let this list overwhelm you. Remember, it’s better to use fewer channels well than to stretch yourself thin trying to maintain a presence on every network.

Optimize your profiles (and content) for search

Never heard of social SEO ? It’s time to learn.

44% of Gen Z consumers use social platforms to research their purchase decisions, which means it’s extra critical that your channels are optimized for social search.

That means making sure your profile names are clear and descriptive, you’re including relevant hashtags and keywords in your bio and on every post, and you’re using features like alt text and captions to include your target keywords as naturally as possible.

Step 6. Find inspiration

While it’s important that your brand be unique, you can still draw inspiration from other businesses that are great on social.

“ I consider it my job to stay active on social: to know what’s trending, which campaigns are winning, what’s new with the platforms, who’s going above and beyond,” says Amanda. “This might be the most fun step for you, or the hardest one, but it’s just as crucial as the rest of them.”

Social media success stories

You can usually find these on the business section of the social network’s website. ( Here’s Facebook’s , for example.)

Case studies can offer valuable insights that you can apply to your own social media plan.

Award-winning accounts and campaigns

You could also check out the winners of The Facebook Awards or The Shorty Awards for examples of brands that are at the top of their social media game.

For learning and a laugh, check out Fridge-Worthy, Hootsuite’s bi-weekly awards show highlighting brands doing smart and clever things on social media.

Your favorite brands on social media

Who do you enjoy following on social media? What do they do that compels people to engage and share their content?

National Geographic, for example, is one of the best on Instagram, combining stunning visuals with compelling captions.

View this post on Instagram A post shared by National Geographic (@natgeo)

Then there’s Shopify. The ecommerce brand uses Facebook to sell themselves by showcasing customer stories and case studies.

And Lush Cosmetics is a great example of superior customer service on X. They use their 280 characters to answer questions and solve problems in an extremely charming and on-brand way.

Source: lushcosmetics on X

Notice that each of these accounts has a consistent voice, tone, and style. That’s key to letting people know what to expect from your feed. That is, why should they follow you? What’s in it for them?

Consistency also helps keep your content on-brand even if you have multiple people on your social media team.

For more on this, read our guide on establishing a compelling brand voice on social media .

Ask your followers

Consumers can also offer social media inspiration.

What are your target customers talking about online? What can you learn about their wants and needs?

If you have existing social channels, you could also ask your followers what they want from you. Just make sure that you follow through and deliver what they ask for.

Step 7. Create a social media content calendar

Sharing great content is essential, of course, but it’s equally important to have a plan in place for when you’ll share content to get the maximum impact.

Your social media content calendar also needs to account for the time you spend interacting with the audience (although you need to allow for some spontaneous engagement as well).

Set your posting schedule

Your social media content calendar lists the dates and times at which you will publish types of content on each channel. It’s the perfect place to plan all of your social media activities—from images, link sharing, and re-shares of user-generated content to blog posts and videos. It includes both your day-to-day posting and content for social media campaigns.

Your calendar also ensures your posts are spaced out appropriately and published at the best times to post .

Pro tip: You can plan your whole content calendar and get recommended best times to post on every network based on your past engagement rate, impressions, or link click data in Hootsuite.

Hootsuite’s Best Time to Publish feature

Determine the right content mix

Make sure your content strategy and calendar reflect the mission statement you’ve assigned to each social profile, so that everything you post is working to support your business goals.

(We know, it’s tempting to jump on every meme, but there should always be a strategy behind your social media marketing efforts!)

You might decide that:

• 50% of content will drive traffic back to your website
• 25% of content will be curated from other sources
• 20% of content will support lead-generation goals (newsletter sign-ups, ebook downloads, etc.)
• 5% of content will be about your company culture

Placing these different post types in your content calendar will ensure you maintain the right mix.

If you’re starting from scratch and you’re not sure what types of content to post, try the 80-20 rule :

• 80% of your posts should inform, educate, or entertain your audience
• 20% can directly promote your brand.

You could also try the social media content marketing rule of thirds :

• One-third of your content promotes your business, converts readers, and generates profit.
• One-third of your content shares ideas and stories from thought leaders in your industry or like-minded businesses.
• One-third of your content is personal interactions with your audience

Whatever you decide on, be sure to document it in your strategy doc.

Don’t post too much or too little

If you’re starting a social media marketing strategy from scratch, you may not have figured out how often to post to each network for maximum engagement yet.

Post too frequently and you risk annoying your audience. But, if you post too little, you risk looking like you’re not worth following.

Start with these posting frequency recommendations:

• Instagram (feed): 3-7 times per week
• TikTok: 3-5 times per week
• Facebook: 1-2 times per day
• X (Twitter): 1-5 times per day
• LinkedIn: 1-5 times per day

Pro tip : Once you have your social media content calendar planned out, use a scheduling tool to prepare messages in advance rather than updating constantly throughout the day.

We might be biased, but we think Hootsuite is the best social media management tool. You can schedule social media posts to every network and the intuitive calendar view gives you a full picture of all your social activity each week.

Try It Free

Step 8. Create compelling content

Remember those mission statements you created for each channel in Step 5? Well, it’s time to go a bit deeper, a.k.a. provide some examples of the type of content you’ll post to fulfill your mission on each network.

If you’re not sure what to post, here’s a long list of social media content ideas to get you started. Or (to make it even easier) you can use an AI tool like OwlyWriter to generate on-brand content in a flash.

The idea here is to:

• Keep your content aligned with the purpose of each network;
• Show other stakeholders (if applicable) what kind of content they can expect to see on each network.

This last point especially will help you avoid any tension when your colleagues want to know why you haven’t posted their case study/whitepaper/blog post to TikTok yet. It’s not in the strategy, Linda!

Ideally, you will generate content types that are both suited to the network and the purpose you’ve set out for that network.

For example, you wouldn’t want to waste time posting brand awareness tweets if you’ve designated X/Twitter for primarily customer support. And you wouldn’t want to post super polished corporate video ads to TikTok, as users expect to see short, unpolished videos on that platform.

It might take some testing over time to figure out which type of content works best on which type of network, so prepare to update this section frequently.

We won’t lie: content creation isn’t as easy as everyone not on the social team seems to think. But if you’re struggling, Amanda suggests going back to basics.

The first question to ask is: is there cohesion between your content types? Is your content providing value? Do you have a good mix of entertaining, or educational content? What does it offer that makes a person stop and spend time? Creating a few different content pillars or categories that encompass different aspects of storytelling for your brand, and what you can offer your audience is a good start.

This brings us to Step 9.

Step 9. Track performance and make adjustments

Your social media marketing strategy is a hugely important document for your business, and you can’t assume you’ll get it exactly right on the first try.

As you start to implement your plan and track your results, you may find that some strategies don’t work as well as you’d anticipated, while others are working even better than expected.

That’s why it’s important to document your progress along the way.

Look at performance metrics

In addition to the analytics within each social network (see Step 2), you can use UTM parameters to track social visitors as they move through your website, so you can see exactly which social posts drive the most traffic to your website.

Benchmark your results

You’ve got your numbers, but how do they stack up to the competition in your industry? Industry benchmarks are a great way to evaluate your performance against other businesses in your category.

If you’ve got Hootsuite Analytics , you can use our built-in social media benchmarking tool to compare the performance of your social accounts against the average of brands in your industry with just a couple of clicks.

You can set up custom timeframes, switch between networks — Instagram, Facebook, X (Twitter), LinkedIn, and TikTok — and look up benchmarks for metrics like followers, audience growth rate, engagement rate, clicks, shares, and much more.

You’ll also find resources to improve your performance  right in the summary section:

Re-evaluate, test, and do it all again

Once this data starts coming in, use it to re-evaluate your strategy regularly. You can also use this information to test different posts, social marketing campaigns, and strategies against one another. Constant testing allows you to understand what works and what doesn’t, so you can refine your social media marketing strategy in real time.

You’ll want to check the performance of all your channels at least once a week and get to know the basics of social media reporting so you can track your growth over time.

Pro tip: If you use Hootsuite, you can review the performance of all your posts on every network in one place. Once you get the hang of checking your analytics, you may even want to customize different reports to show specific metrics over a variety of different time periods.

Surveys can also be a great way to find out how well your social media strategy is working. Ask your followers, email list, and website visitors whether you’re meeting their needs and expectations, and what they’d like to see more of. Then make sure to deliver on what they tell you.

Finalizing your social media strategy

Spoiler alert: nothing is final.

Social media moves fast. New networks emerge, others go through demographic shifts.

Your business will go through periods of change as well.

All of this means that your social media marketing strategy should be a living document that you review and adjust as needed. Refer to it often to stay on track, but don’t be afraid to make changes so that it better reflects new goals, tools, or plans.

When you update your social strategy, make sure to watch our 5-step video on how to updating your social media strategy for 2024:

Social media strategy template

Ready to start documenting? Grab your free social media strategy template below!

What’s next? When you’re ready to put your plan into action, we’re here to help…

Save time managing your social media marketing strategy with Hootsuite. From a single dashboard you can easily:

• Plan, create, and schedule posts to every network
• Track relevant keywords, topics, and accounts
• Stay on top of engagement with a universal inbox
• Get easy-to-understand performance reports and improve your strategy as needed

Try Hootsuite for Free

With files from Shannon Tien .

Do it better with Hootsuite , the all-in-one social media tool. Stay on top of things, grow, and beat the competition.

Become a better social marketer.

Get expert social media advice delivered straight to your inbox.

Christina Newberry is an award-winning writer and editor whose greatest passions include food, travel, urban gardening, and the Oxford comma—not necessarily in that order.

Amanda Wood is a senior social marketing professional who combines analytical and creative thinking to build brands.

As head of social at Hootsuite, Amanda oversees the global social strategy encompassing organic and paid social on Instagram, Facebook, Twitter, TikTok, and LinkedIn, a social engagement and listening strategy, and an employee advocacy program.

As the leader of a high-performing social team, she has extensive experience collaborating with creatives to bring campaigns to life on social and drive business results.

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Home » How To Design a Website in 2024: 7 Steps To Get Started

How To Design a Website in 2024: 7 Steps To Get Started

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Written and researched by:

First impressions matter, so it’s important to take the time to design your website properly. Website builders like Wix provide plenty of editing support and stunning templates, but we’re here to help you from start to finish, from finding your site’s purpose to setting a color scheme to adding pages.

You’ll want to consider your website’s aim ahead of time and adapt your design to suit your business, branding, and target audience. After all, a poor website design could result in the loss of traffic or sales – it isn’t something to rush.

But, where do you start? What tools do you need? We’ve pulled together a seven-step guide to walk you through designing a website from the ground up.

What You Need To Design a Website

Before you can even start designing, you’ll need a platform to build your website. We carry out regular testing of the market’s leading website builders to help you find the perfect fit for your needs, whether you’re looking to create a personal website or build an online store .

Here are our top website builders for 2024:

As you can see, Wix is our top-rated website builder overall , offering well-rounded features and 900+ professionally designed templates that cater to a variety of industries.

Website builders, like Wix, package web hosting into your subscription so you don’t need to worry about sourcing a hosting provider yourself. However, if you choose to design a website with a CMS platform, such as WordPress, you’ll need to purchase a plan from a web hosting provider before you can publish your site.

You’ll also need a domain name – this makes your website appear professional and helps repeat visitors recognize your website. Website builders often include a free custom domain name for the first year, but some, like Shopify , will require you to source and pay for a domain name separately. This can cost roughly $10-$20 per year, depending on your chosen domain.

Finally, we recommend gathering your brand assets and information before you begin designing your website . Having a business logo, visuals, and key content to hand will help you save time as you get set up.

#1. Set Your Website Goals

The first step in designing your website is to define your website and set your goals . With a clear vision in mind, you’ll reduce the risk of confusing your visitors as they navigate your pages. Here are a few things to consider:

• What is your site’s purpose? – Get an understanding of your industry and figure out what you hope to achieve with your website, such as showcasing your products or creating an online community
• Do you have a unique selling point? – Think about what will make your website stand out in the market and avoid replicating the style and look of your competitors
• Who are your target audience ? – Your website’s design should reflect your goals and your audience, e.g. if you’re prioritizing customer engagement, there should be features like live chat and contact forms readily available
• What actions do you want visitors to take? – Is your website largely informational and is that content easy to access? Do you want people to purchase products? Should you add a button signposting an action? Would moving your newsletter sign-up form make it easier for visitors to spot?

#2. Build Your Brand Identity

It’s essential to build your brand identity before you start designing. This will ensure your website’s look remains consistent, no matter which page users visit. And, don’t overlook this step if you’re building a personal website either – a clear online identity applies to both individuals and businesses.

Tone of Voice

Your website’s tone of voice needs to align with your business and website goals. Do you want to sound professional and formal? Do you want to sprinkle jokes into your site’s copy with a playful and friendly tone? The tone you decide on brings your website to life for visitors – it can make your brand or business seem approachable, inspiring, and authoritative.

Naturally, your tone of voice can adapt and change to suit its environment. Say you pick a relatively formal tone for your website, you can absolutely lighten things up for social media posts or add more bold and engaging copy into your weekly newsletters.

When testing website builders, I noticed that a lot of recently developed AI tools will adopt a set tone of voice when generating text. For example, I used Shopify Magic to create some product descriptions and I could add a custom tone or choose from a list of preset options for my prompt, including persuasive, daring, and supportive.

Color Scheme

Choosing a color scheme is incredibly important when designing a website – a signature color, like Coca Cola’s famous red, can set your brand apart from the competition and make your brand instantly recognizable.

However, certain colors are perceived differently by people . For example, green can represent wealth, tranquility, health, and nature. This could be ideal for a wellness business or spa looking to take online bookings thanks to the relaxation effects of the color. And, gray can symbolize simplicity, calm, futuristic, and logic – this color is best suited for technology brands and industrial businesses.

We recommend choosing one dominant color, with two or three secondary colors to complete the palette . You can set your color scheme based on your branding or products, or choose a variety of colors based on what looks nice! If you need some inspiration, Pantone recently revealed “Peach Fuzz” as the 2024 Color of the Year.

I started building a website with Squarespace and was impressed by the color palette editor. If you have an established brand with set colors already, you can easily input the individual hex codes. Alternatively, I could choose from preset color schemes designed by Squarespace, or even draw a palette from an uploaded image or single color.

Now, you need a font style to complement your website’s tone of voice and color palette. Businesses and websites that want to appear professional and serious will gravitate towards classic styles of font, such as Arial and Helvetica.

A modern or more playful website might want to explore abstract or quirky fonts instead. Website builders, like Wix, offer a variety of fonts to choose from when editing, so you can easily test things out before committing to a style.

Just remember, strike a balance between an interesting font type and readable content – you don’t want to alienate any readers by using a font that’s impossible to decipher.

#3. Select a Template

Now that you’ve set your website’s goal and created a clear brand identity, it’s time to pick a template. A template or theme creates the structure of your website, shaping the layout and overall appearance .

There are several ways to start the design process of your website, but your options depend on your chosen website builder or platform. You could:

• Create a design from scratch – if you’ve got some building experience, this is a great way to design a unique-looking website
• Choose a template – website builders make it easy for users by offering professionally designed and high-quality templates
• Use an AI website builder – share your vision with an AI tool and hand the design process over to the computer

For most users, we recommend choosing a template, especially if you’re a beginner . Website builders, like Wix or Squarespace , offer a range of high-quality and customizable templates that come with example content included. This helps you get a good idea of what your site will look like at the end of the design process.

You simply have to swap our elements, images, and text to suit your needs.

Wix has the best selection of templates, with over 900 on offer . These are divided into industry categories or website types, such as “Wellness” and “Photography.” During our testing, this made it really easy for us to browse and find a relevant template.

#4. Customize Essential Pages

Once you’ve settled on a template, you can begin to tailor your website with relevant pages. Most templates come with a selection of pages already built in, including a homepage, about page, and contact page – these are the essential three.

Of course, if you’re looking to build an online store, you’ll also want to add pages for your storefront and products. Website builders will usually add these automatically after the onboarding process.

If certain pages aren’t included after setup or with your chosen template, we recommend also adding an FAQ page (to help users get answers easily), a blog (to show expertise in your niche), and a review or testimonial page (to build brand trust).

As you customize your pages, remember your brand identity and target audience. Add sections and elements that make sense and ensure your key information is readable and accessible. You don’t want visitors to hunt around to find your contact details or your store’s opening times.

#5. Optimize Your Content

After adding your pages and content, you need to think about optimizing your site design. A well-optimized site improves the overall user journey and helps search engines, like Google, look favorably on your site.

Here’s what we recommend:

• Make your site user-friendly – Consider the structure, layout, and user experience when designing your site so it’s easy to navigate
• Apply SEO best practices – Lots of builders generate sitemaps and let you tweak your page’s metadata with a click of a button, but we rate Wix as the best SEO website builder thanks to its keyword support, SEO resources, and personalized SEO checklist which flags areas for improvement
• Guarantee accessibility – Your website should be accessible for everyone, and not just designed with search engines in mind, so make sure your text is scannable, use plenty of whitespace to break up sections, and add alt text to images
• Consider mobile users – Not everyone will visit your website from a desktop (about half of all web traffic comes from mobiles), so preview and rework your site’s design for different devices
• Speed up your website – Compress your images or large files, and don’t overwhelm your pages with tons of content, to ensure your website’s load time doesn’t leave visitors with a frustrating experience

#6. Launch Your Website

Feeling happy with your website design? You’ve got a clear vision, you’ve established your brand identity, you’ve chosen a template, added pages, and optimized your content. It’s finally time to check everything’s in working order before you publish your site.

We recommend asking your family, friends, colleagues, or even the general public to test the site in preview mode . This is a great way to get fresh eyes on your design, pages, and content. By this point, you’ll have worked closely on the site for some time, so you’re less likely to spot errors or notice any issues when navigating the site you’ve designed.

When testing your website, there are a few key areas to look at:

• Links – Make sure all of your links are set up properly and direct visitors to the right page
• Content – Check that what you’re trying to say is clear and readable
• Navigation – Can visitors find their way around your website? Can they return to the homepage easily?
• Different views – View your website using different devices to make sure your design looks okay on desktop, mobile, and tablet
• Loading speed – Test that your pages don’t take longer than a couple of seconds to load (review the section above to help optimize your website)

Once you’re satisfied with your website’s design, publish it! And, don’t forget to spread the word by sharing your new website with your network. We recommend building some buzz across social media before revealing your beautiful website to the world.

#7. Gather Feedback & Evolve

You might think you’re done, but designing a website doesn’t stop once you publish it . Nothing’s ever perfect from the get-go, so you’ll need to monitor your site’s performance and request feedback regularly.

Maybe you’re thinking about rebranding your business down the line, or you’ve spotted a new design trend, or you’ve noticed a change in your audience – whatever it is, you have to keep working and improving your website.

Most website builders have built-in analytics or integrations, like Google Analytics , so you can track things like page views, the time users spend on each page, your site’s bounce rate, and your store’s conversion rate .

For example, Hostinger’s website builder includes an AI heatmap tool so you can easily track which elements of your site attract the most attention from visitors. This is a really neat tool if you’re looking for areas to improve on your pages.

Alternatively, you could reach out to engaged visitors, customers, and friends to see what they think needs some work. Requesting regular feedback is a necessary step for website owners if they want to keep on top of pain points or issues.

Overall, monitoring your site’s performance and audience behavior helps draw attention to areas that need tweaking. You don’t need to make changes every single day, but your website needs to evolve and adapt to the times. Visitors will appreciate it if their feedback is listened to and actioned.

Should You Hire a Web Designer?

If all of this seems overwhelming to you, consider hiring a web designer . There are a few things to consider before deciding:

• Do you have the budget? Using a website builder is considerably cheaper than hiring a web designer, so make sure to factor in costs before committing to this design route
• Do you have the time to design a website? If not, a web designer can help free up your schedule so you can focus on other business matters instead
• Are you confident in your building skills? Hiring a web designer can give you peace of mind if you’ve got limited web design experience, but with the user-friendly website builders and AI tools available in 2024, everyone should be able to build a website, no matter their skill level

How to Design a Website: The 7-Step Journey

Now you know how to design a website – you can break the seven-step process down into three key stages.

To recap, you first want to understand your website’s goals and prep your materials , such as brand assets and content. This will give you a good foundation to build from.

The second stage is when you physically start designing your pages and elements , whether you use the help of AI or build your vision from scratch. This is when you implement your color scheme, font type, and tone of voice – and also play around with your copy and imagery to get them in the right position.

Lastly, the third stage is all about getting that site live for visitors and adapting your design when necessary . It’s important to ask for feedback regularly and make changes that suit your website’s visitors and customers.

Can I design my website for free?

How much does it cost to design a website.

If you don’t feel confident when it comes to designing a website, you can always hire a web designer or developer to handle things for you. Of course, this will cost more than a traditional do-it-yourself website builder.

How hard is it to design a website?

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Walmart offers new perks for workers, from a new bonus plan to opportunities in skilled trade jobs

FILE - People walk by the Walmart booth during the CES tech show Tuesday, Jan. 9, 2024, in Las Vegas. Walmart is offering new perks for its hourly workers. They include a new bonus plan as well as opportunities to move into skilled trade jobs within the company. (AP Photo/John Locher, file)

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NEW YORK (AP) — Walmart is offering new perks for its hourly U.S. workers, ranging from a new bonus plan to opportunities to move into skilled trade jobs within the company.

The perks program announced Wednesday comes as the nation’s largest private employer says it’s seeing a decline in worker turnover. But Walmart, like other employers, faces a still-competitive labor market and increasing demands from its employees .

Walmart’s new bonus plan for eligible part-time and full-time U.S. store workers — including those in its pharmacy and Vision Centers — is based on their store’s performance, with the maximum bonus potential also tied to years of experience.

For example, a full-time worker who’s been with Walmart between one year and almost five years can earn a maximum bonus of $350 per year, while a 20-year full-time worker can earn a maximum bonus of $1,000, Walmart said. The plan will be available to 700,000 U.S. workers, the company said.

In January, Walmart announced its U.S. store managers would receive up to $20,000 in Walmart stock grants every year.

The company, based in Bentonville, Arkansas, is also launching a training program for hourly workers in its U.S. stores and supply networks that will give them an opportunity to move into roles in facilities maintenance, refrigeration, heating, ventilation and air conditioning, and automation. Walmart said it is looking to increase these skilled trades workers from 450 to roughly 2,000 in the next two years.

The jobs pay between $19 and $45 per hour, and workers will be paid during the training, the company said. Walmart’s average hourly wage is close to $18, an increase of 30% over the past five years. Walmart’s starting wages for U.S. workers range between $14 and $19 an hour.

The training program is expected to start with 100 workers in the Dallas-Fort Worth area. It is part of the Walmart Academy, one of the largest skill-development programs in the country.

Last month, Walmart reported another quarter of strong results as its low prices pull in shoppers scouring for discounts amid stubbornly high inflation .

Households with incomes exceeding $100,000 have been drawn to the retailer as it upgrades the quality of its items and focuses on providing more convenient ways to shop. Two-thirds of Walmart’s market share gains across the aisles are coming from that group, Walmart said.

Walmart said the skilled trades initiative is similar to a program it announced two years ago that gave employees who work in its distribution and fulfillment centers a chance to become certified Walmart truck drivers through a 12-week program taught by the company’s established drivers.

At the time, it said it was raising pay for its 12,000 truck drivers. The starting range for new drivers is now between $95,000 and $110,000 a year. The retailer said that $87,500 had been the average that new truck drivers could make in their first year.

Walmart spokeswoman Anne Hatfield said the trucker program has produced more than 500 new drivers since launching in the spring of 2022. That’s helped the company navigate an industrywide shortage of truck drivers.

Walmart has similar training and development programs for pharmacy tech and opticians.

Meanwhile, Walmart said Wednesday it is expanded the number of skills certificates available to help fast-track front-line workers into about 100,000 jobs that are higher paying and in demand at the company over the next three years.

In 2020, the company offered five skilled certificates. Now, there are 50. They include topics such as front-line manager leadership, people and business leadership, data science, software development and project management.

Employees can earn the certificates in four months, according to Lo Stomski, Walmart’s senior vice president and chief talent officer.

Walmart highlighted its worker training efforts as it prepares to hold two big events this week. A virtual shareholders’ meeting is set for Wednesday. On Friday, the company is holding a celebration of its workers at Bud Walton Arena in Fayetteville, Arkansas, to recognize Walmart’s employees from around the world as well as shareholders.

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Space elevators could get us to Mars in record time — and Japan is planning one for 2050

• A space elevator could make it much cheaper and faster to get goods to other planets, like Mars.
• The Obayashi Corporation based in Japan announced in 2012 plans to begin building one by next year.
• Not only would it cost $100 billion, there are huge technological and organizational challenges.

Imagine a long tether linking Earth to space that could launch us to orbit at a fraction of the cost and slingshot us to other worlds at record speed.

That's the basic idea behind a space elevator .

Instead of taking six to eight months to reach Mars, scientists have estimated a space elevator could get us there in three to four months or even as quickly as 40 days .

The concept of space elevators isn't new, but engineering such a structure would be no easy feat , and many other issues besides technology stand in the way.

That's why the ambition to seriously build one is fairly recent.

The Japan-based company Obayashi Corporation thinks it has the expertise.

Japan aims to build a space elevator by 2050

Known for constructing the world's tallest tower, the Tokyo Skytree , Obayashi Corporation announced in 2012 that it would reach even loftier heights with its own space elevator.

In a report that same year, the company said it would begin construction on the $100-billion project by 2025 and could start operations as early as 2050.

We checked in with Yoji Ishikawa, who wrote the report and is part of the company's future technology creation department, to see how the project is progressing ahead of 2025.

While Ishikawa said the company likely won't start construction next year, it is currently "engaged in research and development, rough design, partnership building, and promotion," he told Business Insider.

Some have doubted such a structure is even possible.

"It's been sort of a kooky idea," said Christian Johnson, who published a report on space elevators last year in the peer-reviewed Journal of Science Policy & Governance.

"That said, there are some people who are real scientists who are really on board with this and really want to make it happen," Johnson said.

A cheaper route to space

Launching humans and objects into space on rockets is extremely expensive. For example, NASA has estimated its four Artemis moon missions will cost $4.1 billion per launch .

The reason is something called the rocket equation . It takes a lot of fuel to get to space, but the fuel is heavy, which increases the amount of fuel you need. "And so you see the kind of vicious cycle there," Johnson said.

With a space elevator, you don't need rockets or fuel.

According to some designs, space elevators would shuttle cargo to orbit on electromagnetic vehicles called climbers. These climbers could be remotely powered — like through solar power or microwaves — eliminating the need for on-board fuel.

In his report for the Obayashi Corporation, Ishikawa wrote that this type of space elevator could help drop the cost of moving goods to space to $57 per pound. Other estimates for space elevators in general have put the price at $227 per pound.

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Even SpaceX's Falcon 9, which, at around $1,227 per pound, is one of the cheaper rockets to launch, is still about five times as expensive as the higher cost estimates for space elevators.

There are other benefits besides cost, too.

There's no danger of a rocket exploding , and the climbers could be zero-emission vehicles, Johnson said. At a relatively leisurely pace of 124 miles per hour, the Obayashi Corporation's climbers would travel slower than rockets with fewer vibrations, which is good for sensitive equipment.

Ishikawa said the Obayashi Corporation sees a space elevator as a new kind of public works project that would benefit all of humankind.

There's not enough steel on Earth to make a space elevator

Right now, one of the biggest obstacles to building a space elevator is what to make the tether or tube from.

To withstand the tremendous tension it would be under, the tube would have to be very thick if it were made out of typical materials, like steel. However, "if you try to build it out of steel, you would need more steel than exists on Earth," Johnson said.

Ishikawa's report suggested Obayashi Corporation might use carbon nanotubes . A nanotube is a rolled-up layer of graphite, the material that's used in pencils.

It's much lighter and is less likely to break under tension compared to steel, so the space elevator could be much smaller, Johnson said. But there's a catch.

While nanotubes are very strong, they're also tiny, a billionth of a meter in diameter. And researchers haven't made them very lengthy. The longest is only about 2 feet.

To be properly balanced while still reaching geosynchronous orbit — where objects stay in sync with Earth's rotation — the tether would need to be at least 22,000 miles long, per Ishikawa's report.

"So we're not there," Johnson said of the nanotube length. "But that doesn't mean it's impossible."

Instead, researchers might need to develop an entirely new material, Ishikawa said.

Other obstacles

Whatever the material turns out to be, there are still other problems.

For instance, a space elevator's tether would be under such incredible tension that it would be prone to snapping, Johnson said. A lightning strike could vaporize it. There's also other weather to consider like tornadoes, monsoons, and hurricanes.

Locating the tether base at the equator would lessen the likelihood of hurricanes , but it would still need to be in the open ocean to make it more difficult for terrorists to target, Johnson said.

It would also take a lot of trips to make up for that giant price tag for construction.

That's only scratching the surface of the challenges. And they can't all be solved by one company, Ishikawa said. "We need partnerships," he said. "We need different industries."

"Of course," Ishikawa said, "raising funds is very essential."

That's a lot of obstacles to overcome to start construction in time for operation by 2050, especially since Ishikawa estimated it would take 25 years to build. He noted that the 2050 estimate always came with caveats about the technology progressing. "It's not our goal or promise," he said, but the company is still aiming for that date.

"I think that those time estimates are optimistic," Johnson said, "even assuming there was a breakthrough tomorrow."

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