How to Write a Business Plan in 2026: Sections, a Sample Plan and Projections Lenders Trust

A business plan is the document that turns an idea into numbers a lender, investor or partner can test, and the exercise of writing it is often more useful to you than to them. This guide follows the two formats the US Small Business Administration recommends, walks through every section with a mini sample plan for a fictional mobile dog-grooming business, builds a first-year financial projection line by line, and explains what an SBA lender checks before saying yes. Lender rules were checked against SBA's current loan rulebook in October 2026.

Quick answer

To write a business plan, pick a format — a traditional plan (detailed, what lenders expect) or a lean one-page plan (fast, for testing an idea) — then write the sections in this order: market research and customers, your offer and pricing, marketing and sales, operations and team, financial projections, funding request, and finally the executive summary.

• SBA's traditional format has 9 parts, from executive summary to appendix

• Show 5-year projections, with year one by month or quarter

• Build revenue bottom-up: price × customers per month, with a ramp-up

• SBA lenders want cash flow covering debt at least 1.15x and start-up equity of 10% of total project cost

• Write the executive summary last; it is the page most readers finish

Why write a business plan at all

Most first-time owners write a plan because a bank asked for one. That is a fine reason, but the bigger payoff is finding the holes before they cost money. Writing down how many customers you need each month, what each one costs to win and when cash actually arrives forces you to answer questions you could otherwise avoid until the business account runs dry.

A plan also does different jobs for different readers. A lender reads it to judge whether you can repay. An investor reads it to judge whether the business can grow large enough to return their money several times over. A partner or key hire reads it to see whether you have thought things through. Write for the reader who matters most right now, and keep a version you update as the business changes. If you have not yet chosen a structure or registered the business, our how to start a business guide covers those steps; the plan should reflect the entity you pick.

Traditional vs lean: choose your format

The SBA describes two formats and says plainly that there is no single right way to write one. What matters is that the plan does its job for its reader.

A traditional business plan is detailed and takes longer to write. The SBA notes that lenders and investors commonly request this format, and that it can run to dozens of pages. It suits anyone applying for a bank or SBA loan, raising money from outside investors, or planning a complex business with staff, premises and inventory.

A lean startup plan fits on one page, uses a chart-like layout and, by the SBA's estimate, can take as little as an hour to make. It suits a simple business, an owner testing an idea before spending money, or a plan you expect to revise often. Some lenders will ask for more detail, so treat a lean plan as a starting point rather than a loan application.

Traditional vs lean business plan

	Traditional plan	Lean plan
Length	Typically 15–30+ pages plus appendix	One page
Time to write	Days to weeks	As little as an hour (SBA)
Best for	Bank and SBA loans, investors, complex businesses	Testing an idea, simple or fast-changing businesses
Financials	5-year projections, year one by month or quarter	Key costs and revenue streams only
Sections	Executive summary through appendix (9 parts)	9 boxes: partners to revenue streams

Length

Traditional plan

Typically 15–30+ pages plus appendix

Lean plan

One page

Time to write

Traditional plan

Days to weeks

Lean plan

As little as an hour (SBA)

Best for

Traditional plan

Bank and SBA loans, investors, complex businesses

Lean plan

Testing an idea, simple or fast-changing businesses

Financials

Traditional plan

5-year projections, year one by month or quarter

Lean plan

Key costs and revenue streams only

Sections

Traditional plan

Executive summary through appendix (9 parts)

Lean plan

9 boxes: partners to revenue streams

Many owners start lean, test the idea with real customers and then expand the plan when they apply for funding. Our business plan generator produces a structured draft in either style that you can edit.

The sections of a traditional business plan (with a mini sample)

The SBA's traditional format has nine parts. Below, each one is explained with a short excerpt from a sample plan for a fictional business, Northside Mobile Grooming LLC, a one-van dog-grooming service in Columbus, Ohio. The figures are illustrative, not industry benchmarks.

1. Executive summary

This is a one-page snapshot: what the company does, for whom, where, who runs it, and, if you want money, how much and what for. Write it last, after the numbers are settled, because it summarizes everything else. Lenders often read only this page before deciding whether to read on.

Sample: "Northside Mobile Grooming LLC will provide full-service dog grooming from a converted van at customers' homes in north Columbus. Owner Dana Ruiz has eight years of salon grooming experience and a waiting list of 140 existing clients. We are requesting a $60,000 SBA 7(a) loan, plus $8,000 of owner equity, to buy and fit out a grooming van. Projected first-year revenue is $82,000, rising to $109,000 in year two."

2. Company description

Explain the problem you solve, who you solve it for and why you will win. Name the legal structure and location. Be specific about the advantage: experience, a location, a licence, an existing customer base, or a cost edge.

Sample: "Busy households and older owners struggle to transport anxious or large dogs to salons. A mobile service removes the drive, the wait and the stress of a kennel room. Northside is a single-member LLC formed in Ohio."

3. Market analysis

Show you know the market: its size, its trends, your target customer and your competitors. Use local figures where you can, such as households in your service area, the number of competing groomers within your radius, and their prices. The SBA suggests looking at what successful competitors do and how you could do it better.

Sample: "Our service area covers about 40,000 households across five ZIP codes. We identified three mobile groomers serving the area, all booking two to three weeks out, and six salons charging $70 to $110 for a full groom of a medium dog."

Sample plan — Northside's market at a glance

40,000

Households in service area

Five ZIP codes, illustrative

3

Mobile competitors

All booking 2–3 weeks out

$70–$110

Local salon price range

Full groom, medium dog

140

Clients on owner's waiting list

Launch customer base

4. Organization and management

Describe who runs the business, their experience, and the structure. Include an org chart if you have staff, and name advisors such as an accountant. Lenders look hard at this section for start-ups because the owner's track record stands in for business history.

5. Service or product line

What you sell, how it benefits customers, how it is priced, and any plans for new services or intellectual property. Include the pricing logic, not just the prices.

Sample: "Full groom $95 average (small dogs $80, large $120); bath and tidy $60; add-ons such as teeth brushing $10."

6. Marketing and sales

How you will attract and keep customers, and how a sale actually happens. The SBA points out that this section feeds your financial projections, so keep the two consistent. If you say you will win 20 customers a month, show the channels and the cost per customer.

Sample: "Launch to the existing client list, then local search ads ($250 a month), referral credit of $15 per referred client, and partnerships with two veterinary clinics. Online booking with a 24-hour reminder text."

7. Funding request

If you are asking for money, say how much you need over the next five years, what it will pay for, what type of financing you want (loan, line of credit, equity), and on what terms. Include your own contribution. The SBA's guidance is to explain clearly how much funding you will need and how you will use it.

8. Financial projections

This is the section lenders read most closely. An existing business includes past income statements, balance sheets and cash flow statements, usually for three to five years. Every business includes forecasts for the next five years, with year one broken out by month or quarter, as the SBA recommends. We build the numbers for Northside in the next section.

9. Appendix

Put supporting documents here: résumés, permits and licences, leases, quotes for equipment, letters of intent from customers, credit histories and anything else a lender asked for. Keep the body of the plan readable and let the appendix carry the paperwork.

The lean plan: nine boxes on one page

The SBA's lean format, closely modelled on the business model canvas, fits on a single page with nine elements. Fill each box with a few words or a short list, not paragraphs.

The nine boxes of a lean business plan

0/9

• Key partnerships — suppliers, subcontractors, referral partners (e.g. vet clinics)
• Key activities — what you do that gives you an edge
• Key resources — people, equipment, capital, licences, intellectual property
• Value proposition — the one-sentence reason customers choose you
• Customer relationships — self-service, personal, subscription, repeat booking
• Customer segments — who exactly buys, and where
• Channels — how customers find you and buy
• Cost structure — your main fixed and variable costs
• Revenue streams — what you charge for, and how

Share Print

The test of a lean plan is whether someone else can read it in two minutes and explain your business back to you. If they cannot, the boxes are too vague.

Financial projections: a worked example

Lenders want to see three things: a sales forecast, an expense budget and a cash flow view, all built on assumptions you can defend. The cleanest way to do that for a new business is bottom-up, from the price and volume of a single sale.

Start-up costs. Northside needs a used, converted grooming van ($52,000), equipment and initial supplies ($6,000) and working capital to cover the first few slow months ($10,000), a total project cost of $68,000. The SBA advises sorting costs into one-time and ongoing, planning at least a year of ongoing costs, and adding a margin of around 10% for surprises. Dana puts in $8,000 of her own cash, which is 11.8% of the project and clears SBA's 10% of total project cost start-up equity minimum. The rest comes from a $60,000 7(a) loan. Total up your own costs in the startup cost calculator.

Revenue. At full capacity one van can do about six full grooms a day, five days a week, 48 weeks a year: 1,440 grooms. At a $95 average ticket that is $136,800. No new business starts at capacity, so the plan assumes an average of 60% in year one and 80% in year two.

Costs. Variable cost per groom is about $18: shampoo and supplies $6, fuel and generator $9, and card processing about 3%. Fixed costs are $14,600 a year: insurance $3,600, vehicle maintenance $3,000, phone and booking software $1,200, marketing $4,800, accounting $1,500 and licences $500. Dana plans to pay herself $36,000 in year one and $42,000 in year two.

Loan payment. A $60,000 loan over 10 years at an assumed 11.5% costs about $844 a month, or $10,123 a year. SBA caps 7(a) rates on loans of this size at Prime + 6.0% over the base rate, so the plan uses a rate below the cap and states the assumption.

Break-even. The SBA's formula is fixed costs divided by price minus variable cost. Monthly fixed costs including owner pay and the loan are about $5,060, and each groom contributes $77, so Northside breaks even at roughly 66 grooms a month, a little over three a day. That is the single number to watch in the first quarter.

Try it — mobile grooming break-even (grooms per month)

Monthly Fixed CostsSelling Price per UnitVariable Cost per Unit

Contribution Margin / Unit₹77.00

Contribution Margin Ratio81.05%

Break-Even Revenue₹6,242.86

Break-Even Units66

Open the full Break Even Calculator (PDF, save, compare)

Year one should then be spread month by month. Show the ramp honestly: perhaps 35% of capacity in month one, rising to 75% by month twelve, with a dip in January when grooming demand is usually slower. The monthly view reveals what the annual totals hide, which is the cash low point. If cash goes negative in month three, your working capital line is too small.

What lenders look for in an SBA loan plan

SBA loans are made by banks and other lenders under SBA's rulebook, SOP 50 10, currently Version 8.1, effective October 1, 2026. The plan is how the lender documents that your business meets its tests. SBA's own guidance to borrowers is to have a business plan, an expense sheet and five years of projections ready before applying, and to expect that a new business's eligibility will lean heavily on the owner's personal credit.

Repayment ability. For a standard 7(a) loan, the business's cash flow must cover all debt payments at least 1.15x; 7(a) Small loans of up to $350,000 need 1.10x. A start-up relies on projections, so the lender will check that your assumptions are realistic and that coverage reaches the minimum soon after funding. Northside's 1.57x in year one clears the bar with room to spare.

Equity. Start-ups must inject at least 10% of total project cost of total project costs. Show where the money comes from: bank statements, or a gift letter if family provided it.

Experience and management. With no operating history, the lender is underwriting you. Put relevant experience, certifications and any existing customers front and centre.

Assumptions that hold up. Expect the lender to test your price against competitors, your volume against capacity and your costs against industry norms. A projection that hits 100% capacity in month two, or forgets payroll taxes and insurance, is the fastest way to lose credibility. Show a downside case, for example 20% lower volume, and prove the loan still gets paid.

Collateral and guaranties. SBA does not decline a loan solely for lack of collateral, but lenders take available business assets, and owners of 20% or more must personally guarantee. Our guides to SBA loan requirements and the SBA 7(a) loan set out every test; check your numbers first in the loan eligibility calculator.

How to write it, step by step

Do the research and numbers first and the polished prose last. Most weak plans are written in the order the sections appear, which means the executive summary promises numbers the financial section never supports.

Write your business plan in seven steps

1. 1

   Pick your reader and format

   Lender or investor? Use the traditional format. Testing an idea? Start with the lean one-page plan.

2. 2

   Research the market and competitors

   Count potential customers in your area, list competitors with their prices, and talk to at least 10 likely buyers.

3. 3

   Set your offer and price

   Write down what you sell, the price, and why customers will pay it rather than the alternative.

4. 4

   Build the numbers bottom-up

   Start-up costs, price × volume with a ramp-up, variable and fixed costs, owner pay and loan payments. Month by month for year one.

   SBA: calculate your startup costs
5. 5

   Write marketing, operations and management

   Make sure the customer numbers in marketing match the volume in your projections.

6. 6

   Write the funding request and executive summary

   State the amount, the use of funds and your own contribution, then summarize the whole plan on one page.

7. 7

   Get a free review

   Ask a SCORE mentor or your local Small Business Development Center to read it and challenge the assumptions.

Common mistakes that sink a plan

The most common is a hockey-stick forecast with no support: flat for two months, then a jump to capacity. Tie every revenue line to a channel and a conversion rate. The second is confusing profit with cash. A business can be profitable on paper and still run out of money because customers pay late or inventory is bought ahead; the monthly cash view is there to catch it.

Third, forgetting the owner. A plan with no owner pay looks profitable but tells a lender you will have nothing to live on, which makes you a risk. Fourth, generic market research. National industry size means little to a lender considering a one-van business; the number of households and competitors within your service radius means a lot.

Last, writing once and filing it away. Compare your actual results with the plan every month in the first year. The gaps tell you what to fix, and an updated plan is exactly what a lender asks for when you return for a second loan. If you need grant money rather than a loan, many programmes also ask for a plan; see our guide to small business grants.

Official SBA resources

• SBA — Write your business planTraditional and lean formats, sample plans
• SBA — Calculate your startup costsBreak-even formula
• SBA — Fund your business
• SBA — SOP 50 10 (Version 8.1)Effective October 1, 2026

What to do next

Draft a lean one-page plan this week, then expand it into the full format once the numbers hold up. If you are in food service, see our worked coffee shop business plan and food truck business plan for industry-specific figures. When you are ready to apply, compare options in our startup business loans guide.

Frequently asked questions

What are the main sections of a business plan?

The SBA's traditional format uses an executive summary, company description, market analysis, organization and management, service or product line, marketing and sales, funding request, financial projections and an appendix. A lean plan fits on one page and covers partners, activities, resources, value proposition, customer relationships, customer segments, channels, cost structure and revenue streams.

How long should a business plan be?

A lean plan is usually one page. A traditional plan for a bank or SBA loan typically runs 15 to 30 pages plus financial statements and an appendix, though the SBA notes it can be dozens of pages. Lenders care more about clear, supported numbers than length, so cut anything a reader would skim.

Do I need a business plan for an SBA loan?

For a start-up or a business purchase, effectively yes. SBA tells borrowers to have a business plan and five-year projections ready, and lenders use the plan to judge whether projected cash flow covers the loan. Standard 7(a) loans need debt service coverage of at least 1.15x, and start-ups must put in at least 10% of total project cost.

How do I write financial projections with no history?

Build revenue from the bottom up: price times realistic customers or units per month, ramping up over the first year. Then list variable costs per sale, fixed monthly costs, owner pay and loan payments. Show 12 months in detail and years two to five annually, and write down every assumption with its source.

Can I write a business plan myself or should I hire someone?

You should write it yourself, because a lender will question you on every number. Free help is available: SCORE mentors and Small Business Development Centers review plans and projections at no cost. Paying a writer is fine for polish, but you must understand and defend the assumptions.

What is the difference between a lean and a traditional business plan?

A traditional plan is detailed, takes longer and is what lenders and investors usually request. A lean plan is a one-page summary of the key elements that can take as little as an hour, suited to testing an idea or a simple business that will change often. Many owners start lean and expand it when they apply for funding.

Sources & verification

Figures on this page were checked against the sources below when it was last reviewed on 8 October 2026. Each rate and limit is stored once with its own official source and review date, and official update channels are monitored daily so changes are picked up. How we verify

1. 1.Write your business plan — U.S. Small Business Administration · accessed 8 October 2026
2. 2.Fund your business — U.S. Small Business Administration · accessed 8 October 2026
3. 3.Calculate your startup costs — U.S. Small Business Administration · accessed 8 October 2026
4. 4.SOP 50 10 — Lender and Development Company Loan Programs (Version 8.1, effective October 1, 2026) — U.S. Small Business Administration · accessed 8 October 2026
5. 5.SBA loan requirements — MSMETOOLS · accessed 8 October 2026
6. 6.How to write business plan financial projections — M&T Bank · accessed 8 October 2026