How to write a business plan for small IT company

If you’re starting a new IT company, having a business plan will help to create the best beginning possible. A plan sets out what your business is about and where its future is heading. Having direction allows you to inform every decision you make to move the business forward. A plan also allows you to search for additional finance sources. Finding funding can mean approaching a bank for a small business loan or pitching to investors.

This guide on writing a business plan for an information technology services company includes:

• Value proposition
• Leadership
• Target audience
• Marketing
• Financials

The first section of your business plan can include a description of the company’s unique value. This proposition creates an information technology company that can stick out from the competition.

As a business, the service you will provide is one of the essential elements of your business plan. Especially in a crowded market like technology, having a USP (unique selling point) means that no one else currently provides what you can.

Your unique service can be similar to other providers. Still, it needs to be distinct enough to draw in customers.

You’ll need to convince investors or lenders of your leadership on top of what you offer. So by having a section that details who you are and your background, you can ensure your business is compelling.

Suppose you have experience of information technology, detail previous employers and your roles. In addition, if you have any business management experience or qualifications, they can improve your credentials. Still, say you don’t have relevant experience or any qualifications before starting. In that case, you can take part in online courses to help convince others of your abilities.

The Open University offers a variety of computing and IT courses.

Aside from time in work or education, your skills may improve your business plan. For example, if you can build websites, mention the advantage for creating your own.

The customers you’ll sell to are a crucial part of the business as a service. For that reason, investors or lenders may want to learn about who you’ll target.   

Before you decide on a target audience, you can investigate who they are through market research. One way to do that is to put together a survey and share it over social media. You can also conduct interviews either in person or over a video call. But the aim should be to find similarities between the groups of people who are likely to use your service.

To express who your audience is in your business plan, put together a customer profile. These are summaries of hypothetical customers. Using your research, paint a picture of who your ideal customer could be. If your service aims at companies, it could even be a business.

Another helpful section to include is discussing the marketing channels you plan on using to reach those customers. For banks or investors, it’s crucial that you can sell your services to people.

The first step of marketing is to create a brand, the identity of your company in the eyes of your customers. Strong branding can leave a lasting impression on customers, and it helps you build relationships with them. Your brand can include a name and logo, which gets across the message of what you offer. In addition, you can also think about colours your brand uses and the way you want to speak to customers (e.g. conversational or corporate). 

You can plan which channels to use to promote the brand and customer base. After writing a customer profile, you can think about your audience’s daily lives. That also helps you decide on media to use for your marketing. For example, suppose you would like to help photographers build websites. In that case, Instagram may be a great channel to market because of its visual nature.

You can look to include some critical pieces of financial information within your business plan. The first is the amount of money you are asking for if you seek finance. Any figure provided would benefit from details about what you want to do with it. For example, if you require money to set up an office, then details rent and utility costs.

It would be useful to include projections in your business plan. Often companies provide a sales forecast. To calculate one, estimate the number of customers you expect by the price each will pay. If you have varying prices, think about how many days you’d work for a client and how you’d charge each day. You can create a sales forecast for a month, quarter or year.

In addition to expected sales and the money you are asking for, you can also include some information about the running costs. Lenders or investors may be interested in knowing the prices for your business in providing a service. For example, if you work and the only costs are wages and utilities, you’ll likely see more profit than the additional costs of office work. 

The better the financial position, the more likely someone is to invest in your business. They look for companies with potential growth to get returns for themselves in the future. If you have high costs and low profit, your likelihood of growth is less. Similarly, the banks want assurance that you can pay off your loans with interest. If you struggle to cover your other costs, it could mean that you will cause problems for them with your repayments.

After writing a business plan and securing funds, you’ll have the task of running your information technology business. It will be a lot easier for you to do that and focus on the services you provide if you can manage your finances.

Countingup is the current business account with built-in accounting software to make small business owners’ lives easier. Its expense categorisation feature allows you to have all of your costs handily sorted into convenient HMRC-approved labels. This tool means keeping an eye on spending accessible, but when it comes to taxes, they will be a breeze as well.

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