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What is a business plan? Definition, Purpose, and Types

In the world of business, a well-thought-out plan is often the key to success. This plan, known as a business plan, is a comprehensive document that outlines a company’s goals, strategies , and financial projections. Whether you’re starting a new business or looking to expand an existing one, a business plan is an essential tool.

As a business plan writer and consultant , I’ve crafted over 15,000 plans for a diverse range of businesses. In this article, I’ll be sharing my wealth of experience about what a business plan is, its purpose, and the step-by-step process of creating one. By the end, you’ll have a thorough understanding of how to develop a robust business plan that can drive your business to success.

What is a business plan?

Purposes of a business plan, what are the essential components of a business plan, executive summary, business description or overview, product and price, competitive analysis, target market, marketing plan, financial plan, funding requirements, types of business plan, lean startup business plans, traditional business plans, how often should a business plan be reviewed and revised, what are the key elements of a lean startup business plan.

• What are some of the reasons why business plans don't succeed?

A business plan is a roadmap for your business. It outlines your goals, strategies, and how you plan to achieve them. It’s a living document that you can update as your business grows and changes.

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These are the following purpose of business plan:

• Attract investors and lenders: If you’re seeking funding for your business , a business plan is a must-have. Investors and lenders want to see that you have a clear plan for how you’ll use their money to grow your business and generate revenue.
• Get organized and stay on track: Writing a business plan forces you to think through all aspects of your business, from your target market to your marketing strategy. This can help you identify any potential challenges and opportunities early on, so you can develop a plan to address them.
• Make better decisions: A business plan can help you make better decisions about your business by providing you with a framework to evaluate different options. For example, if you’re considering launching a new product, your business plan can help you assess the potential market demand, costs, and profitability.

The executive summary is the most important part of your business plan, even though it’s the last one you’ll write. It’s the first section that potential investors or lenders will read, and it may be the only one they read. The executive summary sets the stage for the rest of the document by introducing your company’s mission or vision statement, value proposition, and long-term goals.

The business description section of your business plan should introduce your business to the reader in a compelling and concise way. It should include your business name, years in operation, key offerings, positioning statement, and core values (if applicable). You may also want to include a short history of your company.

In this section, the company should describe its products or services , including pricing, product lifespan, and unique benefits to the consumer. Other relevant information could include production and manufacturing processes, patents, and proprietary technology.

Every industry has competitors, even if your business is the first of its kind or has the majority of the market share. In the competitive analysis section of your business plan, you’ll objectively assess the industry landscape to understand your business’s competitive position. A SWOT analysis is a structured way to organize this section.

Your target market section explains the core customers of your business and why they are your ideal customers. It should include demographic, psychographic, behavioral, and geographic information about your target market.

Marketing plan describes how the company will attract and retain customers, including any planned advertising and marketing campaigns . It also describes how the company will distribute its products or services to consumers.

After outlining your goals, validating your business opportunity, and assessing the industry landscape, the team section of your business plan identifies who will be responsible for achieving your goals. Even if you don’t have your full team in place yet, investors will be impressed by your clear understanding of the roles that need to be filled.

In the financial plan section,established businesses should provide financial statements , balance sheets , and other financial data. New businesses should provide financial targets and estimates for the first few years, and may also request funding.

Since one goal of a business plan is to secure funding from investors , you should include the amount of funding you need, why you need it, and how long you need it for.

• Tip: Use bullet points and numbered lists to make your plan easy to read and scannable.

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Business plans can come in many different formats, but they are often divided into two main types: traditional and lean startup. The U.S. Small Business Administration (SBA) says that the traditional business plan is the more common of the two.

Lean startup business plans are short (as short as one page) and focus on the most important elements. They are easy to create, but companies may need to provide more information if requested by investors or lenders.

Traditional business plans are longer and more detailed than lean startup business plans, which makes them more time-consuming to create but more persuasive to potential investors. Lean startup business plans are shorter and less detailed, but companies should be prepared to provide more information if requested.

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A business plan should be reviewed and revised at least annually, or more often if the business is experiencing significant changes. This is because the business landscape is constantly changing, and your business plan needs to reflect those changes in order to remain relevant and effective.

Here are some specific situations in which you should review and revise your business plan:

• You have launched a new product or service line.
• You have entered a new market.
• You have experienced significant changes in your customer base or competitive landscape.
• You have made changes to your management team or organizational structure.
• You have raised new funding.

A lean startup business plan is a short and simple way for a company to explain its business, especially if it is new and does not have a lot of information yet. It can include sections on the company’s value proposition, major activities and advantages, resources, partnerships, customer segments, and revenue sources.

What are some of the reasons why business plans don't succeed?

• Unrealistic assumptions: Business plans are often based on assumptions about the market, the competition, and the company’s own capabilities. If these assumptions are unrealistic, the plan is doomed to fail.
• Lack of focus: A good business plan should be focused on a specific goal and how the company will achieve it. If the plan is too broad or tries to do too much, it is unlikely to be successful.
• Poor execution: Even the best business plan is useless if it is not executed properly. This means having the right team in place, the necessary resources, and the ability to adapt to changing circumstances.
• Unforeseen challenges:  Every business faces challenges that could not be predicted or planned for. These challenges can be anything from a natural disaster to a new competitor to a change in government regulations.

What are the benefits of having a business plan?

• It helps you to clarify your business goals and strategies.
• It can help you to attract investors and lenders.
• It can serve as a roadmap for your business as it grows and changes.
• It can help you to make better business decisions.

How to write a business plan?

There are many different ways to write a business plan, but most follow the same basic structure. Here is a step-by-step guide:

• Executive summary.
• Company description.
• Management and organization description.
• Financial projections.

How to write a business plan step by step?

Start with an executive summary, then describe your business, analyze the market, outline your products or services, detail your marketing and sales strategies, introduce your team, and provide financial projections.

Why do I need a business plan for my startup?

A business plan helps define your startup’s direction, attract investors, secure funding, and make informed decisions crucial for success.

What are the key components of a business plan?

Key components include an executive summary, business description, market analysis, products or services, marketing and sales strategy, management and team, financial projections, and funding requirements.

Can a business plan help secure funding for my business?

Yes, a well-crafted business plan demonstrates your business’s viability, the use of investment, and potential returns, making it a valuable tool for attracting investors and lenders.

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How to Write a Business Plan, Step by Step

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What is a business plan?

1. write an executive summary, 2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. summarize how your company operates, 10. add any additional information to an appendix, business plan tips and resources.

A business plan outlines your business’s financial goals and explains how you’ll achieve them over the next three to five years. Here’s a step-by-step guide to writing a business plan that will offer a strong, detailed road map for your business.

ZenBusiness

A business plan is a document that explains what your business does, how it makes money and who its customers are. Internally, writing a business plan should help you clarify your vision and organize your operations. Externally, you can share it with potential lenders and investors to show them you’re on the right track.

Business plans are living documents; it’s OK for them to change over time. Startups may update their business plans often as they figure out who their customers are and what products and services fit them best. Mature companies might only revisit their business plan every few years. Regardless of your business’s age, brush up this document before you apply for a business loan .

» Need help writing? Learn about the best business plan software .

This is your elevator pitch. It should include a mission statement, a brief description of the products or services your business offers and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description. This should contain basic information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, write a little about the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out what you’d like to accomplish, both in the near term and over the coming years.

If you’re looking for a business loan or outside investment, you can use this section to explain how the financing will help your business grow and how you plan to achieve those growth targets. The key is to provide a clear explanation of the opportunity your business presents to the lender.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch that new product and how much you think sales will increase over the next three years as a result.

» MORE: How to write a successful business plan for a loan

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

Include details about your sales and distribution strategies, including the costs involved in selling each product .

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

Accounting software may be able to generate these reports for you. It may also help you calculate metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

Before the end of your business plan, summarize how your business is structured and outline each team’s responsibilities. This will help your readers understand who performs each of the functions you’ve described above — making and selling your products or services — and how much each of those functions cost.

If any of your employees have exceptional skills, you may want to include their resumes to help explain the competitive advantage they give you.

Finally, attach any supporting information or additional materials that you couldn’t fit in elsewhere. That might include:

Licenses and permits.

Equipment leases.

Bank statements.

Details of your personal and business credit history, if you’re seeking financing.

If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

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We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Here are some tips to write a detailed, convincing business plan:

Avoid over-optimism: If you’re applying for a business bank loan or professional investment, someone will be reading your business plan closely. Providing unreasonable sales estimates can hurt your chances of approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

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What is a Business Plan? Definition and Resources

9 min. read

Updated May 10, 2024

If you’ve ever jotted down a business idea on a napkin with a few tasks you need to accomplish, you’ve written a business plan — or at least the very basic components of one.

The origin of formal business plans is murky. But they certainly go back centuries. And when you consider that 20% of new businesses fail in year 1 , and half fail within 5 years, the importance of thorough planning and research should be clear.

But just what is a business plan? And what’s required to move from a series of ideas to a formal plan? Here we’ll answer that question and explain why you need one to be a successful business owner.

• What is a business plan?

A business plan lays out a strategic roadmap for any new or growing business.

Any entrepreneur with a great idea for a business needs to conduct market research , analyze their competitors , validate their idea by talking to potential customers, and define their unique value proposition .

The business plan captures that opportunity you see for your company: it describes your product or service and business model , and the target market you’ll serve. 

It also includes details on how you’ll execute your plan: how you’ll price and market your solution and your financial projections .

Reasons for writing a business plan

If you’re asking yourself, ‘Do I really need to write a business plan?’ consider this fact: 

Companies that commit to planning grow 30% faster than those that don’t.

Creating a business plan is crucial for businesses of any size or stage. It helps you develop a working business and avoid consequences that could stop you before you ever start.

If you plan to raise funds for your business through a traditional bank loan or SBA loan , none of them will want to move forward without seeing your business plan. Venture capital firms may or may not ask for one, but you’ll still need to do thorough planning to create a pitch that makes them want to invest.

But it’s more than just a means of getting your business funded . The plan is also your roadmap to identify and address potential risks. 

It’s not a one-time document. Your business plan is a living guide to ensure your business stays on course.

Related: 14 of the top reasons why you need a business plan

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What research shows about business plans

Numerous studies have established that planning improves business performance:

• 71% of fast-growing companies have business plans that include budgets, sales goals, and marketing and sales strategies.
• Companies that clearly define their value proposition are more successful than those that can’t.
• Companies or startups with a business plan are more likely to get funding than those without one.
• Starting the business planning process before investing in marketing reduces the likelihood of business failure.

The planning process significantly impacts business growth for existing companies and startups alike.

Read More: Research-backed reasons why writing a business plan matters

When should you write a business plan?

No two business plans are alike. 

Yet there are similar questions for anyone considering writing a plan to answer. One basic but important question is when to start writing it.

A Harvard Business Review study found that the ideal time to write a business plan is between 6 and 12 months after deciding to start a business. 

But the reality can be more nuanced – it depends on the stage a business is in, or the type of business plan being written.

Ideal times to write a business plan include:

• When you have an idea for a business
• When you’re starting a business
• When you’re preparing to buy (or sell)
• When you’re trying to get funding
• When business conditions change
• When you’re growing or scaling your business

Read More: The best times to write or update your business plan

How often should you update your business plan?

As is often the case, how often a business plan should be updated depends on your circumstances.

A business plan isn’t a homework assignment to complete and forget about. At the same time, no one wants to get so bogged down in the details that they lose sight of day-to-day goals. 

But it should cover new opportunities and threats that a business owner surfaces, and incorporate feedback they get from customers. So it can’t be a static document.

Related Reading: 5 fundamental principles of business planning

For an entrepreneur at the ideation stage, writing and checking back on their business plan will help them determine if they can turn that idea into a profitable business .

And for owners of up-and-running businesses, updating the plan (or rewriting it) will help them respond to market shifts they wouldn’t be prepared for otherwise. 

It also lets them compare their forecasts and budgets to actual financial results. This invaluable process surfaces where a business might be out-performing expectations and where weak performance may require a prompt strategy change. 

The planning process is what uncovers those insights.

Related Reading: 10 prompts to help you write a business plan with AI

• How long should your business plan be?

Thinking about a business plan strictly in terms of page length can risk overlooking more important factors, like the level of detail or clarity in the plan. 

Not all of the plan consists of writing – there are also financial tables, graphs, and product illustrations to include.

But there are a few general rules to consider about a plan’s length:

• Your business plan shouldn’t take more than 15 minutes to skim.
• Business plans for internal use (not for a bank loan or outside investment) can be as short as 5 to 10 pages.

A good practice is to write your business plan to match the expectations of your audience. 

If you’re walking into a bank looking for a loan, your plan should match the formal, professional style that a loan officer would expect . But if you’re writing it for stakeholders on your own team—shorter and less formal (even just a few pages) could be the better way to go.

The length of your plan may also depend on the stage your business is in. 

For instance, a startup plan won’t have nearly as much financial information to include as a plan written for an established company will.

Read More: How long should your business plan be?  

What information is included in a business plan?

The contents of a plan business plan will vary depending on the industry the business is in. 

After all, someone opening a new restaurant will have different customers, inventory needs, and marketing tactics to consider than someone bringing a new medical device to the market. 

But there are some common elements that most business plans include:

• Executive summary: An overview of the business operation, strategy, and goals. The executive summary should be written last, despite being the first thing anyone will read.
• Products and services: A description of the solution that a business is bringing to the market, emphasizing how it solves the problem customers are facing.
• Market analysis: An examination of the demographic and psychographic attributes of likely customers, resulting in the profile of an ideal customer for the business.
• Competitive analysis: Documenting the competitors a business will face in the market, and their strengths and weaknesses relative to those competitors.
• Marketing and sales plan: Summarizing a business’s tactics to position their product or service favorably in the market, attract customers, and generate revenue.
• Operational plan: Detailing the requirements to run the business day-to-day, including staffing, equipment, inventory, and facility needs.
• Organization and management structure: A listing of the departments and position breakdown of the business, as well as descriptions of the backgrounds and qualifications of the leadership team.
• Key milestones: Laying out the key dates that a business is projected to reach certain milestones , such as revenue, break-even, or customer acquisition goals.
• Financial plan: Balance sheets, cash flow forecast , and sales and expense forecasts with forward-looking financial projections, listing assumptions and potential risks that could affect the accuracy of the plan.
• Appendix: All of the supporting information that doesn’t fit into specific sections of the business plan, such as data and charts.

Read More: Use this business plan outline to organize your plan

• Different types of business plans

A business plan isn’t a one-size-fits-all document. There are numerous ways to create an effective business plan that fits entrepreneurs’ or established business owners’ needs. 

Here are a few of the most common types of business plans for small businesses:

• One-page plan : Outlining all of the most important information about a business into an adaptable one-page plan.
• Growth plan : An ongoing business management plan that ensures business tactics and strategies are aligned as a business scales up.
• Internal plan : A shorter version of a full business plan to be shared with internal stakeholders – ideal for established companies considering strategic shifts.

Business plan vs. operational plan vs. strategic plan

• What questions are you trying to answer? 
• Are you trying to lay out a plan for the actual running of your business?
• Is your focus on how you will meet short or long-term goals? 

Since your objective will ultimately inform your plan, you need to know what you’re trying to accomplish before you start writing.

While a business plan provides the foundation for a business, other types of plans support this guiding document.

An operational plan sets short-term goals for the business by laying out where it plans to focus energy and investments and when it plans to hit key milestones.

Then there is the strategic plan , which examines longer-range opportunities for the business, and how to meet those larger goals over time.

Read More: How to use a business plan for strategic development and operations

• Business plan vs. business model

If a business plan describes the tactics an entrepreneur will use to succeed in the market, then the business model represents how they will make money. 

The difference may seem subtle, but it’s important. 

Think of a business plan as the roadmap for how to exploit market opportunities and reach a state of sustainable growth. By contrast, the business model lays out how a business will operate and what it will look like once it has reached that growth phase.

Learn More: The differences between a business model and business plan

• Moving from idea to business plan

Now that you understand what a business plan is, the next step is to start writing your business plan . 

The best way to start is by reviewing examples and downloading a business plan template. These resources will provide you with guidance and inspiration to help you write a plan.

We recommend starting with a simple one-page plan ; it streamlines the planning process and helps you organize your ideas. However, if one page doesn’t fit your needs, there are plenty of other great templates available that will put you well on your way to writing a useful business plan.

Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

Table of Contents

• Reasons to write a business plan
• Business planning research
• When to write a business plan
• When to update a business plan
• Information to include
• Business vs. operational vs. strategic plans

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Strategic Account Planning: All You Need to Know

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What is Strategic Account Planning?

Strategic account planning is more than just a buzzword in the business world. It is a structured approach that allows companies to align their goals and objectives with the needs and expectations of their key accounts. By understanding and implementing strategic account planning, businesses can drive long-term success, foster strong customer relationships, and stay ahead of the competition.

At its core, strategic account planning involves a deep understanding of the customer’s business, industry, and challenges. It goes beyond transactional interactions and focuses on building strategic partnerships that are mutually beneficial for both parties involved. By investing time and effort into understanding the customer’s needs, businesses can develop tailored solutions, provide exceptional value, and become trusted advisors to their key accounts.

One of the key benefits of strategic account planning is the ability to retain and grow existing customer relationships. By understanding the customer’s unique challenges and objectives, businesses can proactively identify new opportunities for collaboration and growth. This not only helps in retaining the customer but also enables businesses to increase their share of wallet and drive revenue growth.

Benefits of Strategic Account Planning:

• Improved customer satisfaction and loyalty
• Increased revenue and profitability
• Enhanced cross-selling and upselling opportunities
• Stronger alignment of business goals and objectives
• Greater visibility into customer needs and expectations

However, it is important to note that strategic account planning is not a one-size-fits-all approach. Each customer and industry will have unique requirements and dynamics. Therefore, businesses must invest in the time and resources required to truly understand their key accounts and develop customized account plans.

Key Elements of Strategic Account Planning

By understanding strategic account planning and its implications, businesses can unlock the full potential of their key accounts and establish themselves as trusted partners in their industry.

Processes of Strategic Account Planning

Strategic account planning involves several key processes aimed at building value-driven relationships with key customers. Implementing these processes effectively can significantly contribute to long-term development and revenue maximization. Let’s delve into these essential processes:

Current Position

Understanding the current position of the account is crucial. This includes analyzing account information such as revenue, profitability, product/service usage, geographic spread, and strategic initiatives. By leveraging publicly available data and asking relevant questions, such as the client’s future goals and potential obstacles, account managers can gain valuable insights into the client’s financial standing and organizational structure.

Voice of Customer (VOC)

Listening to the voice of the customer is paramount in strategic account planning. Engaging in meaningful discussions with clients helps uncover their challenges, concerns, and pain points. This insight is invaluable for tailoring products/services to meet client needs, driving customer loyalty, and increasing sales. Unlike publicly available data, VOC requires proactive communication and relationship-building efforts.

Relationship Management

Effective relationship management is essential for success in strategic account planning. This involves understanding the different types of relationships with clients and creating organization charts to identify key contacts, their roles, and their level of influence within the client organization. By mapping relationships and understanding the dynamics within the client’s organization, account managers can tailor their strategies and efforts accordingly.

ARPEDIO’s Relationship Mapping & Org Chart Software, natively in Salesforce

Key Components of Strategic Account Planning

When it comes to strategic account planning, certain key components are crucial for achieving success. These components form the foundation of an effective account planning process. Let’s explore the essential elements that businesses should consider:

1. Understanding Customer Needs

One of the key components of strategic account planning is gaining a deep understanding of customer needs. By conducting thorough research and analysis , businesses can identify their customers’ pain points, challenges, and goals. This knowledge enables them to tailor their strategies and solutions to meet those specific needs.

2. Setting Clear Objectives

To drive success in account planning , it’s important for businesses to set clear objectives. These objectives should be specific, measurable, achievable, relevant, and time-bound (SMART). By defining clear goals, businesses can align their efforts and track progress effectively.

3. Developing Effective Strategies

An effective account plan requires the development of well-thought-out strategies. These strategies should outline how businesses will address customer needs and achieve their objectives. It’s essential to consider factors such as value proposition, competitive advantage, and differentiation when developing these strategies.

Conducting Account Research and Analysis

In order to develop an effective strategic account plan, businesses need to conduct thorough account research and analysis. This crucial step provides valuable insights into the customers’ business environment, challenges, and goals, allowing businesses to tailor their strategies and offerings accordingly.

Account research involves gathering data and information about the customer’s industry, market trends, competition, and customer preferences. This can be done through market research reports, industry publications, customer interviews, and online surveys. By leveraging these sources, businesses can gain a comprehensive understanding of the customer’s unique needs and pain points.

Once the account research is complete, businesses can perform a detailed analysis of the gathered information. This analysis helps identify patterns, trends, and areas of opportunity that can shape the strategic account plan. It provides a solid foundation for making data-driven decisions and developing tailored strategies for customer engagement and growth.

Techniques and Tools for Account Research and Analysis

There are several techniques and tools available to aid businesses in conducting account research and analysis. These include:

• SWOT analysis : A strategic tool that helps identify the strengths, weaknesses, opportunities, and threats associated with the customer’s business.
• Competitor analysis: Evaluating the customer’s direct and indirect competitors to understand their positioning, offerings, and market share.
• Customer segmentation: Dividing the customer base into distinct segments based on demographic, geographic, psychographic, or behavioral factors to better understand their unique needs.
• Financial analysis: Assessing the customer’s financial health, including revenue, profitability, and liquidity ratios, to gauge their stability and growth potential.
• Technology platforms: Utilizing customer relationship management (CRM) systems, data analytics tools, and social listening platforms to gather and analyze customer data effectively.

By employing these techniques and tools, businesses can uncover valuable insights and trends that drive informed decision-making and allow for the development of targeted strategies. With a well-rounded understanding of their customers and the market, businesses can position themselves as trusted advisors and add significant value to their strategic account relationships.

Developing a Strategic Account Plan

Developing a comprehensive strategic account plan is essential for businesses looking to drive long-term success and build strong customer relationships. In this section, we will guide you through the process of creating an effective account plan that aligns with your business objectives and meets the needs of your key stakeholders.

Identifying Key Stakeholders

One of the first steps in developing a strategic account plan is identifying the key stakeholders involved in the account. These stakeholders may include decision-makers, influencers, and end-users within the customer organization. By understanding their roles and responsibilities, you can tailor your account plan to address their specific needs and objectives.

Defining Value Propositions

To create a successful account plan, it’s crucial to define compelling value propositions that differentiate your offerings from competitors and address the unique challenges faced by the customer. By clearly articulating the value your products or services bring to the table, you can effectively communicate the benefits and outcomes that customers can expect.

Creating Actionable Goals and Initiatives

A strategic account plan should outline actionable goals and initiatives that align with both your business objectives and the customer’s goals. These goals should be specific, measurable, attainable, relevant, and time-bound (SMART). By breaking these goals down into initiatives, you can map out the steps required to achieve them and assign responsibilities to team members.

By following these steps and incorporating them into your strategic account plan, you can create a roadmap for success and establish a strong foundation for long-term growth. In the next section, we will explore strategies for effective communication and relationship building in strategic account planning.

Effective Communication and Relationship Building

Effective communication and relationship building are crucial components of successful strategic account planning. Building strong relationships with key accounts helps businesses establish trust, foster loyalty, and drive long-term growth. In this section, we will explore strategies for fostering strong relationships with key accounts and ensuring effective communication throughout the account planning process.

Fostering Strong Relationships

Building strong relationships with key accounts is about creating a connection based on trust, mutual understanding, and shared goals. Here are some strategies to foster strong relationships:

• Invest time in getting to know your key accounts. Listen actively to their needs, challenges, and objectives. This will help you tailor your approach and provide personalized solutions.
• Communicate regularly with your key accounts and be proactive in addressing their concerns. Show genuine interest in their success and offer support wherever needed.
• Deliver on your promises and exceed expectations. Consistently deliver value and demonstrate your commitment to the success of your key accounts.
• Collaborate with key accounts on joint initiatives and projects. This not only strengthens the relationship but also creates opportunities for mutual growth.

Ensuring Effective Communication

Effective communication is the foundation of successful account planning. It ensures that all stakeholders are aligned, goals are clear, and expectations are managed. Here are some strategies for effective communication:

• Establish clear channels of communication with your key accounts. Regularly check in, provide updates, and be responsive to any inquiries or requests.
• Listen actively to understand your key accounts’ needs and objectives fully. Ask relevant questions and seek clarification to ensure clear communication.
• Communicate strategically, tailoring your messages to resonate with each key account’s unique needs and preferences.
• Utilize a combination of communication methods, including face-to-face meetings, phone calls, emails, and video conferencing, to maintain a strong connection with your key accounts.

By prioritizing effective communication and relationship building, businesses can establish strong partnerships with key accounts, lay the foundation for long-term success, and unlock collaborative opportunities.

Aligning Sales and Marketing Efforts

Effective strategic account planning requires a seamless collaboration between the sales and marketing departments. Aligning sales and marketing efforts ensures a coordinated approach that maximizes customer relationships and drives business growth.

By integrating sales and marketing strategies, companies can create a unified front that delivers consistent messaging and a personalized customer experience. Sales teams can provide valuable insights to the marketing department, enabling them to develop targeted campaigns that resonate with key accounts. Likewise, marketing teams can equip sales teams with the necessary tools and resources to effectively communicate the value proposition to customers.

This alignment also helps to eliminate any disconnect between sales and marketing, fostering a stronger partnership and reducing internal conflicts. Sales and marketing teams are united in their shared goals and objectives, leading to improved communication, streamlined processes, and better overall outcomes.

Furthermore, aligning sales and marketing efforts allows businesses to leverage customer data and insights across both departments. This integrated approach enables a deeper understanding of customer needs, preferences, and behaviors, empowering sales and marketing teams to create more targeted and personalized strategies that drive results.

Ultimately, aligning sales and marketing efforts in strategic account planning enhances customer engagement, accelerates the sales cycle, and improves overall business performance.

Benefits of Aligning Sales and Marketing Efforts

The alignment of sales and marketing efforts offers numerous benefits for businesses:

• Improved lead generation: By working together, sales and marketing teams can generate high-quality leads through targeted campaigns and strategies.
• Enhanced customer experience: Consistent messaging and personalized interactions contribute to a positive customer experience, fostering loyalty and long-term relationships.
• Higher conversion rates: The synergy between sales and marketing ensures a smoother sales process, leading to higher conversion rates and increased revenue.
• Maximized ROI: Integrated sales and marketing efforts optimize resource allocation and minimize wasteful spending, resulting in a higher return on investment.

Proactive Account Management and Growth

Proactive account management is an integral part of achieving long-term success in business. By actively engaging with accounts and continuously delivering value, companies can foster strong relationships, drive customer satisfaction, and identify growth opportunities. In this section, we will explore key insights and strategies for effective account management and achieving sustainable growth.

Delivering Exceptional Customer Service

One of the foundations of proactive account management is delivering exceptional customer service. By going above and beyond to meet customer needs, companies can solidify their position as trusted partners. This involves:

• Anticipating customer needs: Understanding the unique requirements of each account and proactively identifying opportunities to provide value.
• Ensuring clear communication: Maintaining open lines of communication with accounts, actively listening to their feedback, and addressing any concerns in a timely manner.
• Providing personalized support: Tailoring solutions and support to meet the specific goals and challenges faced by each account.

Identifying Growth Opportunities

Proactive account management also involves identifying and capitalizing on growth opportunities. By analyzing account data and market trends, businesses can uncover potential areas for expansion. This includes:

• Understanding customer goals: Gaining a deep understanding of each account’s strategic objectives and aligning efforts to support their growth initiatives.
• Monitoring industry trends: Keeping a pulse on market developments, emerging technologies, and evolving customer needs to identify new opportunities for value creation.
• Collaborating with cross-functional teams: Engaging with sales, marketing, and product teams to leverage synergies and develop innovative solutions that drive customer satisfaction and business growth.

Utilizing Account Management Tools

Effective proactive account management often involves leveraging technology and tools to streamline processes and enhance productivity. By implementing the right account management software , businesses can:

• Track and manage account activities: Gain visibility into account interactions, progress, and potential risks, enabling better decision-making and proactive problem-solving.
• Automate tasks: Reduce manual administrative work, allowing account managers to focus on building relationships and delivering value.
• Generate actionable insights: Analyze data and generate reports to identify trends, measure account performance, and uncover opportunities for improvement.

To effectively implement proactive account management strategies, it’s crucial to leverage data-driven insights, nurture strong customer relationships, and continuously adapt and innovate. By prioritizing proactive account management and embracing a growth mindset, businesses can drive sustainable success for themselves and their valued customers.

Key Performance Metrics and Measurement

Measuring and tracking the success of strategic account planning is crucial. In order to evaluate the effectiveness of their account plans and make data-driven decisions, businesses need to monitor key performance metrics. These metrics provide valuable insights into the outcomes of their strategic initiatives and help identify areas for improvement.

Key Performance Metrics for Strategic Account Planning

When measuring the performance of strategic account plans, businesses should focus on several key metrics:

By regularly monitoring these performance metrics, businesses can assess the impact of their strategic account plans and make informed decisions to optimize their efforts. It is important to establish baseline measurements, set realistic targets, and consistently track progress to ensure continuous improvement and success.

With the right data and insights, businesses can identify areas for improvement, make informed adjustments to their strategies, and drive meaningful results through strategic account planning.

Overcoming Challenges in Strategic Account Planning

Strategic account planning is a crucial process for businesses to ensure long-term success and maintain strong customer relationships. However, it is not without its challenges. In this section, we will explore some common obstacles that businesses may encounter during strategic account planning and provide strategies and solutions for overcoming them.

Lack of Alignment and Communication

One of the key challenges in strategic account planning is the lack of alignment and communication between different departments within an organization. Sales, marketing, and customer service teams need to work cohesively to develop and execute account plans effectively. By fostering open lines of communication and implementing cross-functional collaboration, businesses can overcome this challenge and ensure everyone is working towards a common goal.

Changing Customer Needs

As customer preferences and requirements evolve, businesses must adapt their account plans to meet these changing needs. This can be a challenge, especially when organizations are not proactive in gathering customer feedback and monitoring market trends. By staying abreast of industry changes and regularly engaging with customers, businesses can stay ahead of the curve and continuously update their account plans to align with shifting customer needs.

In strategic account planning, identifying and building relationships with key stakeholders is crucial. However, it can be challenging to determine who the key decision-makers are within a customer organization. Conducting thorough research and leveraging existing relationships can help businesses overcome this hurdle and ensure they are engaging with the right individuals who have the authority to make purchasing decisions.

Managing Multiple Accounts

For businesses managing multiple key accounts, prioritization and resource allocation can become a challenge. It is essential to allocate resources effectively to ensure each account receives the necessary attention and support. By leveraging account management tools and establishing clear guidelines for prioritization, businesses can overcome this challenge and effectively manage multiple accounts.

Measuring Success

Measuring the success of strategic account planning can be difficult without defined metrics and performance indicators. Businesses need to establish clear goals and track relevant metrics to assess the effectiveness of their account plans. By leveraging data analytics and setting measurable objectives, businesses can overcome this challenge and make informed decisions to continuously improve their account planning process.

Overcoming challenges in strategic account planning is essential for businesses to achieve their goals and maintain successful customer relationships. By addressing the common obstacles discussed in this section and implementing the provided strategies, businesses can navigate the complexities of strategic account planning and drive long-term success.

In conclusion, this article has highlighted the essential elements and strategies required for successful strategic account planning. By adopting these practices and continuously refining the account plan, businesses can unlock their full potential, drive long-term success, and foster strong customer relationships.

Strategic account planning is a critical approach that enables businesses to understand and meet the unique needs of their most important customers. By taking the time to research and analyze each account, organizations can develop tailored strategies that address specific challenges and opportunities.

Furthermore, by focusing on effective communication and relationship building, businesses can strengthen collaborations with key accounts, enhance customer loyalty, and drive mutually beneficial growth. Regularly reviewing and evaluating key performance metrics can provide insights into the effectiveness of account plans and guide future decision-making.

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What is a Business Plan?

Home › Business Management › What is a Business Plan?

Definition:  A business plan is a detailed written steps and goals defined to guide a business’ course of action from its initial stages. A business plan provides a complete description and projection of the company as well as its core strategies and expected results.

• What Does Business Plan Mean?

The creation of a new organization or a new business requires coherent actions in order to achieve the desired outcomes. Following a business plan allows to link actions and resources to objectives and measurable goals. This plan can be used internally like a roadmap for the owner but also can be a requirement when looking for funding or partners.

A business plan is generally a precise, short document that commonly contains the following sections: executive summary, business description with its products or services, marketing plan, operational plan and financial plan with its forecasted financial statements for the first years of operation, often five to ten years. The initial business plan is later substituted by annual or bi-annual strategic plans.

Mark Tilson is a young professional that wants to start a new business. He has the idea of providing an innovative maintenance service to medium-size manufacturing companies but he needs funds to implement it. Mr. Tilson therefore decided to write a business plan to present the idea to some potential capital partners. He though that the ideas were already clear but soon realized that more analysis and pre-launching work was required.

How many employees the company will have? How the company will market its services? How much money the initial investment requires? How much profit the company is expected to generate at the end of the fifth year of operation? These and other questions must be answered and coherently written in the business plan. Finally, Mr. Tilson improved his ideas, presented the plan and found the required partner.

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What Is a Business Plan?

Business Plan Explained in Less Than 5 Minutes

Definition and Examples of a Business Plan

How a business plan works, types of business plans, business plan vs. business model.

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A business plan is a detailed written document that describes your business’s activities, goals, and strategy. A strong plan outlines everything from the products a company sells to the executive summary to the overall management. In essence, a business plan should guide a founder’s actions through each stage of growth

Think of your business plan as a road map. It documents the various stages of starting and running your business, including business activities and objectives. Business plans create the structure you need to make decisions by outlining the financial and operational goals you’re striving toward. 

One of the most common reasons for crafting a business plan is to attract investors—and, in return, receive funding. As an early stage company, for example, you may leverage your business plan to convince investors or banks that your entity is credible and worthy of funding. The business plan should prove that their money will be returned . 

A business plan can also be useful for when a well-developed company goes through a merger or acquisition . As outlined by the U.S. Small Business Administration (SBA), a merger creates a new entity via the combination of two businesses. An acquisition, on the other hand, is when a company is purchased and absorbed into an existing business. In either case, a business plan helps establish relationships between business entities, making a merger or acquisition more likely.

• Alternate name : Strategic plan

A business plan is a formalized outline of the business operations, finances, and goals you aim to achieve to be a successful company. When designing a business plan, companies have leeway for how long, short, or detailed it can be. So long as it outlines the foundational aspects of the business, in most cases, it will be effective.

The most common type of business plan is a traditional business plan. This style tends to have the following common elements, generally in this order.

• Executive summary : Tells your reader why your company will be successful. Includes the company’s mission statement , product information, and basics regarding the business structure. 
• Company description : Where you brag about your entity’s strengths. Answer the question, what problem is your team solving?
• Market analysis : A deep dive into your industry and the competition. Consider why competitors are successful. How can your offering do it better? If applicable, how can you enhance the experience for the consumer? 
• Management plan : Outlines leadership structure of the company and may be best detailed as a chart. This way, readers can see exactly who is planning to run the company and how they will impact growth. 
• Marketing and sales plan : Details how you’ll attract consumers with your product or service, and how you will retain those customers. All strategies outlined in this section, such as the use of digital marketing , will be referenced in your financial plan. 
• Funding request : For those companies asking for funding, this is where you’ll detail the amount of funding you’ll need to achieve your goals. Clearly explain how much you need and what it will be used for.
• Financial plan : Convinces the reader that your company is financially stable and can turn a profit . You will need to include a balance sheet , an income statement, and the cash flow statement (or cash flow projection, in the case of a new venture). 
• Appendix : Where any supporting documents, such as legal documents, licenses of employees, and pictures of the product will be included. 

Your company’s business plan should fit your needs, which will often depend on what stage of growth you are in. If you are considering starting a new venture, for example, writing a detailed business plan can help prove if your concept is viable or not. 

If your business is seeking financial capital, though, you will want your business plan to be investor-ready. This will require you to have a funding request section, which would be placed right above your financial plan.

You should avoid using lofty terms or technical jargon that those outside your team won’t understand. A business plan is meant to be shared with those inside and outside your organization. Simple and effective language is best.

Your business’s stage impacts the length and detail of a business plan. As discussed, a traditional plan follows a detailed structure, from the executive summary to the appendix. It is a lengthier document, often amounting to dozens of pages, and is often used when seeking funding to prove business viability. In most cases, crafting a traditional plan will take lots of due diligence work.

The other main type of business plan is a lean startup plan. A lean startup plan is much more high-level and shorter than the traditional version. Companies just starting development will often create a lean startup plan to help them navigate where they should start. These can be as short as one or two pages. 

A lean plan will include the following elements.

• Key partnerships : Notes other services or businesses you will work with, such as manufacturers and suppliers. 
• Key activities and resources : Outlines how your company will gain a competitive advantage and create value for your consumers. Resources you may leverage include capital, staff, or intellectual property.
• Value proposition : Clearly defines the unique value your company offers.
• Customer relationships : Details the customer experience from start to finish. 
• Channels : How will you stay connected with your customers? Detail those methods here.
• Cost structure and revenue streams : Details the most significant costs you will face as well as how your business will actually make money.  

Remember that business plans are meant to change as your company grows or pivots. You should actively review and edit your business plan to keep it up to date with business activities. For example, you may start with a lean plan and move to a traditional plan when you hit the fundraising stage.

A business plan may often be confused with a business model, and it is easy to understand why. Simply put, a business plan is the holistic overview of the business, while a business model is a skeleton for how money will be made.

Key Takeaways

• A business plan is a comprehensive document that outlines a business’s operations, finances, and goals. It guides the business’s day-to-day decisions.
• A business plan is necessary for your company’s success, as it creates a path to scalability.
• There are two main types of business plans: a traditional business plan and a lean startup plan.
• A traditional business plan will be essential when you begin to seek debt or equity capital for your company.

U.S. Small Business Administration. “ Merge and Acquire Businesses .” Accessed June 8, 2021.

U.S. Small Business Administration. " Write Your Business Plan ." Accessed June 8, 2021.

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How To Write a Business Plan

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Starting a business is a wild ride, and a solid business plan can be the key to keeping you on track. A business plan is essentially a roadmap for your business — outlining your goals, strategies, market analysis and financial projections. Not only will it guide your decision-making, a business plan can help you secure funding with a loan or from investors .

Writing a business plan can seem like a huge task, but taking it one step at a time can break the plan down into manageable milestones. Here is our step-by-step guide on how to write a business plan.

Table of contents

• Write your executive summary
• Do your market research homework
• Set your business goals and objectives
• Plan your business strategy
• Describe your product or service
• Crunch the numbers
• Finalize your business plan

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Step 1: Write your executive summary

Though this will be the first page of your business plan , we recommend you actually write the executive summary last. That’s because an executive summary highlights what’s to come in the business plan but in a more condensed fashion.

An executive summary gives stakeholders who are reading your business plan the key points quickly without having to comb through pages and pages. Be sure to cover each successive point in a concise manner, and include as much data as necessary to support your claims.

You’ll cover other things too, but answer these basic questions in your executive summary:

• Idea: What’s your business concept? What problem does your business solve? What are your business goals?
• Product: What’s your product/service and how is it different?
• Market: Who’s your audience? How will you reach customers?
• Finance: How much will your idea cost? And if you’re seeking funding, how much money do you need? How much do you expect to earn? If you’ve already started, where is your revenue at now?

Step 2: Do your market research homework

The next step in writing a business plan is to conduct market research . This involves gathering information about your target market (or customer persona), your competition, and the industry as a whole. You can use a variety of research methods such as surveys, focus groups, and online research to gather this information. Your method may be formal or more casual, just make sure that you’re getting good data back.

This research will help you to understand the needs of your target market and the potential demand for your product or service—essential aspects of starting and growing a successful business.

Step 3: Set your business goals and objectives

Once you’ve completed your market research, you can begin to define your business goals and objectives. What is the problem you want to solve? What’s your vision for the future? Where do you want to be in a year from now?

Use this step to decide what you want to achieve with your business, both in the short and long term. Try to set SMART goals—specific, measurable, achievable, relevant, and time-bound benchmarks—that will help you to stay focused and motivated as you build your business.

Step 4: Plan your business strategy

Your business strategy is how you plan to reach your goals and objectives. This includes details on positioning your product or service, marketing and sales strategies, operational plans, and the organizational structure of your small business.

Make sure to include key roles and responsibilities for each team member if you’re in a business entity with multiple people.

Step 5: Describe your product or service

In this section, get into the nitty-gritty of your product or service. Go into depth regarding the features, benefits, target market, and any patents or proprietary tech you have. Make sure to paint a clear picture of what sets your product apart from the competition—and don’t forget to highlight any customer benefits.

Step 6: Crunch the numbers

Financial analysis is an essential part of your business plan. If you’re already in business that includes your profit and loss statement , cash flow statement and balance sheet .

These financial projections will give investors and lenders an understanding of the financial health of your business and the potential return on investment.

You may want to work with a financial professional to ensure your financial projections are realistic and accurate.

Step 7: Finalize your business plan

Once you’ve completed everything, it's time to finalize your business plan. This involves reviewing and editing your plan to ensure that it is clear, concise, and easy to understand.

You should also have someone else review your plan to get a fresh perspective and identify any areas that may need improvement. You could even work with a free SCORE mentor on your business plan or use a SCORE business plan template for more detailed guidance.

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The takeaway

Writing a business plan is an essential process for any forward-thinking entrepreneur or business owner. A business plan requires a lot of up-front research, planning, and attention to detail, but it’s worthwhile. Creating a comprehensive business plan can help you achieve your business goals and secure the funding you need.

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What Is a Business Plan? Definition and Planning Essentials Explained

Posted february 21, 2022 by kody wirth.

What is a business plan? It’s the roadmap for your business. The outline of your goals, objectives, and the steps you’ll take to get there. It describes the structure of your organization, how it operates, as well as the financial expectations and actual performance. 

A business plan can help you explore ideas, successfully start a business, manage operations, and pursue growth. In short, a business plan is a lot of different things. It’s more than just a stack of paper and can be one of your most effective tools as a business owner. 

Let’s explore the basics of business planning, the structure of a traditional plan, your planning options, and how you can use your plan to succeed. 

What is a business plan?

A business plan is a document that explains how your business operates. It summarizes your business structure, objectives, milestones, and financial performance. Again, it’s a guide that helps you, and anyone else, better understand how your business will succeed.  

Why do you need a business plan?

The primary purpose of a business plan is to help you understand the direction of your business and the steps it will take to get there. Having a solid business plan can help you grow up to 30% faster and according to our own 2021 Small Business research working on a business plan increases confidence regarding business health—even in the midst of a crisis. 

These benefits are directly connected to how writing a business plan makes you more informed and better prepares you for entrepreneurship. It helps you reduce risk and avoid pursuing potentially poor ideas. You’ll also be able to more easily uncover your business’s potential. By regularly returning to your plan you can understand what parts of your strategy are working and those that are not.

That just scratches the surface for why having a plan is valuable. Check out our full write-up for fifteen more reasons why you need a business plan .  

What can you do with your plan?

So what can you do with a business plan once you’ve created it? It can be all too easy to write a plan and just let it be. Here are just a few ways you can leverage your plan to benefit your business.

Test an idea

Writing a plan isn’t just for those that are ready to start a business. It’s just as valuable for those that have an idea and want to determine if it’s actually possible or not. By writing a plan to explore the validity of an idea, you are working through the process of understanding what it would take to be successful. 

The market and competitive research alone can tell you a lot about your idea. Is the marketplace too crowded? Is the solution you have in mind not really needed? Add in the exploration of milestones, potential expenses, and the sales needed to attain profitability and you can paint a pretty clear picture of the potential of your business.

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Document your strategy and goals

For those starting or managing a business understanding where you’re going and how you’re going to get there are vital. Writing your plan helps you do that. It ensures that you are considering all aspects of your business, know what milestones you need to hit, and can effectively make adjustments if that doesn’t happen. 

With a plan in place, you’ll have an idea of where you want your business to go as well as how you’ve performed in the past. This alone better prepares you to take on challenges, review what you’ve done before, and make the right adjustments.

Pursue funding

Even if you do not intend to pursue funding right away, having a business plan will prepare you for it. It will ensure that you have all of the information necessary to submit a loan application and pitch to investors. So, rather than scrambling to gather documentation and write a cohesive plan once it’s relevant, you can instead keep your plan up-to-date and attempt to attain funding. Just add a use of funds report to your financial plan and you’ll be ready to go.

The benefits of having a plan don’t stop there. You can then use your business plan to help you manage the funding you receive. You’ll not only be able to easily track and forecast how you’ll use your funds but easily report on how it’s been used. 

Better manage your business

A solid business plan isn’t meant to be something you do once and forget about. Instead, it should be a useful tool that you can regularly use to analyze performance, make strategic decisions, and anticipate future scenarios. It’s a document that you should regularly update and adjust as you go to better fit the actual state of your business.

Doing so makes it easier to understand what’s working and what’s not. It helps you understand if you’re truly reaching your goals or if you need to make further adjustments. Having your plan in place makes that process quicker, more informative, and leaves you with far more time to actually spend running your business.

What should your business plan include?

The content and structure of your business plan should include anything that will help you use it effectively. That being said, there are some key elements that you should cover and that investors will expect to see. 

Executive summary

The executive summary is a simple overview of your business and your overall plan. It should serve as a standalone document that provides enough detail for anyone—including yourself, team members, or investors—to fully understand your business strategy. Make sure to cover the problem you’re solving, a description of your product or service, your target market, organizational structure, a financial summary, and any necessary funding requirements.

This will be the first part of your plan but it’s easiest to write it after you’ve created your full plan.

Products & Services

When describing your products or services, you need to start by outlining the problem you’re solving and why what you offer is valuable. This is where you’ll also address current competition in the market and any competitive advantages your products or services bring to the table. Lastly, be sure to outline the steps or milestones that you’ll need to hit to successfully launch your business. If you’ve already hit some initial milestones, like taking pre-orders or early funding, be sure to include it here to further prove the validity of your business. 

Market analysis

A market analysis is a qualitative and quantitative assessment of the current market you’re entering or competing in. It helps you understand the overall state and potential of the industry, who your ideal customers are, the positioning of your competition, and how you intend to position your own business. This helps you better explore the long-term trends of the market, what challenges to expect, and how you will need to initially introduce and even price your products or services.

Check out our full guide for how to conduct a market analysis in just four easy steps .  

Marketing & sales

Here you detail how you intend to reach your target market. This includes your sales activities, general pricing plan, and the beginnings of your marketing strategy. If you have any branding elements, sample marketing campaigns, or messaging available—this is the place to add it. 

Additionally, it may be wise to include a SWOT analysis that demonstrates your business or specific product/service position. This will showcase how you intend to leverage sales and marketing channels to deal with competitive threats and take advantage of any opportunities.

Check out our full write-up to learn how to create a cohesive marketing strategy for your business. 

Organization & management

This section addresses the legal structure of your business, your current team, and any gaps that need to be filled. Depending on your business type and longevity, you’ll also need to include your location, ownership information, and business history. Basically, add any information that helps explain your organizational structure and how you operate. This section is particularly important for pitching to investors but should be included even if attempted funding is not in your immediate future.

Financial projections

Possibly the most important piece of your plan, your financials section is vital for showcasing the viability of your business. It also helps you establish a baseline to measure against and makes it easier to make ongoing strategic decisions as your business grows. This may seem complex on the surface, but it can be far easier than you think. 

Focus on building solid forecasts, keep your categories simple, and lean on assumptions. You can always return to this section to add more details and refine your financial statements as you operate. 

Here are the statements you should include in your financial plan:

• Sales and revenue projections
• Profit and loss statement
• Cash flow statement
• Balance sheet

The appendix is where you add additional detail, documentation, or extended notes that support the other sections of your plan. Don’t worry about adding this section at first and only add documentation that you think will be beneficial for anyone reading your plan.

Types of business plans explained

While all business plans cover similar categories, the style and function fully depend on how you intend to use your plan. So, to get the most out of your plan, it’s best to find a format that suits your needs. Here are a few common business plan types worth considering. 

Traditional business plan

The tried-and-true traditional business plan is a formal document meant to be used for external purposes. Typically this is the type of plan you’ll need when applying for funding or pitching to investors. It can also be used when training or hiring employees, working with vendors, or any other situation where the full details of your business must be understood by another individual. 

This type of business plan follows the outline above and can be anywhere from 10-50 pages depending on the amount of detail included, the complexity of your business, and what you include in your appendix. We recommend only starting with this business plan format if you plan to immediately pursue funding and already have a solid handle on your business information. 

Business model canvas

The business model canvas is a one-page template designed to demystify the business planning process. It removes the need for a traditional, copy-heavy business plan, in favor of a single-page outline that can help you and outside parties better explore your business idea. 

The structure ditches a linear structure in favor of a cell-based template. It encourages you to build connections between every element of your business. It’s faster to write out and update, and much easier for you, your team, and anyone else to visualize your business operations. This is really best for those exploring their business idea for the first time, but keep in mind that it can be difficult to actually validate your idea this way as well as adapt it into a full plan.

One-page business plan

The true middle ground between the business model canvas and a traditional business plan is the one-page business plan. This format is a simplified version of the traditional plan that focuses on the core aspects of your business. It basically serves as a beefed-up pitch document and can be finished as quickly as the business model canvas.

By starting with a one-page plan, you give yourself a minimal document to build from. You’ll typically stick with bullet points and single sentences making it much easier to elaborate or expand sections into a longer-form business plan. This plan type is useful for those exploring ideas, needing to validate their business model, or who need an internal plan to help them run and manage their business.

Now, the option that we here at LivePlan recommend is the Lean Plan . This is less of a specific document type and more of a methodology. It takes the simplicity and styling of the one-page business plan and turns it into a process for you to continuously plan, test, review, refine, and take action based on performance.

It holds all of the benefits of the single-page plan, including the potential to complete it in as little as 27-minutes . However, it’s even easier to convert into a full plan thanks to how heavily it’s tied to your financials. The overall goal of Lean Planning isn’t to just produce documents that you use once and shelve. Instead, the Lean Planning process helps you build a healthier company that thrives in times of growth and stable through times of crisis.

It’s faster, keeps your plan concise, and ensures that your plan is always up-to-date.

Try the LivePlan Method for Lean Business Planning

Now that you know the basics of business planning, it’s time to get started. Again we recommend leveraging a Lean Plan for a faster, easier, and far more useful planning process. 

To get familiar with the Lean Plan format, you can download our free Lean Plan template . However, if you want to elevate your ability to create and use your lean plan even further, you may want to explore LivePlan. 

It features step-by-step guidance that ensures you cover everything necessary while reducing the time spent on formatting and presenting. You’ll also gain access to financial forecasting tools that propel you through the process. Finally, it will transform your plan into a management tool that will help you easily compare your forecasts to your actual results. 

Check out how LivePlan streamlines Lean Planning by downloading our Kickstart Your Business ebook .

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• BUSINESS-PLAN

Definition of Business Plan

A business plan is a written document that outlines the goals, objectives, and strategies of a business. It serves as a roadmap for the organization, detailing the direction it aims to take, and the steps it will take to achieve its goals. A business plan typically includes information about the company’s products or services, target market, competition, financial projections, and marketing and sales strategies. It provides a comprehensive overview of the business and serves as a tool for guiding decision-making, securing funding, and measuring progress. A well-developed business plan is essential for the success and sustainability of any business venture.

Uses of Business Plan

In common business contexts, the term Business Plan refers to a written document that outlines the goals, objectives, strategies, and action plans of a company or organization. It is a comprehensive roadmap that guides a business towards achieving its objectives and can include information on market analysis, financial projections, and operational details. This document is often used to secure funding from investors or lenders, as well as to keep stakeholders informed of the company's direction. Another way the term Business Plan is used is to describe a formal proposal for a new business venture or project. In this context, the plan may be used to communicate ideas and strategies to potential partners, investors, or customers. This type of business plan focuses on the details of the new venture, such as the unique value proposition, target market, competitive analysis, and financial projections. A unique and niche application of the term Business Plan is in the field of entrepreneurship education. In this context, a business plan is used as a learning tool for aspiring entrepreneurs to develop their ideas into a viable business model. Students are challenged to conduct market research, identify their target audience, and create a detailed plan for their business. This application of the term allows students to gain practical experience in creating and evaluating business ideas. Uses: 1. To secure funding: A business plan is often used to attract investors or secure loans from financial institutions by presenting a clear and well-thought-out strategy for the business. 2. To guide decision-making: A business plan can serve as a reference point for business owners and managers to make informed decisions based on the company's goals and objectives. 3. To assess performance: A business plan can be used as a benchmark to track the company's performance and make necessary adjustments to achieve its desired outcomes. This is especially helpful for startups and small businesses that are constantly evolving.

Relevance of Business Plan to Specific Industries

The concept of a business plan is relevant to all industries, regardless of their size, nature, or focus. It is a strategic document that outlines the goals, objectives, and actions necessary to achieve success in any business. A business plan acts as a roadmap that guides the growth and development of an organization, making it crucial for businesses in any industry. {Industry 1}: Technology In the technology industry, a business plan is essential in outlining the direction of a company's growth and development. It helps in setting clear financial goals and identifying potential challenges and opportunities. A well-written business plan allows companies in the tech industry to secure funding from investors and attract potential customers. {Industry 2}: Hospitality In the hospitality industry, a business plan serves as a framework for creating a unique experience for customers. It outlines the company's mission, vision, and values, which are essential in building a brand. It also includes marketing strategies, operational plans, and financial projections, which help in ensuring the smooth functioning of the business. {Industry 3}: Agriculture In the agriculture industry, a business plan is crucial in securing loans or investments for farmers and agripreneurs. It outlines the strategies for farm production, marketing, and sales, which helps in increasing profitability. Additionally, a business plan in the agriculture industry also considers factors such as land, labor, and natural resources, which are crucial for the success of any farming operation. In summary, the concept of a business plan is significant in various industries, such as technology, hospitality, and agriculture, among others. It serves as a critical tool for businesses to outline their goals, plan their operations, secure funding, and ensure future success. It also allows organizations to adapt to changing market conditions and stay ahead of their competitors.

Real-World Example of Business Plan

Real-World Example1: Launching a New Restaurant Situation: A group of entrepreneurs is planning to launch a new restaurant in a busy commercial area. They have a great concept and are passionate about their food, but need to secure funding and determine a solid business strategy. Application: In this scenario, the term "Business Plan" is used to create a comprehensive document outlining the proposed restaurant's goals, financial projections, marketing strategy, operational plan, and risk management. This plan will be presented to potential investors to demonstrate the potential success and profitability of the business. It will also serve as a roadmap for the restaurant's operations and decision-making moving forward. Outcome: By developing and presenting a well-structured and realistic business plan, the entrepreneurs were able to secure funding from investors and successfully launch their restaurant. The business plan helped them to clearly define and prioritize their goals, allocate resources effectively, and anticipate potential challenges. It also provided a solid foundation for the restaurant's growth and success in the long run. Real-World Example2: Expanding an E-commerce Business Situation: An established e-commerce business has been steadily growing and is now considering expanding its operations to a new market. However, this expansion will require significant investments and a strategic approach to ensure success. Application: The term "Business Plan" is essential in this scenario as it helps the business to analyze and evaluate the potential market, competitors, and risks associated with the expansion. It also allows the business to develop a detailed financial plan, set achievable goals, and outline a marketing strategy to attract and retain customers in the new market. Outcome: With a solid business plan in place, the e-commerce business was able to successfully expand into the new market, gaining a competitive edge and increasing profits. The business plan helped the company to identify and address potential obstacles, allocate resources effectively, and ultimately achieve its goals in the new market.

Related Business Terms

1. Gross Profit: Gross profit is a financial measure used to calculate the profitability of a company by subtracting the cost of goods sold from the total revenue. It represents the company's profit after accounting for the direct costs associated with producing and selling its goods or services. 2. Net Profit: Net profit, also known as the bottom line, is a company's total earnings after all expenses, including taxes and interest, have been deducted from its total revenue. It is a key measure of a company's profitability and is often used to evaluate the overall financial health of a business. 3. Revenue: Revenue is the total amount of money that a company generates from its operations, including sales of its products or services. It is an important metric for evaluating a company's financial performance and growth potential. 4. Cost of Goods Sold (COGS): Cost of goods sold, also known as cost of sales, is the direct cost associated with producing and selling a company's products or services. This includes the cost of raw materials, labor, and equipment, as well as any overhead costs. 5. Earnings Before Interest and Taxes (EBIT): Earnings before interest and taxes is a financial measure that indicates a company's operating profit before taking into account taxes and interest expenses. It is often used to assess a company's operational efficiency and profitability. 6. Operating Expenses: Operating expenses are all the costs associated with running a business, such as rent, utilities, salaries, and marketing expenses. They can also include research and development costs and depreciation of assets. 7. Earnings Per Share (EPS): Earnings per share is a company's net profit divided by the number of outstanding shares. It is an important metric for investors to evaluate a company's profitability and to compare it to other companies in the same industry. 8. Return on Investment (ROI): Return on investment is a measure of a company's profitability relative to the amount of money invested in it. It is calculated by dividing the net profit by the total investment and is used to assess the efficiency of a company's investments. 9. Profit Margin: Profit margin is the percentage of revenue that is left after all expenses have been deducted from the total revenue. It is a key measure of a company's profitability and is used to compare companies within the same industry. 10. Cash Flow: Cash flow is the amount of money that comes in and goes out of a company during a specific period. It is an important measure of a company's financial health and its ability to meet its financial obligations.

Understanding the Business Plan is crucial for any modern business to succeed. It serves as a roadmap for the organization, outlining its objectives, strategies, and ways to achieve them. In today's fast-paced and highly competitive business environment, having a clear business plan is essential for growth and sustainability. One of the primary reasons for understanding the Business Plan is its role in effective communication. A well-written Business Plan not only conveys the organization's goals and objectives to potential investors and stakeholders but also serves as a guide for employees to understand their role in achieving those goals. It also helps in aligning everyone in the organization towards the same vision, creating a sense of unity and purpose. Furthermore, the Business Plan plays a crucial role in decision-making. It provides a comprehensive overview of the organization's current state, market analysis, and projected growth, which helps in making informed and strategic decisions. It also outlines potential risks and mitigating strategies, enabling the organization to minimize potential losses and make decisions that align with the long-term objectives. In today's fast-paced and ever-changing business landscape, having a Business Plan is necessary for a sustainable and successful business. It serves as a guidepost, helping organizations stay focused on their objectives and navigate potential obstacles. Additionally, understanding the Business Plan can also facilitate a company's adaptability and flexibility, allowing it to pivot and adjust its strategies as needed. In conclusion, understanding the Business Plan is vital for any modern business to thrive. It serves as a blueprint for success, enabling effective communication, and driving informed decision-making. As markets, technology, and consumer preferences continue to evolve, having a clear sense of direction and a well-thought-out plan is more critical than ever before. Therefore, organizations must invest time and effort in creating and understanding their Business Plan to set themselves up for success in today's dynamic business world.

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Business Plan

By Entrepreneur Staff

Business Plan Definition:

A written document describing the nature of the business, the sales and marketing strategy, and the financial background, and containing a projected profit and loss statement

A business plan is also a road map that provides directions so a business can plan its future and helps it avoid bumps in the road. The time you spend making your business plan thorough and accurate, and keeping it up-to-date, is an investment that pays big dividends in the long term.

Your business plan should conform to generally accepted guidelines regarding form and content. Each section should include specific elements and address relevant questions that the people who read your plan will most likely ask. Generally, a business plan has the following components:

Title Page and Contents A business plan should be presented in a binder with a cover listing the name of the business, the name(s) of the principal(s), address, phone number, e-mail and website addresses, and the date. You don't have to spend a lot of money on a fancy binder or cover. Your readers want a plan that looks professional, is easy to read and is well-put-together.

Include the same information on the title page. If you have a logo, you can use it, too. A table of contents follows the executive summary or statement of purpose, so that readers can quickly find the information or financial data they need.

Executive Summary The executive summary, or statement of purpose, succinctly encapsulates your reason for writing the business plan. It tells the reader what you want and why, right up front. Are you looking for a $10,000 loan to remodel and refurbish your factory? A loan of $25,000 to expand your product line or buy new equipment? How will you repay your loan, and over what term? Would you like to find a partner to whom you'd sell 25 percent of the business? What's in it for him or her? The questions that pertain to your situation should be addressed here clearly and succinctly.

The summary or statement should be no more than half a page in length and should touch on the following key elements:

• Business concept describes the business, its product, the market it serves and the business' competitive advantage.
• Financial features include financial highlights, such as sales and profits.
• Financial requirements state how much capital is needed for startup or expansion, how it will be used and what collateral is available.
• Current business position furnishes relevant information about the company, its legal form of operation, when it was founded, the principal owners and key personnel.
• Major achievements points out anything noteworthy, such as patents, prototypes, important contracts regarding product development, or results from test marketing that have been conducted.

Description of the Business The business description usually begins with a short explanation of the industry. When describing the industry, discuss what's going on now as well as the outlook for the future. Do the necessary research so you can provide information on all the various markets within the industry, including references to new products or developments that could benefit or hinder your business. Base your observations on reliable data and be sure to footnote and cite your sources of information when necessary. Remember that bankers and investors want to know hard facts--they won't risk money on assumptions or conjecture.

When describing your business, say which sector it falls into (wholesale, retail, food service, manufacturing, hospitality and so on), and whether the business is new or established. Then say whether the business is a sole proprietorship, partnership, C or Sub chapter S corporation. Next, list the business' principals and state what they bring to the business. Continue with information on who the business' customers are, how big the market is, and how the product or service is distributed and marketed.

Description of the Product or Service The business description can be a few paragraphs to a few pages in length, depending on the complexity of your plan. If your plan isn't too complicated, keep your business description short, describing the industry in one paragraph, the product in another, and the business and its success factors in two or three more paragraphs.

When you describe your product or service, make sure your reader has a clear idea of what you're talking about. Explain how people use your product or service and talk about what makes your product or service different from others available in the market. Be specific about what sets your business apart from those of your competitors.

Then explain how your business will gain a competitive edge and why your business will be profitable. Describe the factors you think will make it successful. If your business plan will be used as a financing proposal, explain why the additional equity or debt will make your business more profitable. Give hard facts, such as "new equipment will create an income stream of $10,000 per year" and briefly describe how.

Other information to address here is a description of the experience of the other key people in the business. Whoever reads your business plan will want to know what suppliers or experts you've spoken to about your business and their response to your idea. They may even ask you to clarify your choice of location or reasons for selling this particular product.

Market Analysis A thorough market analysis will help you define your prospects as well as help you establish pricing, distribution, and promotional strategies that will allow your company to be successful vis-à-vis your competition, both in the short and long term.

Begin your market analysis by defining the market in terms of size, demographics, structure, growth prospects, trends, and sales potential. Next, determine how often your product or service will be purchased by your target market. Then figure out the potential annual purchase. Then figure out what percentage of this annual sum you either have or can attain. Keep in mind that no one gets 100 percent market share, and that a something as small as 25 percent is considered a dominant share. Your market share will be a benchmark that tells you how well you're doing in light of your market-planning projections.

You'll also have to describe your positioning strategy. How you differentiate your product or service from that of your competitors and then determine which market niche to fill is called "positioning." Positioning helps establish your product or service's identity within the eyes of the purchaser. A positioning statement for a business plan doesn't have to be long or elaborate, but it does need to point out who your target market is, how you'll reach them, what they're really buying from you, who your competitors are, and what your USP (unique selling proposition) is.

How you price your product or service is perhaps your most important marketing decision. It's also one of the most difficult to make for most small business owners, because there are no instant formulas. Many methods of establishing prices are available to you, but these are among the most common.

• Cost-plus pricing is used mainly by manufacturers to assure that all costs, both fixed and variable, are covered and the desired profit percentage is attained.
• Demand pricing is used by companies that sell their products through a variety of sources at differing prices based on demand.
• Competitive pricing is used by companies that are entering a market where there's already an established price and it's difficult to differentiate one product from another.
• Markup pricing is used mainly by retailers and is calculated by adding your desired profit to the cost of the product.

You'll also have to determine distribution, which includes the entire process of moving the product from the factory to the end user. Make sure to analyze your competitors' distribution channels before deciding whether to use the same type of channel or an alternative that may provide you with a strategic advantage.

Finally, your promotion strategy should include all the ways you communicate with your markets to make them aware of your products or services. To be successful, your promotion strategy should address advertising, packaging, public relations, sales promotions and personal sales.

Competitive Analysis The purpose of the competitive analysis is to determine:

• the strengths and weaknesses of the competitors within your market.
• strategies that will provide you with a distinct advantage.
• barriers that can be developed to prevent competition from entering your market.
• any weaknesses that can be exploited in the product development cycle.

The first step in a competitor analysis is to identify both direct and indirect competition for your business, both now and in the future. Once you've grouped your competitors, start analyzing their marketing strategies and identifying their vulnerable areas by examining their strengths and weaknesses. This will help you determine your distinct competitive advantage.

Whoever reads your business plan should be very clear on who your target market is, what your market niche is, exactly how you'll stand apart from your competitors, and why you'll be successful doing so.

Operations and Management The operations and management component of your plan is designed to describe how the business functions on a continuing basis. The operations plan highlights the logistics of the organization, such as the responsibilities of the management team, the tasks assigned to each division within the company, and capital and expense requirements related to the operations of the business.

Financial Components of Your Business Plan After defining the product, market and operations, the next area to turn your attention to are the three financial statements that form the backbone of your business plan: the income statement, cash flow statement, and balance sheet.

The income statement is a simple and straightforward report on the business' cash-generating ability. It is a scorecard on the financial performance of your business that reflects when sales are made and when expenses are incurred. It draws information from the various financial models developed earlier such as revenue, expenses, capital (in the form of depreciation), and cost of goods. By combining these elements, the income statement illustrates just how much your company makes or loses during the year by subtracting cost of goods and expenses from revenue to arrive at a net result, which is either a profit or loss. In addition to the income statements, include a note analyzing the results. The analysis should be very short, emphasizing the key points of the income statement. Your CPA can help you craft this.

The cash flow statement is one of the most critical information tools for your business, since it shows how much cash you'll need to meet obligations, when you'll require it and where it will come from. The result is the profit or loss at the end of each month and year. The cash flow statement carries both profits and losses over to the next month to also show the cumulative amount. Running a loss on your cash flow statement is a major red flag that indicates not having enough cash to meet expenses-something that demands immediate attention and action.

The cash flow statement should be prepared on a monthly basis during the first year, on a quarterly basis for the second year, and annually for the third year. The following 17 items are listed in the order they need to appear on your cash flow statement. As with the income statement, you'll need to analyze the cash flow statement in a short summary in the business plan. Once again, the analysis doesn't have to be long and should cover highlights only. Ask your CPA for help.

The last financial statement you'll need is a balance sheet. Unlike the previous financial statements, the balance sheet is generated annually for the business plan and is, more or less, a summary of all the preceding financial information broken down into three areas: assets, liabilities and equity.

Balance sheets are used to calculate the net worth of a business or individual by measuring assets against liabilities. If your business plan is for an existing business, the balance sheet from your last reporting period should be included. If the business plan is for a new business, try to project what your assets and liabilities will be over the course of the business plan to determine what equity you may accumulate in the business. To obtain financing for a new business, you'll need to include a personal financial statement or balance sheet.

In the business plan, you'll need to create an analysis for the balance sheet just as you need to do for the income and cash flow statements. The analysis of the balance sheet should be kept short and cover key points.

Supporting Documents In this section, include any other documents that are of interest to your reader, such as your resume; contracts with suppliers, customers, or clients, letters of reference, letters of intent, copy of your lease and any other legal documents, tax returns for the previous three years, and anything else relevant to your business plan.

Some people think you don't need a business plan unless you're trying to borrow money. Of course, it's true that you do need a good plan if you intend to approach a lender--whether a banker, a venture capitalist or any number of other sources--for startup capital. But a business plan is more than a pitch for financing; it's a guide to help you define and meet your business goals.

Just as you wouldn't start off on a cross-country drive without a road map, you should not embark on your new business without a business plan to guide you. A business plan won't automatically make you a success, but it will help you avoid some common causes of business failure, such as under-capitalization or lack of an adequate market.

As you research and prepare your business plan, you'll find weak spots in your business idea that you'll be able to repair. You'll also discover areas with potential you may not have thought about before--and ways to profit from them. Only by putting together a business plan can you decide whether your great idea is really worth your time and investment.

More from Business Plans

Financial projections.

Estimates of the future financial performance of a business

Financial Statement

A written report of the financial condition of a firm. Financial statements include the balance sheet, income statement, statement of changes in net worth and statement of cash flow.

Executive Summary

A nontechnical summary statement at the beginning of a business plan that's designed to encapsulate your reason for writing the plan

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Two Successful Approaches to Account Planning [Template]

Updated: August 23, 2022

Published: June 20, 2022

Are you a B2B account manager or sales executive serious about account-based marketing (ABM)? If the answer is “yes,” chances are you understand your customers want partners, not vendors.

To win new business and grow key accounts, account managers and sales executives must become invested in their customer’s challenges, goals, and the competitive landscape in which their business operates.

By using strategic account planning to target your key accounts , you can become your customer’s trusted partner by solving problems instead of selling products.

This article will touch on two viable account planning solutions — account-based marketing software and a manual, template-based approach. Below, we share one of the best templates to begin the account planning process in your sales organization.

Strategic Account Plan Template Layout

If you're reluctant to invest in ABM software or just want a solid starting point to understand ABM strategy better, this strategic account planning template will help you:

• Expand your understanding of your customer’s business, goals, and motivations
• Deliver value through right-fit solutions to their toughest challenges
• Navigate internal politics and target key stakeholders to drive buy-in
• Identify and avoid risks, barriers, and limitations

Featured Resource: Strategic Account Planning Template

Download This Template for Free

Ready to explore what account planning is all about and how it can increase your sales? In this article, we’ll go over the following topics:

• What is account planning?
• Terms related to account planning
• Account planning process: a step-by-step guide
• Account planning templates
• Account-based marketing software

Let’s get started.

What is Account Planning?

Account planning, used primarily in B2B sales, is the process of nurturing and growing your existing customer relationships. When creating an account plan, you seek to understand your customer’s business by identifying their key initiatives, problems, and challenges. Your objective is to deliver value that helps them achieve their goals and increase their sales.

Account planning is about partnering with your customer instead of selling to your customer. It looks at sales not as a transactional process but as the start of a strategic partnership. This term is usually applicable in B2B organizations rather than B2C organizations.

Because account planning is such a thorough process, it allows you to ask your customer highly specific questions related to their business and challenges.

These questions are usually related to the product or service you offer, giving you further insight into how you can solve for them in both the short and long term.

While account planning aims to decrease customer attrition , it can also be a valuable tool for acquisition. Understanding your most profitable customers can help you identify better prospects to target in your future sales efforts.

Account Plan

An account plan is a document that outlines all pertinent information about your customer, including their business goals, challenges, priorities, competitors, decision-making processes, and purchase criteria. You can also detail your strategies for retaining and upselling them.

The information you gather for your account plan will give you valuable insight into your customer's priorities. This constant flow of helpful information makes it easier to be proactive in fulfilling the client's needs.

Efficient implementation takes a lot of trial and error, but when you have the right data as a starting point, the trial period gets shorter and easy to overcome. Knowing what your clients want is a good way to ensure that your account planning efforts will be more effective from the beginning.

Free Account Management Template

A strategic template for your account-based marketing, sales, and management.

• Key Business Initiatives
• Account Competitor Analysis
• Sales Opportunities, Targets & Risks

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In addition, by offering this type of value, customers are happy and more likely to be loyal to your organization. Your objective is to deliver value that helps them achieve their goals and increase sales.

An effective account planning strategy will help your company build a reputation as a solution provider that customers can trust. To build an effective account strategy, account professionals must become invested in their customer’s challenges, goals, and the competitive landscape in which their business operates.

Account Planning and Marketing Strategies

Knowing what your customers appreciate and expect from your services is a strong foundation for your marketing efforts. Marketing is not only about putting your work out there but also about taking your audience’s language and communicating what they actually need to hear. This is where account planning comes in.

Account planning helps any marketing team turn business data into effective creative work that satisfies your customers and leads.

A marketing strategy aimed at transforming pain points into strong assets creates a strong customer relationship based on value and efficiency rather than a plain sales process.

Why is Account Planning important?

87% of marketers say account-based marketing outperforms other marketing activities. As such, it’s vital to learn how it can help your business too.

Here are some of account planning’s most significant benefits.

Reduces Acquisition Costs

Customer acquisition is expensive for several reasons. Some of the major costs are incurred from the resources expended to discover customer drivers and challenges.

Account planning reduces acquisition costs because it allows you to focus more on creating business through existing customers instead of looking for new ones.

Speeds Up Sales

Account planning reduces acquisition costs and makes it easier to close deals faster. In addition, since account planning focuses on existing accounts, sales professionals already know the key decision-makers in the buying process and understand how they prefer to buy.

Furthermore, account planning helps sales professionals observe customer behaviors that can be disruptive to the buying process.

Retains Important Relationships

Since account planning involves frequent communication between clients and representatives, your sales professionals are positioned to get the real-time pulse of clients.

An effective account plan helps businesses nurture existing relationships with customers while also providing a solid base for future marketing efforts. If account planning plays an essential role in client retention outcomes and conversion rates, it affects the company's overall number of clients (and revenue).

Working on your account planning will reduce acquisition costs while making it easier to close deals faster. Since account planning focuses on existing accounts, sales professionals already know the key decision-makers in the buying process and understand how they prefer to buy.

When account planning is optimized, sales strategies will have a new foundation full of valuable data. This will help sales workers ensure that all their efforts are going in the right direction.

By reducing acquisition costs and speeding up sales, account planning can be the first step in successfully using your business resources, especially time and money. It provides the information needed to build solid foundations for your client’s relationships and your sales work.

Account planning can be a great way to level up your business sales and customer satisfaction rates, but it can be difficult to start implementing its steps. Having the right guides and resources is essential for any business process.

Related Account Planning Terms

Now, let’s talk about some of the common terms you’ll find while scrolling through any account planning article.

Sales Account Planning

Sales account planning is an alternative term for account planning. This account planning approach process takes all the information about customer behavior and focuses on improving sales processes. With a special focus on converting users into customers, sales account planning will have a strong lead generation potential. However, customer retention strategies won’t have a special place in this process.

Strategic Account Management

Choosing high-value and high-profit accounts to grow and nurture is called strategic account management. Not all accounts or customers warrant a plan, so strategic account managers typically spearhead these efforts. Thus, account planning and strategic account management can go hand-in-hand.

Key Account Management

Key account management is similar to strategic account management and may also complement the account planning process. Sales leaders and representatives build, maintain, and nurture the business’s most profitable accounts. They do this by offering exclusive resources, recurring meetings, and dedicated key account managers (KAMs).

Account-based Marketing

Account-based marketing is usually carried out after key accounts have been established and account plans have been created. After these high-value customers are identified, the marketing team will create campaigns, assets, and messaging that targets these accounts.

As you can see, account planning can be a huge asset to your business, allowing you to delve in-depth into each customer profile.

By knowing the customer’s challenges, industry, and goals, you can position your product as the solution in a much more specific and targeted way, which can help increase close rates .

Now, it’s time to create a plan that can help you jumpstart your account planning efforts.

How to Start Account Planning at Your Business

Starting an account plan can be time-intensive, but when done right can show good results. There are four basic steps to implement if you want to start account planning at your business. These are:

1. Determine which accounts require account planning.

First, you should develop criteria for determining which accounts need an account plan. Clients who tend to require an account plan include those who are high profile, likely to scale, and can use your product or service in other departments in the company.

2. Discover the needs of these accounts.

Discovering the needs of these strategic accounts requires loads of research. These are some questions that can be a good place to start:

• What are the goals of this client?
• What do they value the most?
• Who is involved in the buying decision process?
• What are their current plans to achieve goals?
• What KPIs do they measure?

3. Create actionable steps.

After doing your research, it’s time to develop actionable steps. These steps vary depending on the account but might include:

• Account analysis
• Short-term steps (e.g., getting them to renew with you)
• Long-term steps (e.g., long-term client growth)

4. Execute the account plan.

Lastly, execute the plan you’ve created by incorporating the specifics of your business and sharing it with your stakeholders.

Account Planning Process

• Use an account planning template.
• Summarize your customer’s business strategy.
• Know your customer’s key business initiatives.
• Understand your customer’s organizational chart and key players.
• Audit your customer’s products and revenue.
• Analyze your customer’s competition.
• Outline the buying process and selling points for prospective contacts.
• Establish a strategy for growing your relationship with your customer.
• Identify sales opportunities, targets, and risks.
• Create an action plan.
• Review your plan with your customer.

Before Starting: Download HubSpot's Account Planning Template

Now you know all the details about account planning, its benefits, and what’s required to implement it effectively. So, with all this information in mind, it’s time to put in the work and start building your account plan.

HubSpot's pre-built Account Planning Template contains prompts for each of the subsequent sections, as well as suggested topics to include in each one. Rather than starting from scratch, we recommend you follow along by downloading the free template.

Section 1: Business Overview

The most effective account managers and sales teams understand their customer’s narratives. They ask value-focused questions to get to the root of their customer’s business objectives, internal and external challenges, and industry landscape.

This questioning and learning must be an ongoing exercise. Objectives and goals are ever-changing, and customers often reposition their value in the face of new technology or market shifts.

In this section, identify the following:

• Your customer’s vision/strategy
• Your customer’s vital numbers
• The year the company was founded
• Your customer's annual revenue
• Number of employees who work for your customer
• Popular target markets in the customer's industry

After creating an account plan and getting to know your customer inside out, here are a few questions your account managers can ask:

• “We noticed that your industry has seen a decline in _______. How has your business fared since this trend started?”
• “Your competitor recently developed a new product. How does leadership plan to tackle this new challenge?”
• “Your initiatives for ________ did well for Q4 of last year, resulting in X% growth in revenue. Do you have any plans to continue those initiatives in Q1? What challenges do you foresee?”
• “I saw that you expanded into the ________ market. How has that been going? Are there any plans to expand into related industries?”

Section 2: Key Business Initiatives

As former FBI hostage negotiator Chris Voss outlines in his book Never Split the Difference , all successful negotiations begin with listening. To develop a value-based action plan, you need to discover what your customer values most.

By focusing on your customer’s value expectations, you create opportunities to grow more strategic customer relationships. This safeguards against competition while increasing customer loyalty.

Ask questions that will reveal your customer’s:

• Short-/medium-/long-term priorities
• Key projects
• Key performance indicators (KPIs)

Section 3: Customer Relationship Landscape

Your customer relationship landscape is, essentially, what you know about your audience based on the connections you’ve been creating with your clients. Knowing what they appreciate, how they want to communicate, and even the aspects of your business they admire most will save time and help them reach new goals.

Which type of clients are you helping the most? Where do you find more growth potential and positive feedback? It’s time to ask these questions and turn them into the customer approach that your account plan will follow.

Section 4: Customer Products and Revenues

Today’s customer desires a strategic partner to deliver value across their organization. In this section, list and describe where you are currently adding value, analyze the ROI of that value, and identify gaps in the value chain.

Don’t forget to include the following information:

• Whitespace analysis
• Current sales performance
• Current margin performance
• Wins or losses over the last 12 months

Section 5: Competitor Analysis

Performing a competitive analysis for your customer may not seem to provide high value to your sales team, but remember: Your goal is to move from a transactional relationship to a strategic partnership. Only when you understand your customer’s challenges can you help them differentiate their products and services.

List your customer’s:

• Competitors
• Competitors’ strengths
• Competitors’ weaknesses

Section 6: Buying Process and Selling Points

Businesses don’t buy products or services — people do. So, expand your organizational chart from section three to include personal motivations and decision criteria, and plot your value-based selling points to specific members of your customer’s organization.

The goal of a trusted advisor should not be to fit a product into an empty slot. Rather, your focus should be to understand how your key selling points match each decision maker’s goal.

Identify each of the following:

• Evaluation criteria
• Key decision criteria
• Key selling points

Section 7: Relationship Goals and Strategy

Before an account manager can move the customer relationship forward, they must establish the status of their current client relationship. Knowing where we’re starting helps us get the right resources to build solid foundations and effectively approach the next steps.

Using the organizational chart from section three and the motivations from section six, determine which relationship target has the greatest opportunity for engagement. Focus on those who can provide the most productive outcomes for the customer’s business and your own.

Expand your relationship landscape to include:

• Current relationship status ( Vendor, Preferred Supplier, Planning Partner, Trusted Advisor )
• Core business partners
• Relationship target (who, what, where, how, why)
• Relationship progression strategy

Section 8: Sales Opportunities, Targets, and Risks

Once you’ve documented your customer’s objectives, motivations, and key relationships, determine the products/services that will help them attain their goals. List revenue goals and identify blockers — internal and external.

List and define:

• Two-year revenue goals
• Customer needs for products/services
• Cross-sell and upsell opportunities
• Risks, barriers, and limitations
• Operational restrictions

It can be easy to gloss over the final bullet — operational restrictions. However, this exercise can illuminate friction in service/product delivery and reveal opportunities for automation and processes that can impact your entire book of business.

Section 9: Action Plan

Although there may be many value-add opportunities, narrow your focus to a small subset. Move the needle one position at a time.

Determine which team members will own which task, what resources will be required to achieve these tasks, and agree upon accountability measures.

Ensure that you do the following in your action plan:

• Identify the top five objectives.
• Create a list of critical resources.
• Assign tasks and key owners.

Section 10: Plan Review

Discuss value co-creation with your customer. Ensure you have correctly defined and prioritized value opportunities and work with them to provide relevant materials or resources to secure buy-in.

Engage the customer in a collaborative role to establish a process, timeline, and next steps.

We’ve collected some of the best strategic account planning templates you can use right now.

1. HubSpot’s Account Planning Template [Google Docs]

HubSpot’s Account Planning Template is useful for account managers who want the freedom to personalize their account plan with a strong marketing basis.

This template includes all the items discussed before, making it a complete resource for startups and big businesses. It can help small and large teams by providing an actionable step-by-step guide for account managers, sales executives, and marketing professionals to collaborate within the account planning process.

2. Databahn Account Plan Template [XLS]

Databahn offers a free Strategic Account Plan template that’s a good option for account management teams trying to streamline their account planning processes. This template is not only easy to use and complete, but it also includes different details like the members of the team, marketing strategies and targets, industry analysis, and annual reports.

Disclaimer: Even when completed, the account planning template needs to be constantly updated to be as effective as possible.

3. Gartner’s Key Account Plan Template

Gartner, the leading information technology research and advisory company, offers a template that includes a comprehensive set of customizable tools to help executive sales leaders construct or enhance their organization’s critical account plan.

4. ForecastEra’s Free Account Planning Template [PDF]

As part of its account planning tools, ForecastEra also offers a free account planning template to help sales executives.

5. Intercom’s Account Plans [XML]

Intercom is a customer success company that works with tools that level up clients relationships.

This company offers an account plan template to help account managers maintain successful customer satisfaction rates by taking advantage of up-to-date information.

6. Unstrategic’s Strategic Account Plan [PDF]

This easy-to-use template is an excellent resource for account managers and sales teams. It offers a detailed solution for companies to work on their account planning without struggling with technical misunderstandings.

This PDF guide offers a user-friendly content display and provides systematic instructions on how to fill out each section. It is great for anyone filling out an account plan for the first time.

7. Revegy’s Account Planning Template

This guide is the best option for sales professionals who want to create effective sales strategies based on customer data.

This tool can help you build consistent account plans that are easy to understand and implement.

8. Avention’s Strategic Account Plan Template [PPT]

Avention made this template to assist the account management team in staying on top of the client’s business objectives and goals. It’s also helping them achieve desired results that will ultimately have a good impact on the customer’s business.

9. Get2Growth Strategic Account Planning Template [PPT]

This company offers a one-page detailed template you can use to build an account plan in a few steps.

With different graphic elements and sections, this template is a good solution for account professionals who want to achieve an innovative account managing approach based on quick solutions.

10. Account Planning Template by AccountTips [XSL]

This template is full of helpful resources for account managers, and they offer clearly labeled Excel tabs to level up your account management work.

Supported by articles and academic resources, this template provides both questions to ask and cells to fill with relevant information. You will find yourself finishing your account plan in a blink of an eye.

Supporting Account Planning with Account-Based Marketing Software

Creating an account-based marketing plan (ABM) is the natural next step after finishing the planning process. But there’s no need to do it manually. Instead, we recommend using ABM software that can help you automate your ABM campaigns.

There are a number of different account-based marketing software platforms that can support your efforts, including HubSpot ABM Software , Terminus , and Demandbase .

A high-quality ABM software generally features tools and resources to help you establish a solid foundation for an account planning strategy. It’s typically rooted in defining and understanding your ideal customer profiles (ICPs).

It might also contain features that cover company and contact information, giving you insight into the businesses you're trying to target and the individual decision-makers you need to reach. Other tools — like workflow templates for building and maintaining your ICPs — can also be a big help for successful account planning.

Image Source

Here's how a workflow looks in HubSpot's ABM software. Specific actions are triggered depending on previous settings, automatically segmenting your ICPs by tier.

Personalization and Engagement

The fundamental basis of ABM, as a concept, is personalization. It's a process rooted in understanding and approaching individual accounts on terms that will specifically resonate with the prospects and customers behind them.

Features designed for compiling lists of target companies with similar characteristics can help you group like-minded companies and contacts for streamlined outreach. Some types of ABM software allow you to send ads to influencers within your targeted accounts across certain platforms — typically LinkedIn.

Resources that allow you to engage with those targeted lists via email can also add value to your account planning efforts. One way or another, it's always in your best interest to reach your target accounts in ways that suit their unique values and characteristics. Finding software to simplify that process can make your outreach more robust without losing focus.

Tracking and Measuring Efforts

Account planning isn't a static process. You need to constantly look for ways to modify your strategy as you interact with more customers. That's why resources to track the efficacy of your efforts are crucial.

Target account reporting libraries can help you keep tabs on target accounts. A solid ABM software often includes resources that let you review internal stakeholders within your target companies, allowing you to see who's supporting, blocking, or influencing your efforts.

It also helps to have visibility into the different interactions your business has with a target company. Some types of ABM software allow you to monitor activity like emails, meetings, and logged calls. Tools like that will enable you to understand where and how to improve your outreach and planning.

How can an ABM support your account plan?

Regardless of the one you choose, ABM software will be a time saver for your sales team, and it will give you the tools to work on your key customer relationships.

You now have all the resources you need to build a successful account plan from scratch, starting with the main questions and all the implementation steps that will help you get there. Are you ready to turn account planning into a valuable asset for your business?

Editor's note: This post was originally published in July 7, 2019 and has been updated for comprehensiveness.

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Starting a business in the United States involves a number of different steps spanning legal considerations, market research, creating a business plan, securing funding, and developing a marketing strategy. It also requires decisions about a business’ location, structure, name, taxation, and registration. Here are the key steps involved in starting a business, as well as important aspects of the process for entrepreneurs to consider.

Key Takeaways

• Entrepreneurs should start by conducting market research to understand their industry space, competition, and target customers.
• The next step is to write a comprehensive business plan, outlining the company’s structure, vision, and strategy.
• Securing funding in the form of grants, loans, venture capital, and/or crowdfunded money is crucial if you’re not self-funding.
• When choosing a venue, be aware of local regulations and requirements.
• Design your business structure with an eye to legal aspects, such as taxation and registration.
• Make a strategic marketing plan that addresses the specifics of the business, industry, and target market.

Before starting a business, entrepreneurs should conduct market research to determine their target audience, competition, and market trends. The U.S. Small Business Administration (SBA) breaks down common market considerations as follows:

• Demand : Is there a need for this product or service?
• Market size : How many people might be interested?
• Economic indicators : What are the income, employment rate, and spending habits of potential customers?
• Location : Are the target market and business well situated for each other?
• Competition : What is the market saturation ? Who and how many are you going up against?
• Pricing : What might a customer be willing to pay?

Market research should also include an analysis of market opportunities, barriers to market entry, and industry trends, as well as the competition’s strengths, weaknesses, and market share .

There are various methods for conducting market research, and these will vary depending on the nature of the industry and potential business. Data can come from a variety of places, including statistical agencies, economic and financial institutions, and industry sources, as well as direct consumer research through focus groups, interviews, surveys, and questionnaires.

A comprehensive business plan is like a blueprint. It lays the foundation for business development and affects decision-making, day-to-day operations, and growth. Potential investors or partners may want to review and assess it in advance of agreeing to work together. Financial institutions often request business plans as part of an application for a loan or other forms of capital. 

Business plans will differ according to the needs and nature of the company and should only include what makes sense for the business in question. As such, they can vary in length and structure. They can generally be divided into two formats: traditional and lean start-up. The latter is less common and more useful for simple businesses or those that expect to rework their traditional business plan frequently. It provides a vivid snapshot of the company through a small number of elements.

The process of funding a business depends on its needs and the vision and financial situation of its owner.  The first step is to calculate the start-up costs . Identify a list of expenses and put a dollar amount to each of them through research and requesting quotes. The SBA has a start-up costs calculator for small businesses that includes common types of business expenses.  

The next step is to determine how to get the money. Common methods include:

• Self-funding , also known as “ bootstrapping ”
• Finding investors willing to contribute to your venture capital
• Raising money online by crowdfunding
• Securing a business loan from a bank, an online lender, or a credit union
• Winning a business grant from a donor, usually a government, foundation, charity, or corporation

Different methods suit different businesses, and it’s important to consider the obligations associated with any avenue of funding. For example, investors generally want a degree of control for their money, while self-funding puts business owners fully in charge. Of course, investors also mitigate risk; self-funding does not.

Availability is another consideration. Loans are easier to get than grants, which don’t have to be paid back. Additionally, the federal government doesn’t provide grants for the purposes of starting or growing a business, although private organizations may. However, the SBA does guarantee several categories of loans , accessing capital that may not be available through traditional lenders. No matter the funding method(s), it’s essential to detail how the money will be used and lay out a future financial plan for the business, including sales projections and loan repayments . 

Businesses operating in the U.S. are legally subject to regulations at the local, county, state, and federal level involving taxation, business IDs, registrations, and permits.

Choosing a Business Location

Where a business operates will dictate such things as taxes, zoning laws (for brick-and-mortar locations), licenses, and permits. Other considerations when choosing a location might include:

• Human factors : These include target audience and the preferences of business owners and partners regarding convenience, knowledge of the area, and commuting distance.
• Regulations : Government at every level will assert its authority.
• Regionally specific expenses : Examples are average salaries (including required minimum wages), property or rental prices, insurance rates, utilities, and government fees and licensing.
• The tax and financial environment : Tax types include income, sales, corporate, and property, as well as tax credits; available investment incentives and loan programs may also be geographically determined.

Picking a Business Structure

The structure of a business should reflect the desired number of owners, liability characteristics, and tax status. Because these have legal and tax compliance implications , it’s important to understand them fully. If necessary, consult a business counselor, a lawyer, and/or an accountant.

Common business structures include:

• Sole proprietorship : A sole proprietorship is an unincorporated business that has just one owner, who pays personal income tax on its profits.
• Partnership : Partnership options include a limited partnership (LP) and a limited liability partnership (LLP) .
• Limited liability company (LLC) : An LLC protects its owners from personal responsibility for the company’s debts and liabilities.
• Corporation : The different types of corporations include C corp , S corp , B corp , closed corporation , and nonprofit .

Getting a Tax ID Number

A tax ID number is the equivalent of a Social Security number for a business. Whether or not a state and/or federal tax ID number is required will depend on the nature of the business and the location in which it’s registered.

A federal tax ID, also known as an employer identification number (EIN) , is required if a business:

• Operates as a corporation or partnership
• Pays federal taxes
• Has employees
• Files employment, excise, alcohol, tobacco, or firearms tax returns
• Has a Keogh plan
• Withholds taxes on non-wage income to nonresident aliens
• Is involved with certain types of organizations, including trusts, estates, real estate mortgage investment conduits, nonprofits, farmers’ cooperatives, and plan administrators

An EIN can also be useful if you want to open a business bank account, offer an employer-sponsored retirement plan, or apply for federal business licenses and permits. You can get one online from the Internal Revenue Service (IRS) . State websites will do the same for a state tax ID.

Registering a Business

How you register a business will depend on its location, nature, size, and business structure.  For example, a small business may not require any steps beyond registering its business name with local and state governments, and business owners whose business name is their own legal name might not need to register at all.

That said, registration can provide personal liability protection, tax-exempt status, and trademark protection, so it can be beneficial even if it’s not strictly required. Overall registration requirements, costs, and documentation will vary depending on the governing jurisdictions and business structure.  

Most LLCs, corporations, partnerships, and nonprofits are required to register at the state level and will need a registered agent to file on their behalf. Determining which state to register with can depend on factors such as:

• Whether the business has a physical presence in the state
• If the business often conducts in-person client meetings in the state
• If a large portion of business revenue comes from the state
• Whether the business has employees working in the state

If a business operates in more than one state, it may need to file for foreign qualification in other states in which it conducts business. In this case the business would register in the state in which it was formed (this would be considered the domestic state) and file for foreign qualification in any additional states.

Obtaining Permits

Filing for the applicable government licenses and permits will depend on the industry and nature of the business and might include submitting an application to a federal agency, state, county, and/or city. The SBA lists federally regulated business activities alongside the corresponding license-issuing agency, while state, county, and city regulations can be found on the official government websites for each region.

Every business should have a marketing plan that outlines an overall strategy and the day-to-day tactics used to execute it. A successful marketing plan will lay out tactics for how to connect with customers and convince them to buy what the company is selling. 

Marketing plans will vary according to the specifics of the industry, target market, and business, but they should aim to include descriptions of and strategies for the following:

• A target customer : Including market size, demographics, traits, and relevant trends
• Value propositions or business differentiators : An overview of the company’s competitive advantage with regard to employees, certifications, and offerings
• A sales and marketing plan : Including methods, channels, and a customer’s journey through interacting with the business
• Goals : Should cover different aspects of the marketing and sales strategy, such as social media follower growth, public relations opportunities, and sales targets
• An execution plan : Should detail tactics and break down higher-level goals into specific actions
• A budget : Detailing how much different marketing projects and activities will cost

How Much Does It Cost to Start a Business?

Business start-up costs will vary depending on the industry, business activity, and product or service offered. Home-based online businesses will usually cost less than those that require an office setting to meet with customers. The estimated cost can be calculated by first identifying a list of expenses and then researching and requesting quotes for each one. Use the SBA’s start-up costs calculator for common types of expenses associated with starting a small business.

What Should I Do Before Starting a Business?

Entrepreneurs seeking to start their own business should fully research and understand all the legal and funding considerations involved, conduct market research, and create marketing and business plans. They will also need to secure any necessary permits, licenses, funding, and business bank accounts.

What Types of Funding Are Available to Start a Business?

Start-up capital can come in the form of loans, grants, crowdfunding, venture capital, or self-funding. Note that the federal government does not provide grant funding for the purposes of starting a business, although some private sources do.

Do You Need to Write a Business Plan?

Business plans are comprehensive documents that lay out the most important information about a business. They reference its growth, development, and decision-making processes, and financial institutions and potential investors and partners generally request to review them in advance of agreeing to provide funding or to collaborate.

Starting a business is no easy feat, but research and preparation can help smooth the way. Having a firm understanding of your target market, competition, industry, goals, company structure, funding requirements, legal regulations, and marketing strategy, as well as conducting research and consulting experts where necessary, are all things that entrepreneurs can do to set themselves up for success.

U.S. Small Business Administration. “ Market Research and Competitive Analysis .”

U.S. Small Business Administration. “ Write Your Business Plan .”

U.S. Small Business Administration. " Calculate Your Startup Costs ."

U.S. Small Business Administration. “ Fund Your Business .”

U.S. Small Business Administration. “ Grants .”

U.S. Small Business Administration. “ Loans .”

U.S. Small Business Administration. “ Pick Your Business Location .”

U.S. Small Business Administration. “ Choose a Business Structure .”

Internal Revenue Service. “ Do You Need an EIN? ”

U.S. Small Business Administration. “ Get Federal and State Tax ID Numbers .”

U.S. Small Business Administration. “ Register Your Business .”

U.S. Small Business Administration. “ Apply for Licenses and Permits .”

U.S. Small Business Administration. “ Marketing and Sales .”

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• Why You Should Trust Us
• Methodology

Best Online Brokerages of June 2024

Paid non-client promotion: Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate investing products to write unbiased product reviews.

A brokerage account is like a checking account for your investments. The difference, however, is that brokerage accounts act as a safe place to hold investable assets like stocks, bonds, ETFs, mutual funds, and crypto. 

Best Online Brokers

• Charles Schwab: Best online brokerage overall
• SoFi Invest: Best for beginners
• Fidelity: Best online brokerage for retirement savings
• TD Ameritrade: Best online brokerage for experienced investors
• Interactive Brokers: Best for active investors
• Public: Best online brokerage for mobile
• Stockpile: Best online brokerage for kids and teens

Compare Top Online Brokerage Reviews 2024

The best brokerage company for you depends on the kinds of assets you're looking for, your investment style, and how much you're willing to pay for top-notch trading tools like auto rebalancing, market trades, and real-time market data. 

Here are the best online brokerages as picked by Business Insider's editors in 2024. 

Charles Schwab

Open and fund your account and get $101 from Schwab to split equally across the top five stocks in the S&P 500

$0 ($5,000 for Schwab Intelligent Portfolios; $25,000 Schwab Intelligent Portfolios Premium)

0% ($0 Schwab Intelligent Portfolios; $30/month Schwab Intelligent Portfolios Premium)

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No minimums; commission-free trading on stocks, ETFs, and options
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Thousands of no-load mutual funds and 50+ Schwab-managed funds; fractional shares (Stock slices) available
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Automated and advisor-managed accounts available
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Multiple trading platforms; stock screeners and other trading tools
• con icon Two crossed lines that form an 'X'. $5,000 minimum for automated Schwab Intelligent Portfolios is on the higher end
• con icon Two crossed lines that form an 'X'. Schwab's no-load funds have a $100 minimum; some competitors offer lower minimums

Insider considers Charles Schwab to be the best online brokerage overall, as well as one of the best online brokerages for beginners. It's great for all types of investors — including active traders, passive investors, and retirement-focused individuals — in search of low costs and access to a variety of trading tools and platforms.

• App store rating: 4.8 iOS/3.8 Android
• Consider it if: You want a wide range of account types, with easy-to-use apps and web interfaces
• Awards: Investor's Business Daily recognized Charles Schwab as one of its Most Trusted Financial Companies for 2021.

Charles Schwab is a major discount broker and one of the largest investment management firms in the United States. Charles Schwab is one of the best brokers for trading commodity futures , offering a range of brokerage accounts and products that meet the needs of virtually any investor.

In addition to offering competitive accounts with no minimum balance requirements and no recurring fees, Schwab is a leader in low-cost pricing for retail investors. 

Hands-on investors are best served by the basic Schwab self-directed brokerage account, which gives you access to various investment choices. If you want more help, you can sign up for managed Schwab Intelligent Portfolios, one of the best robo-advisors . This account also doesn't charge any fees.

The investment platform has an annual percentage yield (APY) of 0.45% for at least $0.01 balances. 

What to look out for:  There are also high phone and broker-assisted trade costs. While online trades are commission-free for stocks and ETFs, you'll pay $5 extra for automated phone trades and $25 extra for broker-assisted trades. Online option traders cost about $0.65 per contract. 

Charles Schwab review

SoFi Invest

Get up to $1,000 in stock when you fund a new account.

$0 ($1 to start investing); $5 fractional shares; $2,000 for margin trading

0% for active trading and automated investing

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No account minimum
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No account or trading fees, and low fees to own funds
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Access to Certified Financial Planners at no additional charge
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. IPOs available
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. SoFi 1% IRA match
• con icon Two crossed lines that form an 'X'. No tax-loss harvesting, an advanced investing technique where you sell a stock or mutual fund at a loss for a tax benefit
• con icon Two crossed lines that form an 'X'. No option for stop-loss orders when actively investing. SoFi's active investing account only uses market orders
• con icon Two crossed lines that form an 'X'. Currently only available to US residents

SoFi Invest is a great platform for US investors who are looking for an intuitive online trading experience, an open active or automated investing account.

• Promotion: Get up to $1,000 in stock when you fund a new account.
• Consider it if: You want an easy-to-use platform paired with rock-bottom pricing.

SoFi is an online brokerage featured in our guides for the best investment apps.  It charges almost no fees for its investment accounts, which include self-directed investing and automated investing (managed portfolios) with no recurring fees and a very low $1 minimum to get started.

SoFi 's self-directed "Active Investing" account has no fees for trading stocks and ETFs . You can buy fractional shares of stocks, which SoFi calls "Stock Bits." SoFi also has a few of its exchange-traded funds that could be a fit for your portfolio. Plus, it now offers options for trading and IPOs.

One SoFi login also gets you access to banking and lending services. Customers get free access to SoFi Relay, a personal finance data aggregator comparable to a lightweight version of Empower Personal Dashboard . Customers also get free access to career coaching and financial planning sessions.

What to look out for:  SoFi's account selection is also fairly limited compared to larger brokers that offer any type of retirement or business investment account under the sun.

SoFi Invest review

Fidelity Investments offers a wide range of investing products, including fractional shares.

$0 ($25,000 Fidelity Personalized Planning & Advice)

0% ($0 or 0.35% for robo-advisor)

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No account minimum or account fees
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No commissions for stock, ETF, and options trades; fractional shares available
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Thousands of no-transaction-fee mutual funds and fee-free mutual funds
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Several research tools and trading platforms available
• con icon Two crossed lines that form an 'X'. Fidelity Go accounts cost more for investors with higher account balances
• con icon Two crossed lines that form an 'X'. Representative-assisted trades are slightly more expensive than other brokerages

Fidelity is one of the best online brokerages for beginners and retirement savings. It has great features for all types of investors and traders.

• Promotion: None at this time
• App store rating: 4.8 iOS/4.4 Android
• Awards: Morningstar named the Fidelity HSA as the best HSA provider in 2019, 2020, and 2021.
• Consider it if: You're focused on long-term investing and retirement.

Fidelity offers multiple account types, a long list of available investments, and competitive pricing with industry leaders for low-cost investments. It has more than 200 locations nationwide.

The online stock trading app Fidelity has no minimum balances or recurring fees. It offers commission-free stock and ETF trades with fractional shares available. You can invest in stocks, ETFs, options, mutual funds, bonds, CDs, and precious metals. Fidelity offers international investing in foreign markets and foreign currency exchange between 16 different currencies.

It offers zero-expense ratio Fidelity Flex mutual funds and uses them for its robo-advisors, Fidelity Go. Fidelity Go now has unlimited one-on-one coaching calls for account balances of $25,000 or more. 

Fidelity can be a great choice for most investment needs, but it's especially strong for investors with a long-term retirement focus. The combination of low fees and a focus on helping investors reach a successful retirement helped make it the top choice for retirement brokerage accounts.

What to look out for: Fidelity gives you a lot for free, but mutual funds outside of the no-fee list cost up to $49.95 each, not including added fees for phone or broker-assisted trades. In addition, Fidelity charges higher margin rates than many competitors.

Fidelity review

TD Ameritrade

TD Ameritrade offers a large range of investment options, including stocks, bonds, ETFs, mutual funds, futures, bitcoin futures, and more.

$0 ($5,000 or $25,000 for managed accounts through Schwab)

0% ($300 one-time fee and $30/month for advisor-managed account through Schwab); $49.95 or $74.95 for no-load mutual funds, $2.25 per futures contract, and $0.65 per options contract

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Free commissions on stock, ETF, and option trades
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No minimum requirement to get started with brokerage account
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Large investment selection
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Research and educational resources available
• con icon Two crossed lines that form an 'X'. No fractional shares
• con icon Two crossed lines that form an 'X'. Robo-advice and managed portfolios are more expensive
• con icon Two crossed lines that form an 'X'. No cryptocurrencies

TD Ameritrade is great for active traders interested in using multiple trading platforms. As one of the best online brokerages, TD Ameritrade offers secure storage for investments and other assets.

• Promotion: None at this time.
• App store rating: 4.5 iOS/3.6 Android
• Consider it if: You want multiple apps for different trading experiences and goals

TD Ameritrade is a discount brokerage that's great for both new and expert investors. Beginners will enjoy the simple online platform at TD Ameritrade's website. Experienced investors will want to take advantage of the advanced trading platform, called thinkorswim, and other expert resources TD Ameritrade makes available.

Like other large commission-free brokers, TD Ameritrade gives you access to almost any brokerage account you could want. It offers a list of tradeable assets bigger than most peers, another draw for experienced investors.

TD Ameritrade's thinkorswim provides a professional-style trading platform with advanced charting and order types. An embedded CNBC TV widget is a nice perk that keeps your trading strategy in sync with the markets. It's nearly Wall Street quality and comes included with TD Ameritrade accounts.

What to look out for: Charles Schwab acquired the company in 2020. TD Ameritrade has said on its website that it will continue to conduct business as usual while combining many components with Schwab. 

TD Ameritrade review

Interactive Brokers

Interactive Brokers provides trading access to more than 150 markets in 33 countries around the world, allowing you to invest in stocks, options, mutual funds, ETFs, cryptocurrencies, futures, bonds, fractional shares, and more.

$0 ($100 Interactive Advisors automated accounts)

$0 for IBKR Lite; $0 IBKR Pro (per-share commissions apply)

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Low commissions and fees
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. International trading opportunities
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Competitive trading platforms and tools
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Several account types available
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Thousands of no-transaction-fee mutual funds
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Cryptocurrency investing available for bitcoin, bitcoin cash, ethereum, and litecoin
• con icon Two crossed lines that form an 'X'. Less active traders pay more for IBKR Pro
• con icon Two crossed lines that form an 'X'. Website can be tricky to navigate

Interactive Brokers is one of the best online brokerages for advanced, active investors who trade securities frequently and value access to market analysis and trading platforms.

Interactive Brokers is a top investment platform for all kinds of investors. Trade at higher volumes and get access to tools optimized for your investing needs. Typical investors may not care about the difference of a few seconds when entering and executing a trade. Very active traders, however, care about milliseconds.

Interactive Brokers has multiple pricing options depending on your level of trading activity and your personal trading needs. The basic account, IBKR Lite, gives you commission-free stock, ETF trades, and competitive fees for most other trades. 

IBKR Pro accounts use tiered or fixed pricing models. This means you won't get completely commission-free trades as you do with IBKR Lite. Pro accounts have additional access to market data. They also get access to the IBKR Web Trader platform and IBKR APIs for automated trading. Algorithmic trading, also known as algos, is included with Pro accounts.

With competitive pricing and an experience tailored to active traders, IBKR Lite could be a good place to test the waters before upgrading to IBKR Pro for the most advanced experience. You can also invest in cryptocurrencies like bitcoin, ether, bitcoin cash, and litecoin. It also offers bitcoin ETFs. Commissions for these assets range from 0.12-0.18%.

What to look out for: Not all accounts and trades are free. Choose the right account level for your investment goals and experience. 

Interactive Brokers review

Public offers a $0 minimum requirement and allows you to filter its investment selection to see the securities that best align with your preferences

0% stocks and ETFs; Crypto: 1% or 2% markup; Alternative assets: 2.5% per transaction; Public Premium: $10/month

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No minimums and commission-free trading on stocks and ETFs
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Cryptocurrency trading available for over 20 coins and tokens; alternative assets available
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Offers fractional share investing for as little as $1; Premium plan includes advanced market data and insights
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Several community features that allow you to share insights and receive insights from other users; educational resources like live audio events also available
• con icon Two crossed lines that form an 'X'. No mutual funds
• con icon Two crossed lines that form an 'X'. Not the best platform for day traders; it doesn't allow day trading of stocks

Public is best for active traders who want to invest in stocks, ETFs, and cryptocurrencies while utilizing the expertise and insights of other Public.com members.

• App store rating: 4.7 iOS/4.3 Android
• Consider it if: You value portfolio diversification and want a social component to your investing experience.

Public is an investment app that uses a mobile-first experience. The result is a mobile investment experience that's somewhat unique but still easy to navigate for both beginner and experienced investors. You can now earn a $0.18 rebate per traded options contract with no commission fees.

As the name suggests, trades at Public allow you to connect with other investors on the platform. You can follow others and chat about investment ideas. You can even join a group chat for live interaction with other investors. In some ways, it's like a built-in social network for investors.

Another useful feature for newer investors is the ability to view various themes. These group stocks by industry or other major categories to help you zero in on companies that make sense for your investment strategy. Public uses a commission-free pricing model so most users won't pay any fees when they trade.

What to look out for: Public doesn't offer a robo-advisor for hands-off automated trades. It's account selection is also limited as you can't invest in retirement, education, or custodial accounts with Public. 

Public review

Stockpile offers brokerage and custodial accounts with no recurring fees, no minimums, and no gift card fees.

$4.95 monthly subscription fee

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. No minimums and no gift card/funding fees
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. 1,000+ stocks and ETFs
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Can fund account with bank transfer or stock gift cards
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Fractional shares available
• con icon Two crossed lines that form an 'X'. Investment selection limited to stocks, ETFs, and crypto

Stockpile is a newer and smaller brokerage than some others on this list, but it's perfect for kids

• Consider it if: You want to invest with kids or teens

Stockpile is a top investment platform for kids to learn how to save and invest toward their future. Stockpile offers brokerage and custodial accounts with no recurring fees, minimums, or gift card fees. Invest in fractional shares for $1 and even trade popular cryptocurrencies. The online brokers have a $4.95 monthly subscription fee. 

Other investable securities include over 4000 stocks and ETFs in five different kid account options and one adult account. Cryptocurrencies are also available. Parents and kids will enjoy the built-in education resources, such as the "mini-lessons," which teach stock market basics that prepare anyone for a more successful future in the stock market.

Stockpile is great for kids and teens for a few reasons. The simple and easy-to-navigate platform shows kids the logos and companies they are familiar with in their investment portfolios . You can fund the account through a bank account or with stock gift cards. 

What to look out for: Other types of investments (such as mutual funds) are not supported.

Best Online Brokerage FAQs

Yes. You can have multiple brokerage accounts to access different investment options, account options, and trading features. Having multiple brokerage accounts can also be a great strategy for diversifying investments in your portfolio. However, managing multiple accounts requires you to keep track of all your information and may potentially lead to you paying higher fees. 

Yes. Trading within a brokerage account has tax implications, including capital gains taxes on profits from selling investments. Depending on the type of brokerage account and how it is funded, you may also unlock tax benefits such as tax credits or tax deductions. 

Retirement accounts are a kind of brokerage account specifically designed for people to invest money toward future retirement expenses. Retirement savings accounts have more limited investment options and strategies than other brokerage account options but offer more prominent tax advantages. 

The minimum investment to open a brokerage account varies by brokerage and the type of account. Some accounts may have no minimum investment requirement, while others require a substantial initial deposit. Make sure to look into the specific requirements of a brokerage before signing up. You should also be comparing fees in top brokerage accounts to find the best deals.

Brokerage accounts are generally secure, with most investment platforms providing users with SIPC insurance and other forms of coverage. Security measures like data encryption software and identity theft protection are also common. Always verify a brokerage's security measures and SIPC insurance status. 

How to Choose the Best Online Brokerage

The best online brokerages offer portfolio diversification, great customer support, low fees, and account flexibility. Here's how to choose the right online brokerage based on your risk tolerance, goals, and time horizon. 

Everyone's investment goals and preferences are unique, and not all brokerage accounts are a perfect fit. To choose the best online brokerage, start by looking at your investment style and what you want from a brokerage. Whether that's cutting-edge active trading tools or a long list of no-transaction-fee mutual funds, there's a good online brokerage for everyone.

For most investors, a long-term, passive investment strategy is ideal. Many experts suggest building a diverse portfolio of low-cost index funds over picking individual stocks and riskier active trading tools.

Newer investors may be overwhelmed by advanced trading strategies and market charting features. The best online brokerages for beginners have strong customer support, easy trading tools, educational resources, staking rewards, and low fees and minimums. 

Once you understand what you need, consider costs, platforms, investment account types, and available investments to decide what's best for you.

How to Buy Stocks with an Online Broker

You can buy and sell individual stocks through an online broker with most stock trading platforms and investment apps. Once you set up an online brokerage account with a stock trading platform, you can deposit funds into your account via bank or wire transfer. You also have the option to link your brokerage account and bank account directly. 

Before opening an account with an online broker, you familiarize yourself with what the platform offers. Not all online brokers allow you to pick and choose individual stocks. Robo-advisors, for example, often only invest in ETFs that are automatically selected based on your preferences and the platform's investing algorithm.

You'll also want to research the stock you're interested in by considering the company's history and market trends. Consult with a financial advisor for professional insight and guidance on investments. Once you've decided where to invest your money, you can place an online order and select several shares. 

How to Open a Brokerage Account

Online brokerage accounts are taxable investment accounts similar to a bank account but for your investable assets. Rather than stepping into a brick-and-mortar building to open a brokerage account and start trading, you can open an online brokerage account to access the market from your phone or computer easily. 

Here's you're opening a brokerage account checklist:

• Evaluate your risk tolerance, financial goals, and time horizon
• Explore different investment options in brokerage accounts to find the right one for you
• Compare fees, minimums, and investment features
• Determine what you need to open an account with that brokerage
• Gather the appropriate information and funds (if applicable) and start investing 

Some brokerages require a minimum deposit to open an account. Depending on the brokerage and the type of account, this minimum can range from $0 to $10,000 or more. Make sure you're comparing fees in top brokerage accounts as well. 

Security and insurance of brokerage accounts should also be considered before opening an account. Most platforms offer substantial coverage and security measures, but you'll want to check for any recent scandals or lawsuits in which the platform may be involved. 

You may also need to provide personal information like your name, age, address, social security number, and banking information.

Types of Brokerage Accounts

Online brokerage accounts are still licensed firms in which a broker is responsible for executing a client's orders. Types of brokerage accounts include: 

• Self-directed brokerage accounts
• Robo-advisors (aka automated accounts)
• Retirement savings accounts
• Education savings plans (like the best 529 plans )
• Custodial accounts
• Cryptocurrency trading accounts
• Health savings accounts

Why You Should Trust Us: Our Expert Panel For The Best Online Brokerage

We consulted financial advisors, investing experts, and our own wealth-building reporter to inform our choices for the best online brokerages. 

We interviewed the following investing experts to see what they had to say about online brokerages:

• Brian Fry, CFP, founder at Safe Landing Financial
• Charlotte Geletka, CFP, CRPC, managing partner at Silver Penny Financial Planning
• Kaysian Gordon, MBA, CFP, CDFA, CPA, wealth manager at Clarus Group

What are the advantages or disadvantages of opening a brokerage account?

Brian Fry, CFP:

A taxable brokerage account offers the flexibility to have funds available when needed and without a tax penalty. They offer transparency and freedom when considering costs and investment options.

Other account types may add more value and/or tax-efficiency depending on a household's financial situation. For example, if qualified, HSAs provide tax deductions, tax-free growth, and tax-free distributions if used for qualified medical expenses; retirement accounts may provide tax deductions, tax-deferred or tax-free investment growth, and potentially tax-free distributions.

Education accounts may provide tax deductions and/or tax-free distributions if used for qualified educational expenses.

Charlotte Geletka, CFP, CRPC:

The advantages include access to stock exchanges to buy almost endless options of investments. This is where you can purchase stocks, bonds, ETFs, mutual funds, options, and almost the entire inventory of the open markets.

The multitude of options can also be a disadvantage. Most retirement plans offer a curated list of choices that have been well-vetted by consultants and investment experts. When you go into a brokerage account, it is daunting to know where to start. The recent rise of social media blogs surrounding investing may increase interest, but be cautious about investing, as any investment comes with risk.

Kaysian Gordon, MBA, CFP, CDFA, CPA:

The advantage of opening a brokerage account is — if you're interested in investing in stocks or bonds, mutual funds, or ETFs, as example, a brokerage is a great way to do it. 

Savings accounts or checking accounts just do not have those features. So the disadvantage is [that] you have to be aware of what you're looking for. Lots of different brokerage accounts will provide you with different things, so it's a matter of specifically what it is that's important to you.

Who should consider opening a brokerage account? 

A taxable brokerage account can be a good fit for anyone and everyone. Before saving in a taxable brokerage account, it's important to consider where saving adds the most value to your unique financial situation. Make sure to have an adequate emergency fund.  

Charlotte Geletka:

Once you have set up an emergency fund and started funding a retirement account, then you might consider opening a brokerage account as a place to invest after-tax dollars.

Most often, the account you have set up in a brokerage will be a flexible investment. This is great because you have use of the money for various purposes, and you are not tied to specific withdrawal requirements the same way you would be in a retirement or college 529 account. 

Kaysian Gordon:

When you're looking to start the process of investing after you have saved the amount that you need for your emergency funds — and typically that's three to six months— you should start looking to invest other personal cash. Make it a point to contribute as frequently as you can, because that's how wealth is built over time.

Is there any other advice you'd offer someone who's considering opening a brokerage account?

Before saving with a taxable account, consider the order of where you should save first to accomplish your financial goals best. Are you comfortable taking responsibility in making investment decisions? How are you going to rebalance? How are you going to take emotion out of investing? Taxable accounts can be a good vehicle if you can check all the boxes.

There is a difference between trading and investing. Trading is exchanging [which is] usually short-term in nature. Investing involves time and is long-term in nature.

Do your research because that's very important. Think about the things that are important to you. Do a comparison of the different names that you hear and see what the benefits are of one company over another before making a decision. 

Nothing will have everything you need, but go with the brokerage account with the best of what you need.

Methodology: Criteria for Evaluating Brokerage Accounts

In evaluating the best online brokerage accounts available today, we rate investing products on various criteria. The most important factors for Personal Finance Insider rates and reviews products are pricing, account types, investment availability, platforms, and overall customer experience. Investing platforms are given a rating between 0 and 5.

Most brokerage accounts on this list have no minimum balance or recurring monthly fees. After a major shift in pricing in 2019, most brokerage firms on this list also offer commission-free trades for stocks and ETFs. They also removed base fees for options trades but charged per-contract fees in most cases.

Top brokerage firms offer different platforms for different investment needs. Some are best for beginners, and others are ideal for more advanced investors. Platforms were evaluated with a focus on how they serve in each category.

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