How to Write a Business Plan for a Consulting Firm

Every company, no matter the industry, is going to eventually run into problems. When those problems extend beyond a company’s skill set, resources, or knowledge, they may need to reach out to an outside agency to help them rectify their problems. These agencies are generally called consulting firms. A consulting firm is comprised of industry specific experts who offer advice, guidance, and solutions to companies in need. Anyone who is starting a consulting firm needs to begin by writing a business plan, a plan that will include your business ideas, identify your target audience, and outline your financial projections.

Every consulting firm business plan should consist of 9 parts. To begin, you need to write the executive summary, which gives a broad view of what you want to accomplish with your consulting firm. You follow that with the company overview, which details the people who will own, manage, and operate the consulting firm. Next you write your market analysis, customer analysis, and competitive analysis. You finish the business plan by writing the operations plan, management plan, marketing plan, and finally, the financial plan.

Your business plan will be unique to your ideas, plans, and goals, but will always contain those sections. Your plan acts as a road map for every step of starting your own consulting firm, but it isn’t set in stone. It will grow, change, and need to be updated as you move along in the process, so don’t feel the need to get it perfect right away. The most important part of any business plan is just having one.

The Executive Summary

The executive summary should be the first section of your consulting firm business plan, though it may be easier to complete it after you finish the rest of your business plan. It will provide a brief summary of the key aspects of your consulting firm. These aspects are:

• Business Overview – The business overview consists of the bones of your firm: your location, ownership, management team members, what services your firm will provide, and what you want your firm to be. Keep the business overview to 3-5 paragraphs, focusing mostly on what your firm will do and the services it will provide. You should also expand on what experience the owners of the company have.

• Service Offering – This is where you will provide the list of services you intend to offer through your consulting firm. Each can be a simple bullet point, possibly with a sentence or two of explanation. 

• Customer Focus – This section should be a paragraph or two explaining who your target audience is, and why your services will be valuable to them. Be specific and focused on who your firm will be targeting i.e. startup companies in New York and/or young entrepreneurs looking to venture out on their own.

• Management Team – Here you will provide a more thorough bio of your owners and management team members. Include qualifications and prior work.

• Success Factors – This is where you will give 3-5 factors that will make your business a success. Keep each to a couple sentences or less. Examples include qualified and knowledgeable staff, friendly and effectual service, or commitment to personal and tailored consults.

• Financial Highlights – This will include the amount you need in financing, and a breakdown of the cost. A visual graph of financial projections for at least the next 5 years should also be included here.

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Company Overview

The company overview reiterates what your consulting business is, and what it will provide. It also goes into more depth about the company’s history, and the founder’s history. List all educational achievements and previous work history for the owners and, if you have any, the managers. This brief history will provide potential investors an inside look into how your company will be successful because of its leadership.

Also include any milestones the company has achieved so far, such as finding an office space, completing the registration process, and/or hiring managers or other staff. Next, reiterate the services your company will offer. This list will largely be a copy of the one in the executive summary. The goal is to keep in investor’s minds who you are and what you will do.

Market Analysis

Your market analysis should be a brief (one page) analysis of what the industry looks like in your location. Explain how the companies you will be consulting for are growing in scope or quantity, or both. Show that you’ve done the research by explaining how much the industry makes in your location now, and how much it is expected to grow.

Your market analysis should show that the industries needing you are profitable, growing, and multiplying. This shows a broad need for the expertise only you can provide. Also explain how the industry is becoming younger and more tech-savvy, and how your firm can be a major player in helping companies adjust to the new world of business.

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Customer Analysis

Your customer analysis presents your target demographic, and can even include a breakdown of the business demographics in your location to show just how many potential customers you have. Show how different services can relate to different companies by segmenting them based on what those companies will need. 

Just because you may focus on younger, tech-heavy businesses doesn’t mean that your services can’t also be used in different industries. Connect those services to those businesses here to show your company’s reach in the market.

Competitive Analysis

Your competitive analysis will be a bit longer, perhaps consisting of two pages. Here is where you will prove you’ve done research on your competitors by listing a few of your main ones (3-4). Be honest about what you’ve found about your competitors, and present them in a good light. Tell what each company stands for, what they specialize in, and how they treat their clients. 

Explain how each competitor presents themselves, and what makes them special to their clients. After you list these competitors, write a section about what gives your company a competitive advantage over them. This can include cost effectiveness, knowledge, past successes, and/or how you will provide 24/7 personal consulting. 

Operations Plan

Your operations plan will detail who will be doing what in the daily operations of your consulting firm. It will also contain any milestones you want your company to achieve for a predetermined amount of time, typically six months to a year. This will usually be boiled down into one page, with the top featuring bullet points containing the names of the people in your company and what they will each be focusing on.

It will begin with the owner(s)/operator(s) and move down the chain. If you have yet to hire all the employees you’ll need, you can call them by generic names such as associates or apprentices. Your list of milestones can range from lease signings to opening to getting your first client. Investors want to see that you have a plan and a timeframe to complete this plan.

Management Plan

Your management plan will also be one page or less, and will go into detail about the history, achievements, and skills that your management team has. It’s fine if the management so far only consists of one or two people, but if you have more, you should write a short bio for all of them. Touch on their strengths and what they can provide to the success of your company.

Marketing Plan

Next you’re going to go into detail about how you plan to market your consulting firm. Start this section with your brand and value proposition, which is how you want the company to be presented and how you intend to provide value to clients. 3-5 bullet points should suffice for this section.

You will then detail your marketing strategy. This will consist of 3-5 sections explaining the different ways you intend to promote your consulting firm. This can include:

• Website/SEO Marketing – This will explain how you will take advantage of SEO guidelines to make your website appear higher in internet searches. It can also detail what your website will contain that will draw potential clients to you.

• Social Media Marketing – This will list the different social media platforms you intend to use (Facebook, Twitter, Instagram, etc.) to promote your firm. Explain how you will reach your targeted audience by using these platforms.

• SBA and Lender Partnerships – If your consulting firm is targeting new entrepreneurs or businesses, explain how you will partner with banks and approved lenders to have those partners promote your company when people apply for business loans. 

Financial Plan

Lastly comes your financial plan, probably the most important part of your business plan. This section can consist of multiple pages that break down your key revenue and costs, funding requirements and how you will use those funds, key assumptions needed to reach your financial goals, and finally, financial projections.

Your financial projections should be charts that detail your income projection, your balance sheet, and your cash flow statement for the first 4-6 quarters of your operations. Here, investors want to see that you’re knowledgeable about the cost of running your consulting firm, including how much debt you need to take on, and how long until you clear that debt from your books. 

The numbers don’t need to be perfect, but they do need to be realistic. Most people you’ll be sharing your business plan with know the cost of operating a consulting firm, and if your numbers are way off, it will stand out to them, and may even prevent them from providing the investment you need.

Your business plan is your road map to opening and operating your consulting firm, and you should be assured that you’re knowledgeable about the facts as you write it. But remember that it will change and grow, so it doesn’t need to be perfect, it just needs to show that you do indeed have the knowledge necessary to start and run your very own consulting firm.

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Frequently Asked Questions

How long should my business plan be?

A typical business plan runs anywhere from 15-25 pages. This is the length many investors have answered in surveys about the perfect length of a business plan. While many new business owners can feel like their business is too complicated to explain in 15-25 pages, it’s important to remember that your business plan is not meant to tell the entire story of your consulting firm. Its purpose is to boil down the main aspects into an easily digestible and compelling overview that will pique the interest of investors.

Do I really need all nine sections?

The typical business plan template includes all nine sections, and is the format that investors are most used to. Even if a certain section is only a single paragraph (such as the management plan with only one owner/operator), investors still want to see each of these elements broken down in a professional way in your business plan. Your business plan is designed to answer all the questions potential investors may have, so skipping sections can leave them unsure if you really know the topic and will cause them to need to ask about material that they expect to be covered.

To learn more on how to plan your own consulting firm business click here!

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