Many people have ideas for nonprofit organizations, but they often overlook the crucial first step of making a business plan. When you want your nonprofit to match your vision, business plans are key to making that a reality.
Basics Sections of a Business Plan
Creating a business plan helps bring your ideas to life and communicates to key stakeholders how you intend to run the organization. Typically, business plans include the following sections:
- Executive Summary: a short summary of the entire document meant to entice readers
- Company Description: information about your organization and what it intends to accomplish
- Organization and Management Team: outlines the organization’s structure and provides bios of key people
- Products and Services: describes what your organization plans to sell or offer
- Market Analysis: provides data and conclusions relevant to your organization’s market focus
- Strategy and Implementation: summarizes your sales, marketing, and growth strategies
- Financial Projections: gives realistic projections for the balance sheet, income statement, and cash flow statement
What Makes a Nonprofit Business Plan Different
Nonprofit business plans are different from for-profit business plans because they don’t focus on showing how the organization intends to provide continuous profits for stakeholders. Instead, a nonprofit business plan describes how the organization intends to successfully carry out its charitable goals while raising enough funding to support itself.
The products and services section of a typical for-profit business plan is deleted and replaced with a section describing milestones and deadlines the organization believes it can achieve. Besides that exception, you should include all the other sections included in a for-profit business plan in your nonprofit’s business plan. Also, keep in mind that you should write your business plan to attract potential partners and donors aligned with the goals of the organization instead of profit-seeking investors.
Customizing Your Business Plan
A business plan usually runs about 30 to 50 pages in length, but you shouldn’t aim for that many pages if you don’t need them. If you complete the first draft of your plan and it’s only a few pages, then it likely needs some rethinking. You need to find a good balance of length and clarity, focusing more on the content quality of the pages than the quantity.
Make sure to include the essential points described above since most stakeholders want to know that information before getting involved. Once you polish these sections and make them as strong as you can, feel free to add anything else you’d like. It’s your organization, and since there are no set rules for business plans, you can customize your exactly as you see fit.
When considering your business plan, keep in mind that it’s very important to comply with all laws and regulations regarding nonprofits in Canada. This means you should review the Canada Not-for-Profit Corporations Act and similar documents before you get started. If you have the budget, consult with a qualified legal professional specializing in nonprofits to get advice about setting up your organization and pursuing donors.