In this article you will find:
This article is part of the school of coworking course through Archie. Make sure to check out the other articles to learn more about how to start a coworking space business.
1. What is a Business Plan?
Chances are, you have probably heard of a business plan before but in case you’re unfamiliar with what a business plan is, it is a written document that helps a business define who they are and how it will be profitable.
This management tool is widely recognized as one of the first and most crucial steps in starting a business, especially when seeking investors and financing for your project.
These documents can quickly become quite hefty due to the sheer amount of information included in them. For the same reason, it can also be rather difficult and even confusing to draft up one of your own from scratch.
This article will review and explain the key points to include in your coworking space business plan as well as provide templates to help you get started.
2. Why do you need a Business Plan?
Whether you are planning on sharing your business plan with potential investors or if you are writing it for internal purposes, this document is one of the foundational tools for kickstarting your business idea.
Above all, you can expect to be asked to hand in your business plan anytime you are looking to raise funds for your project. If you don’t have one, raising capital will be nearly impossible as your investors won’t be able to assess the viability of your project and are unlikely to invest in a business without a promise of return on investment.
A well-written business plan will help you clearly identify your strategy, potential roadblocks and required resources to name a few. Remember that each segment of your coworking space business plan is interdependent on the next and will serve as building blocks for one another.
3. What Goes in a Business Plan?
While there is no official set structure or length for business plans, there are some elements that should always be included. Your plan should provide as much detailed information about your business but you should be careful to keep it concise to avoid confusing or even boring your reader. Your business plan should demonstrate your expertise and dedication to the project.
Below is an example of a coworking space business plan table of contents:
Business Plan Table of Contents (Sample)
- Executive Summary
- Company Description
- Market Analysis Team and Management
- Products and Services
- Marketing Strategy
- Operations Strategy
- Financial Plan
It is important to take note that the information below serves as a guideline for your coworking space business plan and that there is no set length for any given section. Your business plan should reflect your company’s uniqueness and lucrative potential.
4. Your Coworking Space Business Model
The following section of the article will review each point found in the sample table of contents above in detail so let’s jump right into it!
4.1 Executive Summary
This is a high-level overview of your plan. The purpose of including this summary at the beginning of your business plan is to highlight the keys points found in it for your potential investors. This summary should be persuading the reviewers to continue reading further.
This summary will be the first section of your business plan and shouldn’t go much longer than one page. Additionally, it should be the last section you write since you won’t know what the key points to summarize are before you have written the bulk of your business plan.
Your executive summary should include:
- Company overview. What is the company’s mission, goals and vision?
- The team. Who is involved in the project, and what are their roles?
- Product and services. What is the company selling and who are you selling to?
- Marketing strategy. A brief overview of your strategy for reaching your target audience.
- Financial plan. What is the revenue or revenue projection, how much are investing or looking to fund?
4.2 Company Description
This next section of your coworking business plan is the basis for your entire project. Your company description should clearly inform the reviewers of who you are and what you plan to do.
This portion of your business plan should provide clear, persuasive answers on what sets you apart from the competition. Identify the uniqueness of your product and services; is your business model solving issues in its industry? What are the strengths of your business? What advantages does it hold?
The goal of this portion is to convince your potential investors that your business model is a good investment and should include the following points:
- Business structure: this refers to the type of legal entity your coworking space will fall under. There are different types of structures such as sole proprietorship or partnership, each with their respective benefits. It is extremely important that you are careful with your choice since different structures are subject to different laws on personal liability, taxation, funding, etc.
- Your industry: you will need to identify which industry your business will be a part of. For example, your coworking business is an industry of its own but if you were drafting up a business plan for a new women’s boutique then the industry would be retail. Mission statement: is a concise explanation of the reason your company exists. In other words, in a sentence, you should be able to provide the “why” behind what your company does.
WeWork’s Mission Statement: “Empowering tomorrow’s world at work.”
- Vision: here you should paint a picture of the impact your company is foreseen to have on the world once it is fully realized. Ultimately, your vision should clarify what your company will bring to the industry.
WeWork’s Vision: “WeWork was founded in 2010 with the vision to create environments where people and companies come together and do their best work…”
- Goals: naturally, you also want to provide an overview of what you hope to achieve. You will want to include both short-term and long-term goals. Your short-term goals should be realizable within a year’s time and your long-term goals projections should be attainable within 1 to 5 years.
4.3 Market Analysis
Your business plan will require market research and analysis as well as a competitive analysis.
The goal of this section is to provide an overview of your industry and target market and define your potential market.
You will want to collect relevant data on your industry trends and trajectory and your target audience. Your analysis should also reveal your market size and total addressable market.
You will need to establish a perimeter for your market and research the competition within this perimeter. For example, you could set a 10 miles radius from your location as your perimeter and conduct your market and competitor analysis within this radius.
A good analysis should provide answers to questions such as:
- How will your company impact those habits?
- Why is the selected target market the right choice?
- How is your company helping them meet their needs?
- What are the projected future changes in your market?
- How will you meet the projected changes?
For the competitive analysis portion, you will want to look at what competitors are doing and why it is working or not. Consider how your competition is approaching the market and identify their strengths and weaknesses to help you visualize how you can do it better. After conducting a competitive analysis, your company’s unique offering should be well-defined.
Below are some examples of criteria for a coworking space competitor analysis:
- Design of their space
- Services offered
- Price point
During this time, you will likely want to perform a S.W.O.T. analysis to help you clearly identify the strengths, weaknesses, opportunities, and threats of your company.
That being said, while a S.W.O.T. analysis is an excellent exercise to conduct you should avoid including it “as is” in your business plan. Instead, try to summarize the main findings of your analysis and incorporate them in your market analysis section.
4.4 Team and Management
This part of your coworking space business plan should include details on who is running the company.
With an organizational chart, present the internal structure of your company with the respective roles and responsibilities clearly listed.
This section should effectively communicate how each key management role is contributing to your company’s success.
You will also have to reiterate the legal structure of your company which you established with your business structure. Is your company a C or an S corporation? Is it a form of a limited partnership, or are you a sole proprietor or limited liability company (LLC)?
4.5 Product and Services
This section is meant to provide a clear outline of the key details of your product or service offerings. You will want to describe each selling point, whether it is a specific product or a general service provided at your company and demonstrate how it benefits the consumer.
Consider the life cycle of your product or services and future product and services your company will offer and describe how you plan on implementing them.
4.6 Marketing Plan
The overarching goal of your marketing plan is to detail your strategy for attracting and retaining customers. A marketing strategy is ever-evolving and unique to each business. This section of your business plan should reflect this and should include both your current and future approach for marketing your company.
Things to consider for this section:
- How is your strategy fitting for the needs of your target market?
- Will you be using a particular channel more than another to promote your business and why?
- How much does your product or services cost?
- What is the reasoning behind the price?
- How will you put your offerings in front of the desired audience?
- Where will you be selling your product or services?
- What is the cost of acquisition and lifetime value of a client?
Your value proposition is another key element of this section. This summarized statement of why the consumer should buy your product or services refers to the promised value a company vouches to deliver if a consumer chooses to buy what they are selling.
This statement should provide some insights on the company’s intent, what it stands for, how it operates and why it deserves the consumer’s business.
Another goal here is to put down on paper how sales will take place in practice. You will use what you’ve learned about marketing and sales again in later sections so it’s important that you thoroughly describe your strategies and include as many tactical details as possible without overcrowding the overall marketing plan.
4.7 Operations Strategy
Operations and logistics refer to the workflow strategies you plan on implementing at your company in order to make your business come to life. This section should assess your company’s needs in regards to the premises and capital goods in order to provide an in-detail plan of your operations including structures related to suppliers and production, the facilities and required equipment, etc.
4.8 Financial Plan
The financial health of your company should be your top priority. Naturally, without financial health, your business will not succeed. Your financial plan should present how you expect your business to thrive financially.
This section should include financial projections for the upcoming years presented in the form of a financial model.
5. Coworking Space Business Plan Templates
You can find a number of good business plan templates online. A good place to start is to look up “your location + business plan template” in Google to find out what your local government recommends.
Below is a list of some templates available online:
U.S Small Business Administration
It is also a good idea to use a business model canvas to map out all of your ideas before you start. This will give you an overview of everything you need to include in your business plan.
Your coworking space business plan should remain clear and succinct. Keep in mind your audience when writing out your plan.
If you are looking for funding, you will want to pay extra attention to the financial and marketing aspects of your business plan and include a clear exit strategy with maximum profits for your potential investors. If you are writing a business plan for internal purposes you may want to add a more in-depth description of the marketing strategy and operations.
You’re now readily equipped to draft a comprehensive and effective business plan for your coworking space
Still, have questions or something you wish to discuss? Join our Facebook Group and enter the conversation on everything coworking.