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What Is a Business Plan?

Understanding business plans, how to write a business plan, common elements of a business plan, how often should a business plan be updated, the bottom line, business plan: what it is, what's included, and how to write one.

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

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A business plan is a document that details a company's goals and how it intends to achieve them. Business plans can be of benefit to both startups and well-established companies. For startups, a business plan can be essential for winning over potential lenders and investors. Established businesses can find one useful for staying on track and not losing sight of their goals. This article explains what an effective business plan needs to include and how to write one.

Key Takeaways

• A business plan is a document describing a company's business activities and how it plans to achieve its goals.
• Startup companies use business plans to get off the ground and attract outside investors.
• For established companies, a business plan can help keep the executive team focused on and working toward the company's short- and long-term objectives.
• There is no single format that a business plan must follow, but there are certain key elements that most companies will want to include.

Investopedia / Ryan Oakley

Any new business should have a business plan in place prior to beginning operations. In fact, banks and venture capital firms often want to see a business plan before they'll consider making a loan or providing capital to new businesses.

Even if a business isn't looking to raise additional money, a business plan can help it focus on its goals. A 2017 Harvard Business Review article reported that, "Entrepreneurs who write formal plans are 16% more likely to achieve viability than the otherwise identical nonplanning entrepreneurs."

Ideally, a business plan should be reviewed and updated periodically to reflect any goals that have been achieved or that may have changed. An established business that has decided to move in a new direction might create an entirely new business plan for itself.

There are numerous benefits to creating (and sticking to) a well-conceived business plan. These include being able to think through ideas before investing too much money in them and highlighting any potential obstacles to success. A company might also share its business plan with trusted outsiders to get their objective feedback. In addition, a business plan can help keep a company's executive team on the same page about strategic action items and priorities.

Business plans, even among competitors in the same industry, are rarely identical. However, they often have some of the same basic elements, as we describe below.

While it's a good idea to provide as much detail as necessary, it's also important that a business plan be concise enough to hold a reader's attention to the end.

While there are any number of templates that you can use to write a business plan, it's best to try to avoid producing a generic-looking one. Let your plan reflect the unique personality of your business.

Many business plans use some combination of the sections below, with varying levels of detail, depending on the company.

The length of a business plan can vary greatly from business to business. Regardless, it's best to fit the basic information into a 15- to 25-page document. Other crucial elements that take up a lot of space—such as applications for patents—can be referenced in the main document and attached as appendices.

These are some of the most common elements in many business plans:

• Executive summary: This section introduces the company and includes its mission statement along with relevant information about the company's leadership, employees, operations, and locations.
• Products and services: Here, the company should describe the products and services it offers or plans to introduce. That might include details on pricing, product lifespan, and unique benefits to the consumer. Other factors that could go into this section include production and manufacturing processes, any relevant patents the company may have, as well as proprietary technology . Information about research and development (R&D) can also be included here.
• Market analysis: A company needs to have a good handle on the current state of its industry and the existing competition. This section should explain where the company fits in, what types of customers it plans to target, and how easy or difficult it may be to take market share from incumbents.
• Marketing strategy: This section can describe how the company plans to attract and keep customers, including any anticipated advertising and marketing campaigns. It should also describe the distribution channel or channels it will use to get its products or services to consumers.
• Financial plans and projections: Established businesses can include financial statements, balance sheets, and other relevant financial information. New businesses can provide financial targets and estimates for the first few years. Your plan might also include any funding requests you're making.

The best business plans aren't generic ones created from easily accessed templates. A company should aim to entice readers with a plan that demonstrates its uniqueness and potential for success.

2 Types of Business Plans

Business plans can take many forms, but they are sometimes divided into two basic categories: traditional and lean startup. According to the U.S. Small Business Administration (SBA) , the traditional business plan is the more common of the two.

• Traditional business plans : These plans tend to be much longer than lean startup plans and contain considerably more detail. As a result they require more work on the part of the business, but they can also be more persuasive (and reassuring) to potential investors.
• Lean startup business plans : These use an abbreviated structure that highlights key elements. These business plans are short—as short as one page—and provide only the most basic detail. If a company wants to use this kind of plan, it should be prepared to provide more detail if an investor or a lender requests it.

Why Do Business Plans Fail?

A business plan is not a surefire recipe for success. The plan may have been unrealistic in its assumptions and projections to begin with. Markets and the overall economy might change in ways that couldn't have been foreseen. A competitor might introduce a revolutionary new product or service. All of this calls for building some flexibility into your plan, so you can pivot to a new course if needed.

How frequently a business plan needs to be revised will depend on the nature of the business. A well-established business might want to review its plan once a year and make changes if necessary. A new or fast-growing business in a fiercely competitive market might want to revise it more often, such as quarterly.

What Does a Lean Startup Business Plan Include?

The lean startup business plan is an option when a company prefers to give a quick explanation of its business. For example, a brand-new company may feel that it doesn't have a lot of information to provide yet.

Sections can include: a value proposition ; the company's major activities and advantages; resources such as staff, intellectual property, and capital; a list of partnerships; customer segments; and revenue sources.

A business plan can be useful to companies of all kinds. But as a company grows and the world around it changes, so too should its business plan. So don't think of your business plan as carved in granite but as a living document designed to evolve with your business.

Harvard Business Review. " Research: Writing a Business Plan Makes Your Startup More Likely to Succeed ."

U.S. Small Business Administration. " Write Your Business Plan ."

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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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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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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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What is a Business Plan? Definition, Tips, and Templates

Published: June 07, 2023

In an era where more than 20% of small enterprises fail in their first year, having a clear, defined, and well-thought-out business plan is a crucial first step for setting up a business for long-term success.

Business plans are a required tool for all entrepreneurs, business owners, business acquirers, and even business school students. But … what exactly is a business plan?

In this post, we'll explain what a business plan is, the reasons why you'd need one, identify different types of business plans, and what you should include in yours.

What is a business plan?

A business plan is a documented strategy for a business that highlights its goals and its plans for achieving them. It outlines a company's go-to-market plan, financial projections, market research, business purpose, and mission statement. Key staff who are responsible for achieving the goals may also be included in the business plan along with a timeline.

The business plan is an undeniably critical component to getting any company off the ground. It's key to securing financing, documenting your business model, outlining your financial projections, and turning that nugget of a business idea into a reality.

What is a business plan used for?

The purpose of a business plan is three-fold: It summarizes the organization’s strategy in order to execute it long term, secures financing from investors, and helps forecast future business demands.

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Working on your business plan? Try using our Business Plan Template . Pre-filled with the sections a great business plan needs, the template will give aspiring entrepreneurs a feel for what a business plan is, what should be in it, and how it can be used to establish and grow a business from the ground up.

Purposes of a Business Plan

Chances are, someone drafting a business plan will be doing so for one or more of the following reasons:

1. Securing financing from investors.

Since its contents revolve around how businesses succeed, break even, and turn a profit, a business plan is used as a tool for sourcing capital. This document is an entrepreneur's way of showing potential investors or lenders how their capital will be put to work and how it will help the business thrive.

All banks, investors, and venture capital firms will want to see a business plan before handing over their money, and investors typically expect a 10% ROI or more from the capital they invest in a business.

Therefore, these investors need to know if — and when — they'll be making their money back (and then some). Additionally, they'll want to read about the process and strategy for how the business will reach those financial goals, which is where the context provided by sales, marketing, and operations plans come into play.

2. Documenting a company's strategy and goals.

A business plan should leave no stone unturned.

Business plans can span dozens or even hundreds of pages, affording their drafters the opportunity to explain what a business' goals are and how the business will achieve them.

To show potential investors that they've addressed every question and thought through every possible scenario, entrepreneurs should thoroughly explain their marketing, sales, and operations strategies — from acquiring a physical location for the business to explaining a tactical approach for marketing penetration.

These explanations should ultimately lead to a business' break-even point supported by a sales forecast and financial projections, with the business plan writer being able to speak to the why behind anything outlined in the plan.

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Fill out the form to access your free business plan., 3. legitimizing a business idea..

Everyone's got a great idea for a company — until they put pen to paper and realize that it's not exactly feasible.

A business plan is an aspiring entrepreneur's way to prove that a business idea is actually worth pursuing.

As entrepreneurs document their go-to-market process, capital needs, and expected return on investment, entrepreneurs likely come across a few hiccups that will make them second guess their strategies and metrics — and that's exactly what the business plan is for.

It ensures an entrepreneur's ducks are in a row before bringing their business idea to the world and reassures the readers that whoever wrote the plan is serious about the idea, having put hours into thinking of the business idea, fleshing out growth tactics, and calculating financial projections.

4. Getting an A in your business class.

Speaking from personal experience, there's a chance you're here to get business plan ideas for your Business 101 class project.

If that's the case, might we suggest checking out this post on How to Write a Business Plan — providing a section-by-section guide on creating your plan?

What does a business plan need to include?

• Business Plan Subtitle
• Executive Summary
• Company Description
• The Business Opportunity
• Competitive Analysis
• Target Market
• Marketing Plan
• Financial Summary
• Funding Requirements

1. Business Plan Subtitle

Every great business plan starts with a captivating title and subtitle. You’ll want to make it clear that the document is, in fact, a business plan, but the subtitle can help tell the story of your business in just a short sentence.

2. Executive Summary

Although this is the last part of the business plan that you’ll write, it’s the first section (and maybe the only section) that stakeholders will read. The executive summary of a business plan sets the stage for the rest of the document. It includes your company’s mission or vision statement, value proposition, and long-term goals.

3. Company Description

This brief part of your business plan will detail your business name, years in operation, key offerings, and positioning statement. You might even add core values or a short history of the company. The company description’s role in a business plan is to introduce your business to the reader in a compelling and concise way.

4. The Business Opportunity

The business opportunity should convince investors that your organization meets the needs of the market in a way that no other company can. This section explains the specific problem your business solves within the marketplace and how it solves them. It will include your value proposition as well as some high-level information about your target market.

5. Competitive Analysis

Just about every industry has more than one player in the market. Even if your business owns the majority of the market share in your industry or your business concept is the first of its kind, you still have competition. In the competitive analysis section, you’ll take an objective look at the industry landscape to determine where your business fits. A SWOT analysis is an organized way to format this section.

6. Target Market

Who are the core customers of your business and why? The target market portion of your business plan outlines this in detail. The target market should explain the demographics, psychographics, behavioristics, and geographics of the ideal customer.

7. Marketing Plan

Marketing is expansive, and it’ll be tempting to cover every type of marketing possible, but a brief overview of how you’ll market your unique value proposition to your target audience, followed by a tactical plan will suffice.

Think broadly and narrow down from there: Will you focus on a slow-and-steady play where you make an upfront investment in organic customer acquisition? Or will you generate lots of quick customers using a pay-to-play advertising strategy? This kind of information should guide the marketing plan section of your business plan.

8. Financial Summary

Money doesn’t grow on trees and even the most digital, sustainable businesses have expenses. Outlining a financial summary of where your business is currently and where you’d like it to be in the future will substantiate this section. Consider including any monetary information that will give potential investors a glimpse into the financial health of your business. Assets, liabilities, expenses, debt, investments, revenue, and more are all useful adds here.

So, you’ve outlined some great goals, the business opportunity is valid, and the industry is ready for what you have to offer. Who’s responsible for turning all this high-level talk into results? The "team" section of your business plan answers that question by providing an overview of the roles responsible for each goal. Don’t worry if you don’t have every team member on board yet, knowing what roles to hire for is helpful as you seek funding from investors.

10. Funding Requirements

Remember that one of the goals of a business plan is to secure funding from investors, so you’ll need to include funding requirements you’d like them to fulfill. The amount your business needs, for what reasons, and for how long will meet the requirement for this section.

Types of Business Plans

• Startup Business Plan
• Feasibility Business Plan
• Internal Business Plan
• Strategic Business Plan
• Business Acquisition Plan
• Business Repositioning Plan
• Expansion or Growth Business Plan

There’s no one size fits all business plan as there are several types of businesses in the market today. From startups with just one founder to historic household names that need to stay competitive, every type of business needs a business plan that’s tailored to its needs. Below are a few of the most common types of business plans.

For even more examples, check out these sample business plans to help you write your own .

1. Startup Business Plan

As one of the most common types of business plans, a startup business plan is for new business ideas. This plan lays the foundation for the eventual success of a business.

The biggest challenge with the startup business plan is that it’s written completely from scratch. Startup business plans often reference existing industry data. They also explain unique business strategies and go-to-market plans.

Because startup business plans expand on an original idea, the contents will vary by the top priority goals.

For example, say a startup is looking for funding. If capital is a priority, this business plan might focus more on financial projections than marketing or company culture.

2. Feasibility Business Plan

This type of business plan focuses on a single essential aspect of the business — the product or service. It may be part of a startup business plan or a standalone plan for an existing organization. This comprehensive plan may include:

• A detailed product description
• Market analysis
• Technology needs
• Production needs
• Financial sources
• Production operations

According to CBInsights research, 35% of startups fail because of a lack of market need. Another 10% fail because of mistimed products.

Some businesses will complete a feasibility study to explore ideas and narrow product plans to the best choice. They conduct these studies before completing the feasibility business plan. Then the feasibility plan centers on that one product or service.

3. Internal Business Plan

Internal business plans help leaders communicate company goals, strategy, and performance. This helps the business align and work toward objectives more effectively.

Besides the typical elements in a startup business plan, an internal business plan may also include:

• Department-specific budgets
• Target demographic analysis
• Market size and share of voice analysis
• Action plans
• Sustainability plans

Most external-facing business plans focus on raising capital and support for a business. But an internal business plan helps keep the business mission consistent in the face of change.

4. Strategic Business Plan

Strategic business plans focus on long-term objectives for your business. They usually cover the first three to five years of operations. This is different from the typical startup business plan which focuses on the first one to three years. The audience for this plan is also primarily internal stakeholders.

These types of business plans may include:

• Relevant data and analysis
• Assessments of company resources
• Vision and mission statements

It's important to remember that, while many businesses create a strategic plan before launching, some business owners just jump in. So, this business plan can add value by outlining how your business plans to reach specific goals. This type of planning can also help a business anticipate future challenges.

5. Business Acquisition Plan

Investors use business plans to acquire existing businesses, too — not just new businesses.

A business acquisition plan may include costs, schedules, or management requirements. This data will come from an acquisition strategy.

A business plan for an existing company will explain:

• How an acquisition will change its operating model
• What will stay the same under new ownership
• Why things will change or stay the same
• Acquisition planning documentation
• Timelines for acquisition

Additionally, the business plan should speak to the current state of the business and why it's up for sale.

For example, if someone is purchasing a failing business, the business plan should explain why the business is being purchased. It should also include:

• What the new owner will do to turn the business around
• Historic business metrics
• Sales projections after the acquisition
• Justification for those projections

6. Business Repositioning Plan

When a business wants to avoid acquisition, reposition its brand, or try something new, CEOs or owners will develop a business repositioning plan.

This plan will:

• Acknowledge the current state of the company.
• State a vision for the future of the company.
• Explain why the business needs to reposition itself.
• Outline a process for how the company will adjust.

Companies planning for a business reposition often do so — proactively or retroactively — due to a shift in market trends and customer needs.

For example, shoe brand AllBirds plans to refocus its brand on core customers and shift its go-to-market strategy. These decisions are a reaction to lackluster sales following product changes and other missteps.

7. Expansion or Growth Business Plan

When your business is ready to expand, a growth business plan creates a useful structure for reaching specific targets.

For example, a successful business expanding into another location can use a growth business plan. This is because it may also mean the business needs to focus on a new target market or generate more capital.

This type of plan usually covers the next year or two of growth. It often references current sales, revenue, and successes. It may also include:

• SWOT analysis
• Growth opportunity studies
• Financial goals and plans
• Marketing plans
• Capability planning

These types of business plans will vary by business, but they can help businesses quickly rally around new priorities to drive growth.

Getting Started With Your Business Plan

At the end of the day, a business plan is simply an explanation of a business idea and why it will be successful. The more detail and thought you put into it, the more successful your plan — and the business it outlines — will be.

When writing your business plan, you’ll benefit from extensive research, feedback from your team or board of directors, and a solid template to organize your thoughts. If you need one of these, download HubSpot's Free Business Plan Template below to get started.

Editor's note: This post was originally published in August 2020 and has been updated for comprehensiveness.

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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 Examples of a Business Plan

Susan Ward wrote about small businesses for The Balance for 18 years. She has run an IT consulting firm and designed and presented courses on how to promote small businesses.

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A business plan is a document that summarizes the operational and financial objectives of a business. It is a business's road map to success with detailed plans and budgets that show how the objectives will be realized.

Keep reading to learn the basic components of a business plan, why they're useful , and how they differ from an investment plan.

A business plan is a guide for how a company will achieve its goals. For anyone starting a business , crafting a business plan is a vital first step. Having these concrete milestones will help track the business's success (or lack thereof). There are different business plans for different purposes, and the best business plans are living documents that respond to real-world factors as quickly as possible.

In a nutshell, a business plan is a practice in due diligence. When it's done well, it will prevent entrepreneurs from wasting time and money on a venture that won't work.

How Does a Business Plan Work?

If you have an idea for starting a new venture, a business plan can help you determine if your business idea is viable. There's no point in starting a business if there is little or no chance that the business will be profitable, and a business plan helps to figure out your chances of success.

In many cases, people starting new businesses don't have the money they need to start the business they want to start. If start-up financing is required, you must have an investor-ready business plan to show potential investors that demonstrates how the proposed business will be profitable.

Since the business plan contains detailed financial projections, forecasts about your business's performance, and a marketing plan, it's an incredibly useful tool for everyday business planning. To be as effective as possible, it should be reviewed regularly and updated as required.

Business owners have leeway when crafting their business plan outline. They can be short or long, and they can include whatever detail you think will be useful. There are basic templates you can work from, and you'll likely notice some common elements if you look up examples of business plans.

Market Analysis

The market analysis will reveal whether there is sufficient demand for your product or service in your target market . If the market is already saturated, your business model will need to be changed (or scrapped).

Competitive Analysis

The competitive analysis will examine the strengths and weaknesses of the competition and help direct your strategy for garnering a share of the market in your marketing plan . If the existing market is dominated by established competitors, for instance, you will have to come up with a marketing plan to lure customers from the competition (lower prices, better service, etc.).

Management Plan

The management plan outlines your business structure, management, and staffing requirements. If your business requires specific employee and management expertise, you will need a strategy for finding and hiring qualified staff and retaining them.

Operating Plan

The operating plan describes your facilities, equipment, inventory, and supply requirements. Business location and accessibility are critical for many businesses. If this is the case for your business, you will need to scout potential sites. If your proposed business requires parts or raw materials to produce goods to be sold to customers, you will need to investigate potential supply chains.

Financial Plan

The financial plan is the determining factor as to whether your proposed business idea is likely to be a success. If financing is required, your financial plan will determine how likely you are to obtain start-up funding in the form of equity or debt financing from banks, angel investors , or venture capitalists . You can have a great idea for a business, along with excellent marketing, management, and operational plans, but if the financial plan shows that the business will not be profitable enough, then the business model is not viable and there's no point in starting that venture.

Business Plan vs. Investment Proposal

A business plan is similar to an investment proposal. In fact, investment proposals are sometimes called investor-ready business plans . Generally speaking, they both have the same contents. You can think of an investment proposal as a business plan with a different audience.

The business plan is largely an internal document, intended to guide the decisions of executives, managers, and employees. The investment proposal, on the other hand, is designed to be presented to external agencies.

Key Takeaways

• A business plan is a detailed road map that explains what the company's goals are and how it will achieve them.
• The exact details of a business plan will depend on the intended audience and the nature of the business.
• It's a good idea to regularly revisit your business plan so you know it's as accurate, realistic, and detailed as possible.

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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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What Is A Business Plan (& Do I Really Need One?)

The term "business plan" is a familiar one, often bandied about in entrepreneurial circles. Yet, despite its ubiquity, it's remarkable how much mystery and confusion can surround this essential business tool.

What exactly is a business plan? What purpose does it serve? How is it structured? This article aims to lift the veil, demystifying the business plan and revealing its multifaceted nature.

Business Plan Definition

A business plan is a document that describes a company's objectives and its marketing, financial, and operational strategies for achieving them. It's more than a mere document; it's a structured communication tool designed to articulate the vision of the business, allowing stakeholders to easily find the information they seek.

The business plan is a tangible reflection of the strategic planning that has gone into the business's future. While the plan is a static document, the planning is a dynamic process, capturing the strategic thinking and decision-making that shape the business's direction.

Purposes of a Business Plan

1. attracting funding opportunities.

A well-crafted business plan illustrates the company's potential for growth and profitability. It outlines the company's vision, mission, and strategies, providing a clear roadmap for success. A potential investor, whether venture capitalists or angel investors, can see how capital will be utilized, fostering trust and confidence in the business venture. A bank or financial institution can assess your company's ability to meet debt service obligations and compliance with strict financial accounting to meet underwriting requirements.

2. Aligning Organizational Objectives

A business plan acts as a unifying document that aligns the team with the company's goals and strategies. It ensures that everyone is on the same page, working towards common objectives. This alignment fosters collaboration and efficiency, driving the business towards its targets.

3. Validating the Business Concept

Before launching, a business plan helps in validating the feasibility of the business idea. It's a rigorous process that tests the concept against real-world scenarios, ensuring that the idea is not only innovative but also practical and sustainable. This validation builds credibility and prepares the business for the challenges ahead. For an existing business, a business plan can help address a possible merger and acquisition (M&A), rolling out a new business product or location, or expanding the target market.

4. Facilitating Legal and Regulatory Compliance

Whether it's securing a visa for international operations or meeting other regulatory requirements, a business plan can be an essential tool. It provides the necessary information in a structured format, demonstrating compliance with legal and regulatory standards. This can streamline processes and prevent potential legal hurdles.

5. Articulating and Formalizing the Business Vision

The business plan is more than a set of numbers and projections; it's the embodiment of the business vision. It communicates the essence of the business to stakeholders, turning abstract ideas into a concrete operational plan. It's a vital tool for leadership to articulate and formalize the vision, setting the stage for strategic execution.

Identifying the Right Type of Business Plan

Once you understand who your business plan is for and what specific needs it must address, you can identify the type of plan that best suits your situation. Business plans can be categorized into two main types: traditional and lean, each serveing its own unique purpose.

Traditional Business Plan

The Traditional Business Plan is a detailed and comprehensive document, often used by a new business, especially those seeking significant funding. It provides a complete picture of the company's vision, strategies, and operations. A traditional business plan leaves no stone unturned, offering a robust tool that communicates the business's entire vision and plan to stakeholders.

Lean Business Plan

In contrast, the Lean Business Plan is an abbreviated structure that still emphasizes the key elements of a Traditional Business Plan, but in less detail. It's suitable for early-stage startups, small businesses, or situations where agility and speed are essential. The Lean Business Plan focuses on the essentials, providing a quick overview without overwhelming details. It's a flexible and adaptable tool that can evolve with the business. One of the primary distinctions between it and a Traditional Business Plan is that a Lean Business Plan does not typically include financial planning, or if it does, it's a simple financial forecast or cash burn.

Components of a Business Plan

There are many places online where you can buy a business plan template. Often, those documents are just an outline of the sections of the business plan and what is included in each. If that's what you're looking for, here's a good business plan outline:

Executive Summary

The Executive Summary is the first section read but often the last written, as it encapsulates the entire plan. If the company has a mission statement, it's typically included here. When used for funding, it includes the ask or uses of funds, and for investment, it may contain an investor proposition. It's a concise overview that sets the tone, summarizing each section that follows.

Company Overview

The Company Overview is the foundation of the business, articulating how it operates, generates revenue, and delivers unique value to its customers. This section defines products and/or service the business sells, as well as the company’s business model and unique value proposition. It covers key partners, pricing strategy, revenue model, and other essential business activities. 

Market Analysis Summary

The Market Analysis is the business intelligence portion of the plan. It comprises an industry analysis, market segments, target customers, competitive analysis, competitive advantage. This section provides insights into the market landscape, identifying opportunities, challenges, and how the business positions itself uniquely within the industry.

Strategy & Implementation Summary

Here, the business plan should outline the short-term and long-term objectives, marketing strategy and sales approach. It's a roadmap that details how the business will achieve its goals, including tactical steps, timelines, and resources. In a business plan for investors, the inclusion of an exit strategy can provide a vision for the future, considering various potential outcomes.

Management Summary

The Management Summary offers profiles of key personnel, their qualifications, roles, and plans to fill talent gaps. It's a snapshot of the leadership team, providing assurance that the right people are in place to execute the business plan successfully.

Financial Projections

This section includes standard financial statements like the profit & loss statement (P&L), the balance sheet, and the cash flow statement. It offers a detailed financial blueprint, illustrating the company’s revenue drivers and unit assumptions, income statement, a break-even analysis, and a sensitivity analysis to examine how changes in variables affect outcomes. For businesses with complex structures, framing the revenue in terms of market share can offer additional insight into the viability and feasibility of the financial projections.

The Appendices often include year 1 and year 2 monthly financial statements, intellectual property like patents and trademarks, construction blueprints, and other essential documentation. It's a repository for supporting information that adds depth and context to the main sections of the plan.

Do I Need a Business Plan?

The question "Do I need a business plan?" is one that many entrepreneurs and business leaders grapple with. The answer, however, is not as straightforward as it might seem. While not every business requires a traditional business plan, the strategic planning process is essential for all. 

In some cases, a traditional business plan is required. Applying for a Small Business Administration (SBA) loan , obtaining a entrepreneurship visa , or meeting specific investor requirements may mandate a comprehensive business plan.

However a traditional business plan isn’t always necessary. For example, in early-stage investor funding, particularly in industries like SaaS, a lean business plan accompanied by a pitch deck presentation will often suffice. The focus here is on agility and essential information rather than exhaustive detail.

Every Business Needs Business Planning

Unlike the traditional business plan, which may or may not be required depending on the situation, business planning as a process is indispensable for every business, regardless of size or stage.

Business planning is a dynamic, continuous process. It's not confined to a single document but evolves with the business, adapting to changes, challenges, and opportunities. Effective strategic planning ensures internal alignment with both long-term vision and short-term objectives. It's a holistic approach that guides business goal-setting decision-making, resource allocation, and strategic direction. It often serves as the basis for a fully developed marketing plan.

Every business, from a small startup to a large corporation, benefits from strategic planning. It's a practice that fosters growth, innovation, and resilience, providing a roadmap for success.

Not every business needs a traditional business plan as a document, but all businesses need to engage in business planning as a process. While the traditional business plan serves specific purposes and audiences, business planning is a universal practice that guides and grows the business.

Entrepreneurs and business leaders must assess their specific needs, recognizing that the traditional business plan is just one tool among many. The true value of the business plan lies in continuous planning, adapting, and aligning with the unique vision and goals of the business.

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7 Different Types of Business Plans Explained

11 min. read

Updated April 10, 2024

Business plans go by many names: Strategic plans, traditional plans , operational plans, feasibility plans, internal plans, growth plans, and more.

Different situations call for different types of plans. 

But what makes each type of plan unique? And why should you consider one type over another?

In this article, we’ll uncover a quick process to find the right type of business plan, along with an overview of each option. 

Let’s help you find the right planning format.

• What type of business plan do you need?

The short answer is… it depends. 

Your current business stage, intended audience, and how you’ll use the plan will all impact what format works best. 

Remember, just the act of planning will improve your chances of success . It’s important to land on an option that will support your needs. Don’t get too hung up on making the right choice and delay writing your plan.

So, how do you choose?

1. Know why you need a business plan

What are you creating a business plan for ? Are you pitching to potential investors? Applying for a loan? Trying to understand if your business idea is feasible?

You may need a business plan for one or multiple reasons. What you intend to do with it will inform what type of plan you need.

For example: A more robust and detailed plan may be necessary if you seek investment . But a shorter format could be more useful and less time-consuming if you’re just testing an idea.

2. Become familiar with your options

You don’t need to become a planning expert and understand every detail about every type of plan. You just need to know the basics:

• What makes this type of plan unique?
• What are its benefits?
• What are its drawbacks?
• Which types of businesses typically use it?

By taking the time to review, you’ll understand what you’re getting into and be more likely to complete your plan. Plus, you’ll come away with a document built with your use case(s) in mind—meaning you won’t have to restart to make it a valuable tool.

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3. Start small and grow

When choosing a business plan format, a good tactic is to opt for a shorter option and build from there. You’ll save time and effort and still come away with a working business plan.

Plus, you’ll better understand what further planning you may need to do. And you won’t be starting from scratch.

Read More: How to identify the right type of plan for your business

Again, the type of business plan you need fully depends on your situation and use case. But running through this quick exercise will help you narrow down your options. 

Now let’s look at the common business plan types you can choose from.

• Traditional business plan

The traditional (or standard) business plan is an in-depth document covering every aspect of your business. It’s the most common plan type you’ll come across. 

A traditional business plan is broken up into 10 sections:

• Executive summary
• Description of products and services
• Market analysis
• Competitive analysis
• Marketing and sales plan
• Business operations
• Key milestones and metrics
• Organization and management team
• Financial plan
• Appendix 

Why use this type of plan?

A traditional business plan is best for anyone approaching specific business planning events—such as presenting a business plan to a bank or investor for funding.

A traditional plan can also be useful if you need to add more details around specific business areas. 

For example: You start as a solopreneur and don’t immediately need to define your team structure. But eventually you hit a threshold where you need more staff in order to keep growing. A great way to explore which roles you need and how they will function is by fleshing out the organization and management section .

That’s the unseen value of a more detailed plan like this. While you can follow the structure outlined above and create an in-depth plan ready for funding, you can also choose which sections to prioritize. 

Read More: How to write a traditional business plan  

• One-page plan

The one-page business plan is a simplified (but just as useful) version of a traditional business plan. It follows the same structure, but is far easier to create. It can even be used as a pitch document.

Here’s how you’ll organize information when using a one-page plan:

• Value proposition
• Market need
• Your solution
• Competition
• Target market
• Sales and marketing
• Budget and sales goals
• Team summary
• Key partners
• Funding needs

A one-page plan is faster and easier to assemble than a traditional plan. You can write a one-page plan in as little as 30 minutes . 

You’ll still cover the crucial details found in a traditional plan, but in a more manageable format.

So, if you’re exploring a business idea for the first time or updating your strategy—a one-page plan is ideal. You can review and update your entire plan in just a few minutes.

Applying for a loan with this type of plan probably wouldn’t make sense. Lenders typically want to see a more detailed plan to accurately assess potential risk. 

However, it is a great option to send to investors. 

“Investors these days are much less likely to look at a detailed plan,” says Palo Alto Software COO Noah Parsons. “An executive summary or one-page plan, pitch presentation, and financials are all a VC is likely to look at.”

Creating a more detailed plan is as much about being prepared as anything else. If you don’t dig into everything a traditional plan covers, you’ll struggle to land your pitch . 

If you don’t intend to seek funding, a one-page plan is often all you need. The key is regularly revisiting it to stay on top of your business. 

Let’s explore two unique processes to help you do that: 

Read More: How to write a one-page business plan

Lean planning process

Lean planning is a process that uses your one-page plan as a testing tool. The goal is to create a plan and immediately put it into action to see if your ideas actually work. You’ll typically be focusing on one (or all) of the following areas: 

• Strategy – What you will do
• Tactics – How you will do it
• Business Model – How you make money
• Schedule – Who is responsible and when will it happen

Why use this process?

Lean planning is best for businesses that need to move fast, test assumptions, revise, and get moving again. It’s short and simple, and meant to get everyone on the same page as quickly as possible. 

That’s why it’s so popular for startups. They don’t necessarily need a detailed plan, since they’re mostly focused on determining whether or not they have a viable business idea .

The only drawback is that this planning process is built primarily around early-stage businesses. It can be a useful tool for established businesses looking to test a strategy, but it may not be as helpful for ongoing management.

Read More: The fundamentals of lean planning

Growth planning

Growth planning is a financials-focused planning process designed to help you make quick and strategic decisions.

Again, it starts with a one-page plan outlining your strategy, tactics, business model, and schedule. The next step is to create a working financial forecast that includes projected sales, expenses, and cash flows.

From there, you run your business. 

As you go, track your actual financial performance and carve out time to compare it to your forecasts . If you spot any differences, these discrepancies may indicate problems or opportunities that call for adjusting your current strategy.

Growth planning combines the simplicity of the one-page plan and the speed of lean planning, with the power of financial forecasting. 

This makes the process useful for every business stage and even allows you to skip to the forecasting step if you already have a plan.

With growth planning, you’ll:

• Regularly revisit your financials
• Better understand how your business operates 
• Make quick and confident decisions

This process focuses on growing your business. If diving into your financials isn’t a priority right now, that’s okay. Start with a one-page plan instead, and revisit growth planning when you’re ready.

Read More: How to write a growth-oriented business plan

• Internal plan

Sometimes you just need a business plan that works as an internal management tool. 

Something to help you: 

• Set business goals
• Provide a high-level overview of operations
• Prepare to create budgets and financial projections

You don’t need an overly long and detailed business plan for this. Just a document that is easy to create, useful for developing or revisiting your strategy, and able to get everyone up to speed.

The internal plan is a great option if you’re not planning to present your plan to anyone outside your business. Especially if you’re an up-and-running business that may have created a plan previously. You might just need something simple for day-to-day use.

Read More: 8 steps to write a useful internal business plan

• 5-year business plan

Some investors or stakeholders may request a long-term plan stretching up to five years. They typically want to understand your vision for the future and see your long-term goals or milestones.  

To be honest, creating a detailed long-term business plan is typically a waste of time. There are a few exceptions:

• A long-term plan is specifically asked for
• You want to outline your long-term vision
• Real estate development
• Medical product manufacturing
• Transportation, automotive, aviation, or aerospace development

The reality is, you can’t predict what will happen in the next month, let alone the next one, three, or five years.

So, when creating a long-term plan, don’t dig too deep into the details. Focus on establishing long-term goals , annual growth targets, and aspirational milestones you’d like to hit.

Then supplement these with a more focused one-page plan that actually describes your current business, which you can use in your business right now.

Read More: How to write a five-year business plan

• Nonprofit business plan

A nonprofit business plan is not too different from a traditional plan. You should still cover all of the sections I listed above to help you build a sustainable business. 

The main differences in a nonprofit plan are tied to funding and awareness. You need to account for:

• Fundraising sources and activities.
• Alliances and partnerships.
• Promotion and outreach strategies.

You also need to set goals, track performance, and demonstrate that you have the right team to run a fiscally healthy organization. You’re just not pursuing profits, you’re trying to fulfill a mission. But you cannot serve your community if your organization isn’t financially stable.

If you can use your business plan to show that you’re a well-organized nonprofit organization, you are more likely to attract donors and convince investors to provide funding.

Read More: How to write a nonprofit business plan

Resources to help write your business plan

Don’t get too hung up on the type of business plan you choose. Remember, you can always start small and expand if you need to.

To help you do that, I recommend downloading our free one-page business plan template . It’s especially useful if you’re exploring an idea and need a quick way to document how your business will operate.

If you know you’ll pursue funding, download our free traditional business plan template . It’s already in an SBA-lender-approved format and provides detailed instructions for each section. And if you want to explore other options, check out our roundup of the 8 best business plan templates you can download for free.

Lastly, check out our library of over 550 sample business plans if you need inspiration. These can provide specific insight into what you should focus on in a given industry.

Remember, just by deciding to write a business plan, you are increasing your likelihood of success. Pick a format and start writing!

Types of business plans FAQ

Which type of planning should be done for a business?

The type of planning fully depends on your business stage and how you intend to use the plan. Generally, whatever format you choose should help you outline your strategy, business model, tactics, and timeline.

How many types of business plans are there?

There are seven common types of business plans, including: traditional, one-page, lean, growth, internal, 5-year, and nonprofit plans.

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.

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Business Plan

Who should write a business plan, pros and cons of a business plan, the anatomy of a business plan, .css-uphcpb{position:absolute;left:0;top:-87px;} what is a business plan, definition of a business plan.

A business plan is a strategic document which details the strategic objectives for a growing business or startup, and how it plans to achieve them.

In a nutshell, a business plan is a written expression of a business idea and will describe your business model, your product or service, how it will be priced, who will be your target market, and which tactics you plan to use to reach commercial success.

Whilst every enterprise should have a plan of some sort, a business plan is of particular importance during the investment process. Banks, venture capitalists, and angel investors alike will need to see a detailed plan in order to make sound investment decisions — think of your plan as a way of convincing them your idea is worth their resources.

Roadmapping From A to Z

Business plans can also be useful as a guide to keeping a new business on track, especially in the first few months or years when the road ahead isn’t too clear.

Starting a business isn’t an exact science. Some companies organically develop out of trial and error, while others are plotted out from start to finish.

So if you’re asking whether your company needs a lengthy business plan, the answer would be ‘no’. That said, there are definitely a few situations in which writing a plan makes sense and can help increase the chances of a business becoming successful:

In situations when the market is new and untested — or simply volatile — it can be very helpful to have a business plan to refer back to when the road ahead isn’t clear.

For those who have an exciting business idea but haven’t necessarily distilled it down into black-and-white. Writing a business plan is a great way to look at a concept from all angles and spot any potential pitfalls.

How to write a business plan?

The most important step in writing a business plan is to identify its purpose.

Who are you trying to attract with it, and why?

Here are a few key pointers for writing a business plan:

Are you looking to secure a bank loan, get funding from private investors, or to lure skilled professionals to join you?

Include a brief history of your business, the concept, and the products or services. Keep it professional and transparent.

Don’t exaggerate your experience or skills, and definitely don’t leave out information investors need to know. They’ll find out at some point, and if they discover you lied, they could break off their involvement. Trust is crucial.

Explain what the product or service your business offers in simplistic terms.

Watch out for complex language and do whatever you can to prevent readers from becoming confused.

Focus on the benefits the business offers, how it solves the core audience’s problem(s), and what evidence you have to prove that there is a space in the market for your idea. It’s important to touch on the market your business will operate in, and who your main competitors are.

Another essential aspect of writing an effective business plan is to keep it short and sweet. Just focus on delivering the crucial information the reader has to know in order to make a decision. They can always ask you to elaborate on certain points later.

Still, deciding whether or not a business plan will benefit you at this stage of your venture?

Let’s look at a few reasons why you might (or might not) want to write a business plan.

A business plan will help you to secure funding even when you have no trading history. At the seed stage, funding is all-important — especially for tech and SaaS companies. It’s here that a business plan can become an absolute lifesaver.

Your business plan will maintain a strategic focus as time goes on. If you’ve ever heard of “mission creep”, you’ll know how important an agreed can be — and your business plan serves exactly that purpose.

Having a plan down in black and white will help you get other people on board . Again, with no trading history, it can be hard to convince new partners that you know what you’re doing. A business plan elegantly solves this problem.

Your business plan can cause you to stop looking outward. Sometimes, especially in business, you need to be reactive to market conditions. If you focus too much on your original business plan, you might make mistakes that can be costly or miss golden opportunities because they weren’t in the plan.

 A lot of time can be wasted analyzing performance. It’s easy to become too focused on the goals and objectives in your business plan — especially when you’re not achieving them. By spending too much time analyzing past performance and looking back, you may miss out on other ways to push the business forward.

A business plan is out of date as soon as it’s written. We all know how quickly market conditions change. And, unfortunately, certain elements in your business plan may have lost relevance by the time you’re ready to launch. But there is another way — by transferring your strategic plan into an actionable roadmap , you can get the best of both worlds. The business plan contains important detail that is less likely to change, such as your mission statement and target audience, and the roadmap clarifies a flexible, adaptable, route forward.

So, you’ve decided to write a business plan — a great choice! 

But now comes the tricky task of actually writing it. 

This part can be a little frustrating because there is no one-size-fits-all template appropriate for all business plans. The best approach, in fact, is to look at common ingredients of a business plan and pick out the ones that make sense for your venture.

The key elements of a great business plan include:

An overview of the business concept . This is sometimes referred to as an executive summary and it’s essentially the elevator pitch for your business.

A detailed description of the product or service. It’s here that you’ll describe exactly what your core offering will be — what’s your USP , and what value do you deliver?

An explanation of the target audience. You need a good understanding of who you’ll be selling your product or service to, backed up by recent market research.

Your sales and marketing strategy. Now that you know who you’re targeting, how do you plan to reach them? Here you can list primary tactics for finding and maintaining an engaged client base.

Your core team . This section is all about people: do you have a team behind you already? If not, how will you build this team and what will the timeline be? Why are you the right group of people to bring this idea to the market? This section is incredibly important when seeking external investment — in most cases, passion can get you much further than professional experience.

Financial forecasts . Some investors will skim the executive summary and skip straight to the finances — so expect your forecasts to be scrutinized in a lot of detail. Writing a business plan for your eyes only? That’s fine, but you should still take time to map out your financial requirements: how much money do you need to start? How do you plan to keep money coming in? How long will it take to break even ? Remember, cash is king. So you need a cash flow forecast that is realistic, achievable and keeps your business afloat, especially in the tricky first few years.

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More From Forbes

Global expansion strategies: how to take your business to new markets successfully.

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Jason Miller helps influential brands and celebrities create generational wealth with their businesses | CEO, Strategic Advisor Board .

If you’re an entrepreneur who’s ready to take your business ventures from domestic to global, read on to learn about how to research, create financial and strategic plans, and use marketing to get to global success. These are some of the steps I used when breaking into markets with my company, Strategic Advisor Board.

The obvious reason to go global is with access to more people, you will most likely experience revenue growth. But one of the biggest reasons I recommend doing this is due to risk diversification by not relying solely on one market for your business revenue; this is important because of ongoing changes to the economy. According to research, "shareholders do, in fact, reward companies who grow faster outside of the U.S ."

Expanding to new markets can lead to economies of scale and lower production costs due to bulk purchasing and more streamlined production. Your business could also have access to new talent and resources which could lead to more innovation and creativity as well as tapping into local raw materials. Here is how to do it:

Research & Adaptation

I would argue that this is the most important part of the process and maybe the most in-depth of expanding globally because so much of what you find out determines if it’s a smart company decision to make the move. Research your new market to determine whether your product/service will perform well there but also find out tax and regulatory info. You may be exempt from certain taxes if you open your business to new borders.

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Find out if you have a target market in the new area you’re looking at, and if they’d be receptive to your products/services. Make sure you take into account the different cultural aspects that could affect the marketability of your product. Do research on any competitors in the area and figure out what your unique selling proposition is. All this information you’ve gathered will help with making your decision.

Financial Planning

Before you can decide to expand, you need to see if you can afford it. Before creating any sort of budget, find out all the costs associated with expanding. Start with looking at the operational expenses such as infrastructure for office or warehouse spaces and supply chain costs. Supply chain costs can include storage of inventory, or transportation costs of your products to and from manufacturing centers to stores or directly to clients.

Find out if any tariffs or customs fees would affect the profitability of your product. You may want to insure your goods, so look into the costs of doing that as well as how much you should put aside for contingency funds to have on hand for any unforeseen expansion costs.

Strategic Planning

In this part of the process, you will create a roadmap starting with defining clear objectives for your expansion. Then developing a strategy that consists of how to enter the market, including looking into joint ventures, mergers, franchising or partnerships.

Your strategic plan also needs to include adaptive planning. This means you’re flexible in your plan so you can accommodate any unforeseen changes, difficulties or challenges that may occur in the marketplace. Since markets are dynamic and continuously shift, it’s important your strategies adjust as well to include any changing political, economic or cultural conditions. Include these factors in the risk management portion of the plan. Also, include a timeline with realistic expectations of short-term and long-term goals.

Marketing & Talent Management

The marketing strategy you’ve been using domestically may not work globally. It’s a skill to be able to build a consistent brand image while making sure you’re connecting with and being respectful of local market preferences.

One of the best things about having a business operating on a global scale is access to top talent. Hiring the correct talent that goes with your brand’s values and mission is important across all your business locations. That being said, HR policies may be different from domestic HR laws in the workplace. Look into getting work visa support if you need employees to work on international projects.

Global expansion isn’t easy and there’s a lot to consider, but if you’re willing to accept the challenge, there are certain strategies to help you achieve success. Extensive research is the most important to start with. Understand what the new market potential will be like, and find out what the taxes and culture look like. Evaluate how receptive your product will be to locals and what makes it unique. Financial planning is crucial in the early stages and you should assess everything from operational and supply chain costs to insuring your goods. Strategic planning is the roadmap to follow and should include clear objectives, a comprehensive entry strategy, timelines, and adaptive planning. The last steps include using marketing that sits well with locals and hiring top talent to help with the transition. Expanding your company isn’t easy, but if you do your research and plan accordingly, you’ll be on the right track to global success.

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What is a project plan and how to create one in 5 steps?

W hen you decide to undertake a particular project, it can initially be quite daunting. Where should you begin? Business software, from project management software to the best CRM solutions ,  can help, of course, but what organizations really need is a plan. But coming up with a project plan isn’t necessarily straightforward either.

A project plan is essentially a clear description of what your project is, what you want to achieve, and how you aim to go about it. Project planning will usually outline certain timeframes, as well as define the resources that you will use. 

Project planning can take a variety of forms and is likely to differ depending on a project’s aims, a company’s industry, stakeholders, and many other factors. However, we’ve included five summon steps that will help you get your project plan off to the right start.

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Step 1: Define your stakeholders

Even if your project is a solo affair, it’s likely that other individuals will be involved, whether that’s customers or commercial rivals. Most projects are about people at the end of the day, which is why the first step when crafting your project plan should be to define your stakeholders. 

Businesses should include anyone with an interest in the project when outlining stakeholders - from both inside and outside the organization. Meet with these stakeholders where possible and get them to discuss their needs and expectations from the project. Define their roles, keeping in mind that some stakeholders might have multiple within a single project.

The best CRM software can help businesses improve communication, which will improve stakeholder engagement within the company. At the same time, marketing departments probably have their own solutions for crafting buyer personas to help form 360-degree outlines of consumer stakeholders. 

Step 2: Set your goals

The next step when crafting your project plan is to outline your goals. Without a clear objective, your project will flounder without an objective and no way of measuring success. Defining your project objectives will also inform the final shape that your project takes. Your goals will also help determine where resources are allocated and what tools you’ll use. For instance, if one of your project’s main aims is to derive clearer customer insights, then a business intelligence platform is likely to be essential. 

As well as listing your goals when creating a project plan, remember that not all goals are of equal importance. Prioritization is an important part of goal creation, so you can focus resources in the right areas. Outline the tasks needed to meet your most important goals ( task management may help here) and see if some project visualization tools can provide added clarity. A Gantt chart, for instance, can help with task prioritization and mapping project dependencies.

Step 3: Create a schedule

A project plan doesn’t just tell you what to do and what order to do it in; it also helps create a timeframe for your project. When creating a project plan, businesses should establish a schedule as early as possible. It’s important to be realistic here and account for the fact that most projects will hit a snag at some point. Flexibility will be important if timelines have to be shifted in light of new developments.

In fact, any timeline that forms part of your project plan should look to outline risks and take these into account. Identify risks to not only hopefully form mitigating strategies but also to evaluate what sort of impact they might have on the project. Could they delay the project’s completion? Could they damage your results? 

A simple matrix, the kind often included in many small business CRMs , can help you to better understand a likely time frame for your project. Think carefully about who will be responsible for each task and consider the person’s bandwidth before you set a deadline for completion. List each stakeholder should be accountable to - probably a team leader or manager - and keep on top of things. Don’t wait until the deadline has passed before you check in on individual employees. Use metrics to understand how things are progressing, if additional support is needed, and whether the initial timeline you came up with is still feasible.

Step 4: Communicate

When you’ve formulated an initial project plan, there are a couple of steps before the planning stage is formally complete. Make sure your plan is shared with all the relevant stakeholders as part of an open discussion. If there are any concerns, allow these same stakeholders to share them freely. Project planning should be an ongoing process with feedback always welcomed. 

If a stakeholder has some important input, you may want to reassess your plan and communicate any changes you’ve made. Ask stakeholders if they fully understand the plan you’ve come up with. If there are any reservations, it’s highly unlikely that your plan will deliver the results you’re looking for. And remember your project doesn’t exist in isolation. Any feedback - from the initial plan or following a project’s conclusion - can help inform the next plan so things go even better.

Step 5: Final evaluation

When you’ve implemented your plan, it’s time to assess how things went. Did your plan lead to the desired outcome? What could be communicated better? What would you change for the next project? Conduct a thorough final evaluation covering the planning stage, implementation, and results. 

Canvass opinions from multiple stakeholders when you're carrying out your final evaluation too. You may have thought that the project was an unqualified success, for example, but your employees may have been exhausted due to what they saw as unrealistic expectations. Talking to different stakeholders is the only way of getting a well-rounded picture of a project’s success. A formal revenue can help to elucidate the strengths and weaknesses of any project so you can derive the necessary learnings from it.

Do you really need a project plan?

Of course, you could forgo the planning stage and launch headfirst into your next project - but it’s probably not a great idea. A project plan provides structure around what you want to achieve, when, with whom, and how. It’s an important step - and while it won’t guarantee project success, it will provide clarity on what went well and what didn’t.

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Employee Onboarding Guide

Onboarding definition & overview.

Last updated: May 15th, 2024

Quality onboarding is crucial for new employees' long-term success and organizational productivity. Learn why a solid employee onboarding process can make a significant impact on employee experience and retention, plus innovative ideas to approaching welcoming new staff.

Onboarding Guide Navigation

> Definition & Overview

What Is Onboarding?

Onboarding is the process of integrating new employees into an organization. It includes the orientation process and opportunities for new hires to learn about the organization's structure, culture, vision, mission and values. Onboarding can span one or two days of activities at some companies; others offer a more extensive series of activities spanning months. 

Onboarding is often confused with orientation. While orientation is necessary for completing paperwork and other routine tasks, onboarding is a comprehensive process involving management and other employees and can last up to 12 months. 

Why Is It Important to Get Onboarding Right?

All new employees are onboarded—but the quality of the onboarding makes a difference. Too often, onboarding consists of handing a new employee a pile of forms and having a supervisor or HR professional walk the employee around the premises, making introductions on an ad hoc basis. When onboarding is done well, however, it lays a foundation for long-term success for the employee and the employer. It can improve productivity, build loyalty and engagement, and help employees become successful early in their careers with the new organization.

A study by  Gallup  showed that while only 12 percent of employees felt their company did a great job with onboarding, those employees were nearly three times as likely to say they have the best possible job. Overall, only 29 percent of new hires felt they were prepared and supported to excel in their new role. This leaves a lot of room for improvement.

Other studies consistently show a positive correlation between engaged employees and a company's profitability, turnover rate, safety record, absenteeism, product quality and customer ratings. An effective onboarding plan offers an ideal opportunity to boost employee engagement by, for example, fostering a supportive relationship between new hires and management, reinforcing the company's commitment to helping employees' professional growth and proving that management recognizes the employees' talent.   For further reading learn  how to optimize the onboarding process  and the importance of good onboarding . 

Relatedly, an  employee value proposition  (EVP) defines the value employees will get from working for a particular organization. It embodies the promises made during recruitment and is lived out every day through company culture. Onboarding gives employees their first look at how an organization's EVP may or may not be realized.

Onboarding Process Summary

While there are many ways to design an onboarding program, some components are integral to the process:

1. Preboarding

Consider inviting new employees to tour the facility, sending informational material, providing care packages, and assigning a buddy to help them integrate before their official start date.

2. Orientation

Introduce employees to the organization's structure, vision, mission, and values; review employee handbook and major policies; complete paperwork; cover administrative procedures; and provide other mandatory training.

3. Foundation Building

Ensure the onboarding process consistently embodies an organization's culture, mission, employee value proposition, brand, and other foundational elements, recognizing that assimilating these values takes time.

4. Mentoring and Buddy Systems

In partnership with hiring managers, enlist mentors or buddies to provide new employees with guidance, assistance, and insights into organizational nuances.

View our full guide on onboarding process steps.

Innovative Approaches to Onboarding

Various components of an onboarding program can be delivered using different approaches and methodologies combined to suit the organization and available resources.

Some employers are using innovative practices, such as games, video, and team-building exercises, to get new hires excited about joining the company. They're also working to make sure people can hit the ground running with functional workstations and equipment. Some examples of this include: 

Facebook has its "45-minute rule," which means all new employees can begin to work within 45 minutes of arriving because all of their systems and devices have been set up before they report for their first day.

Leaders at Suffolk Construction, a national construction firm based in Boston, invite entry-level hires to participate in a variety of team-building exercises, including rowing the Charles River. 

New employees at Bedgear, a Farmingdale, N.Y.-based manufacturer of performance bedding, take a walking tour of downtown Manhattan to visit other retailers that sell customized products, including Warby Parker and Samsung.

View more  original onboarding options, shared from 4 HR leaders . 

Continue Learning About Onboarding

Additional resources:.

• Checklist for Developing Onboarding/New Hire Practices
• New Hire Orientation Checklist
• New-Hire Orientation Process
• New Hire Survey
• New Hire Survey – Remote Employee
• Onboarding Companies and Vendors in the SHRM Vendor Directory  
• SHRM Store resources on  Onboarding

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• Business Continuity

Important: The Scope Of A Business Continuity Plan (Updated)

Dale Shulmistra

• September 28, 2023
• 11 min read

Disasters, both natural and man-made, can happen at any time, often with very little warning. The consequences of not being prepared can be devastating. According to the Federal Emergency Management Agency (FEMA), almost 40 percent  of small businesses affected by a disaster never reopen their doors.

How can you ensure that your company won’t be part of that statistic? The answer is to have a well-thought-out business continuity plan.

What is a Business Continuity Plan (BCP)?

A BCP lays out the steps and procedures a company will follow before, during and in the wake of a disaster, so that it can maintain maximum functionality during the emergency and get its operations back to normal in the shortest possible time. With a good BCP in place, your company’s employees will know exactly what to do when disaster strikes.

In this post, we outline the scope of a typical business continuity plan and how to create one, including:

• Sections to include
• Identifying the plan’s objective
• How to test the BC plan
• Outsourcing your business continuity planning
• Choosing BC/DR vendors for backup and recovery

The Scope of a Business Continuity Plan

What should be in your BCP so that you can be sure that your business is adequately prepared for a disruption? The following are seven  areas any good business continuity plan should address . If you’re creating a BCP for the first time, these are high-level tips to help you create the core framework of your plan. Below, we go into more detail on what to include within each section.

1. Identify the Objectives and Scope of the BCP

Business continuity plans can vary significantly in size and scope. They can be focused on specific business systems or the company’s entire operations. As such, each BCP needs to clearly state what its objectives are – along with its scope and limitations. For example, if the plan is focused narrowly on maintaining continuity for IT systems, then this objective should be clearly stated at the beginning of the plan.

2. Identify Critical Business Functions

One of the most vital steps in formulating a good BCP is to conduct a business impact analysis (BIA) to identify the crucial areas of your business that must be maintained or quickly restored when a disaster strikes. It’s these core business functions that your BCP will be designed to protect.

3. Identify Critical Systems and the Dependencies Between Them

Your BCP should identify the systems and data that are most critical for the continued operation of the company. What equipment, supplies and records (both digital and paper) must be available and operational in order for your company to continue to function? What is their role and importance? Why are they crucial to the survival of the business? Your BCP should identify this in clear terms to emphasize the importance of establishing effective recovery protocols.

4. Identify Your Risks

What are the most likely disruptive events that might impact your company’s operations? Cyberattacks, accidental data loss, server outages, ransomware infections? What about natural disasters, such as tornadoes, hurricanes, wildfires and earthquakes? Obviously, it’s not possible to predict which disaster will strike your operations or when. But you can and should specifically plan for every possible scenario within your BCP. Some businesses may have a higher risk of certain types of disasters, which is why a comprehensive risk assessment should be conducted for each company, as we outline below.

5. Specify Your Data Backup and Recovery Plan

Your BCP should specify procedures and systems for data backup and recovery. How frequently will backups be conducted, and by whom? Where will the data be stored, and how will it be geographically replicated so that no local disaster can result in a permanent loss? How will it be recovered? These questions should be addressed both for electronic and critical paper records.

6. Identify the Composition, Functions and Procedures of Your Disaster Recovery Team

Who can declare an emergency that activates the recovery procedures in the BCP? Who are key employees who should be notified (and how), and who will be in charge? Where will disaster recovery team members and other employees meet if the company premises are not usable? These questions and more should be addressed in detail in the BCP.

7. Have a Detailed Communications Plan

How will the BC team be notified of an emergency if, for example, your email systems and telephones are disrupted? Who is authorized to speak on the company’s behalf to media, customers, suppliers and external partners, such as government agencies? The plan should include a list of people and agencies that will be contacted when an emergency is declared.

8. Specify BCP Testing, Refreshing and Training Procedures

A BCP that looks good on paper may be totally unworkable in practice. It must be realistically tested before it is put into operation, and key employees trained in its use. It must then be updated on a regular basis. With changing conditions, technology, organizational structures and personnel, the plan can quickly become outdated and unusable. Procedures for training, and for both testing and refreshing the plan should be included in the BCP itself.

The Importance of Proper Planning

Creating a thorough business continuity plan is the most important thing you can do to prepare your business for an operational disruption.

As the  Department of Homeland Security  notes, “A business continuity plan to continue business is essential.” Proper planning ensures that operations can be quickly restored, regardless of what has caused the incident.

Preparing for  all  possible disasters is vital to this planning, as FEMA  writes :

“The planning process should take an ‘all hazards’ approach. There are many different threats or hazards. The probability that a specific hazard will impact your business is hard to determine. That’s why it’s important to consider many different threats and hazards and the likelihood they will occur. In developing an all-hazards preparedness plan, potential hazards should be identified, vulnerabilities assessed and potential impacts analyzed. Strategies for prevention/deterrence and risk mitigation should be developed as part of the planning process. Threats or hazards that are classified as probable and those hazards that could cause injury, property damage, business disruption or environmental impact should be addressed.”

Getting the scope of your business continuity plan right is crucial to the survivability of your business if disaster should strike. If the planning falls short or fails to anticipate certain disasters, then recovery will be far more challenging.

What is Your Business Continuity Plan Objective?

Above, we mentioned the importance of identifying an objective for your BCP. What is the purpose of your business continuity plan? What does it aim to accomplish?

While the fundamental goal of every BCP is similar—to ensure continuity through a disruption—plans can vary in their approach. This is why it’s important to identify your business continuity plan objective at the start of your planning. Typically, this is one of the first sections in a BCP.

For example:

• A BC plan objective can be focused on the business as a whole, or specific business units and processes.
• Some organizations create separate BCPs for IT operations, focused on continuity of networking, data storage, backup, Internet connectivity and so on.
• A business with little risk for technology-related hazards, such as smaller retail establishments, may set a business continuity plan objective that is more focused on emergency response protocols, employee safety and workforce continuity.

Setting a plan objective is crucial for ensuring that everyone is on the same page about what the plan aims to achieve. If, for example, the plan is focused solely on IT continuity, then this will make it clear that additional planning is needed for other areas of the business.

What about RTO and RPO?

Recovery Time Objective (RTO) and Recovery Point Objective (RPO) are additional objectives that should be identified within certain sections of your business recovery plan. However, unless your plan is strictly focused on a specific system (rather than the business as a whole) then these objectives should not be used as the plan’s key objective. Instead, RPO and RTO should be identified within your recovery planning sections.

Here’s the difference between RTO and RPO:

• RPO  is the desired backup recovery point for restoring data (or essentially the age of the most recent backup). The more recent, the better.
• RTO  is the desired speed of restoration following an outage. The faster, the better. i.e. a 2-hour RTO following hard drive failure.

For example, an RPO of 8 hours would dictate that no backup should be more than 8 hours old. An RTO could be used to specify how quickly a data recovery should occur. For example, an RTO of 1 hour would dictate that a backup must be able to be restored within 1 hour.

It’s important to note that being able to achieve these objectives depends largely on the capabilities of the backup systems deployed. This is why RPO and RTO should be determined during the planning process to help identify which technologies are required.

Business Continuity Plan Assessment

Your business continuity plan assessment—often referred to as a  risk assessment —is another critical section of your planning document.

Above, we mentioned the importance of identifying the most likely risks to your organization. This is the section where you will outline those risks, defining what they look like and their likelihood of occurring. By assessing your risks in this fashion, you’ll be able to prioritize your planning around the most urgent risks.

Some organizations may also choose to incorporate aspects of their business impact analysis in this section, in the form of a table or chart. This provides a clearer overview of the threats and their severity, at a glance. Here is a basic example of what this business continuity plan assessment might look like:

Business Continuity Plan Checklist: Have You Included These Sections?

We’ve touched on the fundamental scope of a business continuity plan and some key components to include. But there are several other sections you’ll want to include to ensure that the plan is effectively communicated and able to be properly executed. Use the business continuity plan checklist below as a basic outline for how to structure your document and what these sections should entail.

• Contact information : Include the names and contact information of those who have created the BCP. You may also choose to include the contact information of disaster recovery team members here, as well as stakeholders who should be notified first when critical business disruptions occur.
• Plan objectives:  Outline the key goals of the plan and its areas of focus, as directed above, to define its scope (and limitations).
• Risk assessment:  Identify probable risks and disaster scenarios, as outlined above, which have the potential to cause a break in continuity.
• Impact analysis : Define the impact of those scenarios, including the potential length of the disruption, business systems or areas that will be affected and the estimated costs.
• Prevention : Define the systems and protocols that will help to prevent those scenarios from occurring or that can mitigate the issue. A basic example would be antimalware solutions to prevent a malware infection.
• Response : Provide step-by-step instructions for how to respond to the disaster scenarios identified in the risk assessment. Typically, these are the protocols that should be followed immediately after a disruption to ensure a swifter mitigation and recovery.
• Recovery : Detail the additional protocols for fully recovering affected systems or business functions. Examples could include recovering data from backup, restoring lost power or rebuilding a structure after a natural disaster.
• Contingencies:  Identify backup assets and contingency plans for incidents involving extended disruptions. This could include a sudden transition to remote work, as was seen during the COVID-19 pandemic, as well as secondary business locations and backup equipment if primary facilities are destroyed.
• Action items:  Explain any weaknesses identified during the planning process or outstanding action items that need to be followed up on. For example: the need to deploy a new  data backup solution for greater protection  against emerging threats such as ransomware.
• Communication:  Identify the means of communicating important updates between recovery teams and to other personnel. Examples could include the use of mobile devices/text messages, intranet/extranet sites or emergency phone lines for employees to call for updates during prolonged disruptions.
• Plan review:  Specify how often the business continuity plan should be reviewed and updated, and by whom.

Auditing a Business Continuity Plan

Routine review and auditing of a business continuity plan is crucial for ensuring that the information within the plan is still accurate and up to date. As new risks emerge, or business objectives change, it is necessary to revisit the plan and update those sections accordingly.

For example, only a few years ago, the threat of ransomware was not on many businesses’ radars. Today, it is one of the most dangerous risks to organizations, and as such, is now commonly included in BC plans across numerous industries.

But also, on a smaller level, even personnel names and contact information within a BCP can become quickly outdated when employees leave a company. So it’s important to make sure every aspect of the plan is up to date.

How to Conduct Business Continuity Testing

Business continuity testing is another vital part of the planning process. Testing ensures that the protocols and systems identified in the plan are actually effective. Routine tests also help to educate recovery teams and have them walk through the steps, so they are familiar with the processes when real disruptions occur.

Business continuity testing can encompass nearly any aspect of your planning, including:

• Data backup validation and recovery tests
• Mock drills for IT infrastructure failures
• Emergency response & evacuation procedures
• Network stress tests

All tests should be thoroughly documented. Did anything go wrong? Were recovery objectives met? What improvements must be made? If any critical gaps are uncovered during the testing process that require significant infrastructure changes (such as a new backup system, for example), these should be identified in the Action Items section of the BCP.

Hiring a Business Continuity Professional or Consultant

Hiring a business continuity consultant can be a smart move for businesses that need an outside perspective from a professional. Experienced consultants can identify any gaps in your business continuity plan, as well as the need for additional systems or procedures.

If you plan to hire a business continuity professional, you’ll want to be sure that the consultant is the right fit. Here are some tips:

• Look for a consultant with experience in your specific industry or niche
• Confirm the consultant’s area of expertise; for example: IT-only or comprehensive business continuity planning
• Ask for referrals that you can contact for a deeper understanding of the consultant’s quality of service

Outsourcing Business Continuity

Businesses with limited resources may want to consider outsourcing business continuity planning to an outside provider. This is a perfectly acceptable strategy for both small and large businesses, particularly if in-house personnel have little experience building a BC plan.

Even if your organization already has a BCP, outsourcing business continuity planning can help to provide an independent audit of your plan or manage specific aspects, such as your continuity technologies.

Which BCDR Vendors are Right for You?

Business continuity and disaster recovery (BCDR) vendors can help to deploy the technologies you need to maintain continuity. These solutions can include data storage, data backup , cloud replication and network solutions, just to name a few.

Choosing the right BCDR vendors is much easier when you already have a business continuity plan in place. Your BCP will identify the specific technologies you need to mitigate risks and recover from a disruption. Your continuity objectives will further help to narrow down your options: if a potential data backup solution can’t meet your RPO, for example, then you need to look for other vendors.

Frequently Asked Questions (FAQ) about a Business Continuity Plan

1. what is in a business continuity plan.

A business continuity plan includes the systems and procedures that help a business stay open during an operational disruption. A typical plan includes:

• Plan Objectives
• Key Contacts
• Risk Assessment
• Business Impact Analysis
• Disaster Prevention Strategies
• Communications Plan
• Disaster Recovery Protocols
• Business Continuity & Disaster Recovery (BC/DR) Technologies
• Plan Review & Testing Schedule

2. What is business continuity in simple words?

In simple terms, business continuity means that a business can continue operating during a disruptive event. All companies aim to maintain business continuity. A break in continuity—whether caused by natural disaster, cyberattack or other incidents—can be costly and can threaten the survival of a business.

3. What is the most important step in business continuity planning?

The most important step in business continuity planning is identifying the systems and procedures that will help a business maintain operations during various disaster scenarios. To effectively complete this step, the business will first need to conduct a comprehensive risk assessment and business impact analysis.

4. Who is responsible for a business continuity plan?

A business continuity plan is typically the joint responsibility of leaders from different operational divisions. While one individual may be tasked with overseeing the plan as a whole, the content is usually a team effort, requiring managers to identify operational risks specific to their respective units.

5. Is backup part of business continuity?

Yes, backups are integral to business continuity, because a loss of data can result in a costly operational disruption. This is why it’s important to identify data backup systems and protocols within the business continuity plan, including deployed technologies, recovery objectives, backup testing and recovery procedures.

Developing and maintaining a good business continuity plan is essential for keeping operations running through an unexpected disruption. By adequately assessing risks and outlining strategies for prevention, response and recovery, organizations can greatly reduce the chances of a prolonged interruption to essential systems and services.

Need more help? Learn more about the scope of a business continuity plan and supporting technology.

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What is the RFP Process? A 5-Step Guide + Checklist

Table of Contents

What is a Request for Proposal (RFP)?

The 5-step rfp process, rfp tips & best practices, rfp process checklist, rfp automation.

• December 12, 2023

Emily Bonnie

Senior Content Marketing Manager at Secureframe

Anna Fitzgerald

Requests for Proposals (RFPs) help organizations make informed, transparent, and strategic decisions when selecting vendors, ultimately leading to better project outcomes, cost savings, and stronger vendor relationships.

A good RFP process is clear, collaborative, and organized. We’ve broken the RFP process down into five steps to ensure that you attract the best vendors as well as manage the entire process efficiently and effectively, and we’ve provided a simple checklist you can use as a guide.

An RFP, or Request for Proposal, is a formal document issued by an organization to solicit proposals from potential suppliers, contractors, or service providers. It’s part of a formal selection process that helps organizations learn about multiple service providers and select the one that best meets their needs. Many organizations and government agencies use RFPs as part of the vendor procurement process.

RFx: Types of vendor assessments

Vendor assessments are an essential step for businesses in evaluating and selecting the right service providers. Several types of vendor assessments are available to evaluate different aspects of a vendor's capabilities and suitability.

• Request for Proposal (RFP): Used when an organization needs to buy a product or service and wants to invite various bidders to propose what they can offer. Allows the company to compare options and select the best fit based on their organization’s needs and budget.
• Request for Information (RFI): Used when an organization wants to understand what options are available in the market. Gathers general information from prospective vendors or suppliers about their products, services, or capabilities.
• Request for Quotation (RFQ): Used when an organization already knows the specific product or service it needs and is seeking detailed pricing information from potential suppliers.
• Due Diligence Questionnaire (DDQ): Used to evaluate a potential vendor’s financial health, business practices, security posture, regulatory compliance, and other risk factors.
• Security Questionnaire: Used to assess a third-party vendor’s data protection practices, including access controls, network security, compliance with relevant regulations, and incident response capabilities.

Recommended reading

What is a Request for Proposal? + Template

5 steps of an effective RFP process

An effective RFP process can both streamline the vendor procurement process and ensure you find the best service provider for your needs. Below, we’ve broken the process down into five steps, shared some tips and best practices, and provided a simple checklist to follow.

Step 1: Define the project plan and scope

This is arguably the most important step in the RFP process. Clarity and alignment around your organization’s needs and project goals are essential for drafting complete and effective RFP requirements.

Start by clearly identifying the primary objectives of the project. Consult with stakeholders across the organization to understand requirements from different perspectives. What are the key outcomes you expect to achieve? How will you measure success? This helps align the project scope with your organization's top-level goals.

With a clear sense of what you’re hoping to achieve, you can outline specific requirements. This might include software specifications, hardware needs, system integrations, data requirements, and compliance requirements. Provide a realistic budget and timeline for the project, including key milestones, deadlines, and dependencies. This helps vendors assess their ability to meet your timeline and stay within budget.

During this stage, it’s also important to identify potential third-party risks and consider how these risks should be managed. What data security standards will you require? Identify any compliance or regulatory requirements that the project must adhere to, and be sure to involve information security, compliance, or IT team members in this part of the process.

Next, draft the scope of work. This will be included in the RFP document and should detail what the project will include and what it won’t (referred to as "in-scope" and "out-of-scope" activities). Be specific about the deliverables, tasks, services, or products required. It’s just as important to be upfront about what won’t be included in scope — specify any limitations, constraints, or exclusions that vendors should be aware of.

Step 2: Write the RFP document

What constitutes a good RFP? An effective RFP should outline the specifics of the project and the organization's requirements:

• Overview and Introduction : This portion offers an overview of the organization issuing the RFP and its objectives. It typically comprises the company's name and contextual details regarding the project or need the RFP seeks to address.
• Project Description and Work Scope : In this section, the issuer elaborates on the specific project they are soliciting proposals for. It covers the project goals, expected deliverables, and the scope of work. It might also include the anticipated duration of the project, any significant milestones, limitations, or necessary prerequisites.
• Specifications and Requirements : This segment lays out the technical, functional, and performance criteria of the product or service. It often contains comprehensive descriptions of the tasks, desired attributes, and the standards that need to be met.
• Guidelines for Proposal Submission : Here, instructions for preparing and submitting proposals are provided, including format, necessary components, and specific queries that respondents must address. This segment also states the deadline for submission and contact details for proposal submission.
• Evaluation Metrics : The RFP should clarify the standards for assessing proposals. Criteria may involve aspects like cost, vendor experience, technical capabilities, project approach, and adherence to the stipulated requirements.
• Budget and Costs: Although not always included, some RFPs might specify a budget range for the project or ask for detailed pricing in the proposal. This helps vendors offer realistic and competitive rates.
• Terms and Legal Conditions : This section covers the legal and contractual terms of the project, encompassing payment conditions, duration of the contract, confidentiality clauses, and other legal requirements.
• Timeline for Responses : The RFP outlines crucial dates such as the proposal submission deadline, schedules for pre-proposal meetings or Q&A sessions, and a timeline for the review process and final decision-making. It also usually provides contact information for further inquiries.
• Supplementary Information/Attachments: The issuer may add extra details pertinent to the RFP, like supporting documents, data, or specific templates that respondents should utilize in their proposals.

Step 3: Issue the RFP

When it comes time to issue RFPs, organizations can post the document on their website or send the RFP directly to qualified vendors. Organizations with specific needs such as government agencies may use a procurement network like DemandStar to access the appropriate suppliers and service providers.  

Step 4: Build a shortlist

Evaluating RFP responses effectively and selecting the right vendor requires an organized and objective approach. Here are some key tips for evaluating RFP responses :

• Establish clear evaluation criteria : Before reviewing the proposals, define clear, specific criteria against which each response will be evaluated. This could include cost, compliance with technical requirements, vendor experience and qualifications, project approach and methodology, and timeline feasibility. Evaluate each proposal systematically against the predefined criteria to maintain consistency and fairness in the evaluation process.
• Assemble a diverse evaluation team : Involve a team with diverse expertise relevant to the project. This could include members from different departments such as finance, IT, operations, and procurement. A diverse team ensures a well-rounded evaluation from multiple perspectives.
• Check references and case studies : Review customer case studies for each vendor, and request references for organizations with similar requirements or use cases. This will give you insights into what it’s like to work with each vendor — their reliability, quality of work, ability to meet deadlines, and how they handle challenges.
• Consider total cost of ownership (TCO) : Don’t just focus on the initial cost. Consider the total cost of ownership, which includes ongoing maintenance, support costs, and any other long-term expenses associated with the product or service.
• Look for innovation and added value : Evaluate if the vendor brings innovative solutions or added value that could benefit your organization. This could be innovative technology, additional services, level of expertise, or a unique approach.
• Assess for cultural fit : Evaluate how well the vendor's culture and values align with your organization. A good cultural fit can lead to better communication and collaboration throughout the vendor relationship.
• Conduct a risk assessment : Evaluate the risks associated with each vendor. Types of vendor risk to consider include financial, operational, reputational, strategic, cybersecurity, and compliance risk.
• Consider multiple vendors : Sometimes the best approach may be to choose multiple vendors for different aspects of the project, especially if it's large and multifaceted.

Step 5: Select a vendor & finalize the contract

Once you’ve decided on the best vendor for your needs, you’ll need to negotiate contract terms.

Here are some tips to help you navigate the negotiation process:

• Clarify and prioritize needs: This includes services and functionality, delivery timelines, quality standards, and any other specific requirements. Know what you're willing to compromise on and what is non-negotiable.
• Negotiate total cost : Look beyond the initial price and consider factors that contribute to the total cost, such as delivery charges, implementation or maintenance costs, and any potential penalties for late delivery or poor quality.
• Assess and treat risk : Discuss and negotiate how risks will be shared. This includes what happens in the event of unforeseen circumstances, delays, data security, or quality issues. If relevant, negotiate terms regarding confidentiality and intellectual property rights. This is crucial if the vendor will be handling sensitive information or if there is potential for co-developed intellectual property.
• Define an exit strategy : Discuss and agree on the terms under which either party can terminate the contract. This should include notice periods, termination fees (if any), and the process for winding down the engagement.
• Complete legal review : Have a legal expert review the contract before signing. This ensures that your interests are protected and that the contract is compliant with any relevant laws. Ensure that all agreed-upon terms are clearly documented in the contract.

Remember that the negotiation process is the start of a long-term relationship with the vendor. A strong relationship can lead to better service, favorable terms in the future, and a reliable partner in your business network.

After you’ve made a purchasing decision and agreed on the final offer, you can proceed to implementation or project kickoff.

RFP best practices

Above all, an effective RFP process is efficient, transparent, competitive, and fair. These RFP best practices will help your organization easily compare vendors and select the best solution for your needs.

• Clearly define needs : Before drafting the RFP, have a clear understanding of what you need, including the project's scope, objectives, and specific requirements. This clarity helps in creating a more targeted and focused RFP.
• Involve key stakeholders from the beginning : This includes anyone who will be affected by the outcome of the RFP, including end users, technical experts, and finance and procurement professionals. Their insights can help shape a more effective RFP.
• Conduct market research: This will help you understand current market trends, potential vendors, and typical costs associated with your requirements. This will help in setting realistic expectations and understanding what to look for in proposals.
• Use tools to manage the RFP process: Various automation tools can streamline the time-consuming RFP process, from creation and response to evaluation.

After each RFP process, review what worked well and what could be improved. Continuous improvement helps refine future RFPs and procurement processes.

RFP Process Checklist

Define project plan and scope, write the rfp document, issue the rfp, collect vendor responses and create a shortlist, select a vendor and begin work, respond to rfps faster and easier with automation .

RFPs are an incredibly useful tool for assessing service providers and understanding third-party risk. But they can be incredibly cumbersome and resource-intensive to both answer and review.

Secureframe’s Questionnaire Automation can streamline the tedious and time-consuming process of answering lengthy RFPs and security questionnaires, with built-in AI functionality that pulls responses from your Knowledge Base. Simply upload a completed RFP or security questionnaire, verify and store answers to specific questions in your Knowledge Base, and Secureframe will pull answers to automatically complete future RFPs and questionnaires.

Pair questionnaire automation with the Secureframe Trust Center to demonstrate the strength of your security posture. Publish a Trust Center that pulls in data from the Secureframe platform – highlight your key security metrics and certifications, enable customers to self-serve or request access to security documents like SOC 2 reports, and review, approve, and deny document requests from the platform. Learn more about Secureframe Trust , or schedule a demo with a product expert to see it in action.

What are the steps in an RFP?

Step 1: Define the project plan and scope by consulting with key stakeholders

Step 2: Write the RFP document, including the scope of work and submission guidelines. 

Step 3: Issue the RFP to qualified vendors or through a procurement network

Step 4: Evaluate responses and build a shortlist of potential vendors

Step 5: Select a vendor and finalize the contract following legal review

What is an RFP checklist?

RFP checklists simplify the project management aspect of writing, issuing, and evaluating RFPs. They break down each phase of the process into concrete tasks, improving organization, accountability, and visibility. 

What is an RFP template?

Requests for proposals (RFPs) are commonly used by businesses and government organizations to announce a project and solicit bids from vendors and service providers. Many organizations use an RFP template to draft new requests. 

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Safe Food for Canadians Regulations: Glossary of key terms

Keep in mind.

This glossary includes and identifies terms that are defined in the Safe Food for Canadians Act and in the Safe Food for Canadians Regulations (SFCR), as well as the Food and Drugs Act and the Food and Drug Regulations . Additional terms are also included and have generally been defined using their ordinary meaning.

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "acceptable level", with respect to a biological, chemical or physical hazard, as meaning "a level of a biological, chemical or physical hazard that does not present a risk of contamination of the food."

The term "accessible" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "accessible" refers to easily accessible usually without the need to remove obstruction or take an unnecessarily prolonged time to obtain access.

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "agronomic input" as meaning "an input that is used in growing of fresh fruits or vegetables, and includes agricultural chemicals, biological controls, pollinators, commercial fertilizers, compost, compost tea, green manure, manure, mulch, row covers, soil amendments and pulp sludge."

The term "alcoholic beverage" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, when used in the context of Part 2 – Trade of the SFCR, "alcoholic beverage" refers to a beverage that contains more than 0.5% absolute ethyl alcohol by volume and is regulated under the Importation of Intoxicating Liquors Act (IILA). IILA covers both the interprovincial and international trade of alcoholic beverages.

The term "animal welfare audit" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "animal welfare audit" refers to the on-site inspection or examination of specific slaughter activities in the establishment that have an impact on animal welfare of the food animals. It is a type of process audit of the operator's measures to prevent or mitigate key animal welfare risks using recognized set standards, best practices, performance criteria and benchmarks (national or international).

The Fresh Fruits or Vegetables requirements in Part 6, Division 6 of the Safe Food for Canadians Regulations (SFCR) define "apple" as meaning "a fresh apple for which a grade is prescribed by these Regulations."

The term "batch thermal treatment" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "batch thermal treatment" when used in Part 4 – Preventive Controls of the SFCR, refers to the application of a thermal treatment to a discrete group of products (a batch) as opposed to a continuous stream of products.

The term "carcass parts" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "carcass parts" refers to parts from dressed carcasses.

The term "carry on business" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "carry on business" when used in Part 2 – Trade of the SFCR refers to conducting activities related to the import of the food identified on the licence.

The term "cleaning" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "cleaning" when used in Part 4 – Preventive Controls of the SFCR, refers to the removal of soil, food residue, dirt, grease or other objectionable matter.

The term "clothing" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "clothing" when used in Part 4 – Preventive Controls of the SFCR refers to items worn to cover the body. Examples include shirts, pants, socks and uniforms.

The Safe Food for Canadians Regulations define "commercially sterile" as meaning "has the same meaning as in section B.27.001 of the Food and Drug Regulations ."

The Food and Drug Regulations define "commercially sterile" as meaning "the condition achieved in a food that has been processed by the application of heat, alone or in combination with other treatments, to render the food free from viable forms of microorganisms, including spores, capable of growing in the food at temperatures at which the food is designed normally to be held during distribution and storage."

The Safe Food for Canadians Regulations define "common name", in respect of a food, as meaning

"(a) the name of the food that is printed in boldface type, but not in italics, in the Standards of Identity Document ;

(b) the name of the food that is printed in boldface type, but not in italics, in a provision of the Food and Drug Regulations ; or

(c) in any other case, the name by which the food is generally known or a name that is not generic and that describes the food."

The term "communicable disease" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "communicable disease" when used in Part 4 – Preventive Controls of the SFCR, refers to a disease that can be transmitted through direct contact with an individual or indirect contact through food. Examples of communicable diseases that can be transmitted through food include salmonellosis, campylobacteriosis, and hepatitis A.

The term "competencies" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "competencies" when used in Part 4 – Preventive Controls of the SFCR, refers to the observable or measurable level of knowledge, skills, abilities, and behaviours required to successfully perform a particular job or activity.

The term "condemnation" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "condemnation" refers to determination by the Canadian Food Inspection Agency that a food animal, its carcass, the parts of its carcass or its blood is inedible.

The Safe Food for Canadians Regulations define "consumer prepackaged", in respect of a food , as meaning "packaged in a container in the manner in which the food is ordinarily sold to or used or purchased by an individual – or in which the food may reasonably be expected to be obtained by an individual – without being repackaged, to be used for non-commercial purposes."

The Safe Food for Canadians Regulations defines "container" as meaning "an outer receptacle or covering that is used or to be used in connection with a food. It includes a wrapper and a confining band but does not include a conveyance or any container that is an integral part of a conveyance".

The Safe Food for Canadian Regulations define "contaminated", in respect of a food , as meaning "that the food contains any micro-organism, chemical substance, extraneous material or other substance or thing that may render the food injurious to human health or unsuitable for human consumption, including those that are not permitted under the Food and Drugs Act or those that do not comply with any limits or levels provided under that Act."

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define this term as meaning "a measure that can be applied to prevent or eliminate any biological, chemical or physical hazard that presents a risk of contamination of a food or to reduce the hazard to an acceptable level."

The term "control program" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "control program"", in relation to meat products, refers to a subset of your preventive control plan that details any measures that are taken to meet a specific requirement.

The term "controlled atmospheric stunning" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "controlled atmospheric stunning" refers to exposing the animals to a mixture of breathing gases, for example carbon dioxide, that produce unconsciousness or death through hypoxia or asphyxia. This can occur by a rapid onset of unconsciousness or in multiple stages to induce a more gradual onset of unconsciousness.

The Safe Food for Canadians Act defines "conveyance" as meaning "a vessel, aircraft, train, motor vehicle, trailer or other means of transportation, including a cargo container."

Note: refer to the separate definitions for conveyance or equipment and facility or conveyance .

The phrase "conveyance or equipment" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "conveyance or equipment " when used in Part 4 – Preventive Controls of the SFCR, refers to anything that is used within the establishment to transport or manufacture, prepare, store, package, or label food or slaughter a food animal.

Examples of conveyances or equipment include:

• Forklifts and hand lifts used to transport materials within the establishment.
• Trucks, trailers and wagons used in the field where fresh fruits or vegetables are grown or harvested.
• Slaughter equipment such as stunning devices, evisceration machinery
• Utensils, containers, thermometers and devices
• Boning, grinding and processing equipment
• Tables, ovens, mixers
• Rails, rail supports and conveyors
• Pasteurizers, pressure canners, refrigeration units, water baths, dump tanks
• Growth media used in greenhouses
• Mesh bags, wires, clips, ladders, stakes, elastic bands, gutters, chemical applicators used for growing and harvesting fresh fruits or vegetables.
• Equipment used in cleaning systems such as Clean-In-Place (CIP)

Note: Refer to the separate definitions for conveyance and facility or conveyance .

The term "corrective action" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "corrective action" when used in Part 4 – Preventive Controls of the SFCR, refers to the actions taken to address a deviation from a preventive control plan . This could include controlling affected food as necessary, conducting a root cause analysis and modifying the control measure or animal welfare measure to prevent recurrence.

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "critical control point" as meaning "a step at which the application of a control measure is essential to prevent or eliminate any biological, chemical or physical hazard that presents a risk of contamination of a food or to reduce the hazard to an acceptable level."

The term "critical limit" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "critical limit" when used in Part 4 – Preventive Controls of the SFCR, refers to the maximum or minimum set values that control a hazard at a critical control point.

The Safe Food for Canadians Regulations define "dairy product" as meaning "milk or a food that is derived from milk, alone or combined with another food, and that contains no oil and no fat other than that of milk."

The term "defect detection" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "defect detection" refers to the act of identifying and removing viscera and carcasses with specified pathology and processing defects before and after evisceration.

The Safe Food for Canadians Act defines "document" as meaning "anything on which information that is capable of being understood by a person, or read by a computer or other device, is recorded or marked."

Note: This can include figures, graphs, records , pictures or videos. In addition, a document can be in hard copy or electronic.

The term "dressing procedures" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "dressing procedures" refers to procedures to remove any parts that are not by nature edible and to allow better visualisation of all parts that may harbor a risk.

The term "driving tools" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "driving tools" refers to tools specialized for moving the food animals and can be hand-held tools or automatic equipment. Handheld driving tools include electric or vibrating prods, flags and capes. Automatic driving tools include the automatic gates used for moving pigs onto the gondolas for Controlled Atmospheric Stunning (CAS).

The Safe Food for Canadians Regulations define "egg" as meaning "an egg of a domestic chicken of the species Gallus domesticus or, in respect of a processed egg product , means that egg or an egg of a domestic turkey of the species Meleagris gallopavo . It does not include a balut."

The Safe Food for Canadians Regulations define "egg carton" as meaning "a package that is capable of being closed and of containing not more than 30 eggs in separate compartments."

The term "electrical stunning" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "electrical stunning" refers to stunning done by sending an electric current through the brain and/or heart of the animal before slaughter. Current passing through the brain induces an immediate but non-fatal general convulsion that produces unconsciousness. Current passing through the heart produces an immediate cardiac arrest that also leads shortly to unconsciousness and death; therefore, electrical stunning methods can be either reversible or irreversible depending on the equipment and operational parameters used.

The Safe Food for Canadians Act defines "establishment" as meaning "any place, including a conveyance, where a food commodity is manufactured, prepared, stored, packaged or labelled."

The term "establishment" is used throughout the Safe Food for Canadians Regulations . Part 4 – Preventive Controls applies to "establishment" in the following manner

• (a) manufacture, process, treat, preserve, grade, store, package or label a food, the establishment is the place identified in their licence
• (b) store and handle a meat product in its imported condition, the establishment is the place identified in their licence
• (1) that do not apply to the establishment where the game animal is slaughtered; and

(2) where the facility in the establishment is considered to be the establishment

For more information, refer to Section 2 – Application of Regulatory requirements: Preventive Controls

• In the case of a person who grows or harvests fresh fruits or vegetables, the establishment is the place where the person grows or harvests the fresh fruit or vegetables. Examples of places where fresh fruit or vegetables are grown or harvested include a facility or field

In the case of a person who handles fish in a conveyance, the establishment is the conveyance, such as a fishing vessel, where the person handles the fish

Note: Establishment refers to the facility, the land on which the facility is built and any surrounding area where the food may be manufactured, prepared, stored, packaged or labelled or where food animals may be slaughtered.

The term "export" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "export" refers to sending food from Canada to a foreign state.

The term "export certificate" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "export certificate" includes an export certificate or other export permission, such as being on an export eligibility list.

The term "facility" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "facility" when used in Part 4 – Preventive Controls of the SFCR, refers to the physical structure or building within an establishment where a person is

• manufacturing , preparing , including growing or harvesting fresh fruits or vegetables, storing, packaging or labelling food; or
• slaughtering a food animal ; or
• storing and handling an edible meat product in its imported condition

Examples of facilities include

• packing sheds for fresh fruits or vegetables
• processing plants
• slaughter plants

Note: refer to the separate definition for facility or conveyance .

The phrase "facility or conveyance" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "facility or conveyance" when used in Part 4 – Preventive Controls of the SFCR, refers to the physical structure or means of transportation within the establishment where

• a food is manufactured , prepared , including growing or harvesting fresh fruits or vegetables, stored, packaged or labelled
• food animals are slaughtered
• meat products are stored in their imported condition

Examples of facilities or conveyances include

• fishing vessels where fish is handled
• packing sheds for fresh fruit or vegetables
• facilities where baked good are manufactured
• facilities where milk is processed into yoghurt
• shacks where maple syrup is prepared
• facilities where food animals are slaughtered

Note: refer to the separate definitions for facility and conveyance .

The term "farmed game animal " is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "farmed game animal" refers to a food animal that is historically considered "wild" but has been raised for food production and is transported to an abattoir for traditional slaughter with stunning, eg., bison, musk ox, elk, deer, reindeer, caribou, quail, partridges, pheasants.

The Safe Food for Canadians Regulations define "fish" to include "shellfish, crustaceans and other marine animals, and any of their parts, products and by-products."

The term "fixed place of business" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "fixed place of business" when used in Part 2 – Trade of the SFCR, refers to a permanent, physical business location. A post office box is not considered a fixed place of business.

The Safe Food for Canadians Regulations define "food" as meaning "has the same meaning as in section 2 of the Food and Drugs Act ."

The Food and Drugs Act defines "food" as meaning "any article manufactured, sold or represented for use as food or drink for human beings, chewing gum, and any ingredient that may be mixed with food for any purpose whatever."

The Safe Food for Canadians Regulations define "food additive" as meaning "has the same meaning as in section B.01.001(1) of the Food and Drug Regulations ."

The Food and Drug Regulations define "food additive" as meaning

"any substance the use of which results, or may reasonably be expected to result, in it or its by-products becoming a part of or affecting the characteristics of a food, but does not include

• (a) any nutritive material that is used, recognized or commonly sold as an article or ingredient of food;
• (b) vitamins, mineral nutrients and amino acids, other than those listed in the tables to Division 16,
• (c) spices, seasonings, flavouring preparations, essential oils, oleoresins and natural extractives;
• (d) agricultural chemicals, other than those listed in the tables to Division 16,
• (e) food packaging materials and components thereof; and
• (f) drugs recommended for administration to animals that may be consumed as food."

The Safe Food for Canadians Regulations define "food animal" as meaning "a bird or mammal, other than a marine mammal, from which an edible meat product may be derived."

The term "food animal information document" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "food animal information document" refers to a document that is prepared and attested by the owner, or the person having care and control over the food animal prior to its arrival at slaughter, that details specifics regarding its rearing that will inform as to whether the food animal might harbor potential hazards, such as disease, chemical residues, physical hazards.

The Safe Food for Canadians Act defines "food commodity" as meaning "any food as defined in section 2 of the Food and Drugs Act ; any animal or plant, or any of its parts, from which food may be derived; or anything prescribed to be a food commodity."

Note: For more information on prescribed food commodities, refer to sections 5, 6, 7, 17, 26, 27, and 341 of the Safe Food for Canadians Regulations .

The term "footwear" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "footwear" when used in Part 4 – Preventive Controls of the SFCR refers to outer coverings for the feet, such as shoes, disposable footwear and rubber boots.

The term "foreign animal disease" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "foreign animal disease" refers to a serious epizootic disease from which Canada is considered free, such as avian influenza.

The Safe Food for Canadians Regulations define "fresh fruits or vegetables" as meaning "any fresh plant or any fresh edible fungus, or any part of such a plant or fungus, that is a food is considered to be a fresh fruit or vegetable."

Note: this meaning does not apply for the purposes of section 122. Section 122 covers the requirements for the fair and ethical trading practices of fresh fruits and vegetables.

The Safe Food for Canadians Regulations define "game animal" as meaning "a wild ruminant, pig or bird – including a ruminant, pig or bird that lives in an enclosed territory under conditions of freedom similar to those of wild animals – that is a food animal and that is hunted for commercial use under an authorization issued by a competent authority." Also referred to as wild game animal in guidance documents.

The term "good agricultural practices" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "good agricultural practices" refers to the general practices used in the planting, growing, harvesting, sorting, packing, storing and transporting of agricultural products that reduce risks of contamination.

The term "good manufacturing practices" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "good manufacturing practices" refers to general practices designed to ensure product quality and safety. They set appropriate standards and practices for product manufacturing, storing, handling and distribution.

The verb "to grade" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "grade" refers to examining a food against a set of requirements prescribed in the SFCR and determining the grade for that food.

The Grades and Grade Names requirements in Part 12 of the Safe Food for Canadians Regulations define "grader" as meaning "a person designated as a grader under subsection 13(3) of the Canadian Food Inspection Agency Act for the purposes of the Act."

The Safe Food for Canadians Act defines "grade name" as meaning "a prescribed name, mark or designation of a food commodity."

Section 305 of the Safe Food for Canadians Regulations further specifies that, for the purposes of this definition, "the grade names that are set out in the Compendium and in the Grades Document are prescribed in respect of foods."

The term "handle" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "handle" when used in relation to animal welfare in Part 6, Division 7 – Meat Products and Food Animals of the SFCR, refers to the handling of food animals during all slaughter activities when any person is conducting an activity on the animal to achieve a specific outcome. This would include holding animals in lairage or holding areas, driving or moving, restraining, stunning and cutting to bleed the animal. It also includes the use of any tool or equipment used for the activity.

The term "hazard" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "hazard" when used in Part 4 – Preventive Controls of the SFCR, refers to a biological, chemical or physical agent that has the potential to cause illness or injury to humans when present.

• Biological hazard: Any illness-causing pathogen, micro-organism, pest or vector that poses a danger to human health
• Chemical hazard: A chemical substance, including allergens, that poses a danger to human health
• Physical hazard: A physical substance that poses a danger to human health, such as wood slivers, needles, glass fragments, metal shavings, and shell fragments, among others

The term "hazard analysis" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "hazard analysis" when used in Part 4 – Preventive Controls of the SFCR, refers to the process of collecting and interpreting information pertaining to potential hazards and conditions that may support the occurrence of hazards and identify which ones pose a significant risk to food safety.

The term "hazard analysis critical control point" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "hazard analysis critical control point", when used in the context of Part 4 – Preventive Controls of the SFCR, refers to an internationally recognized food safety system that identifies, evaluates, and controls hazards.

The Safe Food for Canadians Regulations define "hermetically sealed package" as meaning "a package that, due to its design, is secure against the entry of micro-organisms, including spores."

The term "humidity-control system" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "humidity-control system" when used in Part 4 – Preventive Controls of the SFCR, refers to a system that adds or removes water vapour from indoor air to maintain the desired humidity level.

The term "humane killing" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "humane killing", when used in relation to animal welfare in Part 6, Division 7 – Meat Products and Food Animals of the SFCR, refers to the killing of a food animal by an employee of the slaughter establishment to alleviate its suffering or for disease control purposes or for any other reason that it is not slaughtered. Humane killing must be by an approved method, such as acceptable stunning methods that result in the death of the animal, for example penetrative captive bolt. The carcass of the humanely killed food animal is not eligible for human consumption and the carcass must be conveyed to the inedible section of the facility.

The term "import" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "import" refers to bringing food into Canada from a foreign state.

The term "incompatible activities" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "incompatible activities" when used in Part 4 – Preventive Controls of the SFCR, refers to two or more activities that, if they occur simultaneously, sequentially, and/or in close proximity, would present a risk of contamination to the food.

The term "inedible" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "inedible", in relation to a food , refers to food not fit for human consumption, for example spoiled food, or contaminated food.

The term "inedible meat product" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "inedible meat product" refers to any part of a food animal carcass that does not meet the requirements of section 125 of the SFCR. For further specifics refer to the guidance material on Inedible meat products (under development).

The term "insignificant quantity" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . The term is used in the definition of Meat product . In that context, the following foods are not considered a meat product as they include an insignificant quantity of meat:

• Pork and beans
• Traditional bakery products including plum pudding ( Note: does not include bakery products with a meat topping or filling)
• Salad dressings
• Dairy-based dip
• the meat utilized in the cheese originates from a licence holder or its foreign equivalent;
• a statement on the label of the cheese reflects the origin of the meat product; and,
• the cheese containing the meat product was prepared by a licence holder or its foreign equivalent
• Foods, other than meat products, fried in animal fat
• Potato-based foods such as perogies containing not more than 3% meat products
• Flavouring and seasoning preparations
• Fish products in which the only meat product is rendered animal fat
• Capsules, tablets and retail size containers of liquid and powder-concentrates, containing meat or meat by-products, that are intended and labelled for sale as pharmaceuticals or pseudopharmaceuticals rather than as food products
• Foods containing 2% meat product or less other than (g), calculated on the basis of the cooked weight of the meat product

The Safe Food for Canadians Act defines "inspector" as meaning "a person designated under subsection 13(3) of the Canadian Food Inspection Agency Act or paragraph 9(2)(b) of the Canada Border Services Agency Act as an inspector for the purposes of this Act."

The term "interprovincial trade" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "interprovincial trade" refers to the trade of food from one province or territory to another. In the Safe Food for Canadians Regulations , this is referred to as "send or convey from one province to another."

The term "intraprovincial trade" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "intraprovincial trade" refers to the trade of food within a single province or territory.

The term "investigate" is not specifically defined in the Safe Food for Canadians Act (SFCA) nor the Safe Food for Canadians Regulations (SFCR). In general terms, "investigate" when used in Part 4 – Preventive Controls, involves the collection and review of information to determine

• the nature and extent of an issue or complaint; and
• if the food in question presents a risk of injury to human health or does not meet the requirements of the SFCA or SFCR

Generally, the review of information may include conducting sampling, reviewing the process steps that were used in the food production and reviewing relevant documents.

The term "irreversible stun" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "irreversible stun" refers to when the animal does not return to consciousness with time after stunning. This method of stunning is also referred to as stun-kill because the animal may die prior to cutting and bleeding.

The Safe Food for Canadians Act defines "label" to include "a legend, word or mark that is or is to be applied or attached to or included in, or that accompanies or is to accompany, a food commodity or a package ."

The verb "to label" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "to label" refers to applying or attaching a label, including a legend, a word or a mark, to a food or a package of food.

The phrase "land that forms part of an establishment" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "land that forms part of an establishment", when used in Part 4 – Preventive Controls of the SFCR refers to the land on which the facility is built and any surrounding area within the establishment where food may be manufactured, prepared, stored, packaged or labelled or where food animals may be slaughtered.

The term "lesion" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "lesion" when used in Part 4 – Preventive Controls of the SFCR, refers to a region in an organ or tissue which has suffered damage through injury or disease. Examples include superficial or surface cuts, scratches, boils, sores, and skin infections.

The Safe Food for Canadians Regulations define "licence" as meaning "a licence that is issued under paragraph 20(1)(a) or (b) of the Act".

A person who has been issued a licence under paragraph 20(1)(a) or (b) of the Safe Food for Canadians Act .

The term "lot code" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "lot code" when used in Part 5 – Traceability of the SFCR refers to a code that can be used to identify a lot that was manufactured , prepared , produced, stored, graded , packaged or labelled , under the same conditions. A lot code can be numeric, alphabetic or alphanumeric.

Examples of lot code include, production date, best before date, establishment number, or SFC licence number. In addition, for fresh fruits or vegetables (FFV), the lot code may also be the harvest date, grower identification number, GPS coordinates, growing region* or any other code that may be used for traceability purposes.

Note: a growing region cannot be a country of origin. However the growing region may be a province/state or sub-provincial/state within a country.

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "low-acid food" as meaning "a food of which any component has a pH that is greater than 4.6 and a water activity, as determined by the ratio of the water vapour pressure of the component to the vapour pressure of pure water at the same temperature and pressure, that is greater than 0.85."

The term "maintain" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "maintain" when used in relation to a document , includes the review, analysis and updating of a document as necessary.

The terms "maintain" and "maintenance" are not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "maintain" and "maintenance", when used in the context of conveyance, facility or conveyance, and conveyance or equipment in Part 4 – Preventive Controls of the SFCR, refers to their upkeep to make sure that they continue to be suitable for their intended purposes and that they do not become a risk of contamination of a food or, as applicable, a risk of harming a food animal.

The term "manipulated" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "manipulated" when used in Part 5 – Traceability of the SFCR, refers to the ability to alter, edit, or move electronic data using standard commercial software.

The term "manufacture" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "manufacture" refers to making or fabricating a food from raw ingredients or already pre-manufactured ingredients, manually or with the use of machinery.

The Safe Food for Canadians Regulations define "meat product" as meaning "the carcass of a food animal, the blood of a food animal or a product or by-product of its carcass or any food that contains the blood of a food animal or a product or by-product of its carcass. It does not include

• (a) gelatin, bone meal, collagen casing, hydrolyzed animal protein, monoglycerides, diglycerides or fatty acids; or
• (b) any food that contains a meat product in an insignificant quantity , having regard to the nature of the food and of the meat product"

The term "measures" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "measures" when used in the context of the animal welfare preventive control plan, refers to preventive measure procedures or protocols that control the animal welfare risks in order to achieve an outcome of humane handling and slaughter of food animals.

The term "mechanical stunning" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "mechanical stunning" refers to mechanical or percussive stunning requires a device to hit the head with or without penetration. Percussive stunning produces immediate unconsciousness through brain trauma.

The term "monitoring" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "monitoring", when used in Part 4 – Preventive controls of the SFCR, refers to a planned sequence of observations or measurements of control parameters to assess whether a control measure or an animal welfare measure is effective.

The phrase "by or for whom the food was manufactured, prepared, produced, stored, packaged or labelled" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations .

To help you to understand this phrase, please consider the following

• 'by whom' refers to the person who manufactured, prepared, produced, stored, packaged or labelled. For example, food business ABC prepares food. Therefore the name and the principal place of business is that of ABC
• 'for whom' refers to a person who manufactured, prepared, produced, stored, packaged or labelled the food for someone else . For example, food business ABC prepares food for DEF. Therefore the name and principal place of business is that of DEF

The term "non-food chemical agents" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "non-food chemical agents" refer to chemicals in the establishment that are not considered to be a food or food ingredient, including cleaning chemicals, detergents, lubricants, petroleum products, and pest control products.

The term "noxious" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "noxious" when used in Part 4 – Preventive Controls of the SFCR refers to harmful, poisonous, or very unpleasant.

The Fresh Fruits or Vegetables requirements in Part 6, Division 6 of the Safe Food for Canadians Regulations (SFCR) define "onion" as meaning "a fresh onion for which a grade is prescribed by these Regulations."

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "operator" as meaning

• "(a) the holder of a licence to manufacture , process , treat , preserve , grade , store, package or label a food , to store and handle an edible meat product in its imported condition or to slaughter a food animal
• (b) any person who grows or harvests fresh fruits or vegetables ; and
• (c) any person who handles fish in a conveyance ."

The Meat Products and Food Animals requirements in Part 6, Division 7 of the Safe Food for Canadians Regulations define "on-farm food safety program", in respect of food animals, as meaning "a program that is operated on a farm or at a similar place and under which hazards relating to the safety of meat products that may be derived from those food animals are identified, analyzed and controlled."

The term "organoleptic examination" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "organoleptic examination" refers to physical examination using the senses of touch, smell, and sight to determine the wholesomeness and cleanliness of a meat product.

The Safe Food for Canadians Act defines "package" as meaning "an inner or outer receptacle or covering used or to be used in connection with a food commodity and includes a wrapper or confining band."

The verb "to package" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "package" refers to placing a food in an inner or outer receptacle or covering, including a wrapper or confining band.

The term "performance criteria" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "performance criteria" refers to standards by which a given performance is evaluated, while maintaining objectivity and providing information about expectations for a target or goal for which to strive. In the context of the animal welfare preventive control plan , these will be standards of acceptability for the outcomes of the slaughter activities which impact humane handling and slaughter, such as (but not limited to) moving, stunning, cutting and bleeding the animals.

"Person" has the same meaning as in the Criminal Code . When used in Part 4 – Preventive Controls of the Safe Food for Canadians Regulations , "person" can be an individual, including employees, visitors, contractors, inspectors or an organization, including an association, company, or corporation.

The Pest Control Products Act defines "pest control products" as meaning

• "(a) a product, an organism or a substance, including a product, an organism or a substance derived through biotechnology, that consists of its active ingredient, formulants and contaminants, and that is manufactured, represented, distributed or used as a means for directly or indirectly controlling, destroying, attracting or repelling a pest or for mitigating or preventing its injurious, noxious or troublesome effects
• (b) an active ingredient that is used to manufacture anything described in paragraph (a); or
• (c) any other thing that is prescribed to be a pest control product"

The phrase "physical or other effective means" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "physical or other effective means" when used in Part 4 – Preventive Controls of the SFCR, in relation to the separation of incompatible activities , refers to the separation by time, space, or preparation practices.

Examples of physical or other effective means include:

• Scheduling the preparation of ready-to-eat foods before the preparation of raw foods
• Use of separate food preparations lines and equipment
• Use of separate rooms and dedicated employee coverings
• Use of dedicated and colour-coded equipment
• Use of separate storage rooms and areas
• Cleaning in between the preparation of different food

The term "pithing rod" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "pithing rod" refers to a metal rod that is inserted into the stunning hole to cause further disruption of the brain tissue in order to reduce/stop reflexive movements.

The Traceability requirements in Part 5 of the Safe Food for Canadians Regulations define "plain text" as meaning "data that is not encrypted and whose semantic content is available."

The term "post-cut management" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "post-cut management" refers to the time immediately after the cut is executed until the animal dies from exsanguination requires careful post-cut management to mitigate any suffering especially in the case of ritual slaughter because the animal remains conscious until it collapses and subsequently dies from blood loss.

The term "post-mortem defect management program" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "post-mortem defect management program" refers to a program that must be authorized by the Canadian Food Inspection Agency and would permit a licence holder, under the supervision of a veterinary inspector, to conduct a post mortem screening of the carcasses, parts and blood of food animals. Post-mortem defect management includes the screening (detection and identification) of defects of carcasses and parts prior to the beginning of the post-mortem inspection, and the management of defects detected before post-mortem inspection is completed, along with other elements set out in the document Fundamentals of the Post Mortem Defect Management Program , incorporated by reference in the SFCR.

The term "post-mortem examination program" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "post-mortem examination program" refers to a program that must be authorized by the Canadian Food Inspection Agency and would permit a licence holder to conduct post-mortem examinations of the carcasses, parts, and blood of food animals, under the supervision of a veterinary inspector. Post-mortem examination includes the detection of defects of carcass and parts along with the other elements set out in the document Fundamentals of the Post-Mortem Examination Program , incorporated by reference in the SFCR.

The term "potable water" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "potable water", when used in Part 4 – Preventive Controls of the SFCR, refers to water that is safe to drink.

The Fresh Fruits or Vegetables requirements in Part 6, Division 6 of the Safe Food for Canadians Regulations (SFCR) define "potato" as meaning "a fresh potato for which a grade is prescribed by these Regulations."

The Safe Food for Canadians Regulations define "prepackaged", in respect of a food , as meaning "packaged in a container in the manner in which the food is ordinarily sold or used or purchased by a person , and includes consumer prepackaged ."

The Safe Food for Canadians Act defines "prepare", in respect of a food commodity , to include " process , treat , preserve , handle, test, grade , code or slaughter it or to do any other activity in respect of it that is prescribed." The Safe Food for Canadians Regulations further prescribe the activity of growing and harvesting as preparing.

The term "to preserve" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "to preserve" refers to applying a process or treatment to a food to prevent its decomposition. However, it does not include storing the preserved food in a temperature controlled facility for the exclusive purpose of maintaining the preserved condition and quality of the food.

The term "preventive controls" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "preventive controls" when used in Part 4 – Preventive Controls of the SFCR refers to a combination of measures to achieve compliance with regulatory requirements that forms a system focused on prevention to control risks to food and to food animal welfare during slaughter activities.

The term "preventive control plan" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "preventive control plan" refers to a written document that demonstrates how risks to food and food animals are identified and controlled.

The term "primary production" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "primary production" refers to the growing, cultivation, picking, harvesting, collection or catching of food. Some examples of primary producers include fish and shellfish harvesters (including wild and aquaculture), egg farmers, dairy farmers, honey producers and maple sap producers.

The Safe Food for Canadians Regulations define "principal display panel" as meaning

• ( i ) all or part of the principal display surface, or
• ( ii ) all or part of the surface of the display card that is displayed or visible under customary conditions of sale or use
• ( i ) to all or part of the bottom of the container,
• ( ii ) to all or part of the principal display surface, or
• ( iii ) to all or part of a tag that is attached to the container
• (c) in the case of a consumer prepackaged food whose container is not described in paragraph (a) or (b), the part of the label that is applied to all or part of the principal display surface
• ( i ) that is applied or attached to all or part of the surface of the container that is displayed or visible under customary conditions of sale or use, or
• ( ii ) if the container does not have a surface described in subparagraph ( i ), that is applied to any part of the container except any part that is the bottom of the container; or
• (e) in the case of a food that is not a prepackaged food, the part of the label that is applied or attached to all or part of the surface of the food that is displayed or visible under customary conditions of sale or use"

The verb "to process" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "process" refers to a series of steps taken in order to prepare a food; a series of changes to a food.

The Safe Food for Canadians Regulations define "processed egg product" as meaning "a food for which a standard is set out in Volume 2 of the Standards of Identity Document ."

The Safe Food for Canadians Regulations define "processed fruit or vegetable product" as meaning "a fruit or vegetable that is in a hermetically sealed package and is commercially sterile or that has been cooked, frozen, concentrated, pickled or otherwise prepared to assure its preservation and

(a) for which a standard is set out in Volume 4 of the Standards of Identity Document ;

(b) for which a grade is set out in Volume 3 of the Compendium ; or

(c) that is identified as a processed fruit or vegetable product in the Standard Container Sizes Document ."

The term "protective covering" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "protective covering" when used in Part 4 – Preventive Controls of the SFCR refers to items used to protect and cover the body or clothing. Examples include lab coats, aprons, gloves, sleeve coverings, smocks, coveralls, hairnets, beard nets and boot covers.

The term "provide" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "provide", when used in relation to food in Part 5 – Traceability of the SFCR, refers to give, supply, sell or to be picked up by another person.

The term "qualifications" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "qualifications" when used in Part 4 – Preventive Controls of the SFCR refers to a quality or accomplishment that makes someone suitable for a particular job or activity.

This may include a combination of formal education or training, knowledge, experience, skills, abilities or evaluation that would make a person suitable to perform a particular activity or duty. Qualifications should be demonstrated by some sort of documented proof, for example a diploma, certificate of completion.

The Safe Food for Canadians Regulations define "ready-to-eat", in respect of an edible meat product , as meaning "that it has been subjected to a treatment or process that is sufficient to inactivate vegetative pathogenic micro-organisms or their toxins and control spores of food-borne pathogenic bacteria so that the meat product does not require further preparing before consumption except washing or thawing or exposing it to sufficient heat to warm it without cooking it."

The term "recall" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "recall" refers to the removal of a food from further sale or use, or the correction of its label, at any point in the supply chain as a risk mitigation action.

The term "receiving" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "receiving" of the food animals in the context of animal welfare provisions under the SFCR refers to the licence holder's responsibilities for the animals that are received for slaughter begins the moment the truck with the food animals or containers of food animals arrives at the gates of the premises of the establishment identified in the licence. This also means that the licence holder is responsible for ensuring there will be personnel available to receive and to assess the animals upon their arrival.

The term "reclaimed water" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "reclaimed water" when used in the context of Part 4 – Preventive Controls of the SFCR refers to water that has been removed from a food and that is intended to be re-used in the establishment where food is prepared.

The term "record" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "record" refers to a type of document used to capture observations, measurements, and other data.

The Safe Food for Canadians Regulations define "refrigerated", in respect of a food , as meaning "that it is kept at a temperature of 4° C or less, without being frozen."

The term "regulated party" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "regulated party" refers to a person, including an individual, corporation, partnership or organization, who is subject to the Acts and Regulations administered by the Canadian Food Inspection Agency.

The term "rejection" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "rejection" refers to treating as inedible , by the licence holder , any part of a carcass that presents a defect.

The term "rejected" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "rejected" in relation to eggs , refers to eggs that have been assessed by the grader and determined to not meet the grade criteria described in the Canadian Grade Compendium, Volume 5 . Rejected shell eggs are not eligible to be used as food for humans.

The term "reportable disease" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "reportable disease" refers to a disease listed in the Reportable Diseases Regulations that must be reported/declared to the Minister.

The term "reprocessing/reconditioning" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "reprocessing/reconditioning" refers to a process by which defects are removed from within the abdominal cavity of a carcass by vacuuming, scraping, trimming, or a combination thereof.

The phrase "restaurant or other similar enterprise" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, this phrase when used in relation to the traceability and licensing requirements of the SFCR includes sit-down, buffet, fast food or take-out restaurants, cafeterias, caterers, food stands or wagons and ice cream or coffee shops.

The term "restraining equipment" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "restraining equipment" in relation to food animals, refers to equipment used to restrain food animals during their handling, assessment, ante-mortem examination, and inspection. These include chutes, head gates, crates, and crowding gates, among others.

The term "restraint" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "restraint", in relation to slaughter, refers to either manual that will require at least one person to hold the animal firmly, gently and calmly or it is restraint equipment that may be specialized, as in the case for ritual slaughter that must be able to immobilize the animal well without causing it distress or pain.

The term "retail" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "retail" refers to the sale of food to consumers for consumption. Examples include supermarkets, farmers' markets, grocery stores, bakeries and butcheries.

The term "reversible stun" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "reversible stun" refers to when the animal returns to consciousness after stunning with time unless slaughtered or humanely killed.

The term "ritual slaughter" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "ritual slaughter" refers to the practice of slaughtering livestock for meat in the context of a ritual. Ritual slaughter involves a prescribed method of slaughtering an animal for food production purposes. The requirements are outlined in the religious rules for Jewish Shechita or Islamic Ḏabīḥah slaughter, with any deviation from the protocol rendering the resulting derived meat non-Kosher or unfit as Halal.

The term "ritual slaughterer" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "ritual slaughterer" refers to the person who conducts the ritual slaughter either without stunning or with pre-cut or post- cut stunning must be qualified and skilled to conduct the ritual cut properly, in accordance with these regulations and in accordance with the religious laws for Jewish Shechita or Islamic Ḏabīḥah slaughter.

The Safe Food for Canadians Regulations define "sanitary condition" as meaning "a condition that does not present a risk of contamination of a food."

The term "sample of a shipment" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "sample of a shipment", in relation to food animals received in crates or cages as part of a truckload/shipment, refers to a number that sufficiently represents the whole shipment to ensure that food safety, reportable disease and animal welfare conditions will be detected if present in the shipment.

The term "sanitize" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "sanitize" when used in Part 4 – Preventive Controls of the SFCR refers to the reduction of microorganisms to levels that are considered safe from a public health viewpoint. Examples of sanitization methods include:

• Thermal sanitization – the use of hot water or steam for a specified temperature and contact time.
• Chemical sanitization – the use of an acceptable chemical sanitizer at a specified concentration and contact time.

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "scheduled process" as meaning "a process in which a treatment is applied to a food to render the food commercially sterile , taking into account the critical physical and chemical factors that affect the treatment's effectiveness."

The term "self-audit" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "self- audit" refers to a self or internal or first party audit conducted by employees of the slaughter establishment. For animal welfare audits, the employee must have the appropriate competency to conduct them and must be able to report audit findings objectively to give meaningful results.

The Safe Food for Canadians Act defines "sell" as meaning "includes agree to sell, offer for sale, expose for sale or have in possession for sale – or distribute to one or more persons whether or not the distribution is made for consideration."

The phrase "semantic content" is not specifically defined in the Safe Food for Canadians Act s nor in the Safe Food Regulations (SFCR). In general terms "semantic content" when used in Part 5 – Traceability of the SFCR refers to the meaning in language or logic of the lot code or unique identifier .

The phrase "send or convey from one province or territory to another" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, this phrase refers to the trade of food from one province or territory to another, and is often referred to as inter-provincial trade .

The Safe Food for Canadians Regulations define "shellfish" as meaning "a bivalve mollusc of the class Bivalvia or a carnivorous marine mollusc of the class Gastropoda, or any product that is derived from one of those molluscs."

The term "single file" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "single file", when used in Part 5 – Traceability of the SFCR, refers to electronic data that can be contained within one, concise file. For example, data that can appear on one page and is not unreasonably separated into multiple pages.

The term "slaughter" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "slaughter" of the individual animal is one of the slaughter activities . It is the activity during which the animal is bled out or exsanguinated completely to result in the food animal's death, except for cases where the stun method itself or humane killing method results in the animal's death prior to the bleed out stage.

The term "slaughter activities" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "slaughter activities" refers to all actions taken by a licence holder on a food animal from its receiving at the slaughter establishment until the time its carcass is cooled. Slaughter activities in the context of animal welfare apply to the live animal prior to its death.

The term "sound construction" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "sound construction" when used in Part 4 – Preventive Controls of the SFCR in relation to facility or conveyance , refers to the construction of the facility or conveyance being of good condition. For example, this includes free from flaw, defect, or decay.

The Meat Products and Food Animals requirements in Part 6, Division 7 of the Safe Food for Canadians Regulations define "specified risk material" as meaning "has the same meaning as in section 6.1 of the Health of Animals Regulations ."

The term "standard commercial software" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "standard commercial software" when used in Part 5 – Traceability of the SFCR refers to non-specialized software which would normally be purchased and used by the general public.

The Safe Food for Canadians Regulations define "Standards of Identity Document" as meaning "the document entitled Canadian Standards of Identity, prepared by the Agency and published on its website, as amended from time to time."

The Preventive Controls requirements in Part 4 of the Safe Food for Canadians Regulations define "starter products" as meaning "the materials that are used to start growing fresh fruits or vegetables and includes seeds, seedlings, plants, cuttings, canes, seed potatoes and nursery stock."

The term "station" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "station" refers to work spaces that allow for post-mortem examination or screening by the licence holder's employees, or, in the case of "inspection stations at fixed locations", work spaces determined in number and location by the Canadian Food Inspection Agency to allow for post mortem inspections by inspectors, including veterinary inspectors.

The phrase "storing and handling an edible meat product in its imported condition" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, this phrase refers to preparing edible meat products for inspection by the Canadian Food Inspection Agency (CFIA). Examples of activities which may occur under an SFC licence for "storing and handling an edible meat product in its imported condition" for the purpose of inspection include

• extracting samples (cutting, drilling or sawing)
• freezing, packaging, staging, thawing, trimming or unpacking
• refrigerating or storing at room temperature
• removing parts with defects or contamination

The term "stunning" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "stunning" refers to the process of rendering animals unconscious, with or without killing the animal, when or immediately prior to slaughtering them for food.

The term "temperature-sensitive indicator" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "temperature-sensitive indicator" when used in Part 4 – Preventive Controls of the SFCR refers to an indicator that changes in appearance after exposure to high temperature. These are heat specific in that the process temperature has to have been attained to result in the colour change. Temperature sensitive indicators come in various forms including

• paints, lacquers, crayons or pellets that change shape or texture; and
• tapes, labels or chemical inks that change colour

Note: Colour change is only an indication that containers have been subjected to heat, and are not a means to verify that an adequate heat process was performed.

The term "third-party animal welfare auditor" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "third-party animal welfare auditor" refers to independently contracted auditors qualified through a recognized auditing program or organization.

The term "traceability" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "traceability" refers to the ability to track the movement of a food or food commodity one step forward and one step back in the supply chain.

The Safe Food for Canadians Regulations define "tray", in respect of eggs , as meaning "a package, other than an egg carton, that is capable of containing not more than 30 eggs in separate compartments."

The verb "to treat" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "treat" when used in Part 4 – Preventive Controls of the SFCR refers to applying a process or a substance to a food to protect it or to give it particular properties.

The term "unique identifier" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "unique identifier" when used in Part 5 – Traceability of the SFCR, refers to a code that can be used to identify a defined quantity of food. This may include a lot code , purchase order number, or a bill of lading number.

The term "verification" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "verification" when used in Part 4 – Preventive Controls of the SFCR refers to the application of methods, procedures, tests and other evaluations, in addition to monitoring , to determine whether the control measure or animal welfare measure is and has been operating as intended.

The term "veterinarian with supervisory authority " is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "veterinarian with supervisory authority" refers to a CFIA veterinary inspector who is authorized to supervise inspection staff in an establishment and is referred to as veterinarian -in-charge (VIC) of an establishment.

The Meat Products and Food Animals requirements in Part 6, Division 7 of the Safe Food for Canadians Regulations define "veterinary inspector" as meaning "a person who is designated as a veterinary inspector under subsection 13(3) of the Canadian Food Inspection Agency Act for the purposes of the Act."

The term "waste" is not specifically defined in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations (SFCR). In general terms, "waste" when used in Part 4 – Preventive Controls of the SFCR includes a material, substance, or by-product that is discarded as no longer useful or required.

The term "wild game animal " is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "wild game animal" refers to a ruminant, porcine or bird that lives in the wild and that is slaughtered by means of hunting and reflects the meaning of "game animal" in the SFCR.

The term "zoonosis" is not used in the Safe Food for Canadians Act nor in the Safe Food for Canadians Regulations . In general terms, "zoonosis" refers to an infection or disease that is transmissible between animals and humans.