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Business planning

The business plan is the key document which sets out the strategy by which the development trust will achieve its objectives - whether they are social, economic or environmental - and also stay in business. During the setting up process an early draft of the business plan can act as a 'bid document' by which the steering group can seek core funding. The business plan makes the case for establishing the trust in the area, outlines the projects or programmes it will work on, and describes the team of Board and staff needed. At the heart of the plan should be a financial projection. This should show how the trust will balance three main elements:

  • The surpluses or deficits generated by projects. Some will be 'earners' and some 'spenders', making a net contribution or call upon the core budget of the trust.
  • The core costs of running the trust - its staff, office and other overhead costs.
  • The core funding provided by one or more funders.

Trust finances are even more difficult to manage than those of a small firm. They rely partly on grants which are uncertain; some of the projects are deliberately unprofitable; decisions rest with a Board representing a variety of interests. Consequently the trust staff and Board can end up scrambling to bridge a gap between expenditure on desirable projects and inadequate capital, while worrying about the security of their jobs. In these circumstances it is not enough to have an honorary treasurer and competent auditors - or even a good book-keeper. At best that's like trying to drive while looking through the rear window, with a few glances to the side. What is needed is a financial strategy - expressed through the business plan - which looks forward.

Key issues

In developing a business plan it is important to grapple with a number of key issues which will determine the success or failure of the organisation:

  • What is the mission or purpose of the trust? Rather than a set of vague aims and objectives, try and identify and express the tangible or visible outcomes the trust will achieve. These, together with a brief summary of methods, can be developed as mission statement to use to funders and potential supporters.
  • What is the core business - what is the trust going to be really good at? What will it do that is not being done already? How will it provide value to those it serves?
  • The competences. What particular skills, contacts, influence will be needed in Board and staff to carry out the trust's mission?

Preparing the plan

The plan must be prepared by the trust itself, or by the steering group or development officer in advance of the trust's formation. It can't be done effectively by outsiders, although they can provide advice. The plan must have the backing of any initial sponsoring organisations. The maximum realistic timescale for a business is likely to be five years, with six-monthly reviews.

What the plan should include

The following is a suggested outline for a business plan for a community development trust.

1 Summary

A one-side summary at the beginning of the business plan, with some conclusions and an assessment of the trust's likely position in five years time.

2 Context - the area and the trust

Profile of the area (including map) covering:

  • Geography and communications
  • Social and cultural environment
  • Economic environment
  • Physical environment

These issues could be covered in terms of a SWOT analysis of the area - strengths, weaknesses, opportunities and threats, plus trends. The community development trust

  • History of the trust
  • The main partners: their roles and interests

3 Mission statement/Statement of aims

A brief encapsulation of why the trust is needed, what it aims to achieve, and how it will do this. This should also cover the values or principles on which the trust will operate. A longer description of outcomes, targets or objectives. This section could cover the main programme areas of the trust e.g.

  • Employment
  • Environment
  • Leisure, recreation
  • Community development etc.

(These will also be used in section 12 below)

4 SWOT analysis of the trust (optional)

The strengths and weaknesses of the organisation, and the opportunities and threats that it faces.

5 Projects

A summary of the projects which the trust is planning to carry out:

  • Project 1 description, financial summary
  • Project 2 description, financial summary
  • Project 3 etc

(full business plans for each of the projects should be included in appendices: see below) This detail may not be possible in an initial bid document, in which case refer to the programme areas under section 3.

6 Communications strategy

How the trust plans to communicate and market its overall strategy and projects to a range of audiences:

  • The local community and organisations
  • The local authority
  • The private sector
  • Generally

7 Organisational structure

  • Legal form, constitution, membership, Board, sub-committees etc
  • Legal relationships between the trust and its projects, if any of these have their own management arrangements
  • Agreements with main partners or sponsors
  • Staffing structure

(This section may include flow charts showing lines of responsibility and accountability)

8 Human resource strategy

The involvement and personal development of those associated with the trust:

  • Development of membership
  • Training for Board and staff
  • Staff time budgets (optional)

9 Financial strategy

Where the funds will come from to run the trust and develop projects, and how this will be managed:

  • Sources of grant income
  • Fundraising strategy
  • Financial control system

10 Financial projections

An annual budget and projections over five years showing, in particular, how far project income will cover core costs, and how the deficit will be made up

  • Profit and loss forecast
  • Cash flow forecast
  • Balance sheet forecast

11 Monitoring outcomes

The criteria for evaluation of the trust's performance, under each heading identified in the mission statement. They should include 'internal' criteria (e.g. membership and training). The outcomes should preferably be measurable, and might include, for example:

  • Number of jobs created
  • Training opportunities
  • Employment opportunities for disadvantaged groups
  • Environmental improvements
  • Recreation opportunities

12 Objectives for next year and the following years.

These should be set out under each of the criteria and dated

13 Implementation plan

Who will do what and when to put the business plan into practice.

14 Appendices

In a full business plan a mini business plan should be written for each project covering:

  • Background to the project
  • Aims of the project
  • Description of the project in terms of product or service, market and customers, pricing policy, promotional policy, premises and equipment required.
  • Organisational structure and staffing
  • Financial projections for the project
  • Financial requirements of the project
  • Objectives for the first year of the project
  • Implementation plan for the project


  • Does your trust have a bid document or business plan developed by the steering group or Board and staff?
  • Does the plan cover: the nature of the area served by the trust? why the trust is needed, and the benefits it will bring to different interests? a programme of projects?
  • Does the plan contain a five year financial projection showing how to balance: project surpluses or deficits? core costs of staff, offices and overheads? core funding?
  • Is there a description of the staff team and Board, and the management structure?
  • Does the plan explain how you will know whether you are succeeding or failing?
  • Is regular reference made to the plan: when developing more detailed plans and strategies? when talking to potential funders? when evaluating progress? when producing communication materials?
  • Is the plan reviewed periodically by the Board?

© David Wilcox Tel +44 (0)1273 677377. Fax: +44 (0)1273 677379. These information sheets may be freely distributed with this attribution, but not republished as a whole. Partnerships Online : The Guide to Development Trusts and Partnerships: other sheets

partnerships/azp/bus.txt · Last modified: 2017/06/12 10:20 (external edit)