How to write a basic business plan

In this article ’ll show you how to write a basic business plan

Do you need to write a business plan?

In this article I’ll show you the rules to follow and the format to adopt in order to produce a successful document. I’ll explain why it’s a good idea to follow those rules and suggestions and I’ll point out some common pitfalls to avoid while you’re doing it.

The process and format I recommend will work well for the vast bulk of business plans, whether they are shorter or longer, basic or more complex. They apply regardless of what you intend to use your plan for (e.g. going into business with a partner, raising external funding or for any other reason).

Don’t confuse doing business planning with creating a business plan

Before I get into the details, it’s important to clarify the difference between creating a business plan and conducting business planning. Because every entrepreneur needs to do business planning but most of them don’t need write a business plan.

Business planning is something you do regularly (I suggest every three months). It’s the process of putting in place short-term actions that implement your long-term strategy. It should cover topics like business growth initiatives (e.g. new product launches), required resources (e.g. new staff hires), updated financial forecasts and funding needs (i.e. having enough cash to pay your bills on time).

Creating a business plan is different. A business plan is a longer, formal document you prepare on a one-off basis for a particular purpose. It takes some effort to together even a basic business plan so don’t do it unless you need to.

If you want to know how to do business planning effectively and you don’t need to create a business plan, try reading our separate article on small business planning and why it’s important.

Some reasons why you may need to write a business plan

While it requires effort, there are good reasons why some entrepreneurs go to the trouble of creating a business plan.

First, writing a business plan can be part of the process of creating a shareholder agreement. If you’re going to go into business with a partner, you could be putting a lot at stake – your time, your money and your emotional energy. Before you do that, it’s a very good idea for you and your partner(s) to be clear with yourselves and each other about what you’re getting into.

By putting things down on paper, you’ll think through the costs and implications of your plans more thoroughly than if you just talk about them. In a worst case, if a business partner lets you down (e.g. by not fulfilling the commitments they made to develop the business) your business plan could provide you with evidence that helps you recover any money you’ve lost as a result.

Second, a business plan is usually essential if you want to raise funding from an outside investor. Your potential backers will rely heavily on the content of your business plan to decide whether or not to invest in your company. If you’re looking for a loan then your bank or other lender will probably also want to see your plan.

Finally, entrepreneurs sometimes create a business plan because they think it will give them better control over the future development of their company. This can be true, but before you set to work, consider this.

If you’re an established business and you find it hard to put your strategy into action, this is probably not a good reason to create a business plan. Simply writing down your plans won’t guarantee you implement them. What you really need is an effective business planning process (which I touched on above) backed up by a well designed set of management routines.

However, if you’re planning to launch several initiatives that are so important they could transform your business and you’d like to create a road map that everyone in your company can consult, then a formal business plan might be a good idea.

Some general rules and principles to follow as you create your business plan

Document formats you can use

As a general rule, write your business plan in a Word document (or similar). It should look like a traditional report.

If you’re going to meet an investor face to face to pitch your business plan then you may also choose to create an accompanying PowerPoint slide deck. The slide deck will be a slimmed down version of your report with bullet points and tables or charts that prompt you to elaborate on your key topics. This should help you present your case more naturally in your pitch meeting.

You can always have the full report to hand as a reference document (or include appendices in your PowerPoint slide deck).

Document structure and chapter headings

Structure your business plan like this:

• Start with an executive summary that communicates the key elements of your plan.

• Organise the main body of your report into chapters, one for each key aspect of your business.

• Add supporting material in appendices at the end of the report for anyone who wants more detail (for example data on your market or the technical performance of your product).

I have organised this article into sections that reflect the chapter structure I recommend you follow in the main body of your business plan. Here are my suggested chapter headings:

• Business description

• Market demand

• Competition

• Strategy

• Operations

• Forecasts

Choose the right document length for your purpose

How long should your business plan be?

Your executive summary should typically contain 1-2 short paragraphs on each of the chapters you include in the body of your report. How long you make each of those chapters is up to you but your business plan usually shouldn’t go much over 30 pages in total. If it is, try reviewing the topics you’re covering and cutting back the chapters that are less crucial.

If you just need a basic business plan, your document can be far shorter than that. Lots of authorities on entrepreneurship argue that you should be able to summarise your business plan on one page. I agree, but a one pager isn’t a full business plan – it’s more a short executive summary. But there’s no reason why you can’t write a basic business plan in 5 pages.

In the end, there’s no hard and fast rule on length:

• The right length depends on what you’ll use your plan for. If you hope to raise external funding it will likely need to be longer than if you’ll just use it as an internal road map for your team.

• It also depends on your unique business – some business plans simply need more explanation than others.

And however short or long you make your business plan, I still recommend you follow the structure and chapter headings I set out above.

Use appropriate writing style and language

If you’re writing your business plan purely for the use of people inside your business, feel free to use whatever writing style and language you wish. But if there’s a chance you’ll want to present it to anyone external, I strongly recommend you use formal business language.

That doesn’t mean using long words and sentences. But it does mean avoiding the use of slang and ensuring you use correct spelling, punctuation and grammar.

It should hardly need saying, but you must write your business plan in a way that’s clear and easy to read. Your arguments should be organised in a logical order and your writing should be easy to understand. Investors see lots of business plans every week.

If you make it hard work to read your plan then your reader may give up and move on.

Know your reader and write from their perspective

Write your business plan from the perspective of the reader. And not just any reader either. If you have a particular reader in mind then write your business plan as if you were writing a one-to-one letter or having a one-to-one conversation with that person.

Don’t talk about yourself and how you aim to benefit from the growth of your business – talk about what’s in it for your reader. Don’t assume knowledge of your company that an outsider wouldn’t have. And don’t use jargon from your industry they might not be familiar with.

If you’re writing your business plan for an investor, it’s crucial to cater for the particular type of investor you’re dealing with. In particular, are you writing for an investor who is going to extend you a loan or one who is going to contribute equity (i.e. become a shareholder in your business alongside you)? Debt and equity investors have very, very different priorities.

For a debt investor (i.e. someone who lends you money), their best case scenario is to get paid back what you owe them in full and on time. If your business becomes a roaring success, it’s simply not relevant for them. They are cautious and conservative and won’t want you to take more risk than you absolutely must.

For an equity investor, things look very different. They want your business to be as successful as it can possibly be because they share in that upside. They will likely encourage you to take risk, partly because they have other companies in their portfolio they can fall back on if your business fails. (That’s an important difference between your point of view and theirs).

You should bear these different perspectives in mind as you compile your business plan. That’s not to say you should twist your arguments around to please a particular audience – you shouldn’t. But you should tailor the space you give to each topic so as to cover the issues that matter to your reader in enough detail for them to take their investment decision.

Include historic data where it aids understanding

If you’re an established business with a track record, that’s great. You can use the data from your historic performance to back up your arguments about how your business will develop in the future. But be sure only to use as much historic data as you need to make your points convincingly.

Your reader is mainly interested in the future. Don’t wander into giving them a history lesson. Your plan should not include a data dump of what happened in the past. It’s not relevant and will only bore your reader.

Make sure your plan is credible

Your business plan must be credible. What does that mean exactly?

On one hand, you shouldn’t underplay the potential of your business. If you’re writing for an investor, bear in mind they run a portfolio. They know they’re going to lose money on some of the businesses they back. The trick is to invest in a few opportunities that return them 10x what they invest.

With that in mind, you can be optimistic about your prospects. The investor wants you to paint them a picture of all the things that could go right. What would be the potential for your business if all your plans come off? If you don’t show them how great the upside could be, don’t be surprised if they don’t back you.

On the other hand you need to avoid making excessively gung-ho assumptions that veer into plain over-optimism. Your analysis of your future prospects and the assumptions you make in your forecasts must be capable of being achieved in the real world. And nobody hits the bullseye 100% of the time.

You should also be careful to communicate the main risks your business will face. If you don’t, your reader may assume you’re seeing the world through rose-tinted spectacles and you’re unprepared to deal with the inevitable problems that arise from time to time in any small business.

A key part of staying realistic is to use facts to back up as much of what you write as you can. I touch on this below in the sections on your market and competition. When you do need to make estimates to fill in the gaps where you can’t provide real world evidence of key points, you must make it clear that you’re relying on your own assumptions.

If your reader is an investor you can assume they’ve read many business plans before and will spot bluster or over-optimism from a mile away.

Executive summary

Your executive summary appears at the start of your business plan but you should write it last. That’s because you won’t be sure what to put in it until you’ve finalised the body of your report. Going through this process should help you clarify in your mind which issues will be most important for your reader.

As I mentioned above, your executive summary should typically contain 1-2 short paragraphs on each of the chapters you include in the body of your report. That’s around 6-12 paragraphs – probably 1-2 pages of text.

When you come back to complete your executive summary, consider following these principles:

• The executive summary is the main sales pitch for your business plan. It must hook your reader’s attention and persuade them to keep reading or get in touch with you.

• Your executive summary should enable the reader to grasp the gist of the investment case for your business without reading the whole document. If the reader is a key decision maker they may delegate most of the reading to someone else. Or they may prefer to hear you pitch your business to them in person.

• Weave the most important arguments from the body of your report into a coherent narrative. Tell the reader the story of why you’re launching or growing your business and why it’s going to be a success.

• Where possible, quantify your conclusions. Some of what you write will inevitably be qualitative. But you must back up your arguments with some numbers as well.

Business description

Immediately after your Executive Summary you should start with a chapter that explains your business (or your business idea if you’ve not yet launched it).

To help the reader orient themselves, explain what do you, how you do it and for whom. In the jargon, this is your ‘business model’. This basic information will give your reader the context they need to understand how your later chapters fit together.

If you operate in more than one business segment then explain this up front. To know whether you should split your business into segments, ask yourself whether the products you sell or the customers you serve have very different profiles. Are some products much more profitable than others? Do you expect your sales to grow much faster with some types of customer than others?

If you expect all your products and customers to contribute equally to the future growth of your business then you may well operate in just a single segment. If you expect one part of your business to become much more important than the others then you should highlight this at the start.

You should also set the scene by including some basic financial information about your business. You can wait until the chapter on financials to communicate the details but you should include enough information at the start for the reader to understand the bare bones of your financial situation.

For example, how much revenue are you generating at present and how have your revenues grown over the last 1-3 years? What are your profit margins at present and how have they developed? How much cash do you have on hand? In a couple of sentences, how do you expect those key items to develop over the coming 1-3 years and why?

Market demand

Once you’ve explained what you do, it’s time to quantify how big your market is, how fast it’s growing and how large it could become in the future.

You will have plenty of qualitative points to make in this chapter. For example, you should explain the key drivers of market demand. You should also highlight to readers any future milestones or key events that will demonstrate that your market growth thesis is playing out.

But it’s also essential to put some numbers on the size of your market and how fast it’s growing.

It’s vital to do a rigorous job here. You must demonstrate to your reader that your market will grow large enough for the value of your company to increase sharply in future. If your reader can’t easily see that your market will be large enough to bother targeting they will probably stop reading and move on to their next pitch.

There are broadly two sources of data you can pursue to quantify the size of your market.

If you’re lucky, you’ll be able to access good quality independent data about your market. This is most likely if your market is quite well established already. In this case you might not be promising to invent a new paradigm business but your reader will be able to get comfortable with how big the pie is that you’re aiming at.

Here are some sources of third party market data you might be able to tap:

• A number of private sector market data providers exist including IBISWorld (https://www.ibisworld.com/) and Statista (https://www.statista.com/). Obtaining data from these sources will cost you money but the data can be very helpful for your pitch.

• The UK’s Office for National Statistics (ONS) (https://www.ons.gov.uk/) makes a lot of data on the UK economy available to the public free of charge.

• UK government departments (try the www.gov.uk website) and UK parliamentary reports (try https://committees.parliament.uk/publications/) also make data available to the public free of charge.

(Before including third party data in a business plan you intend to provide to third parties, make sure you’re complying with any copyright restrictions).

The second potential source of market data is your own primary research.

Even if you’ve been able to obtain market data from reputable third parties, don’t omit to test those data against your own real world experiences. You must get out and speak to actual and potential customers. Do they seem as numerous as you would expect based on the market data you’ve obtained from third party sources? If not, are you sure the third party data are reliable?

Doing your own field research and incorporating it in your report will add credibility to your business plan. It will show you’re open-minded and have validated the assumptions on which you’re basing your business plan. Your reader will see that you have good entrepreneurial instincts as well as the commitment and energy you’ll need to grow your business.

If you’re a startup business you may not be able to find any third party data to back up your market size estimates. If so, don’t worry – it’s a common problem. Just be imaginative and consider using unconventional approaches to fill in the information gaps you face. Then be up front about the methodologies you’ve used to build your estimates.

Competition

Next it’s time to discuss the competition you’ll face as you scale up your business.

Your report should include a list of the companies you compete against together with your thoughts about their strengths and weaknesses. What do they do particularly well and how has that helped them build their current franchise with customers? Do they have weak points (where they execute poorly) or gaps in their business model (e.g. products or services they simply don’t offer)?

Make sure to compare your own business strengths and weaknesses to these competitors. Don’t focus too much on how strong or weak they appear in absolute terms. Competition is mainly relative so how they stack up relative to your offering is at least as important.

As you do this, it’s vital to remain objective. If your business currently has weak points, acknowledge these and refer to your later chapter on strategy. It’s there that you’ll explain the actions you intend to take to strengthen your proposition, beat off your peers and win in your market.

Above all, never ignore your competitors or dismiss them. If you make disparaging comments about competitors it will usually raise a red flag for your reader – they’ll assume you’re too emotional about your business and lack the perspective to learn and improve.

As you compile your list of competitors, don’t limit yourself to your direct competition. Companies sometimes face indirect competition that can be even more important than the direct sort.

For example, if you’re active in an emerging industry, customers may simply not use anything like your product or service at all. In this case, your competition may be inertia (i.e. continue to make do without) or an imperfect workaround (often a manual or otherwise inefficient process). For example, many software companies effectively compete against spreadsheets.

Another indirect competitor is in-house staff carrying out work that specialist providers offer on an outsourced basis. Even if it would be better, quicker and cheaper to go down the outsourcing route, persuading companies to ‘sack’ an in-house team can be challenging.

Your strategy, when you come to it later on, will need to tackle issues like these directly.

Finally, don’t think about competition from a static point of view – in many industries it changes constantly. What are the main trends in your industry and will they lead to the appearance of new competitors or the growth of existing competitors over the next 2-5 years?

Will any new competitors be different to your existing ones? For example, will any of your suppliers ‘forward integrate’ and begin marketing the product or service you sell, turning themselves into competitors? Will companies from adjacent industries close to your own make the jump across into your industry?

Will these new competitors have different strengths and weaknesses to your current peers? What are the implications for how your business will seek to compete and grow?

As you compile your list of competitors and your analysis of their strengths and weaknesses you can use many of the same data sources you used to research your market – that’s to say free and paid market data providers as well as your own primary research.

Strategy

By now you’ve given the reader a clear idea of what you do, the nature of the market you operate in and the competition you face. Now is the time to explain the strategy you’ll follow to take advantage of the opportunities you’ve set out and face down the threats you might encounter.

Your strategy chapter should make it crystal clear to your reader how you will successfully grow your business and maximise your profits. If you don’t do that you’ll likely lose their interest, so this chapter is crucially important.

Start with a clear explanation of your competitive strengths. What is it you do that sets you apart from most of your competitors? What do you do differently to them that your customers really value? This is usually referred to as the Unique Selling Point (USP) of your product or service.

Most companies aren’t unique. They usually face several peers that offer broadly similar products or services to them. But ideally your offering should combine a few elements in a unique way that some of your customers find particularly valuable.

For example, perhaps you offer a wider product range, faster delivery or an element of customisation. There are many ways to set yourself apart – more than you may realise. Remember that you often need to offer just 2-3 customer benefits in a distinctive combination to create a unique proposition.

You also need to explain what it is that enables you to differentiate yourself in the way you do. In the jargon, you should explain why you’ll be able to sustain the differentiation that makes your offer special.

For example, do you have a proprietary technology, company founders with a pool of superior know how, better access to a critical resource or a unique way of carrying out your business that’s hard for your competitors to copy? Think about the things you do that your customers really value and why you’re able to meet their needs so well.

Your strategy chapter should include a strong focus on your target customer. This is the customer group you are most strongly focused on servicing. Your target customer is generally a customer who:

• Values your USP particularly highly.

• Is able and willing to pay for it.

• Can be reached and converted by you cost effectively.

You need to be laser focused when describing your target customer. Don’t fall into the trap of saying that you can pitch your offer to anyone and everyone. By staying focused you’ll concentrate your marketing expenditure on the customers who will be the most profitable for you and will be most likely to come back and buy from you again and again.

And you must of course set out your marketing strategy. You need to do that in some detail – it’s one of the most crucial components of your business plan. What exactly will you do to put your product or service in front of your target customer, engage with them about it and eventually persuade them to buy from you?

So you’ll need to cover the marketing channels you plan to use. They might be analogue channels like print ads and industry events or digital channels like internet search and social media. You might use a combination of paid media (e.g. Google ads), earned media (e.g. PR) and owned media (e.g. your website). Probably you’ll use a combination of these channels and techniques.

Be sure to explain why you’ve decided on the marketing channels and strategies that you’ve chosen. Why are they the best way to reach your target customer and showcase your USP? Why should your reader be confident they will work? If you can provide evidence that your marketing has been delivering strong results so far it will boost the credibility of your pitch considerably.

Don’t forget to mention whether you’ll be executing your marketing strategies yourself or engaging outside partners to do the job for you. For some techniques (e.g. paid digital ads) a specialist agency is likely to be essential.

As you write your strategy chapter, you need to weave together all the key initiatives that will expand your revenues and increase your profitability over time. That might include improving your products or services (to enhance the benefits you offer customers), strengthening your execution (to boost your profitability) and expanding your reach (to target new customer markets).

By the end, the reader should have a clear understanding of how you will keep your existing customers buying from you and how you’ll keep identifying more new sales leads and convert them into customers.

Finally, you should mention the main risks your business will face, what you’ll do to reduce those risks and how you’ll adapt to them if they actually materialise. Here are some of the most common types of risk your reader may expect you to address:

• Market risk. Demand in your industry could grow more slowly than you expect.

• Competitive risk. The intensity of the pressure you face from competitors on product performance or price may turn out to be greater than you anticipate.

• Customer risk. A key customer could go out of business or they could develop stronger bargaining power over your prices than you anticipate.

• Supplier risk. A key supplier might be unable to continue supplying you or they might raise their prices by more than you expect.

• Operational risk. You could lose key staff or suffer equipment or IT failures.

• Political risk. A new government might introduce policy changes that are bad for your business, such as higher taxes, changes in regulations and so on.

Strategy is a big topic. If you’d like to learn more about how to create business strategy, read our essential guide to creating a strategy for your small business. If you’d like to learn more about developing marketing strategy, try our complete guide to designing a small business marketing strategy.

Operations

Now that you’ve explained your business positioning and strategy you can fill in some of the nuts and bolts details about how your business operates. This involves setting out the assets you have at your disposal and some of the tools you use to serve your customers.

Here are some key topics you should consider covering:

• Summarise your value chain – how your business operates from day to day. What do your staff do to deliver the benefits you provide to your customers? If you manufacture a physical product, explain what is involved. It’s usually helpful if you quantify how many of your staff work in each of your business functions.

• Suppliers, agencies and contractors. Summarise who supplies any key inputs you buy from third parties. This may mean suppliers of finished or semi-finished manufactured goods. But it should also include any agencies or freelancers you use for marketing, legal, HR and other functions. If any of your outsourcing partners is critical to your business success, mention this.

• Storage and distribution. This is particularly relevant for companies that sell physical goods.

• Marketing and sales. You should explain how you market – the channels you use to generate leads, your use of paid vs organic marketing techniques and so on. If you use a sales team it’s important to explain how they contribute to the sales conversion process. Mention the key marketing and sales metrics you monitor.

• Equipment and IT. Summarise the physical and IT systems that are most crucial to your business.

This chapter is also a good place to list the key members of your management team. Include bios that explain how they are qualified to carry out their roles. This is one of the most crucial pieces of information your reader will want to see. When an investor backs a startup company, they are making a judgment about management’s ability to execute.

Forecasts

Your forecasts section is where the rubber meets the road. You’ve set out the opportunities and risks in your market and your plans to capitalise on the outlook as you see it. But what will that mean in pounds and pence for your business and for any investor who backs you?

First of all, don’t forget to include forecasts for all three of the main financial statements – your profit and loss account, your balance sheet and your cash flow statement.

Before you start the forecasting process you need to decide how many years of estimates you’ll provide. If you’re aiming to raise money from an investor then five years of forecasts are normal if you’re an early stage, high growth startup. If you’re a more established business with a more moderate rate of growth then three years could well be sufficient.

In any event the forecast period you choose must be long enough to capture the pay back you expect from any new money you plan to inject into the business. It may not need to be any longer than that.

The two most important variables you need to forecast are your rate of revenue growth and your profit margins. These two variables usually have the biggest impact on your final year profits and they usually involve the most judgment on your part (i.e. they are the most open to risk and debate).

When you forecast your revenue growth you need to link your assumptions back to the market analysis you included earlier in your business plan. The trends that drive your revenues should usually be consistent with the key dynamics playing out in your market.

If they’re not consistent you’ll need to explain your reasoning clearly. For example, if the outlook for your market is weak but you’re optimistic about the growth prospects for your business then it’s essential to explain why. How are you going to successfully buck the wider trend in your industry?

Equally if you’re a startup and you think your market is going to grow fast at 20% p.a. but you expect your own business to grow at 40% p.a. you’ll also have some explaining to do. Don’t assume your competitors will be slow and lazy – they won’t be.

In all cases, if you aim to grow faster than your market you should set out exactly what it is you’ll do that will enable you to win business from your competitors. How will you gain share from them?

If you plan to enter a large pre-existing market with a startup idea (e.g. a fashion brand) then debate around market share will be less of an issue. Your reader will understand that your success will depend on you launching a new concept that resonates with customers and on you executing your business plan effectively.

In cases like this you will need to show why your USP is particularly compelling. Your earlier explanations about marketing and sales strategy will also need to do a lot of heavy lifting.

As with your revenue forecasts, so with your margin forecasts. Your margins are influenced by trends in market demand and competition. You need forecast a margin trend that’s consistent with the outlook for your market or else explain why your margins will develop differently.

That’s because your profit margins are only partly determined by costs that are linked to the size of your business and your expansion plans. For example, if you plan to launch a business selling women’s pyjamas it should not be hard to find out how much it will cost to produce your product or how much rent you’ll need to pay for your premises.

But what gross profit margin will you make from each product sale? That depends on the selling price your customers will accept. If demand for your product or service is strong and what you offer is in short supply then your product should command a high price. But if your market is slow and there are many competing suppliers then you might struggle to achieve the price you want.

From a dynamic point of view, if you’ve assessed that the level of competition in your market is increasing, that usually puts downward pressure on your prices and margins. If you expect competitive pressures to abate, the opposite tends to happen.

So if competition is rising but you believe you can increase your margins, you’ll need to marshal convincing arguments for why that will happen. If you’re forecasting that your margins that will remain at a high level for a long period of time, investors will want to understand why those high margins will prove sustainable.

Be sure to include a list of the key metrics you monitor and target. That applies both to financial metrics (like revenue growth and profit margins) as well as non-financial metrics (like monthly new sales leads or product return rate). Many businesses use targets for operational metrics that are inputs to business performance to steer their company (these are known as KPIs).

If you’re using your business plan to raise funding then you should of course spell out how much new money you want to raise. If appropriate you should include the new funding in your forecasts. Don’t forget to explain exactly what you plan to do with the money – you’ll often use it for more than one purpose. For example, to buy more inventory and increase your marketing expenditure.

While you’ll do all you can to compile realistic forecasts, life is uncertain and your performance will be impacted by external factors you can’t possibly know about in advance. That’s part of the risk of doing business, especially if you’re an early stage startup.

Don’t try to deny that uncertainty – your reader won’t be taken in. Accept it and do what you can to help the reader understand where the biggest uncertainties lie and how great they are. Where there are good reasons for having a high level of confidence in other elements of your model (e.g. you have a long-term contract with a customer), point that out as well.

You can help your reader by making it easy for them to flex your forecasts. One way to do this is by explaining the most important assumptions you’ve used. If your reader thinks your sales volume assumptions for a new product launch seem a bit optimistic or pessimistic, that will help them to make their own estimate of how many you will sell under different scenarios.

You can even include your own analysis of the sensitivity of your profit forecast to different assumptions for key line items like unit sales volumes and price per product. Equally you can specify how your profits would turn out under generally more positive or negative scenarios for specific events.

To provide context for your forecasts you should include relevant historic financial data. Your last three years of results is usually sufficient. If you’re a new startup then you won’t have any figures to include but if you’re an established business this can help the reader understand whether what you’re forecasting for the future is consistent with how your business has performed up to now.