If you are starting a non-profit, a business plan might be the furthest thing from your mind. After all, by definition, you are not trying to make money or capitalize on market trends. Nonetheless, a business plan is just as important for a non-profit organization as it is for any profit-making company. It will guide your growth, show donors and funding sources what you are doing, and demonstrate to the IRS that yours is a legitimate tax-exempt enterprise.

Your business plan describes your non-profit as it currently exists and sets up a road map for the next three to five years. It lays out your goals, challenges, and plans for meeting your goals. It is a living document that should be updated frequently as your non-profit expands.

Although it is normally written last, your executive summary provides an introduction to your entire business plan. The first page should describe your non-profit’s mission and purpose, summarize your market analysis that proves an identifiable need, and explain how your non-profit will meet that need.

This section provides more detailed information on exactly what your non-profit organization does. What products or services do you sell? What social programs do you provide? How does your non-profit benefit the community? What need does your organization meet and what are your specific plans for meeting that need?

This section elaborates on the market analysis that you touched on in the executive summary. Explain the issues that made you decide to start a non-profit. Research those issues in detail to determine how many people are affected, who they are, where they live, and how your non-profit will reach them.

A non-profit must have a strong marketing plan in order to reach its targeted customers. Base your marketing plan on the four P’s: Product, Price, Place, and Promotion. Your Product section includes every item, service, or program you provide. Price details the costs of everything you sell. Place is your physical location, web presence, and third party distribution channels. Promotion is how you will get people to buy your products and services and donate to your cause. Customer retention is another important category that explains how you will build loyalty.

Your operations plan explains how you will meet the goals detailed earlier in your business plan. Everyday short-term processes are the day to day tasks involved in running your non-profit, from selling products and services to serving your target market’s identified needs. Long-term processes are the ways you will meet your organization’s growth goals, such as expanding into new cities or providing new services.

The organizational structure is extremely important for a non-profit. Describe your board members’ backgrounds and expertise. Talk about your advisory board. Explain the different levels of management, financial sponsors, and other key players. Draw an organizational chart that shows the different chains of command, and estimate your current and future staffing needs.

Although you are not trying to make a profit, a financial plan is a crucial part of your business plan. Delineate your different sources of funding. Explain any existing loans or other debts. Summarize your past and future Cash Flow Statements, Balance Sheets, and Income Statements. Describe your fundraising plans, and identify gaps in your funding. Provide a clear explanation of how excess funds will be distributed amongst your various projects. Disclose any salaries that are drawn by members of the organization.

The appendix is where you will attach any documentation that proves your claims. These documents will vary widely depending on the exact nature of your non-profit, but should always include your full financial projections, promotional materials, most current annual report, and a copy of your strategic plan.

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