IT Business Plan Template [Updated 2024]

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IT Business Plan Template

If you want to start an IT business or expand your current IT business, you need a business plan.

Fortunately, you’re in the right place. Our team has helped develop over 100,000 business plans over the past 20 years, including thousands of IT business plans.

The following IT business plan template and example gives you the key elements you must include in your plan. In our experience speaking with lenders and investors, the template is organized in the precise format they want.

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Example Business Plan For Your IT Business

I. Executive Summary

Business Overview

[Company Name], located at [insert location here] is a new IT Consulting firm providing a wide range of advisory services to small local businesses. The company will operate in a professional setting, conveniently located next to [notable bank] in the center of the business district. [Company Name] is headed by [Founder’s Name], an MBA Graduate from UCLA with 20 years of experience working as a business consultant, both for internal and external clients.

Services

[Company Name]will focus on close client relationships. [Founder’s Name], the lead consultant, will provide one-on-one IT Consulting sessions with clients, group sessions with client teams, strategic planning services, fundraising IT Consulting, and webinars of general interest to clients and potential clients.

[Company Name] has a full-time assistant who will contribute to research and analysis for client engagements. The assistant will also support the business through administrative services.

[Company’s Name] services will be offered either as IT Consulting sessions and short-term research and analysis for an hourly rate or defined projects on a fee-basis.

Customer Focus

[Company Name] will primarily serve service sector businesses within a 20 mile radius of our location. The demographics of these customers are as follows:

  • 1,500 businesses
  • Under 100 employees (Average is 42)
  • Privately held companies
  • Top represented sector: Retail stores
  • Average annual payroll for firms with 20-99 employees of $1.3 million

These small businesses face many challenges, from seeking additional funds, strategizing how to expand, moving from owner-operator models to professional management, and incorporating industry best practices. [Company Name] will seek contacts with business startups to start relationships early as well as established small businesses in service sectors.

Management Team

[Company Name]’s most valuable asset is the expertise and experience of its founder, [Founder’s Name]. [First name] has been a consultant for the past 20 years. He spent the first 10 years of that time as an internal consultant at Richards Technology Services.There he analyzed dozens of business units within the company, working with the top management of each to create strategic plans for future growth and deal with pressing challenges. After leaving RTS, [First name] was a senior consultant for Bain & Company for 10 years, where he worked with a variety of medium and large service industry business clients on general strategy and expansion strategy.

[Company Name] will also employ an experienced assistant to work as a business analyst and to help with various administrative duties around the office. [Assistant’s name] has experience working with C-level executives and has spent significant time as an analyst.

Success Factors

[Company Name] is uniquely qualified to succeed due to the following reasons:

  • [Company Name] will fill a specific market niche in the growing community we are entering. In addition, we have surveyed local businesses and received extremely positive feedback saying that they explicitly want to make use of our services when launched.
  • Our location is in an economically vibrant area where new businesses are starting at a fast rate.
  • The management team has a track record of success in the small business IT Consulting business.
  • The local area is currently underserved and has few independent small business consultants offering specific expertise in the full range of small business problems.

Financial Highlights

[Company Name] is seeking a total funding of $82,000 of debt capital to open its office. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses and working capital.

Specifically, these funds will be used as follows:

  • Office design/build: $49,000
  • Working capital: $33,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even

Topline projections over the next five years are as follows:

Financial SummaryYear 1Year 2Year 3Year 4Year 5
Revenue$252,153 $396,667 $658,556 $1,196,480 $1,977,070
Total Expenses$205,061 $335,364 $529,681 $790,035 $964,307
EBITDA$47,092 $61,304 $128,874 $406,445 $1,012,763
Depreciation$7,280 $7,280 $7,280 $7,280 $7,280
EBIT$39,812 $54,024 $121,594 $399,165 $1,005,483
Interest$5,304 $4,641 $3,978 $3,315 $2,652
PreTax Income$34,508 $49,383 $117,616 $395,850 $1,002,831
Income Tax Expense$12,078 $17,284 $41,166 $138,547 $350,991
Net Income$22,430 $32,099 $76,450 $257,302 $651,840
Net Profit Margin9%8%12%22%33%
Full-time Consultants12345
Client Base426396162243

 

II. Company Overview

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Who is [Company Name]?

[Company Name], located at [insert location here] is a new small business IT Consulting firm providing a wide range of advisory services to small local businesses. The company will operate in a professional setting, conveniently located next to [notable bank] in the center of the business district. [Company Name] is headed by [Founder’s Name], an MBA Graduate from UCLA with 20 years of experience working as a business consultant, both for internal and external clients.

While [Founder’s Name] has been in the management IT Consulting business for some time, it was in [month, year] that he decided to launch [Company Name]. Specifically, during this time, [Founder] met with a former friend and fellow independent small-business consultant in Fort Lauderdale, FL who has had tremendous success. After discussing the business at length, [Founder’s Name] clearly understood that a similar business would enjoy significant success in his hometown.

Specifically, the customer demographics and competitive situations in the Fort Lauderdale location and in his hometown were so similar that he knew the business would work. After surveying the local population, [Founder’s name] went ahead and founded [Company Name].

[Company Name]’s History

Upon returning from Fort Lauderdale, surveying the local customer base, and finding a potential office, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].

The business is currently being run out of [Founder’s Name] home office, but once the lease on [Company Name]’s office location is finalized, all operations will be run from there.

Since incorporation, the Company has achieved the following milestones:

  • • Found office space and signed Letter of Intent to lease it
  • Developed the company’s name, logo and website located at [website]
  • Hired an interior designer for the decor and furniture layout
  • Developed service menu and pricing model
  • Recruited full-time assistant

[Company Name]’s Services

[Founder’s Name] will be able to provide clients with the following services:

  • One-on-one executive advisory sessions: Potentially open-ended sessions with [Founder’s Name] to answer specific questions ($100/hour)
  • Group advisory sessions: Meetings with up to 5 client staff members or managers at a time to discuss specific problems and answer specific questions ($100/hour)
  • Strategic Planning: Deliverables will be customized to the client’s needs, and may include discussion of valid alternatives, analysis of these alternatives, recommendation, justification for recommendation, implementation steps, timeline, budgets and financial projections (Project fee based on specific requirements – fee generally $5,000 – $20,000)
  • Fundraising Planning: Deliverables will be customized to client’s needs, and may include investor offer document, financial projections including analysis of return for investor, private placement memorandum. Process can include analysis of funding options, recommendations for funding course to seek, expediting of lender applications. (Project fee based on specific requirements – fee generally $3,000 – $15,000)
  • Webinars: Web-based seminars offering PowerPoint presentation and discussion of topics of specific interest to small business clients, such as “Hiring & Firing”, “Best Practices in Services”, “Exit Strategies for Owner-Operators”, and “Management Technology Tools for Small Businesses”. (Fee from free to $50 for 60- to 90-minute webinar)
  • Other Projects: Research, analysis, and IT Consulting within [Company Name]’s expertise which does not fall into the above categories can be contracted as well. (Fees will vary)

As [Founder’s Name] understands, the key to a successful small business IT Consulting is being accessible and staying in contact with clients and becoming a long-term partner, rather than just a one-time source of information. [Founder’s Name] will have a full-time assistant on hand who, among other things, will manage client’s phone calls and answer questions about ongoing projects as much as possible.

 

III. Industry Analysis

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

According to Gartner, worldwide IT service spending is about $3.8 trillion annually. In the United States, IT consulting revenue is expected to reach $354.2 billion. The output of US computer and data processing services, an indicator of demand for information technology services, is forecast to grow at a moderate rate in the next two years.The IT consulting industry is forecast to experience strong growth in the next five years, albeit at a slower rate than in the 1990s, when the personal computer revolutionized computing technology. Industry revenue will primarily be driven by rising corporate profit, which precipitates increased private investment in computers and software. As a result, IT consultants are forecast to see an uptick in demand for industry services, as firms require computer application and program design and systems integration assistance. Mobile technologies are also expected to help boost industry revenue as firms invest in new technologies that allow consumers to more effectively browse websites through new devices such as smartphones and tablets. Overall, the industry is projected to grow at an average annual rate of 4.0% over the next five years.

Further, as US companies reorganize and expand in the wake of the recession, IT consultants are projected to experience increased demand Expanding firms will seek the assistance of IT consultants to improve operational efficiency through system upgrades and integration. Additionally, demand from private companies, which comprise a small but significant proportion of the industry’s tech support revenue, is expected to pick up, with private investment in computers and software forecast to grow an annualized 5.1% over the five-year period.

 

IV. Customer Analysis

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Demographic Profile of Target Market

[Company Name] will serve small businesses in [company location] and the immediately surrounding area.

The area we serve is suburban, with retail stores as a primary business sector. In addition, services such as photographers, hairdressers, lawyers, accountants, restaurants, guest houses, and more are located in the area.

The precise demographics of the town in which our location resides is as follows:

Nashville, TN
Total Businesses38,124
Forestry, Fishing, Hunting, and Agriculture Support0.29%
Mining0.35%
Utilities0.23%
Construction9.64%
Manufacturing4.16%
Wholesale Trade5.62%
Retail Trade14.54%
Transportation and Warehousing2.83%
Information1.81%
Finance and Insurance6.56%
Real Estate and Rental and Leasing4.75%
Professional, Scientific and Technical Services11.36%
Management of Companies and Enterprises0.69%
Admin, Support, Waste Mgt, Remediation Services5.15%
Educational Services1.20%
Health Cate and Social Assistance10.80%
Arts, Entertainment and Recreation1.66%
Accommodation and Food Services8.59%
Other Services (Except Public Administration)9.78%

Customer Segmentation

The Company will primarily target the following three customer segments:

  1. Service Business Startups: Startups are overwhelmed by the amount of information they must take in and the speed at which they must learn. They often seek business advisors to either assist with research and analysis, prepare a comprehensive business plan, or to offer basic feedback on the company’s ideas. As these companies grow, they can develop an ongoing mentoring relationship with a consultant, if that consultant has expertise to help them grow. Business startups have a great need for information and seek out advice on the ins and outs of how to launch and develop their systems.
  1. Employer service firms of up to 99 employees: Small businesses of this type need a wide range of IT Consulting services and can benefit through the expertise of a firm focusing on the small business perspective. Although these firms may be more knowledgeable than startups, they still have a lot to learn about service industry best practices and often lack the time and forethought to engage in strategic planning.
  1. Nonemployer firms (“Sohos” and “Mom and Pops”): Businesses owned and operated by the same person are often unaware of basic legal, insurance, and labor regulations. Furthermore, these firms often lack exit strategies which can capture the value of what the firm has created.

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V. Competitive Analysis

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Direct & Indirect Competitors

[Company Name] competes indirectly with any service that provides advise and management IT Consulting services for small businesses, including online resources, free mentoring services like SCORE and local SBDCs, and independent consultants. The following small business IT Consulting firms are located within a 20 mile radius of [Company Name], and provide a wider range of small business services, thus providing direct competition for customers:

ABC Small Business IT Consulting

ABC Small Business IT Consulting is anowner-operated business run by Bob Johnson. Having started the business ten years ago, Johnson operates out of his home to keep down costs and meets with small businesses in the surrounding area at their offices. Johnson focuses primarily on mentoring and advisory services and does not undergo detailed research, analysis, and planning for clients.

ABC Small Business IT Consulting has an estimated $150,000 in annual revenue and serves a small subset of area clients. However, its name and focus on small business IT Consulting bring it to the top of local search rankings, leading many small businesses to consider working with Johnson.

Strategic Advisors Inc.

Strategic Advisors Inc., founded fifteen years ago, is now a small and medium business IT Consultingcompany with 250 employees and revenue of $37.5 million. Strategic Advisors Inc. has offices in five US cities and nearest office location is in [city name].

Unlike [Company Name], whose revenues will come entirely from small businesses, the majority of Strategic Advisors Inc. revenue is from medium-sized businesses of 100 to 500 employees. Because of this focus, and the fact that contracts with these medium businesses are more profitable, Strategic Advisors Inc. prefers to only work with small businesses that it feels will grow into the medium-size it prefers and specializes in.

Small business clients go to Strategic Advisors Inc. because of its wide presence on the Internet, public brand awareness, and track record. However, many startups and small businesses cannot afford the fees of working with Strategic Advisors Inc.

Competitive Advantage

[Company Name] enjoys several advantages over its competitors. These advantages include:

  • Location: [Company Name]’s location is near the center of town, in the shopping district of the city. It is visible from the street where many small business owners and managers walk to and from work on a daily basis.
  • Client-oriented service: [Company Name] will have a full-time assistant to keep in contact with clients and answer their everyday questions. [Founder’s Name] realizes the importance of accessibility to his clients, and will further keep in touch with his clients through monthly webinars on topics of interest.
  • Management: [Founder’s Name] has been extremely successful working in the management IT Consulting business and will be able to use his previous experience to grant his clients detailed insight small business best practices. His unique qualifications will serve small business clients in a much more sophisticated manner than [Company Name’s] competitors.
  • Relationships: Having lived in the community for 25 years, [Founder’s Name] knows many of the local leaders, newspapers and other influences.

 

VI. Marketing Plan

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

[Company name] will use several strategies to promote its name and develop its brand. By using an integrated marketing strategy, [company name] will win clients and develop consistent revenue streams.

The [Company name] Brand

The [Company name] brand will focus on the Company’s unique value proposition:

  • Client-focused small business IT Consulting services, where the Company’s interests are aligned with the customer
  • Service built on long-term relationships
  • Big-firm expertise in a small-firm environment

Promotions Strategy

Targeted Cold Calls

[Company name] will initially invest significant time and energy into contacting potential clients via telephone. In order to improve the effectiveness of this phase of the marketing strategy, a highly-focused call list will be used, targeting startups and small businesses. As this is a very time-consuming process, it will primarily be used during the startup phase to build an initial client base.

Referrals

[Company name] understands that the best promotion comes from satisfied customers. The Company will encourage its clients to refer other businesses by providing economic or financial incentives for every new client produced. This strategy will increase in effectiveness after the business has already been established.

Additionally, [company name] will aggressively network with business incubators, small business development centers, small business accountants, lawyers working with startups and small businesses, and others in a position to work with small businesses and startups. This network will generate referral leads.

Internet

[Company name] will invest resources in two forms of geographically-focused internet promotion—organic search engine optimization and pay-per-click advertising. The Company will develop its website in such a manner as to direct as much traffic from search engines as possible. Additionally, it will use highly-focused, specific keywords to draw traffic to its website, where potential clients will find a content-rich site that presents [Company name] as the trustworthy, well-qualified IT Consulting firm that it is.

Publications

[Company name] will place print advertisements in key local publications, including newspapers, area magazines, and business newsletters. Additionally, the Company will print brochures and place them in specific locations frequented by target individuals, such as small business development centers and accountants.

Pricing Strategy

[Company Name]’s pricing will resist reducing prices based on small business concerns about price, as small businesses on a whole are budget-conscious. Instead, prices will be justified through the value of the cost-savings, revenue generation, and future strategy that can be created. Over time, past client testimonials will help to maintain prices. Furthermore, taking on the practice of discounting relates the company to free small business resources, with which [Company Name] does not attempt to compete directly.

Prices will be based around a $100 per hour billing rate for [Founder’s Name] and a $50 per hour billing rate for the assistant/business analyst. Prices will generally be higher than the rates of ABC Small Business IT Consulting and lower than Strategic Advisors Inc. Sometimes, prices for a project will result in a higher or lower billing rate than these targets. Pricing for webinars will aim for a return on investment in excess of these billing rates, whether through direct revenue or through exposure to potential new clients.

 

VII. Operations

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

[Company Name] will carry out its day-to-day operations primarily on an appointment basis. Clients will make appointments for advisory sessions, interview sessions to gather information for proposals, and further meetings throughout client engagements. These will often occur at the company office location to remove clients from the distractions of their business. In-process meetings may occur on-site at the client’s business in order to increase the strength of the client relationship. If necessary, appointments can be conducted over the telephone.

[Founder’s Name] will work on an as-needed basis, but can be expected to be present in the office during normal business hours. The company will also employ an assistant/analyst who will staff the office during normal business hours and support marketing and client relationship development efforts.

Milestones

Company name]’s long term goal is to become the number-one provider of small business IT Consulting services in the [city] area in terms of revenues and profit. We seek to do this by ensuring customer satisfaction, developing a loyal and successful clientele, and expanding consistently.

The following are a series of steps that will lead to this long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:

DateMilestone
[Date 1]Finalize lease agreement
[Date 2]Design and build out [Company Name] storefront
[Date 3]Hire and train initial staff
[Date 4]Kickoff of promotional campaign
[Date 5]Reach break-even
[Date 6]Add second additional full-time consultant
[Date 7]Reach XXX ongoing clients

 

VIII. Management Team

[Company Name]’s most valuable asset is the expertise and experience of its founder, [Founder’s Name]. [First name] has been a consultant for the past 20 years. He spent the first 10 years of that time as an internal consultant at Richards Technology Services.There he analyzed dozens of business units within the company, working with the top management of each to create strategic plans for future growth and deal with pressing challenges. After leaving RTS, [First name] was a senior consultant for Bain & Company for 10 years, where he worked with a variety of medium and large service industry business clients on general strategy and expansion strategy.

[Founder’s Name] has written white papers on business expansion strategy and spoken at IT Consulting conferences representing Bain.

[Company Name] will also employ an experienced assistant to work as a business analyst and to help with various administrative duties around the office. [Assistant’s name] has experience working with C-level executives and has spent significant time as an analyst.

Hiring Plan

[Founder’s Name] will serve as the company CEO and president. In order to launch the business we do not need additional personnel, but will hire the following in the future:

  • Consultants: Hire one additional consultant every year starting with year 2. These employees will be leads on client engagements.
  • Administrative Assistant: Hire a full-time administrative assistant in year 2.
  • Junior Consultants:When hired in the future, these employees will work under full consultants and focus entirely on client engagements.

 

IX. Financial Plan

You can download our Business Plan Template (including a full, customizable financial model) to your computer here.

Revenue & Cost Drivers

[Company Name]’s revenues will come primarily from the fees earned from client IT Consulting engagements (54% of revenue in first year) and advisory sessions (44%).

As with most services, labor expenses are the key cost drivers. [Founder’s Name] and future consultants will earn a competitive base salary. The lease on the office location will be the next largest cost. Moreover, ongoing marketing expenditures are also notable cost drivers for [Company Name].

Capital Requirements and Use of Funds

[Company Name] is seeking a total funding of $82,000 of debt capital to open its office. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses and working capital.

Specifically, these funds will be used as follows:

  • Office design/build: $49,000
  • Working capital: $33,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even

Key Assumptions & Forecasts

The following table reflects the key revenue and cost assumptions made in the financial model.

Number of clients
Year 142
Year 263
Year 396
Year 4162
Year 5243
Annual rent$36,000

5 Year Annual Income Statement

Year 1Year 2Year 3Year 4Year 5
Revenues
Product/Service A$151,200 $333,396 $367,569 $405,245 $446,783
Product/Service B$100,800 $222,264 $245,046 $270,163 $297,855
Total Revenues$252,000 $555,660 $612,615 $675,408 $744,638
Expenses & Costs
Cost of goods sold$57,960 $122,245 $122,523 $128,328 $134,035
Lease$60,000 $61,500 $63,038 $64,613 $66,229
Marketing$20,000 $25,000 $25,000 $25,000 $25,000
Salaries$133,890 $204,030 $224,943 $236,190 $248,000
Other Expenses$3,500 $4,000 $4,500 $5,000 $5,500
Total Expenses & Costs$271,850 $412,775 $435,504 $454,131 $473,263
EBITDA($19,850)$142,885 $177,112 $221,277 $271,374
Depreciation$36,960 $36,960 $36,960 $36,960 $36,960
EBIT($56,810)$105,925 $140,152 $184,317 $234,414
Interest$23,621 $20,668 $17,716 $14,763 $11,810
PRETAX INCOME($80,431)$85,257 $122,436 $169,554 $222,604
Net Operating Loss($80,431)($80,431)$0$0$0
Income Tax Expense$0$1,689 $42,853 $59,344 $77,911
NET INCOME($80,431)$83,568 $79,583 $110,210 $144,693
Net Profit Margin (%)-15.00%13.00%16.30%19.40%

5 Year Annual Balance Sheet

Year 1Year 2Year 3Year 4Year 5
ASSETS
Cash$16,710 $90,188 $158,957 $258,570 $392,389
Accounts receivable$0$0$0$0$0
Inventory$21,000 $23,153 $25,526 $28,142 $31,027
Total Current Assets$37,710 $113,340 $184,482 $286,712 $423,416
Fixed assets$246,450 $246,450 $246,450 $246,450 $246,450
Depreciation$36,960 $73,920 $110,880 $147,840 $184,800
Net fixed assets$209,490 $172,530 $135,570 $98,610 $61,650
TOTAL ASSETS$247,200 $285,870 $320,052 $385,322 $485,066
LIABILITIES & EQUITY
Debt$317,971 $272,546 $227,122 $181,698 $136,273
Accounts payable$9,660 $10,187 $10,210 $10,694 $11,170
Total Liabilities$327,631 $282,733 $237,332 $192,391 $147,443
Share Capital$0$0$0$0$0
Retained earnings($80,431)$3,137 $82,720 $192,930 $337,623
Total Equity($80,431)$3,137 $82,720 $192,930 $337,623
TOTAL LIABILITIES & EQUITY$247,200 $285,870 $320,052 $385,322 $485,066

5 Year Annual Cash Flow Statement

Year 1Year 2Year 3Year 4Year 5
CASH FLOW FROM OPERATIONS
Net Income (Loss)($80,431)$83,568 $79,583 $110,210 $144,693
Change in working capital($11,340)($1,625)($2,350)($2,133)($2,409)
Depreciation$36,960 $36,960 $36,960 $36,960 $36,960
Net Cash Flow from Operations($54,811)$118,902 $114,193 $145,037 $179,244
CASH FLOW FROM INVESTMENTS
Investment($246,450)$0$0$0$0
Net Cash Flow from Investments($246,450)$0$0$0$0
CASH FLOW FROM FINANCING
Cash from equity$0$0$0$0$0
Cash from debt$317,971 ($45,424)($45,424)($45,424)($45,424)
Net Cash Flow from Financing$317,971 ($45,424)($45,424)($45,424)($45,424)
SUMMARY
Net Cash Flow$16,710 $73,478 $68,769 $99,613 $133,819
Cash at Beginning of Period$0$16,710 $90,188 $158,957 $258,570
Cash at End of Period$16,710 $90,188 $158,957 $258,570 $392,389