Business Model vs Business Plan

The business model is a new concept that dates back to a few decades ago. However, the business plan dates back to about two centuries ago.

Business model

It is a short document that describes the skeleton of the business. It provides a structure that outlines how the business is going to make money. A business model explains how a company is communicating and interacting with shareholders, investors, customers, and business partners. There are many examples of business models. A few examples are given in here.

Business plan

It is a more detailed and thorough document that describes all activities in your business and provides a detailed financial and money management plan for the next 3 to 5 years. It depicts a long-term vision for your business and best suited for attracting investors to your business. It describes details of how investors can expect a return for their investments. The business plan lays out the competition and the competitive advantage of the business.

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