Start your story, fanfic or otherwise, as close to the end as possible. That is to say, I don't need four chapters of set up to the first conflict. Drop me in at that first conflict and have an arc to reach the conclusion from there.

Fanfic does vary a bit, as it's more of a playground than mainstream original fiction. However, the best fanfics often don't waste time in the trenches. The enjoyable stories get to work progressing that plot.

You're going to lose your mind long before you make every sentence progress the plot, but two steps forward, OK? Not everyone likes sugar in their tea, but you'll find enough readers that do so long as you don't get bogged down in the pedantic.

The elements you've highlighted in your example are something that can, honestly, be glossed over in a paragraph. Fans of the canon will accept it, those reading that only have a spectator's knowledge of the fandom will appreciate it.

 

Why not try starting with a bit if action and have it revealed that Naruto's teammates are different through the course of the event.

That way the reader is asking, "Wait, who's this guy? Why is this different?"

Afterwards have the changes from canon slowly revealed as you progress, feeding the reader information while keeping them interested rather than writing a large info dump introducing people at the start.

Have the story reveal the characters. Make it do the work.

 

Plot is the skeleton of a story, but have you ever tried eating bones? (if you have go with the metaphor anyway) Things like, as you called it, down time, are the meat. Well, maybe not so much meat as the ligaments keeping the skeleton together.

Stuff like slice of life scenes, or characters just talking can be a great addition to the story if you can make them relevant or interesting. Best if you can do both.

If you have a conversation between characters, insert that scene into the narrative in a place that makes sense. Not in the middle of a battle. Between battles.

Those scenes should still attempt to impart unto the reader information relevant to the plot. It's a good way of diffusing potential infodumps. If the scene isn't plot-critical, it should tell the reader something else about the world, characters, the situation they're in. The worst thing you can do is waste the reader's time, by including stuff that's not in any way relevant to the story you're telling. This is where you stop and think if it really matters what the character is wearing, or what book he's reading, or what band is his favorite, or that the dungeons were originally built as a prison. Does the reader need to know there used to be a prison there? Does it serve to show a character's knowledge of their history and that characteristic will be important?

If you have a cool idea and really feel that it would improve the story, figure out if you can insert it in a way that will make it relevant.

 

You want your fic to be interesting, especially at the start. It is the first 500-1000 words that will keep or break the reader. You will want to write the first couple of chapters with the most emotion and plot as possible. Once they are hooked, it is easier to explain and go slower by providing more details and world building.

My old fic isn't that good, and vastly unfinished (and probably will never be finished) but I did think I started in a good spot (https://www.fanfiction.net/s/6220867/1/Gone). By the middle of the first chapter, you know the main divergence of the fic. I made sure the first couple chapters could hook the reader. After that, I was planning on slowing down and start world building. I always thought that is how you will want to write fanfiction because it is easy to click the back button if you are not hooked right away.

Each chapter should move the plot forward in some way, a little closer to the ending. If you write something and realize it doesn't move the plot forward, even if its written well, you should probably not post it but rewrite it.

Sometimes you have to give up favorite scenes you've thought of because they don't matter to the plot at all. I've had this happen quite a few times.

 

Remember that your plot is not your story. How your plot affects your characters is your story. This means that slice-of-life scenes, as ScottPress called them, are often the bedrock of the narrative.

This doesn't mean that every plot-point needs its own fluff filled scene, though. In this way, fics do not resemble real life but compress it. For my example, please allow me to use Harry Potter, because I know nothing about Naruto (I even had to look up how to spell it).

I have just been posting a new fic. In the third chapter, I wanted to introduce the relationship between Fleur and Bill, the relationship between Molly and her children, the dissipation of fear of Voldemort after his death, some background about the upcoming Triwizard Tournament, and the relationship between Ginny and Harry. Instead of writing this as five different scenes filled with inane conversations, I had this as one (long) scene that focused on each of these plot-points at various times. I surrounded this by some fluff, about Percy, Charlie, and Fred, and about Ginny's new job. But the whole thing is connected and, through a slice-of-life story, told by taking time.

Of course, that chapter was the worst reviewed, so perhaps I'm not getting it right either.