When I write business plans to help my clients seek financing, the following elements must be explained, or the bank is likely to say “no.” Even if you just want a day-to-day working plan to run your business, I’d still follow this outline, although no one is going to say “no” if you’re the only one reading it!
Executive Summary
- 1-3 page overview of your business
- Give to lenders, investors, employees, advisory board, vendors, etc. to explain what your company is all about
- Most important part of the business plan
- Geared to grab reader’s attention and compel them to read rest of business plan
- Highlights key points from all of the sections of your business plan
- Write this section last
Mission Statement
- Tells what your business is about and what you want it to become
- Talks about the direction you want to take your company
- Explains what is important to you about your business
- Gives a clear picture of why your business is important to you – motivational factor for others to know you believe in what you’re doing and why you’re doing it
Company Background
- Provides the history of how you brought your idea or business to this point
- Summarizes both short and long term plans for the company
Ownership Structure
- Explains legal form of your business
- Discusses owners and roles they hold in company
- Talks about funding of company
Description of Services
- Identifies the problem that your product or service solves
- Explains how the product was developed
- Discusses how your product differs from your competitors
- Determines the cost and profit on each product/service and the breakeven point
Market Analysis/Industry and Trends Description
- Identifies characteristics of your market
- Suggests the % of the market you will capture
- Tells why customers will buy your product/service over your competitors’ offerings.
- Identifies size of the industry, trends, and what effect they might have on your business
- Discussed regulatory trends that may affect your business
Competitive Analysis
- Discussed your major competitors’ products/services
- Identifies each competitors’ position in the market
- Lists strengths and weaknesses of each competitor
Marketing and Sales
- Explains your marketing and sales strategy
- Discusses your marketing activities quarter by quarter
- Shows your market research
- Explains your communication and distribution channels
Operations and Facilities
- Describes how you will provide services or products
- Includes description of equipment and suppliers needed
- Covers growth goals
- Describes the location of your business
- Discusses manufacturing equipment and space
Management & Personnel
- Talks about the role of key management staff and board personnel
- Discusses personnel – training, skills, benefits,
- Explains methods of accounting and information management
Financial Projections and Investment Description
- Explains your financial needs
- Discusses how the funds will be used
- Captures project cost data and realistic sales projections
- Explains how you will provide a return on the investment, pay back the loan, etc.
Supporting Documents
- Financial statements
- Cash flow
- Income projections
- Operating budgets
- Leases, contracts, resumes, all documents that support the concepts in your business plan
If you need help developing your business plan, please contact Nancy at nancy@cuttothechasemarketing.com or at 425.415.6427 for more information.