Business Plan Basics

Your Business Plan - There are many reasons to have a comprehensive business plan, here are the three most important are: 1) An objective assessment of success .. 2.) A financing proposal. 3.) An operating manual for your company. All three of these reasons have a place and time in developing your business, usually related to your target audience (who are you writing a Business Plan?). Most business plans have 3 sections, plus a cover page, contents and summary. Let's look a little closer - let us look at some basic principles:
How long should your Business Plan? There is really no right answer. It depends on your company, the purpose for writing and your audience. There are standards, however, so look for funds, and bankers because your expectations may be based on them, you should keep this in mind when designing your plan:
o Start-up for small businesses, small loan applications ------------ 10 pages or less plus attachments.
TIP - Looking for a small business loan? Contrary to what most people tell you, a formal business plan is not always necessary. Many lenders accept a summary (see Summary), together with the loan application and supporting documents (usually three years of income and tax records), if the loan request is small.
o Start looking for $ 200,000. or more, or a mature company looking to expand the financing or capital investor ---- 10 to 40 pages.
OK - let's look at what's in each section of your Business Plan:
The cover page - just that - a cover for your company to identify the rest probably sit on your desk bankers. Include your company name, your logo if you have one, address, contact information (phone, email and website if already established) and the name (s) of clients.
Your Summary - The summary is nothing more than a summary of all other elements of the plan. It's like the first, but usually written last. It is a part of your plan, which most bankers and investors will read, so be sure to call "Hey, read the rest, this is a great idea that can not fail". Every time you write for someone other than yourself, your business plan is a sales proposal!Section I - The BusinessA. Description and location1. Organizational structure, location and clients.2. Products or services sold and geographic area served ..3. Operational plan (how will the company be run?).B. The Market1. Customers or clients (who are - or will be - your customers or clients?).2. Marketing Plan (how will you reach these customers or clients?)3. Market stability and opportunities for growthC. Competition1. Main competitors.2. Your benefits (why you're unique and able to increase market share?).Section II - Financial Data & ProjectionsA. Beginning balance (optional for a small start-up)B. Cash Flow Projection twelve monthsC. Three year cash flow projection (show projections of the quarters)D. Break even analysisSection III - EvidenceThis section would be copies of supporting documents, such as; Incorporation or other organizational records, state or federal required professional licenses, CVs of the principals, Franchise contracts (if franchise), Partnership Agreement (if Partnership), leases, Capital Equipment List, and any company brochures or other promotional materials you may already have produced.