HOW TO DEVELOP A BUSINESS PLAN

A Business Plan should include the following elements, described in more detail in the following outline:

• Cover Page
• Table of Contents
• Mission Statement
• Executive Summary
• Marketing Plan
• Operational Plan
• Management Control Systems
• Financial Plan
• Long-Range Strategic Plan

1. Cover Page: Includes Title, Date of Preparation, Confidentiality Statement, and Contact Information.

2. Table of Contents: Self-explanatory. Be sure to include both major and minor sections of the Plan so that the reader can quickly find the part desired.

3. Mission Statement: A brief paragraph that defines the nature of your business, its purpose and your vision for its future.

4. Executive Summary: A one to two page explanation of your business and its competitive advantage. Write this section last. It should include: Brief history of the business, its legal form and your role in its development. State the Company’s objectives and your vision for its future. Describe the industry and market in which the Company competes. Define your products or services and the unique advantage that will make your Company successful. Describe the Company’s management and key personnel, including their background and experience. Discuss the Company’s projected growth and the factors that are key to its future profitability. Describe any funding requirements and how and over what period they will be repaid.

5. Marketing Plan: A critical section of the Plan, it should include-

1. Description of the products (services) the Company will provide and the need or want that they are designed to satisfy;
2. Compare your products’ unique characteristics with major competing products;
3. Document any product protection available, including patents, copyrights, trademarks and others;
4. Define the customer base, who they are, how many there are and where located. State why they are potential buyers;
5. List major competitor information, size, location, sales methods, reputation, pricing strategies and their strengths and weaknesses;
6. Describe any environmental, legal or governmental factors (if any) that could influence the future of the market for your product;
7. Document your pricing method and how it matches the image of your products;
8. Describe how your Company will sell its products, by whom, and at what cost. State how the product will be supplied to the customer;
9. Define the Company’s policies governing service, before and after the sale, credit terms and warranty considerations;
10. Document any requirements for packaging, labeling, manuals or other technical literature;
11. Describe how your Company will compensate the sales function, salesmen, representatives, and how sales effectiveness will be monitored;
12. Describe your advertising and promotional plans, their cost and how they will compare to those of your competitors.

6. Operational Plan: A description of who will manage the business and how it will be done, including your organization, the hiring and training of personnel and policies governing employment.

7. Management Control Systems: Include a description of how you will maintain accounting records (and at what cost), inventory control measures, monitoring of cash flow and, if applicable, how you will monitor the profitability of each job or product/service.

8. Financial Plan: Includes a Personal Financial Statement, a Schedule of Start-Up Costs, Projected Financial Statements (by month for one year plus two additional years) and the assumptions upon which they are based. If borrowing is planned, state how it will be repaid and collateral proposed.

9. Long-Range Strategic Plan: This section describes where you want your business to be in 3 – 5 years and how you intend to get there. State the strengths you plan to exploit and the weaknesses you will overcome in achieving your goals.

Sign up for our “Writing a Business Plan” workshop and/or download our sample Business Plan. See Downloads.