A business plan doubles both as an important selling point for your business—investors and loan officers will need to see it before they consider giving you money—and a way to get your thoughts organized, forcing you to think about details like electric companies and leasing costs in addition to the more exciting services and offerings.
This is an overview of a typical business plan, including instructions for each section. Don't worry about completing it in order—but make sure you think everything on the list to avoid unnecessary surprises later only to find yourself scrambling for important information!
1. Executive Summary
It's usually best to write this section last. Like an abstract, it will be a truncated version of the entire rest of the document, highlighting the most important points.
2. Business Organizational Structure Description
Describe the basics of your business: the organizational structure (is this a corporation? LLC? general partnership?) and identify the key players. Who are the members of your organization? What do each of them bring to the table? Will you maintain a relationship with vendors or affiliates?
3. Industry Analysis
This section should paint a clear picture of your industry, both in its current state and with projections for the future.
4. Identify Your Services and Products
A natural extension of the previous section, Services and Products should explain not only what it is you have to offer, but how it fits into your industry and its future. Describe what it is you do in detail so that your potential investors have a clear idea what your business is about.
5. Market Analysis and Marketing Plan
You research your target market in order to explain what you will do about it, including the demographic's relationship with other players in the industry, and identify any trends. You use your research to plan your strategy — how you will promote your product and services, where to advertise, the amount of your budget devoted to marketing, handling your competition, dealing with customers, and so forth.
6. Strategic Plan
This is the section where you explain how, in real logistical terms, you will make your business dream a reality. Are you leasing office space, maybe warehousing space? Which electrical company will you sign up with? Where will you get materials for your inventory?
7. Management Team
Describe your management team and their specific roles and responsibilities. Unlike big companies that could include specific duties of your President, Vice President, Treasurer, Secretary, CEO, and any other positions, small businesses are much smaller, usually a small business owner and handful of hired employees.
8. Financial Analysis and Plan
With the details outlines above, you should be able to project your overhead expenses. It's typically a good idea to give three years of projections for your business so that you have a realistic idea of what to expect.
As an entrepreneur and business owner, a business plan will help validate your business concept and set clear goals, directions, and timelines in achieving these goals.
Sources:
- SBA, "Writing a Business Plan"
Sarah Kolb - Business incorporation and copyright registration specialist. Freelance book editor. Senior content editor/writer.
