The Business Plan

What is it? A document that describes a new business. It explains to lenders and investors why the new business deserves financial support.

Why is it necessary? to obtain financing to serve as a living guide to the business (this helps the entrepreneur organize & analyze critical data) to provide a start-up blueprint

How do we begin? There is no “correct” way to write a business plan. They can be long, complex, detailed, or short and simple.

Here we go: The main components Executive summary – a brief recounting of the key points contained in a business plan; It should include the most important information from each section of the plan. Its purpose is to persuade the reader that this business is going to be a success. SHOULD BE WRITTEN LAST

Product/service plan – this section “presents” the product or service being offered. The nature of the business should be clear to the reader. Also, any “spin-off” ideas should be presented here.

Management team plan – this is where the qualifications of the “team” are presented. Also, any missing qualities are exposed here and possible solutions for solving the problem.

Industry/market analysis – this sections presents the research done. It analyzes the customers, competition, and industry. It also contains information about the prospective location’s geographic, economic, and demographic data.

Operational plan – includes all the processes that take place in the business so that the product or service is produced and delivered to the customer. It explains the distributions of the product or service. A distribution channel is the means for supplying the product to the customer. A direct channel is supplying a service or product to an exact target market. An indirect channel means the product or service is sold to a wholesaler who finds retailers to carry the product or service.

Organizational plan – looks at the people aspects of the business. It discusses such things as the management philosophy, the legal form of the company, key management personnel and key employment policies.

Marketing plan – involves how a company makes its customers aware of its products or services. Includes such features as the market niche being served, the pricing policy, company image, marketing tactics used to reach customers, a media plan and a marketing budget.

Financial plan – presents the forecasts for the future of the business. It explains the assumptions made when calculating the forecast figures.

Growth plan – looks at how the business will expand in the future.

4 steps to a business plan: Gathering data Organizing the data Setting up a notebook (record findings in separate sections of a notebook to keep data organized) Writing a draft

Let’s get started!