Week One Chapter five “Develop a Business Plan”

What is a Business Plan? A business plan is a written document that describes all the steps necessary in opening and operating a successful business. It’s broken into seven main sections It also includes introductory and supporting sections/elements

Purpose of a Business pLan Business idea and how the product/service will be produced and sold Product description Target market Sets specific objectives and how you will achieve them Sales projections (up to 5 years – long term) Business expansion ideas Describes the people running the business Experience

Importance of a Business Plan Think of all aspects of your business Identify problems Create strategies Secure financing needed to obtain a loan Your business plan is the proposal you bring with you Helps communicate your ideas A tool for managing your business

Structure of all good business plans Introductory Elements Cover Letter Cover Sheet Table of Contents Statement of Purpose Executive Summary Main Body of the Plan Mission, Goals, Objectives Market Need Location & Setup Business Structure Management & Staff Marketing Plan Financials Supplementary Elements Appendix and Attachments

seven main elements of your business plan Mission, Goals, Objectives Market Need Location & Setup Business Structure Management & Staff Marketing Plan Financials

Mission, goals, and objectives History and background of your idea Describe how you came up with the business idea Day Care Example: Page 110 Goals and Objectives Short and long term goals Short Term Goals: < 1 Year Intermediate Term Goals: Between 2 & 5 Years Long-Term Goals: Beyond 5 Years What’s your vision for your company? GOAL SETTING IS OF PRIMARY IMPORTANCE

Market need Understand Your Customer Outline your Target Market What is your customer profile? What are your market segments? Understand your Competition Direct and Indirect Competitors

Location and setup What sort of space is available? How much will it cost? Is it near my target market? Is it near my competitors? Is it near businesses that deal in related markets? What will my floor layout look like? What sort of starting inventory do I need?

Business structure How should I legally organize my business? Sole Proprietorship Partnership S Corporation C Corporation How do I financially organize my business? Buy an existing business Go into a family business Franchise my business Start a brand new business

Management and staff Create an Organizational Chart Who reports to whom? How many employees will work at every level? Write the Job Descriptions What is expected of each type of employee on a daily basis? Develop a Wages & Benefits Package What will each employee be paid? What other perks will they receive?

Marketing plan “Marketing Mix” Product Place Price Promotion What product/service are you trying to sell? What are your product/service lines? Place How will you get your product/service to the market? Price What will you decide on charging for your products? Promotion How do you plan to advertise for each product/product line?

financials Preparing Financial Statements How do I get a loan/capital? Start Up Costs Cash Flow Statements Income Statements Balance Sheets How do I get a loan/capital? Should I buy insurance?

Business plan: introductory elements Cover Letter [Example on pg. 118] Explains or provides more information about the business plan that follows Name Name of your business Address Telephone number/Fax Number/Website/E-mail Describe your business and its potential for success How much money you will be seeking? Should be no more than 1 page Cover Sheet [Examples on Google] Date Owner of the company and title Address, phone number, contact info

Business plan: introductory elements Table of Contents Listing of material included in the publication Quick reference for what is covered on each page Statement of Purpose [Example on pg. 119] Describes WHY you are asking for the loan and what you will do with the money Should be no more than 1-2 paragraphs Executive Summary [Example on pg. 120] Short restatement of the business plan to catch a readers attention Written after the business plan is complete, approximately one to two pages long.

Business plan: Supplementary Elements Appendix Includes supporting evidence NOT included in the main body Charts, graphs, financial statements Think of it as a section to place large elements that are NOT text-based which would break up the reading of the main business plan Attachments Resume Large sales contracts you may have negotiated Letters of recommendation Legal documents