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Every business starts with an idea. Regardless of what the idea is, a well-thought-out business plan is what helps transform an idea into a reality. It is a common misconception to think that business plans are written for the sole purpose of obtaining financing. Actually, the most important reason for writing a business planis to create an essential management tool to use in the present, as well as the future.
DEVELOPING THE BUSINESS PLAN
This section of the business plan should be written last COVER LETTER: States why the business owner is creating and submitting the business plan
• Highlight important information from the plan • If the business plan is being presented to a specific individual,make certain his/her name and address is spelled correctly • How will the advertising needs be handled? • How much actual inventory should be purchased? • Should the store open in a mall or a free-standing location?
A SERVICE BUSINESS:
• Are the skills better than competitors? • Should the business insist on cash payments only? • Identify the market(s) to be served • Should franchising beconsidered? • Identify the business’ competitive advantage • Is the client list big enough or should the business start fresh? • Explain how the business’ product/service is different from competitors • Explain the legal structure of the company; is it a sole proprietor, partnership or corporation? Be as specific as possible • Tell the reader if the business is a start-up or identify the length of timeit has been in business • Provide a brief overview of progress to date; be sure to mention contracts, patents and any market research identifying the viability of the business • Describe the management team, as well as their individual experience • Indicate exactly how much money has been invested and how it has been spent • Summarize the past financial performance by identifying the projectedgross revenues and net profits • Explain if management will be drawing a salary from the business in the beginning; if so, be as specific as possible when quoting the salary requirements
A BUSINESS PLAN IS...
A written document fully describing and analyzing a particular business; it provides complete, detailed information about short- and long-term business plans Information providing potentialinvestors with complete knowledge of a business; investors will then be able to understand all of its strengths and weaknesses, enabling them to identify present and future potential
NON-DISCLOSURE STATEMENT: This informs the reader to keep the plan’s contents confidential TITLE PAGE: Contains the following information:
• Current date • Company logo • Company name • Company address • Companyemail address • Company telephone numbers • Home and office #s of employees • Company Web site address
WHY CREATE A BUSINESS PLAN?
A COMPLETE BUSINESS PLAN WILL:
• Assist management in obtaining various sources of financing • Identify the strengths and weaknesses of a business • Present correct details about the business; i.e. past, present, and future performance • Furnish detailed projectionsabout the company • Discuss the financial aspects of starting or expanding the business • Guide management through the steps of developing and fine-tuning a business • Provide clear business objectives and short- and longterm goals • Provide answers for any potential financial backers • Provide prospective investors with the information to determine whether the company is the correct investmentfor them • Provide a chronology of events and financial markers against which the firm can compare their actual results • Keep a business focused • Improve odds for success
TABLE OF CONTENTS: Should specifically outline core sections and sub-sections of the business plan; it is a good idea to wait until the plan is written before adding page numbers EXECUTIVE SUMMARY: This section is the most...