The Business Plan

The student will . . .

Discuss elements needed in a formal written business plan

What is a business plan?

A document that describes a new business.

It explains to lenders and investors why the new business deserves financial support.

Why make a business plan?

To obtain financingTo serve as a living guide to the businessTo provide a start-up blueprint

The Parts of the Business PlanExecutive SummaryProduct/Service PlanManagement Team PlanIndustry/Market AnalysisOperational PlanOrganizational PlanMarketing PlanFinancial PlanGrowth Plan

Executive Summary

A brief recounting of the key points in business plan

Reader uses it to decide if concept interests them, then will read on

Should be no longer than two pagesShould include the most important

information from each section of the planPersuade reader business will succeed.

Product/Service Plan

Present product or service offeredNature of business should be clearNote unique features of product or service

and possible spin-offs (additional products) when business is established

Management Team Plan

Present your qualificationsPresent qualification of any partners you’ll

haveAnalyze the expertise you are missing and

how you will solve that problemDescribe the advisory board that will help

you get started

Industry/Market Analysis

Presents your research into the industry and market

Analyze your customers, competition, and industry

Include information about the prospective location’s geographic, economic, and demographic data

Operational Plan

All the processes that take place in the business so that the product or service is produced and delivered to the customer.

If manufacturing, discuss status of product development

How much time and money to get product ready for the market

Explain distribution plan

Organization Plan

Looks at the people aspect of the businessDiscusses management philosophy, legal

form of the company, key management personnel, and key employment policies

Marketing Plan

How a company makes its customers aware of its products or services

Includes such features as the market niche, pricing policy, company image, marketing tactics used to reach customer, a media plan, and a marketing budget

Financial Plan

Presents the forecasts for the future of the business

Explains the assumptions made when calculating forecast figures

Information in the form of financial statements

Shows that the new business will be financially healthy

Growth Plan

Looks at how the business will expand in the future

Explains potential for plan to grow over its life