Developing a Developing a Business PlanBusiness Plan

Cameron StevensonCameron Stevenson

Business plan’s can help with many Business plan’s can help with many things in a business ranging from things in a business ranging from financial progress to how to manage financial progress to how to manage your business. It can possibly make your business. It can possibly make or break your business.or break your business.

Why a Business Plan?Why a Business Plan? Inside a Business PlanInside a Business Plan Creation of a Business PlanCreation of a Business Plan

Why a Business Plan?Why a Business Plan?

What is a Business Plan?What is a Business Plan? Purposes of a Business PlanPurposes of a Business Plan Importance of a Business PlanImportance of a Business Plan

What is a Business Plan?What is a Business Plan?

Document describing all steps to Document describing all steps to opening and operating a businessopening and operating a business

It:It: Describes what business will produceDescribes what business will produce

How to produce itHow to produce it Who will buy product/serviceWho will buy product/service

What is a Business Plan What is a Business Plan Cont.Cont.

Explains who will run the businessExplains who will run the business Who will supply its goodsWho will supply its goods

How to gain customersHow to gain customers Provides detailed financial informationProvides detailed financial information

Purpose of a Business Purpose of a Business PlanPlan

Explains ideas behind your businessExplains ideas behind your business How product/service will be soldHow product/service will be sold

Sets objectives and describes how to Sets objectives and describes how to achieve themachieve them

Describes background and Describes background and experience of manager/ownersexperience of manager/owners

Importance of a Business Importance of a Business PlanPlan

Shows all aspects of businessShows all aspects of business May help secure financingMay help secure financing Helps communicate the idea to Helps communicate the idea to

othersothers Tool for managing businessTool for managing business

What Goes Into a What Goes Into a Business Plan?Business Plan?

There are seven elementsThere are seven elements History and BackgroundHistory and Background Goals and ObjectivesGoals and Objectives Products or ServiceProducts or Service Form of OwnershipForm of Ownership Management and StaffingManagement and Staffing MarketingMarketing Current and Projected Financial StatCurrent and Projected Financial Stat

ementsements

History and BackgroundHistory and Background

Describe how you came up with your Describe how you came up with your ideaidea

It can lead to:It can lead to: InvestorsInvestors LendersLenders Others understanding how the Others understanding how the

business will operatebusiness will operate

Goals and ObjectivesGoals and Objectives

Should outlineShould outline Short term goalsShort term goals Medium term goalsMedium term goals Long term goalsLong term goals

Describes your vision of where you Describes your vision of where you want your business to be.want your business to be.

Product or ServiceProduct or Service

ExplainExplain How products/service is different How products/service is different

from othersfrom others IndustryIndustry LocationLocation

IndustryIndustry

Should include:Should include: External factors affecting your External factors affecting your

businessbusiness Growth potential of the industryGrowth potential of the industry Economic trends of the industryEconomic trends of the industry Technology trends that may affect itTechnology trends that may affect it Forecast industry growthForecast industry growth

Industry Cont.Industry Cont.

To find information use:To find information use: Government documentsGovernment documents ArticlesArticles BooksBooks InternetInternet

Be sure to name all sourcesBe sure to name all sources

LocationLocation

Lenders want to know where your Lenders want to know where your business will bebusiness will be

Crucial Factor in successCrucial Factor in success Sloe to/In an area of demand for Sloe to/In an area of demand for

your product/serviceyour product/service

Form of OwnershipForm of Ownership

Provide information relevant to your Provide information relevant to your formform Who are the partnersWho are the partners How many shareholdersHow many shareholders

Important because:Important because: Each legal form has an effect on your Each legal form has an effect on your

businessbusiness

Management and Management and StaffingStaffing

People who manage are critical to People who manage are critical to successsuccess

Best business plan will fail if Best business plan will fail if managers are not capablemanagers are not capable

Should Show you and employees Should Show you and employees have:have: MaturityMaturity ExperienceExperience Common senseCommon sense

MarketingMarketing

ExplainExplain Who your prospective customers areWho your prospective customers are How large the product is for your How large the product is for your

product/serviceproduct/service How you plan to enter that marketHow you plan to enter that market

Also list advantages your company Also list advantages your company has over othershas over others

Current and Projected Current and Projected Financial StatementsFinancial Statements

Identify RiskIdentify Risk Lender/investors want to know before Lender/investors want to know before

investinginvesting Don’t be afraid to list potential problemsDon’t be afraid to list potential problems

Financial StatementsFinancial Statements Must include projected statementsMust include projected statements

Funding Request and Return on Funding Request and Return on InvestmentInvestment Give an idea on how you plan to use the moneyGive an idea on how you plan to use the money Include how much money you are investingInclude how much money you are investing

Additional Elements of the Additional Elements of the Business PlanBusiness Plan

Businesses that have a license would Businesses that have a license would include legal issues sectioninclude legal issues section

Ask yourself what should you know Ask yourself what should you know about a businessabout a business

Creating an Effective Creating an Effective Business PlanBusiness Plan

Research Business PlanResearch Business Plan Put Your Plan TogetherPut Your Plan Together Sample Business PlansSample Business Plans

OneOne TwoTwo ThreeThree

Researching the Researching the Business PlanBusiness Plan

Print ResourcesPrint Resources Online ResourcesOnline Resources People ResourcesPeople Resources Additional ResourcesAdditional Resources

Print ResourcesPrint Resources

Public libraries have books on Public libraries have books on entrepreneurshipentrepreneurship

BooksBooks MarketingMarketing FinancingFinancing Hiring and Managing a StaffHiring and Managing a Staff Purchasing a BusinessPurchasing a Business Operating a FranchiseOperating a Franchise Business PlanBusiness Plan

Print Resources Cont.Print Resources Cont.

MagazinesMagazines Small Business OwnershipSmall Business Ownership

Government DocumentsGovernment Documents Publications issued by SBAPublications issued by SBA Other federal agenciesOther federal agencies

Online ResourcesOnline Resources

SBA web siteSBA web site Online magazine articlesOnline magazine articles Online booksOnline books Entrepreneurship and small Entrepreneurship and small

business sitesbusiness sites

People ResourcesPeople Resources

Counselors from Small Business Counselors from Small Business Development CenterDevelopment Center

WorkshopsWorkshops Service Corps of Retired ExecutivesService Corps of Retired Executives

Additional ResourcesAdditional Resources

Local Chamber of CommerceLocal Chamber of Commerce Small Business Development Small Business Development

CentersCenters Trade associationsTrade associations Professional business consultantsProfessional business consultants

Put Your Business Plan Put Your Business Plan TogetherTogether

Introductory ElementsIntroductory Elements Cover LetterCover Letter Title PageTitle Page Table of ContentsTable of Contents Statement of PurposeStatement of Purpose Executive SummaryExecutive Summary

Main BodyMain Body AppendixAppendix

Cover LetterCover Letter

Provides more information about a Provides more information about a documentdocument

Cover includes:Cover includes: NameName Business nameBusiness name Address and telephone numberAddress and telephone number

Describe business and its potentialDescribe business and its potential

Title PageTitle Page

Name of companyName of company DateDate Owner of companyOwner of company Title of ownerTitle of owner Address and phone numberAddress and phone number

Table of ContentsTable of Contents

Listing of material included in Listing of material included in publicationpublication

Shows reader what each page coverShows reader what each page cover AccurateAccurate In orderIn order

Statement of PurposeStatement of Purpose

Describes why you want a loan and Describes why you want a loan and your planyour plan

No more than one to two paragraphsNo more than one to two paragraphs

Executive SummaryExecutive Summary

One to two pagesOne to two pages Describes business conceptsDescribes business concepts Communicate what is unique about Communicate what is unique about

your ideayour idea Include sales, cost, and profit Include sales, cost, and profit

projectionsprojections

Executive Summary Executive Summary Cont.Cont.

Identify needsIdentify needs State amount interested in State amount interested in

borrowingborrowing Written after business plan Written after business plan

completedcompleted Use most important points from Use most important points from

business planbusiness plan

Main BodyMain Body

Include the seven elementsInclude the seven elements Additional elements you find Additional elements you find

necessary necessary Short and to the pointShort and to the point No unnecessary informationNo unnecessary information Charts and tablesCharts and tables

AppendixAppendix

Supporting evidence not included in Supporting evidence not included in bodybody

ResumeResume Personal financial statementsPersonal financial statements Income tax returnsIncome tax returns Copies of large sales contractsCopies of large sales contracts Letters or recommendationLetters or recommendation Legal documentsLegal documents

A business plan is vital to a business. A business plan is vital to a business. Be sure to take time and be careful Be sure to take time and be careful when creating one.when creating one.