Originally Posted by KRL
Basic Business Scruture:
Title page
This page should include basic information on the plan, including the name of the business and the name or names of the individuals who are submitting the plan.
Table of Contents
A table of contents must be included. This both conveys the organization of your thoughts and provides a map for the reader to help them access information quickly and easily.
Executive Summary
Description:
An Executive Summary should be clear, concise and convincing. It should be to the point and make you want to read more. The summary should prove credibility and contain at least the following information.
Specific criteria:
Briefly describe the following:
- Business strategy of the enterprise
- Products/services offered
- Identify the management team. Include description and qualifications, including past experience in the industry, and past successes that illustrate the abilities of the team members. (Fill this out in greater detail in the organization and management section)
Describe market size and characteristics
- Support the business' capability to reach the market
- Identify money or resources necessary to implement the plan
- Business sales and profits for at least three years or until positive cash flow, if longer than three years
Mission, Goals & Objectives Statement
Description:
A mission statement sums up the values, purpose and vision of a business in a focused statement(s). In addition, this section can address future goals and strategies for attaining them.
Specific criteria:
- Provide the mission statement for the organization and philosophy of how it will do business
- State what the business does to attain its internal measure of success and serve the customer
- Identify the long term goals and direction for the business
- Lay out a realistic and thorough timeline for attaining its goals
Background Information
Description: This section primarily presents the industry in which the business operates. It could also include information about its stage of development and general growth strategy. It should address all of the following items that apply.
Specific criteria:
- Past and present industry trends that affect the business
- Insight into where the industry is heading
- Economic, social or political trends that affect the business' industry
- Indicate the current stage of development for the business development
- Financial backing already received by the business
- Outline a growth strategy
- Organization and Management
Description:
This section should contain the business' legal form of ownership. This section should also contain information on the people and structures that will make the business run smoothly and successfully. It should address all of the following items that apply.
Specific criteria:
- Legal form of ownership (i.e. corporation, Limited Liability Company, sole proprietorship, etc.)
- The responsibilities and qualifications of its management team
- Highlight the strengths and weaknesses of its team
- Estimate a timeframe for hiring additional personnel
- Discuss the availability of workers needed for growth
- Include an organizational chart
- Explain the management hierarchy including the breakdown of responsibilities and job descriptions
- Outline compensation for management team and employees
- Discuss how records are kept, budgets and management controls
- Discuss an outside board of directors or advisors, if applicable, and the expertise they bring to the business
Product/Service Line
Description: This section should clearly identify what products or services the business will offer. It does not, however, need to give away proprietary information or trade secrets. It should address all of the following items that apply.
Specific criteria:
- Include an operations plan
- Identify intellectual property owned by the business (this will be key for most technology category entrants, though other businesses may need to address this, as well).
- If inventory is required for the business model, address inventory management and policies
- Clearly define what products or services the business offers/will offer
- Clearly define what benefit(s) the products or services provides to its customers
- Include information about seasonality of products/services
- Address patent or licensure issues, if applicable
- Indicate where the product or service is in its life cycle
- Where or when does the business anticipate future growth?
- Discuss any new or additional products or services
- Address suppliers and inventory management issues and challenges, if applicable
- Identify a unique niche or role that the products or services will fill
Market and Marketing Plan
Description:
The marketing plan usually identifies the markets a business intends to serve, its position within the market, and lays out a plan for how the business will reach its target market. The marketing section also analyses competitors and makes a case for the need and the competitive advantage of the enterprise.
Specific criteria:
- Market Analysis
- Clearly state the business' target market or customer profile
- Describe the size of the target market
- Target market information and assumptions should be backed up with research such as demographic information, statistics, etc. including sources for information. This can be research that the plan author does directly, in which case, the scope of the research should be described. It could also be research done by a third party, or a research firm that helps to prove the points in the plan, in which case, the source of the research should be cited.
- Address future trends in the business' target market
- Clearly define opportunities for growth within the industry
- Competitive Analysis
- Clearly identify the business' competitors
- State the business' strengths and weaknesses compared to its competitors
- Identify and discuss barriers to entry in the market
- Describe any opportunities to collaborate with competitors or complementary businesses for mutual benefit
Marketing Strategy
Include a marketing plan, including the following:
- A marketing timeline
- Marketing strategies and media choices
- Costs associated with promotional tactics discussed
- Outline of a marketing budget
- If increased volume is projected, address how the business will maintain production/quality levels to meet customer orders/demand
- Address a customer service plan
- Explain and substantiate the assumptions the business makes about its marketing strategies
- Describe how the business tracks or plans to track the results of its marketing
- Address and substantiate pricing of products or services
- Discuss position of business within the market
- Describe how the product or service is or will be delivered to the market
- Identify any opportunities for free advertising (public relations) of which the business may take advantage
- If business is not a start up (older than two years), is there a person in the organization designated to handle the marketing for the business?
Operational Plan
Description:
The operational plan describes the overall process that runs the business model. This is also where the business addresses succession plans or exit strategies for the current management or for the business as a whole.
Specific criteria:
- Describe the process by which the business operates. It isn't necessary to provide deep details of the operation, but to provide enough insight to the reader to understand the process and provide credibility for the plan and the projections made in it.
- If applicable, address the processing of orders and fulfillment
- Include milestones and an estimated timeframe for meeting them
- Identify exit strategies, such as taking the business public, buying out investors, or selling to another business
Financial Statements & Projections
Description:
The financial section gives the quickest summary of where the business is and where it wants to go. In this section, the business lists the financial requirements for launching or growing the business. The financial section is comprised of cash flow projections, financial statements and supporting financial information.
Specific criteria:
- Include a break-even analysis
- List assumptions made in the financials
- Ensure that most normal business expenses are listed and taken into account
- Include at least the following statements to illustrate the financial feasibility of the business:
- Income statements, by month in year 1, by quarter in years 2 & 3 and yearly for any following years, until the business shows a profit
- Balance sheet
- Statement of cash flows, by month in year 1, by quarter in years 2 & 3 and yearly for any following years, until the business shows a profit
- Make sure that assumptions from other aspects of the plan are incorporated into the financial assumptions
- Address the assets required to operate the business and how those assets will be acquired
- If the business model creates accounts receivables, describe the process for handling these
- Address the salary of the business owner, making reasonable estimates for both ranges and timeline for when he/she will start to receive compensation
- Financial backing already received by the business
- Describe the business' strategy to cover shortfalls in cash
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