Recommended Outline of the Business Plan
By
Dr. Sonny S. Ariss,
The Center for Entrepreneurship and Technology Commercialization
1. Executive Summary
2. Opportunity Rationale
3. The Company
4. The Product/Service
5. Management Team and Organizational Structure
6. Industry Overview
7. Market Size and Trends
8. Estimated Market Share and Sales
9. Competition
10. Marketing Plan
a. Market Entry and Growth Strategy
b. Advertising and Promotion
c. Price
d. Sales Tactics
e. Distribution
f. Service and Warranty Policies
11. Patents and Proprietary Issues
12. Regulatory Issues
13. Product Design and Development Plans
14. Manufacturing and Operations Plan
15. Financial Plan



Breakeven analysis
3 year pro forma monthly cash flow
3 year pro forma monthly income statement
16. Overall Venture Schedule
17. Critical Risks and Assumptions
18. Harvest Strategy
19. Proposed Company Offering
1
Executive Summary- The executive summary is the initial introduction of the overall idea for
the business venture. This section of the Business Plan is what will grasp the potential investor’s
attention and keep it in the ensuing reading. The Executive Summary is usually used by potential
investors to make the initial decision based upon this concise two to three page overall
description of the who, what, when and why of the potential business.
Sections of the Executive summary include:
 A description of the business concept and the business- Describe the business
concept and how this business will be able to fit into the niche that has been
identified for it within the market.
 A summary of the opportunity and strategy- Identify what the opportunity is and
the overall plan to capitalize on it. Outline key facts about why this is an
opportunity and how the business will meet those needs.
 The target market and projections- a description of the market that the business
will be in. Identification of the customer, and anticipated numbers on the level of
market capitalization that the business will achieve (i.e. Market share, industry
growth rate, product/service positioning, etc.)
 The competitive advantage- a summarization of the competitive advantages that
the business will have. Also a brief outline of the competitive atmosphere and the
company place in the industry as compared to identified competitors.
 The economics and profitability potential- A brief description of how the business
will initially turn a profit and a factual representation of key financial data to
demonstrate the potential of the company.
 The team- A concise description of the major contributors to the business (i.e.
Management experience)
 The requirements of doing business – illustrate financing requirements and the
collateral that is being offered in exchange for it.
Overall the executive summary is supposed to tell a concise factual story in a two to three page
summary. Giving factual information while still maintaining a sense of excitement is very
important in the section because investors usually use this as a guide for deciding whether or not
to even continue reading the more in depth information of the Business Plan.
Opportunity Rationale- This section is an expanded version of the summary of opportunity and
strategy within the executive summary. It identifies in broader terms the exact opportunity within
the sector of business and why it is compelling. It describes how the business can rationally enter
the market (entry strategy) and capitalize upon it. Key facts like industry growth rates,
technological advancement, product obsolescence, changing socio-economic conditions,
competitor vulnerabilities, and other evidence can be used to logically draw a picture of why this
idea is a good one.
The Company- This section is an in depth description of the business concept,
products/services, and customers. If the business is already in existence then a description of
pertinent business facts (i.e. date of inception, history, past performance, sales, projected growth,
etc.) should be included.
Management Team and Organizational Structure- This section identifies the overall structure
of the business (i.e. Sole proprietorship, corporation), and also identifies the management and
presents their experience. The use of organizational charts illustrating management structure and
2
also the inclusion of resumes is useful in this section. Be sure to also identify committed
investors, the board of advisors, and any other key personnel.
The Product- This section describes the products/services to be provided and the merits of them.
A detailed description of the products/services to be sold should be the centerpiece of this section
with the inclusion of photographs if applicable to give a visual picture of the venture. Included in
the description should be product/service use and potential secondary applications. Any special
features and value added qualities of the product should also be included.
Industry Overview- This section presents the current status and prospects for the industry in
which the business will operate. Identify the industry structure and discuss trends. This section is
just a description in which the industry the business will function and compete in is described.
This section will not contain a significant amount of business specific information the data will
be more external.
Market Size and Trends- This section identifies the market within the industry where the
business will compete. The actual size of the market (i.e. the soft drink market within the
beverage industry is X amount of dollars) will be identified as well as trends (i.e. More people
are leaning towards diet soft drinks and the sector is growing at X percent per year). Statistical
information about the market is very valuable in this section and should be included.
Estimated Market Shares and Sales- In this section the saleable aspects of the product/service
will be evaluated and presented to readers with greater details. Major customers who could be
described as potential product/service users for the long term will be identified and the reasoning
behind that assessment will be included. Assessment of advantages in conjunction with market
size and trends, customers, competition and their products/services, and prior sales trends for the
market should be clearly identified in this section if possible. The forecasted performance should
also be shown.
Competition- In this section the presentation of a realistic picture of known competitors to the
company will be given. Assess the strengths and weaknesses of each competitor if possible while
acknowledging each of the following areas: Substitute or Alternative Products/Services, Pricing,
Quality, Performance, Delivery, Timing, Service, Warranties, and other pertinent features.
Demonstrate why the competition is not meeting customer needs, be sure to look at the
competitors place within the industry and evaluate common performance measures (i.e. market
share, general sales) if possible. The use of statistical information to support your stance in this
area is important.
Marketing Plan- The marketing plan section details the overall marketing strategy that will
capitalize on the previously identified opportunity and also amplify the competitive advantage
that the company has. The marketing plan needs to describe what is to be done, how it will be
done, when it will be done, and who will do it.
Market Entry and Growth Strategy- This section will discuss how the company will enter
the competitive market and discuss plans for future growth. The initial direction of the
company as far as sales is also identified.
Advertising and Promotion- This section discusses how the company will bring the
product/service to the attention of the consumer. In other words, plans to be in print media,
sales aids, television/radio, trade shows, etc. A schedule of times and implementation should
be included.
3
Price- The layout of pricing for the product/service will be presented in this section. A chart
or price list would be helpful and be sure to clearly explain the process behind setting pricing
and include the reasoning behind pricing decisions.
Sales Tactics- Use this section to describe the methods that will be used to make sales and
distribute the product/service initially and for the long term. Be sure to discuss the roles of
staff in this area along with distributors if applicable (supply chain). Be sure to identify all
methods of sale (direct mail, internet, sales force, etc) and their roles.
Distribution- This section describes how the product/service will be distributed including
logistics, special issues or vulnerabilities, and potential insurance needs if applicable.
Service and Warranty Policies- If the company plans to offer a product/service that requires
service, training or warranties this section will give a clear definition of what will be covered
with all details (terms) included.
Patents and proprietary issues- If the product/service has any aspect that is covered by patent
or proprietary law, this section will be necessary to identify the specific aspects. Include time
limitations, contractual agreements, and identify potential issues with timing and also any
advantages this gives the company in the market.
Regulatory Issues- If the product or service can be regulated in any way by the government, a
description of the constraints and processes needs to be listed within this section.
Design and development plans- This section discusses the current status of the product/service
offered by the company. This will show the stages of development and where each product is in
comparison to being fully marketable. Discussion of the development status and tasks required,
difficulties and risks, and product improvement and new product development should be put into
this section.
Manufacturing and Operations Plan- In this section include information on the types of
facilities required to do business (i.e. space requirement, location), equipment requirements,
operating cycle, and labor force requirements.
For Manufacturing Business- Include policies on inventory control, purchasing, production
control, and info on make or buy decisions.
For Service Business- Include info on minimizing overhead and labor force productivity.
Financial Plan- This section includes all of the financial information on the company. This is
one of the most crucial sections of the Business Plan and must include the most realistic
estimates of current and future financial requirements presented on a MONTHLY basis See PC
BUILD example..
The Financial Plan must include monthly financial exhibits that describe the financial needs for
the business for a minimum of three years. The following financial exhibits should be included:
 Monthly Cash Flow Statement (Current and Projected (ProForma))
 Monthly Income Statements (Current and Projected (Proforma))
 Break Even analysis
4
Outside of those exhibits, assumptions need to be clearly outlined; assumptions on factors like
estimated sales and growth, cost of goods, inventory requirements, bill pay periods, etc. It is
important to outline the costs for all of the business actions described in the prior sections
because all of this information will be analyzed and included in the potential investor’s decision
making process.
Overall Venture Schedule- A schedule that shows the timing and internal relationships
necessary to launch the business and achieve its outlined objectives is what this section
discusses. This section can act as a planning aid where certain objectives are achieved within a
timeframe and everything is laid out in comparison. This could typically be thought of as a
calendar for the business cycle.
Critical Risks and Assumptions- This section includes the risks and consequences of adverse
outcomes relating to the industry, the company, personnel, the products appeal, timing and
financing. While it may seem as though this section is negative it is in fact a good section to have
because it shows the investor that the view of the company is objective and realistic.
Harvest Strategy-This section gives the layout for the harvest strategy. Having a harvest goal
and crafting a strategy to achieve it should be important to all entrepreneurs. Setting a harvest
goal helps entrepreneurs get cash out of an enterprise by selling all or a portion of it. A Harvest
goal is not just a plan for selling and leaving a company rather it is a long term goal to create real
added value in a business. Within the process of Harvest, the seeds of renewal and reinvestment
into a new business should be sown in order to recycle the entrepreneurial talent and capital that
is at the very heart of our economic system.
Proposed Company Offering- This section indicates the amount of money being sought and the
terms offered to the potential shareholder. A brief outline of the purpose for that specific amount
and information on the rate of return is also important. The section should be noted as follows:
 Desired Financing
 Stock Offering
 Use of Funds
 Investors Return
5