DEVELOPING A
BUSINESS PLAN
WHAT IS A BUSINESS PLAN?
A written description of the business idea and how it will be carried out
Includes all major business activities
A business plan should always be created whether you need financial help or not
May prevent potential problems
Forced owner to think about important activities, cost, and amount of
time they will take
STEPS IN DEVELOPING THE BUSINESS PLAN
Owner is in charge and must be familiar with all information in the plan
Helps persuade lenders and investors to finance the venture
Can get help writing the plan from the Small Business Administration
1.
Gather and review information – look at other business plans for reference
2.
Develop strategic alternatives and select the best alternatives
3.
Write each section of the plan
ELEMENTS OF THE BUSINESS PLAN
Following are the sections of a sample business plan.
Some plans include different sections.
SUMMARY (OR EXECUTIVE SUMMARY)
Overview of the business
Generally summarize the business
DESCRIPTION OF THE BUSINESS
The business idea
Major products and services
Ownership structure
Strengths/weaknesses
Long- and short-term goals
CUSTOMER ANALYSIS
Description of customers
Location, number, and resources of customers
Sales forecasts
OPERATIONS PLAN
Organization of the company
Description of major operations
Analysis of resources needed
Human resource plans
MARKETING PLAN
Description of major marketing activities
Description of marketing activities
Schedule of marketing activities
FINANCIAL PLAN
Start-up costs
◦ The amount needed to open the business
◦ Building, equipment, inventory, supplies, licenses, etc.
Short- and long-term financial needs
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Money needed to pay for current operating activities
Short-term financing obtained for less than one year
Long-term financing is needed for main resources of the business that will last many years
Usually large amounts of money and usually paid over many years (financed at bank)
Sources of financing
Budgets and financial statements