The Business Plan

Failing to plan is planning to fail. In the business world this saying holds several truths and can have adverse effects if not taken seriously. As a business owner setting up their new venture, you have to have a business plan that allows you to make sense of all the details on paper. Business plans are a necessity as they act as a reference to consult during the course of running a business. They are also an essential tool when looking for funding from investors and lending institutions. Let’s take a look at the format in detail of a traditional business plan:

Cover Page

The cover page is the first thing a potential investor sees before going through the whole document. It is important to ensure proper layout of text, graphics and business logos for effective presentation. If design and color are used properly they may set a positive mood for the investor to want to read through the entire document. If you can’t do graphics design, find an artist that will develop a killer cover page that will blow away your investors and anyone who reads your business plan.

Table of Contents

You do not want to frustrate potential backers by having to constantly ask you what page the information you are presenting to them is on. It is of paramount importance that your document has an accurate and well labelled table of contents for easy access to information. If it’s in digital format like a pdf or word then try and link the table of contents to the document. This will be much appreciated when one clicks on an item on the table of contents and instantly they are taken to the page the information is on.

Executive Summary

An executive summary details what the company is about and why it will succeed. It should provide an 360 overview of the business: its core values, the mission, company vision and the product/ service offering. The executive summary should also provide information about the employees, management team and business location. Summarized financial projections and expansion plans should also be highlighted in this section if you purport to seek for funding.

Company description

This section describes the company in depth to the reader. What problem the company is solving and who the customers it will serve are. The company description gives specifics into the business operations that will make the company a success. The competitive advantages of the business should also be fully explained here.

Organizational Plan

How is the company structured? Your potential investor will want to know what the structural composition of your business and the leadership running it. It would be ideal to provide information in the form of an organogram that depicts how you are setup from a human resources point of view. Detail the credentials of key team members and how they will contribute to the success of the venture. Also include how the business will be registered. Will it be an S or C corporation? 

Marketing Plan

How is the business going to acquire customers? The marketing plan details strategies that will be implemented into order to penetrate the market acquire customers and turn a profit. It also details the current trends in the market and who the competitors are. It is important to have clear cut strategies in place to put the product or service into the hands of customers therefore thorough market intelligence should be done.

Financial Projections

Financial projections enable a potential backer to assess business viability. Include charts and graphics that are easy to understand. Also include a five year forecast and if you have been in operation include cash flow statements, balance sheets and income statements. Be realistic in your projections so as to get investor buy in.

Appendix

This section houses all the supporting documents such as reference letters, patent information, permits and history of credit. Any document requested prior to the meeting with the investor will be placed here.