In Business Plan Outline And Checklist
Every business needs one. It’s not just for start-ups or new product launches or business expansion initiatives.
Why? And what should be in one?
Documenting a Business Plan is an extremely useful process to focus management and owners on their business concept, strategies, and operating plans. It forces consensus and decision making that might otherwise be neglected. It requires issues to be resolved and the decisions to be reflected in financial projections.
A well-documented business plan will help you communicate the most important elements of your strategy and plans to the people who need to know them. Including you.
Already in business for years and never needed a business plan? It’s still a good idea for all the same reasons. And now is a good time.
Ready to exit your business? Even better. A solid business plan will be the most important document in supporting the valuation of your business.
The greatest value of a business plan, however, is likely to be in the process - involving your management team in a thorough examination of your business - its purpose, its strategies and its plans to ensure success. When completed, all the key players will be more knowledgeable of the issues, the opportunities, the risks, and the alternative paths considered, before committing to the final plan.
Following is a suggested guideline of the layout and content for developing an effective Business Plan. It is a consolidation of best practices, based on our consulting and management experience with many different clients under a variety of circumstances.
COVER PAGE:
Includes title, date, purpose, prepared by whom, confidentiality statement, issued to whom, and a document control number.
PURPOSE:
Objectives of the Business Plan - attract financing, key executives, customers, or strategic partners? Document strategy and action plan for all participants? Set financial objectives and timetable?
CONTENTS:
1.Executive Summary (Max. 2 pages, written last as a stand-alone document, may be offered for review prior to full disclosure of the business plan, convinces reader to go further, or not.)
Business Concept, Plan and Objectives
Current status relative to the market opportunity
Key success factors, risks, expected results
Financial situation and needs
Reference to the complete Business Plan (sections below) for more detail
2.Concept and Business Opportunity (Describe the need being addressed, how this approach is different, and why it is likely to succeed.)
Market need and current solutions available
Business concept and product/service differentiation
Initial market feedback
3.Mission statement (Generate missionaries!, why others should join the cause - have fun, make money, make a difference?)
Clear, attractive objectives - who and what do you want to be?
Statement of values and priorities
Milestones and timetable
4.Market Analysis (Provide relevant, pertinent information to demonstrate your knowledge and competence in this industry.)
The overall market, recent changes
Market segments
Target market and customers
Customer characteristics
Customer needs
Buying and selling process
5.Competition (Demonstrate an awareness of competitors and your ability to compete successfully.)
Industry overview, recent changes
Nature of competition, inside and outside the industry
Primary competitors
Competitive products/services, relative pricing, advantages, disadvantages
Opportunities, protection by patents, copyrights, barriers to entry
Threats and risks, ability of competitors to respond, imitate or copy.
6.Strategic Plan (Describe your starting point, direction, and plan to get there.)
Company history & background - experience, resources
Key competitive strengths & current weaknesses
Business plan and strategy to leverage strengths, reduce weaknesses
Action plan for implementing strategy
7.Management team (Usually the most important factor in determining your success and in attracting staff and financing. Emphasize current strengths and plan to fill in the gaps.)
Key personnel, experience & credentials
Staffing plan
Organizational structure
8.Product & Service Offering (Consider the reader’s familiarity with the industry, avoid technical jargon, relate to the market and competition.)
Product/service description
Positioning of products/services
Competitive evaluation of products/services
Future products/services
9.Marketing and sales plan (Another key to success, too often neglected by owner/managers with strong product, technical, or operations backgrounds. Prove you have a plan that will be affordable and effective.)
Marketing strategy, positioning, presentation
Sales tactics
Advertising, Promotions/incentives
Publicity, public relations, press releases
Trade shows, industry events
Web marketing
10.Operations plan (Describe the important issues and factors that will affect customer service perceptions and the costs related to capital investment and operations.)
Processes for product/service delivery
Customer service and support
Facilities and staff required
11.Risk analysis (What can go wrong, what will you do about it?)
Market factors - economic cycle, interest rat 1ff8 es, currency, government regulations, trade restrictions.
Business risks - key customer & supplier dependence, labour availability, staff turnover, new competitors, new technology, changing demand.
12.Financial plan (Convert all the preceding words into numbers, next year by month, then three-to-five years annually.)
Summary paragraph, Assumptions and Comments, followed by analysis
Starting Balance Sheet
Profit and Loss Projection
Cash Flow Projection
Balance Sheet Projection
Ratio’s and Analysis, value of equity
Financial needs
Sources of funds
APPENDICES:
Add some personalisation and realism with biographies and photos of key executives, product photos, marketing literature, sample packaging, facility plans, press releases, customer testimonials, relevant research documents, etc.
Following these guidelines will ensure that you have considered all the issues and can defend your strategies and action plans against all inquisitors.
Author: Delvin R. Chatterson
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