2011 Business Plan Guide

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Business Plan Guideline


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Index for


I. Executive Summary ................................................................................................... 3

II. Company Summary ................................................................................................... 3

III. Products & Service ..................................................................................................... 4

IV. Industry Analysis ........................................................................................................ 4

V. Marketing .................................................................................................................. 5

VI. Advertising ................................................................................................................. 6

VII. Management/Key Personnel/Staff ............................................................................ 6

VIII.Risks ............................................................................................................................ 7

IX. Community Benefits .................................................................................................. 7

X. Financial Plan ............................................................................................................. 8

Appendix:

Financial Statements:

Sheet for Start-up Funds Cash Flow Projection for Year One Cash Flow Projection for Year Two Income Statement Projection Balance Sheet


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For you to apply for a business loan, you will need a business plan. The following outline is ageneric guide for you to use. Some questions asked might not be relevant to your business;

other points important to your business may not be covered in this outline. Just ignore what you

do not need and add what you need.

I. Executive SummaryThis part of your plan goes first but is completed after you have finished the rest of your plan.

The questions to answer are:

A. What is your objective (other than making money, which should be the objective of allfor-profit business entities)?

B. What is your mission?

C. What are your keys to success?

II. Company SummaryWhat business are you in? Give a full description of your business. Answer the

following questions.

A. Who owns the company? What percentage of your company do they own? (For CEED-but not for the banks- what percentage are minority or female?) What is the legal form

of the company? What type of business (retail, manufacturing, service, etc) do you

have? If you are not currently in business, when do you plan to open?

B. Where is the business located? For each location, state the advantage for the site (ex. Isit easily accessible; how much space do you have; is it visible from the street; will it be

easy to advertise?)

C. What is the history of this company? If this is a new business, explain what made youselect this business. Paint a verbal picture of your company so the reader will know

exactly what you do and how you do it and who you do it for. If this is an existing

business, also explain the progress it has made the past two years.


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III. Products & ServiceIn this section, give a complete description of the products and/or services you offer. Follow the

outline below:

A. Describe any special features and any benefits the customer can expect to gain bypurchasing your product or service. (Will it save them time and/or money, is it easy to

use or easy to buy, is it doctor approved, etc.)

B. If you are a product-based business, where will you get your product or your suppliesand materials to make your product? How reliable is the supplier (how long have they

been in business, how profitable are they, etc.)? Do you have an alternate supplier if you

are unable to get what you need from the first supplier?

C. How will you get your product or service to the customer? What costs will be involvedin distribution?

D. Do you anticipate having new products or services in the future? What would youexpect them to be?

E. Do you have special patents, copyrights, licenses and/or permits? (provide copies ofeach)

IV. Industry AnalysisIn this section, you will need to do some research. There are several ways to find industry

information. We recommend you call your local Library Reference Desk and ask if they have the

Robert Morris Association Industry Reference Book most recent volume. (The reference people

will be happy to assist you.) Look up the two pages in the entire volume that apply to the industry

you are going into and copy the pages (the paper is thin, so you may need to lighten the copy


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setting before you make it.) Once you have this information, we will be happy to assist you with

interpreting it if you do not understand the numbers. Then, answer the following questions:

A. What geographic location will you cover? What size is the industry you are going into?What is the potential growth for the market? Are there a lot of competitors, or a few

small ones? Is the market local, regional, national, or international?

B. Who are your competitors? List their names, main products, advantages anddisadvantages. Competition is the way of life, so it is important to know your

competitors. Start a file on each of your competitors and keep track of what they are

doing and how the are succeeding. Who will be your biggest direct competitors (those

selling the same thing to your target group)? Who will be your biggest indirect

competitors (those selling that can substitute for what you are selling)?

C. How will your company compare with others in the market? What makes your businessunique? Why would someone buy from you instead of your competitor? How is your

product or service better?

V. MarketingHow you market your product will determine your success or failure. Marketing Strategy says:

No one knows I exist. How can I let them know I am here. Know your customers and your

competition. Select a target market (a specific group of people) to direct your sales efforts toward,

and target all your efforts to that section of the population (you can expand later as you grow).

A. Pick a target market. Who will be most likely to buy your product or service? What agegroup, what sex, what economic status, what lifestyle is most likely to buy your product?

Where do they live? Where do they work? Is it a growing market? Is your target market

large enough for the sales you need to make? Determine who will buy your product/service,

when they will buy it (i.e. is this a seasonal product), where they are most likely to look for it,

and why they would buy from you?

B.

How will you price your product/service? If you are new in the industry and no one else has


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the same product, you can price high and come down as the competition enters the market.

The more likely situation is that you can charge similarly or below the market. Make sure

you know all the costs you will incur to create or service your customer before you set yourprice.

C. How will your customer know that you exist? What means will you use to let yourcustomers know that you are open for business? (Also, in your Appendix include a copy of

your business card, website address, letterhead, envelope, and any flyers or brochures you

have created).

VI. AdvertisingHaving a good product/service and not advertising or promoting it is like not having the business at

all. Advertising says: Everyone knows I am here. Now, how do I get them to come into my

business. This is the lifeline to your business. Plan a budget to cover advertising cost. The

more effort you spend here, the more successful you will be. Answer the following questions:

A. How will you attract the customer to your product/service? What methods will youuse? Will you give free samples, offer discounts, give coupons, etc? What kind of

networking will you do?

B. How many people can you reach and how much will it cost?

C. How many sales do you expect to make and how much profit will these sales generate?

D. What discounts or special promotions will you offer?

VII. Management/Key Personnel/StaffGood management requires ability, dedication, and persistence. Know your strengths and

weaknesses. Hire people or bring in partners who can cover your weakness. For this section,


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answer the following:

A.

Who will manage specific management tasks in the organization and what are theirqualifications to do the job? Your management team is your most valuable asset (even

if the team is just YOU!). Who will handle the finances, the sales, and the marketing,

etc.?

B. Who will do what duties? In your Appendix, include resumes and three personalreferences for all key personnel and staff.

Who are your business advisors? Who can you call on for advice when things are not going right?

What experts do they have? Are these people on staff or will you need to plan to pay them from

your budget?

C. Provide copies of insurance coverage (or quotes for coverage) of business and/orpersonnel, rental agreements or mortgage contracts business property.

VIII. RisksThink carefully about this aspect of your business plan. When you plan for challenges, you can

handle them when they occur. What are the possible problems you see in the business? How

can you handle this situation if it does occur? How can you minimize this risk? How would you

rate the risk of your company?

IX. Community BenefitsWhen you are receiving money for your business from an outside source, they want to know how

you will affect the community in which you live. The following questions may help you think of

ways to give back to your community.

A.

How many jobs will your company provide for the community; from what target


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population will you be hiring?

B.

Will you be purchasing your supplies from the community? What contributions willyou make to the community? Will you be offering products or services not currently

available in the community?

C. Will you be able to provide products or services to a deprived segment of thecommunity? Will you be doing charitable work within the community? Will you be

making financial contributions to worthy causes within the community?

X. Financial PlanThe only way to stay in business is to properly manage your money. You need to know where you

are spending and how much money you expect to have coming in. Learn how to read and use

your financial statements.

Your financial plan should consist of the following:

Start-up list of Costs (also called a Sources and Uses of Funds sheet) A projected Statement of Cash Flows for the next two years (if an existing business, include

cash flows for the past two years)

A Two-Year Project Income Statement (showing the revenue flow for each year) A Two-Year Project Balance Sheet (showing the status of the business at the end of each fisical

year)

Documents

2011 Business Plan Guide