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Why Planning is Important
• Suppose you lived in New Hampshire and wanted to drive to Texas, would you use a map or GPS?
• K-12 education is a pre-defined plan• Baking / cooking requires a plan - recipes• Planning will help shape your destination and
provide the best road to get you there• Plans communicate to investors, suppliers,
employees and others interested in your business
Snapshot of a Business Plan
• Typical Business Plan Components– Table of Contents– Executive Summary– Business Description– Definition of the Market– Description of Products and Services– Organization and Management– Marketing and Sales Strategy– Financial Management– Appendices
Table of Contents
Components of the Business Plan• Lists key sections of the business plan• Used to quickly locate specific sections• Brings organization and structure to the plan
Executive Summary
Components of the Business Plan• Purpose
– Interest someone to read rest of plan• Most important section of the plan• Write last• Provides an enthusiastic snapshot of your company• Less than one page
Business Description
Components of the Business Plan• The Company Vision:
– Outlines what a company wants to be– Futuristic: memorable and engaging expression
of hope and inspiration– Staying status quo is moving backwards
Business Description
Components of the Business Plan• The Mission Statement:
– Brief statement about who the company is and what it stands for
– Example: Google’s mission statement is: Organize the world’s information and make it universally accessible and useful.
Definition of the Market
Components of the Business Plan• Describe your business industry and outlook• Define specific needs you will satisfy
• Identify targeted customers• Develop customer profile• Determine market size
– Demographics
Research
• North American Industry Classification System– Find the NAICS– http://naics.com/search.htm
• WA St Dept of Revenue– Determine local statistics– http://www.dor.wa.gov
• Google searches
Research – Sno-Isle
• Sno-Isle Libraries Business Resourceswww.sno-isle.org > Research > Business and Business: Small Business Start-Up
• Small Business Resource Center: Sample business plans, how-to tutorials, business publications
• A-Z: Market research and trend analysis
• Business Plans eBookshelf: Business plan templates
• Learning Express (in eLearning): Microsoft Excel tutorials
• Legal Forms (in Legal Info): WA State legal form templates
• Free wi-fi and meeting rooms at your local library
• Information professionals available in person, on the telephone, and online to help with your business research
Description of Products
Components of the Business Plan• Identify and explain product pricing• Describe your products and services how they are
competitive• Reference applicable graphics and brochures
Organization and Management
Components of the Business Plan• Descriptions of how the company is organized• Legal form of ownership• Explanation of how things get done• Required licenses and permits
– Washington State Department of Licensing (Universal Business Identification Number)
– Internal Revenue Service (Employer Identification Number)
• Biographies of key managers / leaders
Marketing and Sales Strategy
Components of the Business Plan• Marketing is the process of creating customers• Research is the foundation of marketing
– Who are my customers and potential customers?– Where do they live?– Am I offering the kinds of goods or services they
want at the best place, at the best time and in the right amounts?
– Are my prices consistent with what buyers view as the product’s value?
Marketing and Sales Strategy
Components of the Business Plan• Creating a marketing strategy
– Identify customer groups you can best serve– Understand customers needs– Always consider change
Financial Management
Components of the Business Plan• Key Financial Statements
– Cash Flow Statement– Balance Sheet– Income Statement
Financial Management
Components of the Business Plan
• Cash Flow Statement– Monthly statement of
cash on hand, incoming cash and expenses
– Used to determine projected working capital availability and shortages
Financial Management
Components of the Business Plan• For a New Business
– Estimate of start-up costs– Projected cash flow statement (12 months
forward)
Financial Management
Components of the Business Plan• For an Existing Business
– Balance sheets (last 3 years)– Income statements (last 3 years)– Cash flow statement (12 months)
Financial Management
Components of the Business Plan• If Applying for a Loan
– Current personal financial statement on each principal
– Federal tax return for prior year
Appendices
Components of the Business Plan• Company brochures• Resume of key employees• List of business equipment• Copies of press articles and advertisements (if
available)• Pictures of your business location and products• Information and/or data supporting the growth of
your industry and/or products• Key business agreements such as lease, contracts,
etc.
Next Steps
• Put what you’ve learning into action– Prepare a draft business plan
• Include 12 month cash flow projection – Plenty of Excel templates available
– Discuss your draft plan and any questions you have with a business mentor, coach, or other seasoned business advisor
– Use the information you’ve received to prepare a more finished product
Financing
• http://www.kauffman.org/about-the-foundation/kauffman-sketchbook.aspx
Free Services
• The EDC– Demographics / business data
• SCORE (Service Corps Of Retired Executives)– Confidential small business counseling
• Bring business plan and 12 month cash flow projection
– http://www.scorechapter591.org/• Small Business Administration
– http://imedia.sba.gov/vd/media1/training/YoungEntrepreneurs/player.html
How to Write a Business Plan
Questions?
