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By request, below is an outline for a business plan. Use this model as a guide when developing the 
business plan for your business. To view sample business plan Click Here.
Elements of a Business Plan 
1. Cover sheet
2. Statement of purpose
3. Table of contents
I. The Business
    A. Description of business
    B. Marketing 
    C. Competition
    D. Operating procedures
    E. Personnel
    F. Business insurance
    G. Financial data
II. Financial Data
    A. Loan applications
    B. Capital equipment and supply list
    C. Balance sheet
    D. Breakeven analysis
    E. Pro-forma income projections (profit & loss statements)
         -     Three-year summary
         -     Detail by month, first year
         -     Detail by quarters, second and third years
         -     Assumptions upon which projections were based
    F. Pro-forma cash flow
         -     Follow guidelines for letter E.
III. Supporting Documents
         -     Tax returns of principals for last three years
         -     Personal financial statement (all banks have these
         -     In the case of a franchised business, a copy of
               franchise contract and all supporting documents
               provided by the franchisor
         -     Copy of proposed lease or purchase agreement for
               building space
         -     Copy of licenses and other legal documents
         -     Copy of resumes of all principals
         -     Copies of letters of intent from suppliers, etc.
What goes in a business plan? This is an excellent question. And,
it is one that many new and potential small business owners 
should ask, but oftentimes don't ask. The body of the business 
plan can be divided into four distinct sections: 
1) the description of the business, 
2) the marketing plan, 
3) the financial management plan and 
4) the management plan. 
Addenda to the business plan should include the executive summary, 
supporting documents and financial projections.

In this section, provide a detailed description of your business.
An excellent question to ask yourself is: "What business am I 
in?" In answering this question include your products, market and
services as well as a thorough description of what makes your
business unique. Remember, however, that as you develop your
business plan, you may have to modify or revise your initial
The business description section is divided into three primary
sections. Section 1 actually describes your business, Section 2 
the product or service you will be offering and Section 3 the
location of your business, and why this location is desirable (if
you have a franchise, some franchisors assist in site selection). 
1. Business Description
When describing your business, generally you should explain:
     1.     Legalities - business form: proprietorship,
            partnership, corporation. The licenses or permits
            you will need.
     2.     Business type: merchandizing, manufacturing or
     3.     What your product or service is.
     4.     Is it a new independent business, a takeover, an
            expansion, a franchise?
     5.     Why your business will be profitable. What are the
            growth opportunities? Will franchising impact on
            growth opportunities?
     6.     When your business will be open (days, hours)?
     7.     What you have learned about your kind of business
            from outside sources (trade suppliers, bankers, other
            franchise owners, franchisor, publications).
A cover sheet goes before the description. It includes the name,
address and telephone number of the business and the names of all
principals. In the description of your business, describe the
unique aspects and how or why they will appeal to consumers.
Emphasize any special features that you feel will appeal to
customers and explain how and why these features are appealing. 
The description of your business should clearly identify goals 
and objectives and it should clarify why you are, or why you want
to be, in business.
THE BUSINESS PLAN -    2. Product/Service
Try to describe the benefits of your goods and services from your
customers' perspective. Successful business owners know or at 
least have an idea of what their customers want or expect from
them. This type of anticipation can be helpful in building 
customer satisfaction and loyalty. And, it certainly is a good
strategy for beating the competition or retaining your
competitiveness. Describe:
     1.     What you are selling.
     2.     How your product or service will benefit the 
     3.     Which products/services are in demand; if there will  
            be a steady flow of cash.
     4.     What is different about the product or service your
            business is offering.
THE BUSINESS PLAN -    3. The Location
The location of your business can play a decisive role in its
success or failure. Your location should be built around your
customers, it should be accessible and it should provide a sense 
of security. Consider these questions when addressing this 
section of your business plan:
     1.     What are your location needs?
     2.     What kind of space will you need?
     3.     Why is the area desirable? the building desirable?
     4.     Is it easily accessible? Is public transportation
            available? Is street lighting adequate?
     5.     Are market shifts or demographic shifts occurring?
It may be a good idea to make a checklist of questions you 
identify when developing your business plan. Categorize your
questions and, as you answer each question, remove it from your
THE BUSINESS PLAN -     The Marketing Plan
Marketing plays a vital role in successful business ventures. How
well you market you business, along with a few other
considerations, will ultimately determine your degree of success 
or failure. The key element of a successful marketing plan is to
know your customers -- their likes, dislikes, expectations. By
identifying these factors, you can develop a marketing strategy
that will allow you to arouse and fulfill their needs.
Identify your customers by their age, sex, income/educational 
level and residence. At first, target only those customers who 
are more likely to purchase your product or service. As your
customer base expands, you may need to consider modifying the
marketing plan to include other customers.
Develop a marketing plan for your business by answering these
questions. (Potential franchise owners will have to use the
marketing strategy the franchisor has developed.) Your marketing
plan should be included in your business plan and contain answers
to the questions outlined below.
     1.     Who are your customers? Define your target market(s).
     2.     Are your markets growing? steady? declining?
     3.     Is your market share growing? steady? declining?
     4.     If a franchise, how is your market segmented?
     5.     Are your markets large enough to expand? 
     6.     How will you attract, hold, increase your market 
            share? If a franchise, will the franchisor provide    
            assistance in this area? Based on the franchisor's
            strategy? how will you promote your sales? 
     7.     What pricing strategy have you devised?
THE BUSINESS PLAN -    1. Competition 
Competition is a way of life. We compete for jobs, promotions,
scholarships to institutes of higher learning, in sports -- and 
in almost every aspect of your lives. Nations compete for the
consumer in the global marketplace as do individual business
owners. Advances in technology can send the profit margins of a
successful business into a tailspin causing them to plummet
overnight or within a few hours. When considering these and other
factors, we can conclude that business is a highly competitive,
volatile arena. Because of this volatility and competitiveness, 
it is important to know your competitors.
Questions like these can help you:
     1.     Who are your five nearest direct competitors?
     2.     Who are your indirect competitors?
     3.     How are their businesses: steady? increasing?
     4.     What have you learned from their operations? from
             their advertising?
     5.     What are their strengths and weaknesses?
     6.     How does their product or service differ from yours?
Start a file on each of your competitors. Keep manila envelopes 
of their advertising and promotional materials and their pricing
strategy techniques. Review these files periodically, determining
when and how often they advertise, sponsor promotions and offer
sales. Study the copy used in the advertising and promotional
materials, and their sales strategy. For example, is their copy
short? descriptive? catchy? or how much do they reduce prices for
sales? Using this technique can help you to understand your
competitors better and how they operate their businesses.

THE BUSINESS PLAN  -    2. Pricing and Sales
Your pricing strategy is another marketing technique you can use 
to improve your overall competitiveness. Get a feel for the 
pricing strategy your competitors are using. That way you can
determine if your prices are in line with competitors in your
market area and if they are in line with industry averages. 
Some of the pricing strategies are:
     *     retail cost and pricing
     *     competitive position
     *     pricing below competition
     *     pricing above competition
     *     price lining
     *     multiple pricing
     *     service costs and pricing (for service businesses
           - service components
           - material costs
           - labor costs
           - overhead costs
The key to success is to have a well-planned strategy, to 
establish your policies and to constantly monitor prices and
operating costs to ensure profits. Even in a franchise where the
franchisor provides operational procedures and materials, it is a
good policy to keep abreast of the changes in the marketplace
because these changes can affect your competitiveness and profit
THE BUSINESS PLAN -  3. Advertising and Public Relations
How you advertise and promote your goods and services may make or
break your business. Having a good product or service and not
advertising and promoting it is like not having a business at 
all. Many business owners operate under the mistaken concept that
the business will promote itself, and channel money that should 
be used for advertising and promotions to other areas of the
business. Advertising and promotions, however, are the life line 
of a business and should be treated as such. 
Devise a plan that uses advertising and networking as a means to
promote your business. Develop short, descriptive copy (text
material) that clearly identifies your goods or services, its
location and price. Use catchy phrases to arouse the interest of
your readers, listeners or viewers. In the case of a franchise, 
the franchisor will provide advertising and promotional materials
as part of the franchise package, you may need approval to use 
any materials that you and your staff develop. Whether or not 
this is the case, as a courtesy, allow the franchisor the
opportunity to review, comment on and, if required, approve these
materials before using them. Make sure the advertisements you
create are consistent with the image the franchisor is trying to
project. Remember the more care and attention you devote to your
marketing program, the more successful your business will be.
A more detailed explanation of the marketing plan and how to
develop an effective marketing program is provided in the 
Workshop on Marketing. See Training Module 3 - Marketing Your
Business for Success.

Managing a business requires more than just the desire to be your
own boss. It demands dedication, persistence, the ability to make
decisions and the ability to manage both employees and finances.
Your management plan, along with your marketing and financial
management plans, sets the foundation for and facilitates the
success of your business.
Like plants and equipment, people are resources -- they are the
most valuable asset a business has. You will soon discover that
employees and staff will play an important role in the total
operation of your business. Consequently, it's imperative that 
you know what skills you possess and those you lack since you 
will have to hire personnel to supply the skills that you lack.
Additionally, it is imperative that you know how to manage and
treat your employees. Make them a part of the team. Keep them
informed of, and get their feedback regarding, changes. Employees
oftentimes have excellent ideas that can lead to new market 
areas, innovations to existing products or services or new 
product lines or services which can improve your overall
Your management plan should answer questions such as:
     *     How does your background/business experience help you
           in this business?
     *     What are your weaknesses and how can you compensate
           for them?
     *     Who will be on the management team?
     *     What are their strengths/weaknesses?
     *     What are their duties?
     *     Are these duties clearly defined?
     *     If a franchise, what type of assistance can you expect
           from the franchisor?
     *     Will this assistance be ongoing?
     *     What are your current personnel needs?
     *     What are your plans for hiring and training personnel?
     *     What salaries, benefits, vacations, holidays will you
           offer? If a franchise, are these issues covered in the 
           management package the franchisor will provide?
     *     What benefits, if any, can you afford at this point?
If a franchise, the operating procedures, manuals and materials
devised by the franchisor should be included in this section of 
the business plan. Study these documents carefully when writing
your business plan, and be sure to incorporate this material. The
franchisor should assist you with managing your franchise. Take
advantage of their expertise and develop a management plan that
will ensure the success for your franchise and satisfy the needs
and expectations of employees, as well as the franchisor.
Sound financial management is one of the best ways for your
business to remain profitable and solvent. How well you manage 
the finances of your business is the cornerstone of every
successful business venture. Each year thousands of potentially
successful businesses fail because of poor financial management. 
As a business owner, you will need to identify and implement
policies that will lead to and ensure that you will meet your
financial obligations.
To effectively manage your finances, plan a sound, realistic 
budget by determining the actual amount of money needed to open
your business (start-up costs) and the amount needed to keep it
open (operating costs). The first step to building a sound
financial plan is to devise a start-up budget. Your start-up 
budget will usually include such one-time-only costs as major
equipment, utility deposits, down payments, etc. 
The start-up budget should allow for these expenses.
                           Start-up Budget
     * personnel (costs prior to opening)
     * legal/professional fees
     * occupancy
     * licenses/permits
     * equipment
     * insurance
     * supplies 
     * advertising/promotions
     * salaries/wages
     * accounting
     * income
     * utilities
     * payroll expenses
An operating budget is prepared when you are actually ready to 
open for business. The operating budget will reflect your
priorities in terms of how your spend your money, the expenses 
you will incur and how you will meet those expenses (income). 
Your operating budget also should include money to cover the 
first three to six months of operation. It should allow for the
following expenses.
                          Operating Budget
     * personnel
     * insurance
     * rent
     * depreciation
     * loan payments
     * advertising/promotions
     * legal/accounting
     * miscellaneous expenses
     * supplies
     * payroll expenses
     * salaries/wages
     * utilities
     * dues/subscriptions/fees
     * taxes
     * repairs/maintenance
The financial section of your business plan should include any 
loan applications you've filed, a capital equipment and supply
list, balance sheet, breakeven analysis, pro-forma income
projections (profit and loss statement) and pro-forma cash flow.
The income statement and cash flow projections should include a
three-year summary, detail by month for the first year, and 
detail by quarter for the second and third years.
The accounting system and the inventory control system that you
will be using is generally addressed in this section of the
business plan also. If a franchise, the franchisor may stipulate 
in the franchise contract the type of accounting and inventory
systems you may use. If this is the case, he or she should have a
system already intact and you will be required to adopt this
system. Whether you develop the accounting and inventory systems
yourself, have an outside financial advisor develop the systems 
or the franchisor provides these systems, you will need to 
acquire a thorough understanding of each segment and how it
operates. Your financial advisor can assist you in developing 
this section of your business plan. 
The following questions should help you determine the amount of
start-up capital you will need to purchase and open a franchise.
     *     How much money do you have?
     *     How much money will you need to purchase the
     *     How much money will you need for start-up?
     *     How much money will you need to stay in business?
Other questions that you will need to consider are:
     *     What type of accounting system will your use? Is it a  
           single entry or dual entry system?
     *     What will your sales goals and profit goals for the
           coming year be? If a franchise, will the franchisor
           set your sales and profit goals? Or, will he or she
           expect you to reach and retain a certain sales level   
           and profit margin?
     *     What financial projections will you need to include 
           in your business plan?
     *     What kind of inventory control system will you use?
Your plan should include an explanation of all projections. 
Unless you are thoroughly familiar with financial statements, get
help in preparing your cash flow and income statements and your
balance sheet. Your aim is not to become a financial wizard, but 
to understand the financial tools well enough to gain their
benefits. Your accountant or financial advisor can help you
accomplish this goal.

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