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Business Planning

General Guidelines to Follow

  • Make the business plan brief and to the point
  • The business plan should be easy to read and understand
  • Fit the plan to the stage of the company's development
  • Have several qualified individuals evaluate the plan
  • Consider the audience to which the plan is directed.


Cover Letter
1. Dollar amount requested
2. Terms and timing
3. Type and price of securities, if any


1. Business description
     a.  Name of company
     b.  Location and plant description
     c.  Product or service
     d.  Market and competition
     e.  Management expertise
2. Business goals
3. Summary of financial needs and application of funds
4. Earnings projections and potential return to investors

Market Analysis
1. Show evidence that the product is well researched and you have an understanding of what the customer wants
2. Description of total market
3. Industry trends
4. Target market
5. Competition

Products or Services
1. Description of product line or service
2. Proprietary position: patents, copyrights, and legal and technical aspects
3. Development timetable
4. Long-term development strategy

Manufacturing Process (if applicable)
1. Materials
2. Source of supply
3. Production methods

Marketing Strategy
1. Overall strategy
2. Identify cost of marketing efforts
3. Pricing policy
4. Sales terms
5. Target market
6. Methods of selling, distributing and servicing products

Management Plan
1. Form of organization
2. Board of directors composition
3. Officers: organization chart and responsibilities
4. Resumes of key personnel
5. Staffing plan/ number of employees
6. Facilities plan/planned capital improvements
7. Operating plan/schedule for upcoming work for next one to two years

Financial Data
1. Financial statements for previous three to five years (existing businesses)
2. Five year financial projections--first year by quarters and remaining by year
3. Explanation of projections (assumptions}
4. Key business ratios
5. Explanation of use and effect of new funds
6. Potential return to investors; in comparison to average return in the industry as a whole

Supporting Documents
1. Your resume
2. Personal financial statements
3. Tax returns
4. Catalog pages for equipment purchases
5. Customer lists
6. Price sheets
7. Copies of pending contracts
8. Any valuable information that backs up claims you make in the plan

For more business plan information and templates, check these sites.

SBA Business Plans

More Business Plans

10 Most Common Mistakes Found in Business Plans

1. Too long. Reviewers of business plans look for concisely written plans in bullet form that do not read like term paper.

2. No competition indicated. In most cases, this is just not true. Too little competition may indicate there is no market for your product or service.

3. Unreasonable expectations and projections. Grandiose estimates regarding sales projections or money requested can be disastrous.

4. Financial assumptions do not match data in the financial statements.

5. Business does not provide a realistic exit plan for investors.

6. Founders fail to demonstrate that they have the necessary management skills to operate the business.

7. Unrealistic time line projections that the product/service can be produced in a reasonable time period.

8. Little business knowledge demonstrated.

9. Inadequate price/cost ratios.

10. The plan describes a product or manufacturing process with technical jargon only experts can understand.

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