Eight Essentials of a Good Business Plan
Every business starts with an idea but a plan is essential to understand the full scope and complexity of running a business. In addition, most businesses need funding from investors; and to get them behind your company, you’ll need a thorough business plan. Read these eight essential requirements recommended by the U.S. Small Business Administration to guarantee your plan is complete.
- Executive Summary. The executive summary should consist of a the business’ goal (mission statement), launch date, number of employees, locations, products, banking and investor information, summary of financial information and goals, and summary of future plans.
- Market Analysis. The market analysis should include an overview of the industry, target market and competitors. This section should also cover any regulations, purchasing and product cycles, lead times, and trends.
- Company Description. This should describe why your business will be successful, and what will make it successful. Also address how and why your business will appeal to your target market.
- Organization and Management. Create an organizational chart of those involved in the business: owners, investors, employees, etc. Also create profiles of those in management.
- Marketing and Sales. Create a marketing strategy explaining how you will receive coverage and grow your business. The sales focus needs to clarify if sales will be handled in-house or by outside sales reps, and how your sales philosophy will be executed.
- Service or Product. Provide an overview of your product or services and why your customers will want/need it. Include the product lifecycle, copyright or patents, and any research or development required to develop the product.
- Funding. The funding section needs to clearly state how much funding is needed to operate the business including future plans. In addition, explain how funding will be used.
- Financials. Include past and prospective financial information. This should include the past five years, what is planned for the next five years, and projections.