Tips for Preparing a Business Plan
Entrepreneurs often ask us for a sample business plan and for tips on how to prepare a plan.
First and foremost, it is important to develop your business plan in a format that addresses the concerns and interests of the potential investor. This will not only help you land an initial meeting but will also assist you as you discuss your company, growth strategies and investment needs with prospective investors in subsequent meetings.
Here are some general pointers:
- Include complete contact information on your cover page.
- State what your company does in two to three sentences right at the beginning of the plan. Don’t leave the reader guessing until page 3.
- Be straightforward in presenting information and outlining your investment requirements.
- Remember that your audience may not share your industry expertise.
- Don’t ever assume you have no competition.
- Explain why your technology is proprietary.
- Be realistic with your financials.
- The appendix may include marketing materials as well as materials and/or references that verify your market.
- Check your spelling and grammar; they do matter.
Here are the sections that should be included in your business plan:
Business Plan Outline
Cover page – include date and all contact information (1 page)
1. Executive Summary (3 to 5 pages)
A. Business proposition
B. Current status of enterprise
C. Market need being met
D. Enterprise’s product/service advantage(s)
E. Management expertise
F. Financing being sought
2. Mission Statement (1 page)
3. Marketing Plan (4 to 8 pages)
A. Market analysis
B. Product/service offerings and development
C. Competitive situation
E. Channels of distribution
F. Promotional plan
G. Customer service
4. Operations or Manufacturing Plan (3 to 8 pages)
B. Make versus buy decisions
C. Capital items
D. Product support
E. Quality control and assurance
F. Logistics and control
5. Human Resources Plan (2 to 5 pages)
A. Management team background and future requirements for the company
B. Position/employee additions
C. Training and special personnel-related issues
6. Risk Analysis (1 to 3 pages)
A. Business risks
B. Economic risks
7. Financial Plan (4 to 6 pages)
A. Income statement (actual vs. pro forma)
B. Balance sheet (actual vs. pro forma)
C. Cash flow statement (actual vs. pro forma)
D. Capital budget (actual vs. pro forma)
Organizations like SCORE can assist you with putting together your business plan. There are also private entities that can help, and much information can be found on the Internet. However, always remember that you are the best person to describe the information and details of your business.
SCORE is a nonprofit association composed of volunteer business people who mentor small businesses. With chapters across the United States, including several in Connecticut, SCORE is supported by the U.S. Small Business Administration and does not charge for its services. Find them at www.score.org.
Good luck in preparing your plan! We hope these tips have been helpful.
About the Author
Julie Rader is director of business development and analysis at Connecticut Innovations. You can contact her at Julie.Rader@ctinnovations.com.