Business Plan Essentials: Key Sections Explained
What Should a Business Plan Contain?
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Title Page
- Explanation: The introductory page of a business plan, featuring the plan’s title, the company’s name, address, phone number, and other contact details. Essential for making a strong first impression.
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Table of Contents
- Explanation: A list of the major sections within the business plan. Ensure the contents are well-organized and easy to navigate for the reader.
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Executive Summary and Fact Sheet
- Explanation: A concise section summarizing the entire business plan, including key facts and figures. Often read by investors first, this should be compelling and highlight the company’s unique proposition.
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Body of the Plan
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The Company description
- Explanation: Describes the business, its mission, vision, and objectives. Includes details about what the company does and its business structure.
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The Product/Service Offering
- Explanation: Detailed information about the products or services your business provides. Explain what the product is, its benefits, and its competitive advantage.
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Industry Analysis
- Explanation: An overview of the industry in which the company operates, including trends, key players, and the company’s position within the industry.
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Market Analysis
- Explanation: Provides an understanding of the target market, consumer needs, market size, and projections. Includes demographic details and market segments.
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The Marketing Plan
- Explanation: Strategies for promoting, pricing, and distributing the product or service. Should include market entry and growth strategies as well as promotional tactics.
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The Production/Operations Plan
- Explanation: Details of how the product will be produced or how the service will be delivered. This section covers supply chain, production processes, and operational workflow.
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The Management Team
- Explanation: Introduction to the key members of the business team. Highlights their roles, experience, and how they contribute to the company’s success.
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Implementation Schedule and Risks Associated with the Venture
- Explanation: Timeline for executing the business plan, including milestones and deliverables. Identify potential risks and how the business plans to mitigate them.
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The Financial Plan
- Explanation: Includes financial projections, budgets, and funding requirements. Outlines revenue models, break-even analysis, and profitability forecasts.
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Appendices
- Explanation: Supplemental information to support the business plan. Could include resumes, product pictures, additional data, or proprietary studies.
Reference:
www.sba.gov
Write your business plan | U.S. Small Business Administration
www.investopedia.com
Business Plan: What It Is, What's Included, and How to Write One
www.investopedia.com
How to Write a Business Plan...
Section 1: Executive Summary
Executive Summary
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Overview of Entire Business Plan:
- The executive summary is a concise description of the entire business plan.
- It is important because it provides a quick snapshot of your business idea and key points.
- Often the first part investors or stakeholders read, so it needs to be compelling and clear.
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Busy Reader's Need:
- The executive summary delivers all essential information for understanding the new venture's unique aspects.
- It's designed to be a quick read, thus enabling busy readers to grasp critical points rapidly.
- Should include: business name, what the business does, market opportunity, financial highlights, etc.
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Length Limitation:
- An executive summary should be concise and to the point, not exceeding two single-spaced pages.
- Length constraints ensure that it remains a quick and efficient read.
- It can be a challenging task to compress information, but focusing on the most impactful aspects of your plan ensures clarity.
Reference:
goprospero.com
How to Write an Executive Summary for a Business Plan - Prospero
www.forbes.com
Business Plan Executive Summary Example & Template - Forbes
openstax.org
11.4 The Business Plan - Entrepreneurship | OpenStax
Section 2: Company Description
Company Description
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The main body of the business plan beings with a general description of the company.
- This is important as it provides the reader with an overview and introduction to the business.
- Setting the right tone at the beginning can captivate interest and set clear expectations.
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Items to include in this section:
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Company description.
- Include a name, location, nature of your business, and the industry you operate within.
- Explanation of what the company does and aims to achieve.
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Company history.
- Details about the founding of the company, key milestones, and previous major achievements.
- This can provide credibility and context to your business activities.
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Mission statement.
- A concise statement of the company’s purpose, fundamental goals, and values.
- Should inspire and encapsulate the essence of what the company stands for.
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Products and services.
- Specific details about what the company offers to its customers.
- Highlight unique selling points and any innovative aspects.
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Current status.
- Information on the present state of the company, including recent performance and strategic positioning.
- Helps to understand where the company stands in relation to its goals.
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Legal status and ownership.
- Information on the company’s legal structure (e.g., LLC, Corporation) and details about ownership.
- Important for understanding the governance and accountability within the business.
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Key partnerships (if any).
- Identify major partners and collaborators that play a significant role in the company’s operations.
- Collaboration can provide added value and expanded capabilities for the business.
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Reference:
business.yelp.com
How to write an effective business description - Yelp for Business
www.thebalancemoney.com
How to Write a Company Description - The Balance
www.thebalancemoney.com
Parts of a Company Description