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Write a Winning Business Plan
based on
Anatomy of a Business Plan & Automate Your Business Plan
© 2019 Linda Pinson
Printable PDF Business Plan Outline
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Business Planning Every wholesale, retail, and/or service business can benefit from the preparation of a carefully written business plan. There are two main purposes for writing that plan. There is an additional benefit if you do business internationally. Your business plan
will serve as your guide during the lifetime of your operation. It is the blueprint
of your business and will provide you with the tools to analyze your
operation and implement changes that will increase your sales and,
ultimately, your profitability. A business plan is a
requirement if you are planning to seek financing. It will provide
potential lenders or investors with detailed information on all aspects of
your company's past and current operations and provide future projections. If you do business
internationally,
a business plan provides a standard means of evaluating your products'
business potential in a foreign marketplace. Business Plan Outline The following pages provide a suggested outline of the material to be included in your business plan. Your final plan may vary according to your specific needs or individual requirements of your lender or investor. Cover Sheet (Serves as the title page of
your business plan) Name, address, and phone number of the
company. Name, title, address, phone number of
owners/corporate officers. Month and year your plan was prepared. Name of preparer. Copy number of the plan. Table
of Contents (Quick reference to major topics covered in your
plan) Executive Summary The executive summary is the abstract of your business plan. It summarizes the content and purpose of your finished plan, covering all of the key points. This is a key section if you are seeking funding. Your Company (introductory
overview - who, what, where it is and why it is unique) Market Capital Requirements,
Breakdown of Uses of Funds, Repayment of Loan or Benefits to Investors. (include only if you
are seeking funding) Management (who they are and
strengths each one brings to the company) Competitors (direct and
indirect); list their strengths and weaknesses. Your Company's
Competitive Advantages Financial Projections (summary of Income
Statement Projections for next 3 years) Note: Write the executive summary after you have completed your business plan. It is a summary. Part I: The
Organizational Plan What is included? This section should include a "summary description of your business" statement followed by information on the "administrative" end of your company. Summary Description
of the Business In a paragraph or two give a broad overview of the nature of your business, telling when and why the company was formed. Then complete the summary by briefly addressing: mission (projecting short-
and long-term goals) business model (describe your
company's model and why it is unique to your industry) strategy (give an overview of
the strategy, focusing on short- and long-term objectives) strategic
relationships
(tell about any existing strategic relationships) SWOT Analysis (strengths,
weaknesses, opportunities, and threats that your company will face, both
internal and external) Products or Services If you are the
manufacturer and/or wholesale distributor of a product: Describe your
products. Tell briefly about your manufacturing process. Include information
on suppliers and availability of materials. If you are a retailer
and/or an e-tailer: Describe the products you sell. Include information
about your sources and handling of inventory and fulfillment. If you provide a
service:
Describe your services List future products or services you plan to provide. Administrative Plan Intellectual Property Address Copyrights, Trademarks, and Patents Back up in Supporting Documents with
registrations, photos, diagrams, etc. Location Describe your projected or current location. Project costs associated with the location. Include legal agreements, utilities
forecasts, etc. in Supporting Documents. Note: If location is important to marketing, cover in Part II - The Marketing Plan. Legal Structure Describe your legal structure and why it is
advantageous for your company. List owners and/or corporate officers
describing strengths (include resumes). Management List the people who are (or will be) running
the business. Describe their responsibilities and
abilities. Project their salaries. (Include resumes in Supporting Documents) Personnel How many employees will you have in what
positions? What are the necessary qualifications? How many hours will they work and at what
wage? Project future needs for adding employees. Accounting & Legal Accounting: What system will you
set up for daily accounting? Who will you use for a tax accountant? Who will
be responsible for periodic financial statement analysis? Legal: Who will you retain
for an attorney? (Keep 'Murphy's Law' in mind.) Insurance What kinds of insurance will you carry?
(Property & Liability, Life & Health) What will it cost and who will you use for a
carrier? Security Address security in terms of inventory
control and theft of information (online and off). Project related costs. Part
II: The Marketing Plan What is a marketing plan? The Marketing Plan defines all of the components of your marketing strategy. You will address the details of your market analysis, sales, advertising, and public relations campaigns. The Plan should also integrate traditional (offline) programs with new media (online) strategies. Overview and Goals of
Your Marketing Strategy Market Analysis Target Market (identify with demographics,
psychographics, and niche market specifics) Competition (describe major competitors
assessing their strengths and weaknesses. Market Trends (identify industry trends and
customer trends) Market Research (describe methods of
research, database analysis, and results summary) Marketing Strategy General Description (budget % allocations on-
and off-line with expected ROIs) Method of Sales and Distribution (stores,
offices, kiosks, catalogs, d/mail, website) Packaging (quality considerations and
packaging) Pricing (price strategy and competitive
position Branding Database Marketing (Personalization) Sales Strategies (direct sales, direct mail,
email, affiliate, reciprocal, and viral marketing) Sales Incentives/Promotions (samples,
coupons, online promo, add-ons, rebates, etc.) Advertising Strategies (traditional, web/new
media, long-term sponsorships) Public Relations (online presence, events,
press releases, interviews) Networking (memberships and leadership positions) Customer Service Description of Customer Service Activities Expected Outcomes of Achieving Excellence Implementation of
Marketing Strategy In-House Responsibilities Out-Sourced Functions (advertising, public
relations, marketing firms, ad networks, etc.) Assessment of
Marketing Effectiveness* * To be used by existing companies after making periodic evaluations Part
III: Financial Documents The quantitative part of your business plan. This section of the business plan is the quantitative interpretation of everything you stated in the organizational and marketing plans. Do not do this part of your plan until you have finished those two sections. Financial documents are the records used to show past, current, and projected finances. The following are the major documents you will want to include in your Business Plan. The work is much easier if they are done in the order presented because they build on each other, utilizing information from the ones previously developed. Summary of Financial
Needs
(needed
only if you are seeking financing) This is an outline giving the following information: Why you are applying for financing How Much capital you need Loan Fund Dispersal
Statement
(needed only if you are seeking financing) You should: Tell How you intend to disperse the loan funds. Back Up your statement with supporting data. Pro Forma Cash Flow
Statement (Budget) This document projects what your Business Plan means in terms of dollars. It shows cash inflow and outflow over a period of time and is used for internal planning. It is of prime interest to the lender and shows how you intend to repay your loan. Cash flow statements show both how much and when cash must flow in and out of your business. Three-Year Income
Projection A Pro Forma Income P&L (Income) Statement showing projections for your company for the next three years. Use the revenue and expense totals from the Pro Forma Cash Flow Statement for the 1st year's figures and project for the next two years according to expected economic and industry trends. Projected Balance
Sheet Projection of Assets, Liabilities, and Net Worth of your company at end of next fiscal year. Break-Even Analysis The break-even point is the point at which a
company's expenses exactly match the sales or service volume. It can be
expressed in: (1) Total dollars or revenue exactly offset by total expenses
-or- (2) Total units of production (cost of which exactly equals the income
derived by their sales). This analysis can be done either mathematically or
graphically. Revenue and expense figures are drawn from the three-year income
projection.
Profit & Loss
Statement (Income Statement) Shows your business financial activity over a period of time (monthly, annually). It is a moving picture showing what has happened in your business and is an excellent tool for assessing your business. Your ledger is closed and balanced and the revenue and expense totals transferred to this statement. Balance Sheet Shows the condition of the business as of a fixed date. It is a picture of your firm's financial condition at a particular moment and will show you whether your financial position is strong or weak. It is usually done at the close of an accounting period. Contains: (1) Assets, (2) Liabilities and (3) Net Worth. Financial Statement
Analysis In this section you will use your income statements and balance sheets to develop a study of relationships and comparisons of: (1) Items in a single year's financial statement, (2) comparative financial statements for a period of time, or (3) your statements with those of other businesses. Measures are expressed as ratios or percentages that can be used to compare your business with industry standards. If you are seeking a lender or investor, ratio analysis as compared to industry standards will be especially critical in determining whether or not the loan or venture funds are justified. Liquidity Analysis (net working capital,
current ratio, quick ratio) Profitability Analysis (gross profit margin,
operating profit margin, net profit margin) Debt Ratios (debt to assets, debt to equity) Measures of Investment (return on investment) Vertical financial statement analysis (shows
relationship of components in a single financial statement) Horizontal financial statement analysis
(percentage analysis of the increases and decreases in the items on
comparative financial statement) Business Financial
History This is a summary of financial information about your company from its start to the present. The Business Financial History and Loan Application are frequently one and the same. If you have completed the rest of the financial section, you should have all of the information you need to transfer to this document. Part IV: Supporting Documents This section of your plan will contain all of the records that back up the statements and decisions made in the three main parts of your business plan. The most common supporting documents are: Personal Resumes Include resumes for owners and management. A resume should a one-page document. Include: work history, educational background, professional affiliations and honors, and a focus on special skills relating to the company position. Owners' Financial
Statements A statement of personal assets and liabilities. For a new business owner, this will be part of your financial section. Credit Reports Business and personal from suppliers or wholesalers, credit bureaus, and banks. Copies of Leases,
Mortgages, Purchase Agreements, Etc. All agreements currently in force between your company and a leasing agency, mortgage company or other agency. Letters of Reference Letters recommending you as being a reputable and reliable business person worthy of being considered a good risk. (both business and personal references) Contracts Include all business contracts, both completed and currently in force. Other Legal Documents All legal papers pertaining to your legal structure, proprietary rights, insurance, etc. Limited partnership agreements, shipping contracts, etc. Miscellaneous
Documents All other documents which have been referred to, but not included in the main body of the plan. (for example: location plans, demographics, competition analysis, advertising rate sheets, cost analysis, etc.) Putting
Your Plan Together When You Are Finished: Your Business Plan should look professional, but the potential lender or investor needs to know that it was done by you. A business plan will be the best indicator that can be used to judge your potential for success. It should be no more than 30 to 40 pages in length, excluding supporting documents. If you are seeking a lender or investor: Include only the supporting documents that will be of immediate interest to the person examining your plan. Keep the others with your own copy where they will be available on short notice. Make copies for each lender or investor you wish to approach. Keep track of each copy that you give out. If you are turned down for financing, be sure to retrieve your business plan. Keep
Your Business Plan Up-to-Date!!! Your business plan will be beneficial only if you update it frequently to reflect what is happening within your business. Measure your projections against what actually happens in your company. Use the results to analyze the effectiveness of your operation. You can then implement changes that will give you a competitive edge and make your business more profitable. ______________________________________________ Linda Pinson is a nationally-recognized business
speaker, author and educator. She is the owner of Out of Your Mind...and Into
the Marketplace™, publisher of educational "how-to" books and
software for new and established businesses. Linda has authored nine books,
one of which is Anatomy
of a Business Plan, winner of the Ben Franklin Best Business Book of the
Year Award and basis of the U.S. Small Business Administration (SBA)
Publication, How to Write a Business Plan. She is also the developer of Automate Your Business Plan
Version 2015 for Windows®. Her books are in libraries and
bookstores throughout the
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