What Does a Business Plan Include?
A business plan is a document that communicates key information about your business to stakeholders. Stakeholders are people connected to the business because of an employment, investment or ownership relationship. In addition to conveying information, a business plan serves as a planning tool to help managers make decisions about operations and resources.
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Executive Summary
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The executive summary of a business plan is typically a shortened version of the whole business plan and not an introduction. An executive summary is the first part of the business plan most readers typically read, so it should contain all the key information necessary to establish an understanding of the business.
Company Information
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The business plan lists the industry, market and the determining factors for success. By listing industry trends and outlooks, your business is placed in an economic context in which to judge the potential for growth. In addition, identify the target market your business plans to serve by describing how your product solves a particular problem for consumers or businesses. Once you establish a context for your business operations, identify the factors that will influence the success of your business.
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Management and Organization
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Your business plan also establishes the ownership, management and organizational structures that allow the business to operate. This section identifies the owners and the respective ownership percentage each owner holds in the business. According to the Small Business Administration, use this section to establish the structure of the business and who is responsible for the duties of each position.
Marketing Plan
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The marketing plan includes all the activities necessary to generate customers for your product or service. According to the SBA, start your marketing strategy by identifying the target customers you want to attract. Research the characteristics, likes and dislikes of your target customers. Develop a strategy to communicate with these customers through advertisements, public relations and sales tools, like catalogs and coupons.
Product
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Listing your product or service is also an important component of your business plan. Describe your product in clear language to help readers who are unfamiliar with your product and industry. According to the SBA, the product section emphasizes how your customers benefit from using your product or service. The SBA also recommends including current and pending patent and copyright or patents associated with your products.
Financial Analysis
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The contents of the financial analysis vary for new and existing businesses. Existing businesses should include at least the last three years of financial performance data, like revenue, cash flow and other financial information. This shows a pattern of your business's performance and lends credibility to performance projections. For new businesses, financial analysis is useful in establishing the cost of startup and capital investments. Remember to convey reasonable and realistic expectations of growth to attract and keep investors.
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References
Resources
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