How to Write a Business Plan Summary
An effective business plan may be only five pages long. Conversely, it may be 65 pages or more. The point is, there is no standard length that works. There is, however, one constant that always affects the success or failure of a business plan: The Executive Summary. Whether you are seeking a business loan, SBA financing or third party investment from a venture capitalist, the executive summary often dictates how seriously the reader will view your business plan.
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Things You'll Need
- A good business idea
- Access to data regarding your market, competition, and financial requirements
- Access to an up-to-date listing of business lenders and investors.
Instructions
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Write the details of your business plan, including a management summary, marketing analysis, competition overview, marketing and operations plan, and, of course, a financial plan for the next three to five years. If you're seeking substantial funding, consider using an experienced professional to write and/or polish your plan. Always write the plan BEFORE you write your executive summary.
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Plan to stay on topic and commit to your approach before putting words to paper. "Plan your plan" so to speak.
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Maintain an authoritative and positive tone. Use strong, knowledgeable words and phrases, not sales rhetoric. Experienced readers, both lenders and investors, have "seen it all". They can quickly separate a thoughtful, focused executive summary from a sales pitch.
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Target your executive summary to your potential audience. Are you seeking a business loan or investment funds? Lenders are most concerned about a sufficient cash flow that will enable you to repay your business loan. Investors, on the other hand, are more interested in potential profit and the future value of the company. If you're unsure about potential sourced of capital, you may consider writing two executive summaries: one for lenders and another for investors.
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Keep it brief! If possible, use just one page. Should you need more words to convey your message, two pages should be the absolute maximum length. Experienced readers often see multiple business plans everyday. Thus, many will only read those with an executive summary that piques their interest.
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Re-read and revise your executive summary. While you're wildly enthusiastic about your business model, resist the temptation to tell your reader "everything" about this opportunity. Remember, readers will learn all of the details by examining the full business plan. Eliminate all unnecessary words and phrases from your summary. Concentrate on making this document hard hitting, interesting and being viewed as a "call to action".
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Read it aloud. Ask yourself: "How does it sound? If I were a lender or investor, would I want to learn more?" If your honest answers are "Yes", then you've written a good executive summary.
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Tips & Warnings
Always write your executive summary LAST, but place it FIRST in your business plan. Reversing this order will invariably lead you to make a major re-write in your summary.
Think of your executive summary as you would a movie trailer. You've made a two hour movie, but have only 30 seconds to interest potential movie goers. Your executive summary - your trailer - should provoke interest in the entire business plan.
Do your research on all facets of your business plan so your summary leads readers to gain confidence in your ability.
Don't forget to "test the market". Don't assume your executive summary is a totally effective document until you get some preliminary feedback. If it's positive, run with it. Should an objective third party point out some areas of concern, revise your summary again.
Don't lose faith in your executive summary or business plan because a lender or investor chooses not to get involved. Lenders and investors choose to participate in or pass on business opportunities for many different reasons.
