How to Write a Small Business Plan to Use for Loan Application

Write a Well-Conceived Business Plan to Secure Financing

A business plan is essentially a map that defines your business and outlines your strategy for success. It is also a crucial document to securing business loans. Banks and other investors want not only to understand your business, but to know you've thought out all the details, have a focused plan for success and a way to measure success.

Instructions

1. Write the executive summary that outlines your mission statement;defines your products and services; and provides relevant information such as start-up date and significant achievements like awards or milestones. This section also describes the facilities or office space, equipment and number of employees. Finally, it offers a summary of your business goals.

2. Conduct a market analysis. In this section you define the people who will buy your products or services, including their demographics (i.e. age, gender, etc). Identify the media types your market reads or watches by reading to determine the best places to advertise and promote your products or services. Finally, outline the types of marketing tactics your target market will respond to such as special offers, coupons, websites, commercials, etc.

3. Analyze your competition. Research other businesses that provide the same or similar products and services that you do. Identify the similarities and differences in areas such as target market, packaging and delivery and market control. Determine how your business will differentiate itself from the competition.

4. List the management team of the business. Provide the names and information of the partners or management members of the business. Include information about their background including skills, experience, education and other attributes as they relate to building a successful business.

5. Describe the business operations. Outline the day-to-day activities required to build a successful and profitable business. Identify who is involved and/or in charge of ensuring these activities are completed.

6. Provide the financial details. Include the current financial situation as well as projected expenses and income over the coming year. Provide a financial statement that shows current cash and assets (including equipment or property values) and liabilities (i.e. loans).

7. Add an appendix for supplemental materials. Use this section to include any information or documents that don't fit in other sections such as a copy of the business license, business structure (i.e. LLC), intellectual property, contracts, etc.

8. Package the sections together into a single business plan document. Use quality paper and covers. Include your business name and contact information on the cover. If you have supplemental documents such as copies of brochures, include pocket folders or other methods that secure the items to the business plan in a professional looking manner.

Tips & Warnings

• It is possible that banks and other funding institutions will want something more than outlined here. Be sure to read applications carefully so that you cover all the information the bank needs in the manner it asks for.

References

• Writing A Business Plan
• How to Create a Business Plan