@249 CHAP ZZ > BUSINESS PLAN OUTLINE > > FOR: @NAME > [Delete this line and insert title, company, etc.] > > A. EXECUTIVE SUMMARY. > [This should be an overview and lead-in to the rest > of the business plan. It should emphasize your > competence in three key areas: marketing, technical > capabilities, and financial management.] > > (1) Description of Proposed Business. > [Describe below your product or service. Where > possible, supplement with diagrams, illustrations > or pictures in the final package you show to > prospective lenders or investors. Insert as many > extra lines as needed--delete these instructions, > using "-" key.] > ____________________________________________________ > ____________________________________________________ > ____________________________________________________ > (2) Marketing Approach. > [Provide a brief description of the market segment > you will be trying to reach. Then outline the > channel(s) you will use to reach this market, such > as direct mail, retail, or wholesale distributors.] > ____________________________________________________ > ____________________________________________________ > (3) Projected Financial Performance. > [Give your estimated dollar amount of sales and net > profits that you project for each of the first 3 to > 5 years of operating, then set forth the amount of > starting capital you will need. Where cash flow is > negative (as is usual) in the first few years, it > may be helpful to show your net cash "exposure" or > cumulative negative cash flow for each month or > quarter, to show that your initial starting capital > will be more than sufficient to cover such maximum > exposure.] > ____________________________________________________ > ____________________________________________________ > > B. STATEMENT OF OBJECTIVES. > [In this part, you need to do a selling job on the > prospective investor, discussing the unique advantages > your product or service has over existing products and > services. State both your short-term and long-term > business objectives for the business, and describe the > image you want to create for your product or firm.] > ____________________________________________________ > ____________________________________________________ > > C. QUALIFICATIONS OF PRINCIPALS. > [Describe in this section your background qualifications > to run this particular business, citing education, > overall business experience and particularly any suc- > cessful experience in a closely-related type of business > operation. Also describe, if applicable, the qualifica- > tions of your partners or other co-owners who will be > part of the management (or board of directors, in the > case of a corporation) of your proposed business.] > ____________________________________________________ > ____________________________________________________ > > D. DESCRIPTION OF PRODUCT. > D. DESCRIPTION OF SERVICES TO BE OFFERED. > [Delete one of the above headings.] > > [Provide a complete technical description of the product > or service to be offered, in considerable technical de- > tail, including a summary of any test data if any sort > of testing work has been done, or describe any tests > that are currently planned. Also, show that you are > already anticipating the future by outlining any further > refinements or logical next steps for developing an > improved or different product later (or comparable plans > for further innovations in a service business). This is > your chance to show that you really have something that > is a better mousetrap and is also technically feasible.] > ____________________________________________________ > ____________________________________________________ > > E. BACKGROUND OF PROPOSED BUSINESS. > [Spell out here the background conditions in the > business in question, including how, where and when > the product is being used, as well as where trends in > the business or industry seem to be leading. Also > discuss who the main players (i.e., your competitors) > are, or are likely to be, in the case of a fledgling > industry. Then explain where your business will fit in > to this picture. Will you be on the cutting edge of > what is happening, or just one of the pack that is > not in the same league as the leaders? If the latter, > you will need a very convincing rationale to show why > you can garner enough business to meet your financial > objectives, which are discussed in the next section.] > ____________________________________________________ > ____________________________________________________ > > F. MARKETING PLAN. > [Discuss here your marketing plan or strategy. This will > include identifying the market segment you are seeking > to reach, and the various means through which you intend > to reach it, such as door-to-door sales, retail sales, > direct mail, media advertising, selling through sales > reps, jobbers, Amway-type multi-level distributorships, > or whatever else you plan to do. Mention also the > degree of market penetration and market share you expect > to achieve, year-by-year, for the period for which the > business plan is making projections (say 3 to 5 years).] > ____________________________________________________ > ____________________________________________________ > > G. SALES STRATEGY AND TACTICS. > [Discuss in this segment how you plan to go about cre- > ating an awareness of the product among its ultimate > consumers, through advertising, publicity or otherwise, > even though most of your sales may be made to middlemen > such as wholesalers or retailers. Cover all methods you > will employ, such as telemarketing, circulars, print or > electronic media advertising, direct mail, catalogs, or > other means. Here it will be useful to include photo- > copies of dummy ads, brochures or other promotional > materials that you may have already prepared, if you > feel they will be effective in selling your business > plan.] > ____________________________________________________ > ____________________________________________________ > > H. ORGANIZATIONAL PLAN. > [Here it is important to spell out in a convincing way > your plans for structuring the organization, including > a description of the key positions and the people who > you have lined up to fill them, with their (hopefully > impressive) qualifications. Include in this section an > operational plan, describing in detail the type, and, if > known, location of facilities that will be required, and > equipment that must be obtained. Also discuss what > portions of any production work will be done by outside > subcontractors, and what parts will actually be done by > your people. For the 3 or 4 key people in the company > (including each top person in the sales, finance and > technical departments), include their resumes at this > point, or place them in an Appendix at the end of the > business plan, but refer to them here.] > ____________________________________________________ > ____________________________________________________ > > I. FINANCIAL AND TECHNICAL DATA. > [Here is where you include detailed pro-forma financial > statements and other important data in support of the > conclusions you have set forth in other parts of this > business plan. These should include most or all of the > following:] > > 1. Financial Projections: > (a) Profit and Loss Projection. > [These should be on a monthly basis for the first year or > two, and quarterly for subsequent years, in most cases.] > ____________________________________________________ > ____________________________________________________ > (b) Pro-Forma Balance Sheets: > [These should show your projected ending financial pic- > ture for each of the periods covered by the P & Ls.] > ____________________________________________________ > ____________________________________________________ > (c) Cash Flow Projection. > [Show monthly or quarterly and CUMULATIVE pro-forma cash > flows, which should tie into the P & L and balance > sheets for each period covered.] > ____________________________________________________ > ____________________________________________________ > (d) Break-Even Analysis. > [In chart form or otherwise, show the level of sales you > will need each year in order to break even for that > period.] > ____________________________________________________ > ____________________________________________________ > (e) Acquisition Schedule for Fixed Assets. > ____________________________________________________ > ____________________________________________________ > > 2. Other Supporting Data. > > . Technical Drawings of Product. > . Detailed Description of Services To Be Offered. > [Delete one of the above lines, unless both apply.] > ____________________________________________________ > ____________________________________________________ > > . Itemization of Capital Equipment Required & Cost. > ____________________________________________________ > ____________________________________________________ > > . Pricing Schedule. > [Detailed list of prices for products or services > to be offered, in their different configurations.] > ____________________________________________________ > ____________________________________________________ > > . Plant Layout. > [Include floorplans or layout of a proposed manu- > facturing plant, including a manufacturing flow- > chart and costing estimates for producing the > product, broken down into cost accounting detail.] > ____________________________________________________ > ____________________________________________________ > > . Tooling Required for Production. > [Describe here all tooling that will be required, > and the estimated costs thereof.] > ____________________________________________________ > ____________________________________________________ > > . Market Survey Data. > ____________________________________________________ > ____________________________________________________ > > J. SUMMARY AND CONCLUSIONS. > [This is where you make your final pitch, so make it > convincing. Tell what your total capital requirements > are and how much of a safety margin that will provide. > Describe who will put up what debt and equity capital > to get the business off the ground, and when each in- > fusion of capital will be required. This will tell the > prospective investors how much of an ownership interest > they will be getting for X amount of money. Reiterate > the amount of profits you expect the business to make, > when you will make it, and how much of your own money > and property you are putting into the venture, as > evidence of your commitment. Most outside investors > are likely to be leery of investing unless it is clear > that you have put your own financial neck on the line, > so there's no chance of you simply "losing interest" and > walking away to do something else after awhile.] > ____________________________________________________ > ____________________________________________________ > --END OF CHECKLIST--