When you are attempting to launch a new business and will be looking into obtaining funds to do so a key element in the funding process is providing a well written business plan. Almost every loan application for businesses will require a business plan to be turned in with it.
With almost every business plan there are seven parts that must be included. While some plans require more or less information, for the most part the following seven parts will suffice:
1. Cover Sheet: This will serve as the title page of your business plan and will include such information as your businesses name, address, and the like.
2. Executive Summary: Also known as the statement of purpose this section tackles the questions of who, what, where, and why in regards to your business. It is best to write this section last as it will be a reflection of the entire business plan.
3. Table of Contents: This gives the reader a quick reference point for the business plan.
4. The Organization Plan: This section will start with a summary of the overall business. In this section you need to hit on many key components of your business such as products and services, intellectual properties, location, legal structure, personnel, management, accounting system, insurance, and security.
5. The Marketing Plan: This will begin with an overall description of your marketing goals and strategies. In this section you will go into great detail about marketing analysis, marketing strategies you will employ, your expected customer service practices, how you plan on implementing your marketing strategies, and an overall assessment of your marketing strategies.
6. Financial Documents: This section is of utmost importance as it will contain everything that will be closely scrutinized by any lending institution. In his section you will first give a detailed summary of your financial needs. You will also need to go into detail about how you will disperse the loan money, give a pro forma statement or budget, provide a three year income projection, give a projected balance sheet, provide a break even analysis, give a current income statement, give a current balance sheet, provide a financial statement analysis, and provide a history of your business’ financial standing. Again, these documents will be looked at heavily by financial institutions so you must be sure that you give adequate attention to this section and dot all the i’s and cross all the t’s.
7. Supporting Documents: This is where you will provide any and all documents that help to back up your claims and statements within the business plan. The most common types of documents include in this section are personal resumes, the owner’s finical statement, credit reports, copies of any leases or rentals, letters of recommendation, any contracts, and any other legal documentation of importance.
Once you feel that your business plan is complete, thoroughly read through it. Then put yourself in the shoes of the lending institution that you are attempting to get money from. Would you lend the money out? If the answer is no, then you need to tweak and rework your business plan until the answer is yes.