Preparing a Business Plan

Creating a Business Plan
www.sba.gov
www.bizpathways.com

A business plan is like a road map. It will show you where you are going and how to get there. Without it you may get lost or you may end up at the wrong destination. Also without a map you will find that few people will be able to help you on your journey. This is especially true if you plan to seek funding. One of the first things a potential funder will ask to see is your business plan.

Creating a business plan is good practice because will cause you to look at every aspect of business ownership and consider contingencies for every turn. However, unlike a map, a business plan is iterative - you will want to make changes as you travel towards success.

BPlans.com - view a collection of various business plans.

Business Plan Outline
(For details on how to complete the form visit the SBA Web site.)

Elements of a Business Plan
1. Cover sheet
2. Statement of purpose
3. Table of contents

I. The Business

A. Description of business
B. Marketing
C. Competition
D. Operating procedures
E. Personnel
F. Business insurance
G. Financial data

II. Financial Data

A. Loan applications
B. Capital equipment and supply list
C. Balance sheet
D. Breakeven analysis
E. Pro-forma income projections (profit & loss statements)

• Three-year summary
• Detail by month, first year
• Detail by quarters, second and third years
• Assumptions upon which projections were based

F. Pro-forma cash flow

• Follow guidelines for letter E

III. Supporting Documents

• Tax returns of principals for last three years
• Personal financial statement (all banks have these forms)
• In the case of a franchised business, a copy of franchise contract and all supporting documents provided by the franchisor
• Copy of proposed lease or purchase agreement for building space
• Copy of licenses and other legal documents
• Copy of resumes of all principals
• Copies of letters of intent from suppliers, etc.

THE BUSINESS PLAN - WHAT IT INCLUDES
What goes in a business plan? This is an excellent question. And, it is one that many new and potential small business owners should ask, but oftentimes don't ask. The body of the business plan can be divided into four distinct sections: 1) the description of the business, 2) the marketing plan, 3) the financial management plan and 4) the management plan. Addenda to the business plan should include the executive summary, supporting documents and financial projections.