Contents of a Business Plan: Everything You Need to Know
The contents of a business plan consist of a detailed description of what, when, why, where, and how the business's operations will be accomplished.3 min read
Overview of a Business Plan
A business plan includes the cost of organizing the business, the anticipated sources of revenue, how the products and services are customer oriented, and anticipated profit margins. Business plans serve two main purposes. First, they are a guide business owners use to streamline management and planning/organization of the business. Second, they show potential venture capitalists, bankers, and other lenders a comprehensive plan to encourage them to invest in the business.
Sublevels of a business plan include:
- Marketing plan
- Financial plan
- Human resource plan
- Production plan
Elements of a Business Plan
A well-written business plan will include the following:
- Cover letter
- Title page
- Table of Contents
- Executive Summary
- Mission statement
- Company background
- Products and services
- Marketing plan
- Competitive analysis
- Management and international organization
- Risk analysis
- Financial planning
The business plan's cover letter has the same purpose as a cover letter for a resume. The point is to engage prospective investors using the cover letter so they'll look at the entire plan. The cover letter should include the recipient's address, the date, and your address. Begin the cover letter with "Dear" followed by the person's name.
In the body of the cover letter, let the recipient know you're submitting a business plan with a short one-sentence description of the business and what the recipient can expect when reading the plan. In the next paragraph, indicate that you look forward to hearing from them and provide a phone number they can call at their convenience.
Thank them for their time. Sign off. Include your name in typewritten form along with your signature.
Keep this page short and to the point. Include your business logo, business name, if there is a founder, and the name. Add "Business Plan," an image (optional), and the date.
Table of Contents
The table of contents is a roadmap to help the recipient peruse the list and easily find each section. Some people may choose to read sections one after the other while others may choose to skip around. Include every section and subsection that may be of interest to a potential investor.
This is an important section. Because you're targeting executives, the overview of your business should be top-quality information to entice them to read the complete plan. The focus should be a summary of the main facets of your business plan.
This section is a short statement about your business's goal and what you plan to create through the enterprise.
This is a short statement including the date the business was developed, its founders, stages of development, the date it was incorporated, and, for existing businesses, the level of success.
Also, include the key figures in the business and the ownership and legal structure.
Products and Services
Under this section, provide a detailed description of your customer needs, benefits to customers, marketing services, and advantages and disadvantages of any competitor services or products.
This will include an overview of the market in general with an emphasis on purchase incentives, market analysis, and customer structure. It will also include the position your business holds in the market using information from target customer groups, canvassed market segments, and sale channels.
Provide information about your main competitors' names, locations, market positions, weaknesses, strengths, and target markets.
This section covers details about product range, services, and pricing strategies. Sales targets for the next five years should also be included.
Include the location of the business and the advantages and disadvantages of its location. The production should discuss in-house and/or outsourced production and material costs. The administration portion will discuss the office infrastructure, such as accounting and technical support.
Management and International Organization
This section could work written as an organizational chart outlining member functions and responsibilities, special skills, and salaries.
Provide information on anticipated internal risks such as marketing, production, management, and financing. External risks would include information on ecological, economic, social, and legal areas.
Lay out your plan for short- and long-term financial planning.
This is a final wrap up of the business plan that binds the everything together.
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