The type and amount of information included in a business plan varies with the type and size of business that you are planning to start. The most basic business plan should include the following components:
1. Executive Summary: Think of this as a “mini business plan.” This is a brief (2-3 paragraphs) description of the fundamental elements of your start-up.
2. Table of Contents: The table of contents may not seem like an important part of a document, but many investors may like to read certain areas of a business plan before they spend a great deal of time on the rest of the plan. Make it easy for them to find the information that they are looking for.
3. Company/Business Description: This is your opportunity to generate real interest in your venture. Describe how and why you came to form your business; how you have developed your business so far; what makes your product or service unique; and where you plan to be in 5-10 years.
4. Detailed Description of Your Product or Services: This should be a readable, yet detailed description of the products or services that you provide.
5. Target Market/Market Analysis: Before you can make these projections, you need to make several determinations.
a. Define your target market
b. Determine the total potential market for your product or services
c. How much of the total potential market can you expect to garner?
d. Is your market a fresh market (for example, a new technology or service) or are you entering an established market that may have growth potential?
6. Description of Your Competition: It is important for you to have a good understanding of the competitors that you will be facing. Do these competitors have thriving, healthy businesses? This is a good indicator of whether or not you are entering into a market with potential to support another business.
7. Marketing Plan: This is a description of how you plan to expose your product or service to your potential customers.
8. Financial Plan: This section will contain a lot of accounting lingo, and should be formulated with the help of your accountant.
9. Pricing Strategy: There are many different ways to determine what the price of your product or service should be, and there is no single method that fits every situation.
10. Management Plan: In this section, you will provide detailed curriculum vitae (CV) for each member of your management team, focusing on the individual strengths of each member. It is also a good idea to be honest about any weak spots your team may have (for example, your team may lack experience in marketing or some other area.) It is better to recognize your weaknesses up front, especially if you are trying to attract start-up money. Also, a venture capitalist may know someone who could fill out your team to make your start-up stronger.
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