When you are doing business planning, it is thrilling to develop a business plan that has a great introduction. This article is the first in a five-part series on preparing business plans. Each article has been dedicated to creating a plan for starting or running your business. At the end of the series, if you follow the articles and complete each section, you will have a complete business plan you can use to operate your business or seek financing. Each article will cover a different topic:
- Purpose statement, executive summary, and business information
- Personnel and organization
- Marketing information
- Current financial information
- Financial projections
A business plan is a tool for gathering all the important information about running your business and your financial condition all in one place. Most people think of business plans only when they are seeking financial assistance from outsiders. However, a well-done business plan will help you run your business on a day-to-day basis according to a preset, well thought out, and organized plan. Even in times of unexpected crisis, your business plan is a great tool, to keep you focused, on track, and mindful of the big picture you have set for your business. Let’s start with the purpose statement.
Purpose Statement This is the initial section of your business plan. In this section, you identify the purpose of your business. Here you state exactly what it is you plan to make, do or sell. This section will also be where you list your goals for the business. Pick three goals and make each goal SMART (Specific, Measurable, Attainable, Results-oriented, Time-bound):
Those of you who are starting a business and need to borrow money, use this section to list out how much money you need, your proposed repayment plan, how much money you are contributing, the reason for the loan, what you will do with the loan and what collateral you are willing to pledge.
This second section of the business plan is used to give a brief overview of your plan. In this section, you give a hint of the things to come later in the plan. Start this section with a listing of your company contact information, including the following: company name, address, phone and fax numbers, email address, and web page. A person who reads this section should be able to clearly understand what you plan to do, company history, management expertise, products or services, your financial condition, and growth projections. When I draft business plans for clients, I do a sample draft of this section and revise it later because this should be a reflection of the completed plan.
This is a major section of your business plan. You will need to set aside a significant amount of time to complete this section. In this section, provide an overview of your business. Give the company name and location. If possible, describe the building and include building photographs. Tell readers the nature of your business, what kind of business it is (partnership, corporation, etc. ). Give the date the company opened or will open. Provide full contact information for the owners. This is the heart of your plan, and you will not want to rush through this section.
Personal Financial Statement
Use this section to describe your current financial condition. It is a good idea to include tax returns for the past three years. If this is a business start-up, include your personal tax returns as well. Be sure to include state and federal returns.
This is the place to share your business hours and location. Make sure you also include your accounting method and procedures, quality control procedures, and any return policies.
Business History This is the place to give the history of your business. Share when the business was founded, by whom, and the original mission for the company. List the original purchase price and start-up costs. In additionally if there were unique or interesting factors that influenced the creation of the business share those here.
Now, sit back and complete these business plan sections over the course of the next week so you will be ready to work on the personnel section next week.A business plan is an important tool for starting and running your business. With time and little work, you can create a plan for success. So the question for you this thrilling day is, what is your plan for running your business?
While you are going through this process, if you need additional help and support, feel free to contact me:
Janeane M. Davis, J. D.
James, Davis, and Associates
484 381 0532