International White Dove Society Newsletter

Parts of a Business Plan
Reference: Small Business Association

What goes in a business plan? The body can be divided into four distinct sections:

1) Description of the business
2) Marketing
3) Finances
4) Management

Addenda should include an executive summary, supporting documents, and financial projections.
Although there is no single formula for developing a business plan, some elements are common to all business plans. They are summarized in the following outline:

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

               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

          III. Supporting Documents 

               Tax returns of principals for last three years Personal financial

               statement (all banks have these forms) 

               For franchised businesses, 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.

Using the Plan
A business plan is a tool with three basic purposes: communication, management, and planning.
As a communication tool, it is used to attract investment capital, secure loans, convince workers to hire on, and assist in attracting strategic business partners. The development of a comprehensive business plan shows whether or not a business has the potential to make a profit. It requires a realistic look at almost every phase of business and allows you to show that you have worked out all the problems and decided on potential alternatives before actually launching your business.

As a management tool, the business plan helps you track, monitor and evaluate your progress. The business plan is a living document that you will modify as you gain knowledge and experience. By using your business plan to establish timelines and milestones, you can gauge your progress and compare your projections to actual accomplishments.

As a planning tool, the business plan guides you through the various phases of your business. A thoughtful plan will help identify roadblocks and obstacles so that you can avoid them and establish alternatives. Many business owners share their business plans with their employees to foster a broader understanding of where the business is going.

For more information on business plans,
visit the US Small Business Association website

Spotlight: Business

Parts of a Business Plan Reference: Small Business Association

Parts of a Business Plan
Reference: Small Business Association