BUSINESS PLAN

BUSINESS PLAN OUTLINE

1.0 EXECUTIVE SUMMARY
1.1 Problem
1.2 Solution
1.3 Market
1.4 Competition
1.5 Financial Highlights
2.0 Opportunity
2.1 Problem Worth Solving
2.2 Our Solution
2.3 Validation of Problem and Solution
2.4 Roadmap/Future Plans
3.0 Market Analysis Summary
3.1 Market Segmentation
3.2 Target Market Segment Strategy
3.2.1 Market Needs
3.2.2 Market Trends
3.2.3 Market Growth
3.3 Competition
3.3.1 Current Alternatives
3.3.2 Our Advantage
4.0 Execution
4.1 Marketing Plan
4.2 Sales Plan
4.3 Location and Facilities
4.4 Technology
4.5 Equipment and Tools
4.6 Milestones
4.7 Key Metrics
5.0 Company and Management Summary
5.1 Organizational Structure
5.2 Management Team
5.3 Management Team Gaps
5.4 Personnel Plan
5.6 Company History and Ownership

6.0 Financial Plan

6.1 Revenue/Sales Forecast
6.2 Expenses
6.3 Projected Profit and Loss
6.4 Projected Cash Flow
6.5 Projected Balance Sheet
6.6 Business Ratios

7.0 Appendix
 1. Executive summary
• a page or two that highlights the points you’ve made
in your business plan.
• It’s also the doorway to your plan—after looking
over your executive summary, your target reader is
either going to throw your business plan away or
keep reading, so you’d better get it just right
• Summarize the problem you are solving for
customers, your solution, the target market, the
founding team, and financial forecast highlights.
Keep things as brief as possible and entice your
audience to learn more about your company.
 Executive Summary Includes
One sentence business overview
• At the top of the page, right under your business name,
include a one-sentence overview of your business that
sums up the essence of what you are doing.
• This can be a tagline, but is often more effective if the
sentence describes what your company actually does.
This is also known as your value proposition.
– A truly great value proposition introduces you to prospective
buyers and helps you make a strong first impression. Your
value proposition should describe; how your product or
service solves/improves problems, what benefits
customers can expect, and why customers should buy from
you over your competitors.
 Executive Summary Includes
Problem
•In one or two sentences, summarize the problem you
are solving in the market. Every business is solving a
problem for its customers and filling a need in the
market.
Solution
•This is your product or service. How are you
addressing the problem you have identified in the
market?
Target market
•Who is your target market, or your ideal customer?
How many of them are there? It’s important here to
be specific.
 Executive Summary Includes
Competition
•How is your target market solving their
problem today? Are there alternatives or
substitutes in the market?
•Every business has some form of
competition and it’s critical to provide an
overview in your executive summary.
Financial summary
•Highlight the key aspects of your financial plan,
ideally with a chart that shows your planned
sales, expenses, and profitability.
 2. Opportunity
•Describe the problem that you solve for your
customers and the solution that you are selling.
•is where the real meat of your plan lives—it includes
information about the problem that you’re solving,
your solution, who you plan to sell to, and how your
product or service fits into the existing competitive
landscape.
•demonstrate what sets your solution apart from
others, and how you plan to expand your offerings in
the future.
•This section answers these questions: What are you
actually selling and how are you solving a problem (or
“need”) for your market?
 The Problem and Solution
• Defining the problem you are solving for your customers is far and
away the most critical element of your business plan and crucial for
your business success.
• To ensure that you are solving a real problem for your potential
customers, a great step in the business planning process is to get away
and go out and talk to potential customers. Validate that they have the
problem you assume they have, and then take the next step and pitch
your potential solution to their problem. Is it a good fit for them?
• Once you have described your target market’s problem, the next
section of your business plan should describe your solution. Your
solution is the product or service that you plan on offering to your
customers. What is it and how is it offered? How exactly does it solve
the problem that your customers have?
• Explain and demonstrate what sets your product /solution apart from
others, and how you plan to expand your offerings in the future.
 3. Market analysis summary
• You need to know your target market—the types of
customers you are looking for—and how it’s
changing.
• Use this business plan component to discuss your
customers’ needs, where your customers are, how to
reach them and how to deliver your product to
them.
• You’ll also need to know who your competitors are
and how you stack up against them—why are you
sure there’s room for you in this market?
 Market Segmentation
• identify your market segments and determine how big each
segment is
• Segmentation refers to the process of creating small
segments within a broad market to select the right target
market for various brands. Market segmentation helps the
marketers to devise and implement relevant strategies to
promote their products amongst the target market.
• A market segment consists of individuals who have similar
choices, interests and preferences. They generally think on
the same lines and are inclined towards similar products.
• identify your market segments and determine how big each
segment is. A market segment is a group of people (or other
businesses) that you could potentially sell to.
 Target Market Segment Strategy
Market trends
•Describe the most important changes happening in your target
market right now. Are the needs, demographics, or preferences of
potential customers changing in a notable way? Ideally, explain how
those trends will favor your products or services over those of your
competitors.
Market growth
•Explain how your target market has been growing or shrinking in
recent years. Research is key here, obviously. You can use Internet
searches, trade associations, market research firms, journalists who
cover your market, or other credible sources to gauge market growth.
A growing market is encouraging, since it suggests stronger demand
for your solution in the years to come. That said, you can still be
successful in a weak or contracting market. It’s just important to
acknowledge that you are swimming against the tide.
 Target Market Segment Strategy
• Market growth
• Explain how your target market has been growing or
shrinking in recent years. Research is key here,
obviously. You can use Internet searches, trade
associations, market research firms, journalists who
cover your market, or other credible sources to
gauge market growth. A growing market is
encouraging, since it suggests stronger demand for
your solution in the years to come. That said, you can
still be successful in a weak or contracting market.
It’s just important to acknowledge that you are
swimming against the tide.
 Competition
• Competition
• Who else is providing solutions to try and
solve your customers’ problems? What are
your competitive advantages over the
competition?
• What other options do your customers have
to address their needs, and what makes your
solution better for them?
 4. Execution
• Use this business plan section to outline your
marketing plan, your sales plan, and the other
logistics involved in actually running your
business.
• You’ll want to cover the technology you plan
on using, your business location and other
facilities, special equipment you might need,
and your roadmap for getting your business up
and running. Finally, you’ll want to outline the
key metrics you’ll be tracking to make sure
your business is headed in the right direction.
• Before you even think about writing your marketing
plan, you must have your target market well-defined
and have your buyer persona(s) fleshed out. Without
truly understanding who you are marketing to, a
marketing plan will have little value.
• The marketing and sales plan section of your
business plan details how you plan to reach your
target market segments (also called target
marketing), how you plan on selling to those target
markets, what your pricing plan is, and what types of
activities and partnerships you need to make your
business a success.
 Your positioning statement
• The first part of your marketing and sales plan is your positioning
statement. Positioning is how you will try and present your company to
your customers. Are you the low-price solution, or are you the premium,
luxury brand in your market? Do you offer something that your competitors
don’t offer?
• Before you start working on your positioning statement, you should take a
little time to evaluate the current market and answer the following
questions:
– What features or benefits do you offer that your competitors don’t?
– What are your customers’ primary needs and wants?
– How are your competitors positioning themselves?
– How do you plan on differentiating from the competition? In other words, why should a
customer choose you instead of someone else?
– Where do you see your company in the landscape of other solutions?
• A positioning statement is a brief description of a product or service and
target market, and how the product or service fills a particular need of the
target market. It's meant to be used as an internal tool to align marketing
efforts with the brand and value proposition.
 Positioning statement vs Value Proposition
• A value proposition is broader and describes what sets
your product or service apart from competitors. It gives
a big picture overview of the benefits a product or
service provides.
• Positioning statements are more focused, and they're
created after you've developed your business' value
proposition. It identifies only the primary customer
benefits and points of competitive differentiation.
• Positioning statements are used to describe how your
product or service fills a need of your target market
or persona. They're a must-have for any positioning
strategy and create a clear vision for brand positioning.
 Positioning Statement Template
• Before you get started writing, make sure you've developed
your business' value proposition. You'll want to identify your
target audience, their pain points, and how your product can
fit their needs.
• What's the promise your brand provides customers? And how
will your business deliver on that promise? This is the time to
identify aspects of your product or service that are the
primary differentiators from the competition
• For [your target market] who [target market need],
[your brand name] provides [main benefit that
differentiates your offering from competitors]
because [reason why target market should believe
your differentiation statement.]
 Sample Position Statement
Coca-Cola Positioning Statement:
• For individuals looking for high-quality beverages,
Coca-Cola offers a wide range of the most refreshing
options -- each creates a positive experience for
customers when they enjoy a Coca-Cola brand drink.
Unlike other beverage options, Coca-Cola products
inspire happiness and make a positive difference in
customers' lives, and the brand is intensely focused
on the needs of consumers and customers.
 Sample Position Statement
McDonald's Positioning Statement:
For individuals looking for a quick service
restaurant with an exceptional customer
experience, McDonald's is a leader in the fast
food industry, with its friendly service and
consistency across thousands of convenient
locations. McDonald's' dedication to
improving operations and customer
satisfaction sets it apart from other fast food
restaurants
 Marketing Plan
Pricing
•Price sends a very strong message to
consumers and can be an important tool to
communicate your positioning to consumers.
Promotion
•A promotion plan details how you plan on
communicating with your prospects and
customers
Packaging Content Marketing
Advertising Social Media
Public Relations
 Sales Plan
•It’s the logistics, technology, and other nuts and bolts
Sourcing and Fulfillment
•If your company is buying the products it is selling from other
vendors, it’s important to include details on where your
products are coming from, how they get delivered to you, and
ultimately how you deliver the products to the customer
Distribution
•how you will get your product into the hands of your customers
Location and Facilities
•Specific location of your business and what other facilities do
you own or offer
Equipment and Tools
•What specific tools and equipment do you need or use that
makes your product different
 Milestones
•A business plan is only a document on paper without a real
path to get the work done, complete with a schedule,
defined roles, and key responsibilities.
•take the time to look forward and schedule the next critical
steps for your business
Traction
•take a look back at major accomplishments that you have
already had-some evidence of early success
Metrics
•detail the key metrics that you will be watching as your b
•the numbers that you watch on a regular basis to judge the
health of your businessusiness gets off the ground
 5. Company and management summary
• This section is an overview of who you are.
• It should describe the organization of your business,
and the key members of the management team, but
it should also ground the reader with the nuts and
bolts: when your company was founded, who is/are
the owner(s), where your company is registered in
and where you do business, and when/if your
company was incorporated.
• Be sure to include summaries of your managers’
backgrounds and experience—these should act like
brief resumes—and describe their functions with the
company. Full-length resumes should be appended
to the plan.
 Team
• show that you have thought about the important roles and
responsibilities your business needs in order to grow and
be successful.
• Include brief bios that highlight relevant experiences of
each key team member.
• Your management team doesn’t necessarily need to be
complete in order to have a complete business plan. If you
do have gaps in your team, simply identify them and
indicate that you are looking for the right people to fill
certain roles
• an org chart is also a useful planning tool to help you think
about your company and how it will grow over time.
• Personnel Plan -how much you plan on paying your
employees
 Company History and Ownership
• Mission statement
• Intellectual property
• A review of your company’s legal structure
and ownership
• A brief history of the company if it’s an
existing company
 6. Financial plan
• At the very least this section should include
your projected profit and loss and cash
flow tables, and a brief description of the
assumptions you’re making with your
projections.
• You may also want to include your balance
sheet, your sales forecast, business ratios, and
a break-even analysis.
• Finally, if you are raising money or taking out
loans, you should highlight the money you
need to launch the business.
 7.0 Appendix
• Standard tables and charts:
• Cash flow is the single most important numerical
analysis in a business plan, and a standard cash flow
table should never be missing. Most standard
business plans also include a sales forecast and profit
and loss statements.
• have a separate projected balance sheet,
projected business ratios, and market analysis tables,
as well as personnel listings.
• should include bar charts and pie charts to illustrate
the numbers.
I. Executive Summary
A. Opportunity
1.Problem Summary
2. Solution Summary
3. Market Summary
4. Competition
5. Overview
6. Why Us?
B. Expectations
1. Forecast
2. Financial Highlights by Year [chart]
3. Financing Needed
II. Opportunity
A. Problem & Solution
1. Problem Worth Solving
2. Our Solution
B. Target Market
C. Competition
1. Current Alternatives
2. Our Advantages
III. Execution
A. Marketing & Sales
1. Marketing Plan
2. Sales Plan
B. Operations
1. Locations & Facilities
2. Technology
3. Equipment & Tools
C. Milestones & Metrics
1. Milestones Table
2. Key Metrics
IV. Company
A. Overview
B. Team
1. Management Team
2. Advisors
V. Financial Plan
A. Forecast
1. Key Assumptions
2. Revenue by Month [chart]
3. Expenses by Month [chart]
4. Net Profit (or Loss) by Year [chart]
B. Financing
1. Use of Funds
2. Sources of Funds
C. Statements
1. Projected Profit & Loss
2. Projected Balance Sheet
3. Projected Cash Flow Statement
VI. Appendix
A. Monthly Financial Forecasts
B. Additional Documentation