Railsgrammer

3 Main functions of a business plan:

1. A communications tool which conveys your ideas, research and plans to others.

2. A basis on which to manage your business.

3. A yardstick by which you may measure progress and evaluate changes.

Essential Elements:

1. Your business concept: Most important page. Presents a summary of your business idea. It tells why you think it will work, how it fits into the marketplace, what the future should hold. All based on your best research.

2. Your product or service: provide a complete description of what you plan to sell or rent. If possible, include an 8×10 photograph. Emphasize the basic product or service that will provide the bulk of your income. Explain advantages and benefits and anything about your products or services that will help “sell” your business concept to a complete stranger. If your product is still on the drawing board, explain when it will be available, including any test data you have.

3. Your market: Explain the big picture first. What is the total universe of your market? Is the industry growing or declining? Is anything happening now or expected to happen in the future that will impact your business? Who are your competitors? How successful are they, and why? Do they have any weaknesses? If so, will your business fill a need created by their weakness? Who will your customers be? Why will they buy your product or service?

4. Your marketing strategy: Describe how your product or service will be sold. Include pricing strategy, estimated sales and market share for each of the first three years. Add your advertising and public relations plans, plus your service and warranty policies.

5. Your production plans. Cover all the specifics, such as how, where and whom your product will be produced. What is the raw material? Is it readily available? What is the manufacturing process? What is your anticipated rate of production? Will you use union or non-union labor?

6. Your personnel: Will yours be a sole proprietorship? A partnership? Corporation? If so, include an organizational chart. How many people are involved, and what are their skills? How well are they qualified? At what points in time will you add personnel? If you’re running a one-man show, explain convincingly how you have the necessary skills and talent to achieve your goals.

7. Your financial plans: If yours is a new business, you won’t have the benefit of past history. As a bare minimum, you will need a personal financial statement. If your business is already established, include a financial statement for the business. Demonstrate how you plan to elevate existing figures from point A to point B. Ideally, you will be totally familiar with all of the financial details of your business, and will be able to consider line by line how you arrived at each figure.