What You Should Include in Your Business Plan - dummies

What You Should Include in Your Business Plan

By Steven D. Peterson, Peter E. Jaret, Barbara Findlay Schenck

Although business plans come in all shapes, sizes, and formats, they typically share a similar framework. The following components, presented in the order they generally appear, are common elements in most business plans:

  • Table of contents: This element is a guide to the key sections in your business plan and is especially useful if your plan exceeds ten pages.

  • Executive summary: This section is a summary of the key points in your business plan. You should incorporate it if your plan runs more than ten pages and you want to convey important information upfront. You want to keep it clear, captivating, and brief — in fact, try to keep it to two pages or less.

  • Company overview: This section describes your company and the nature of your business. It may include your company’s mission and vision statements as well as descriptions of your values, your products or services, ways your company is unique, and what business opportunities you plan to seize.

  • Business environment: This section includes an analysis of your industry and the forces at work in your market; an in-depth description of your direct and potential competitors; and a close look at your customers, including who they are, what they want, and how they buy products or services. It describes everything that affects your business that’s beyond your control.

  • Company description: In this section, include information about your management team, your organization, your new or proprietary technology, your products and services, your company operations, and your marketing potential.

  • Company strategy: This section brings together the information about your business environment and your company’s resources and then lays out a strategy for going forward.

  • Marketing plan: This section is where you describe how you plan to reach prospects, make sales, and develop a loyal clientele.

  • Financial review: This section includes a detailed review of dollars and cents, including the state of your current finances and what you expect your financial picture to look like in the future. It typically contains financial statements, including an income statement, your balance sheet, and a cash-flow statement.

  • Action plan: Here you detail the steps involved in implementing your business plan, including the sequence of actions and how they align with your goals and objectives.

  • Appendixes: This section includes detailed information that supports your business plan. It may include analyses, reports, surveys, legal documents, product specifications, and spreadsheets that deliver a rounded understanding of your business plan but which are of interest to only a small number of your readers.

There is no single textbook example of a written business plan. Instead, you need to find information on how to develop each of the major components, advice for how business plans tend to work for different kinds of businesses, and ways you can organize and present materials in your written plan. How you put them all together depends on the nature of your business and what you hope to achieve.