What should be in the plan?

SUGGESTED LENGTH

1. SUMMARY OF YOUR PLAN, highlighting the

attraction of your business one or two pages

a) what is the business?

b) what is the market?

c) potential for business

d) forecast profit figures

e) how much money is needed?

f) prospects for the investor/lender

2. THE PAST

a) when business started one page plus

b) brief summary of past performance (put Appendix

accounts for last three years in an Appendix)

c) indication of how relevant or not past

performance is to future progress

3. management (this is a crucial section)

a) your past employment and business as many pages as needed

record – identify achievements, not just a

chronological statement

b) the record of other people working with you

c) if there are obvious weaknesses in your

management, how you propose to deal with them

4. THE PRODUCT OR SERVICE

a) a simple description of what it does (avoid two pages plus

technical words). If essential, technical descriptions Appendix

can go in an Appendix

b) why the product is unique or distinct

c) brief survey of competition

d) how the products will be developed, what new products are being considered, when replacement will be needed for existing product range, what competitive products may emerge

e) any patents applied for

5. MARKETING (also crucial)

Selling:

a) promotion, advertising (if any)

b) who will sell

c) some idea of your sales pitch (for example, the benefits)

of your product

d) how you will price

6. OPERATIONAL DETAILS

a) where you will be based – location, premises length depends

b) suppliers on nature of

c) manufacturing facilities business

d) equipment needed

7. FINANCIAL ANALYSIS

a) summary of the forecasts two or three pages

b) monthly profit and loss forecast for two years plus figures in

c) profit forecast for further three years (optional) Appendix

d) monthly cash flow forecast for two years

e) cash flow forecast for further three years (optional)

f) forecast balance sheet for two years

g) audited accounts for last three years (if available)

h) the assumptions behind your forecasts

i) what are the principal risks which could affect figures?

8. THE PROSPECTS

a) your objectives – short-term, long-term one or two pages

b) the finance needed and what it is needed for

c) shareholdings suggested (if appropriate)

d) prospects for the investor or lender (if appropriate, including possible value of business if floated on the stockmarket, so investors will be able to cash in their investment)

5. Read an extract of a business plan and arrange given information according to the appropriate items of the plan.

Hans Gast